- Deutsche Bank responded to a congressional subpoena Tuesday, revealing it holds tax returns tied to President Trump.
- The letter marks the next step in a complex investigation into Trump’s tax returns, history of loans with the bank, and ties with foreign financiers.
- Here’s what the letter means for ongoing investigations, and why Trump’s relationship with Deutsche Bank is attracting new criticism.
- Visit the Markets Insider homepage for more stories.
Trump bucked historical precedent when he refused to make his tax returns public while running for president, and Democrats have long sought the documents’ release. They also believe such documents could clarify business partnerships that may have influenced his actions in office.
The Deutsche Bank letter, which revealed that it possesses some of the tax records Congress is seeking, marks a major step forward in investigations into Trump’s finances and ties to Russia. Here’s why Trump’s relationship with the bank has made recent headlines and drawn new scrutiny from regulators and investigators alike.
The story so far
Deutsche Bank has a three-decade-long relationship with Trump, as the bank helped finance several of the Trump Organisation’s real estate projects.
The New York Times reported in March that Trump received about $US2 billion in loans from Deutsche over roughly 30 years, with the president starting to borrow from Deutsche in the 1990s. The bank was reportedly one of the few on Wall Street willing to lend to Trump, as his casino bankruptcies signalled risk in lending money to his business endeavours.
The president’s relationship with Deutsche soured over the years, reaching a climax in 2008 when he sued the bank before a loan he owed them came due. Trump blamed his inability to repay the loans on the bank, claiming Deutsche was among the institutions responsible for the financial crisis.
Trump later secured a personal loan from Rosemary Vrablic, a private banker with Deutsche, in order to repay previous loans from Deutsche. The act – taking out a personal loan to repay a loan given by the same bank – was deemed “an extraordinary act of financial chutzpah” by The Times.
Trump reportedly continued to receive loans from Deutsche as late as 2015, taking out a $US170 million loan for the renovation of the Old Post Office building in Washington DC. The Financial Times reported earlier in 2019 that Trump’s debt to the bank reached $US300 million after the Old Post Office loan.
Why it matters
Trump has worked to keep financial documents related to him and his family from being made public. His lawyers tried to block the subpoena sent to Deutsche, but the House of Representatives declined the motion.
Trump has been mostly successful in keeping his more recent tax returns away from the public eye. A New York Times report on leaked tax records from 1985 to 1994 detailed $US1.17 billion in reported losses from Trump’s businesses. The documents also suggested Trump may have skirted federal income tax requirements for two decades.
The report mirrored a 2016 piece by The Times that showed Trump claimed $US916 million losses in his 1995 personal tax filing. The piece was published ahead of a presidential debate, during which Trump said paying no taxes made him “smart.”
House Democrats have long coveted Trump’s tax returns. As Emily Stewart at Vox recently wrote, “Trump’s tax returns have been treated as a Holy Grail that would unlock the secrets of his wealth and, depending on where you fall on the political spectrum, potentially reveal him as a fraud or as having unsavoury ties to foreign interests.”
But as The Washington Post recently reported, Democrats had become resigned to the idea that they might not get access to the returns before the election.
So in revealing that it possesses some of the tax records Congress is seeking, Deutsche Bank marked a step forward in investigations into Trump’s finances, even as the bank did not identify whose records it has.
MSNBC’s Lawrence O’Donnell claimed later on Tuesday he heard from a source “close to Deutsche Bank” that Trump’s loan documents with Deutsche Bank reveal Russian oligarchs as co-signers. He added the Russian billionaires “are close to Vladimir Putin.”
“If true, that would be a significant factor in Vladimir Putin’s publicly stated preference for presidential candidate Donald Trump over presidential candidate Hillary Clinton,” O’Donnell said.
The host did not claim to be able to corroborate the source’s statement, and later walked it back.
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