The New York Times reports: During the presidential campaign, Donald J. Trump pointed to his relationship with Deutsche Bank to counter reports that big banks were skeptical of doing business with him.
After a string of bankruptcies in his casino and hotel businesses in the 1990s, Mr. Trump became somewhat of an outsider on Wall Street, leaving the giant German bank among the few major financial institutions willing to lend him money.
Now that two-decades-long relationship is coming under scrutiny.
Banking regulators are reviewing hundreds of millions of dollars in loans made to Mr. Trump’s businesses through Deutsche Bank’s private wealth management unit, which caters to an ultrarich clientele, according to three people briefed on the review who were not authorized to speak publicly. The regulators want to know if the loans might expose the bank to heightened risks.
Separately, Deutsche Bank has been in contact with federal investigators about the Trump accounts, according to two people briefed on the matter. And the bank is expecting to eventually have to provide information to Robert S. Mueller III, the special counsel overseeing the federal investigation into the Trump campaign’s ties to Russia.
It was not clear what information the bank might ultimately provide. Generally, the bank is seen as central to understanding Mr. Trump’s finances since it is the only major financial institution that continues to conduct sizable business with him. Deutsche Bank has also lent money to Jared Kushner, the president’s son-in-law and senior adviser, and to his family real estate business.
Although Deutsche Bank recently landed in legal trouble for laundering money for Russian entities — paying more than $600 million in penalties to New York and British regulators — there is no indication of a Russian connection to Mr. Trump’s loans or accounts at Deutsche Bank, people briefed on the matter said. The bank, which declined to comment, scrutinizes its accounts for problematic ties as part of so-called “know your customer” banking rules and other requirements.
And with one of its most famous clients headed to the White House, the bank designed a plan for overseeing the accounts of Mr. Trump and Mr. Kushner and presented it to regulators at the New York State Department of Financial Services early this year. The plan essentially called for monitoring the accounts for red flags such as exceptionally favorable loan terms or unusual partners. [Continue reading…]
