The American Democracy Legal Fund has requested that the Office of Government Ethics refer Donald J. Trump to the Department of Justice for investigation for filing an inaccurate personal financial disclosure form with the Federal Election Commission in violation of the Ethics in Government Act of 1978.
Mr. Trump reported income of nearly $5 million and over $20 million on his 2015 and 2016 personal financial disclosures stemming from the Trump-owned parent companies of Trump International Golf Links in Aberdeen, Scotland and Trump Turnberry in Ayrshire, Scotland. At the same time, Mr. Trump reported losses on these investments for this timeframe on his United Kingdom Companies House official accounts. Companies House is a U.K. government agency with a mandate to “register[s] the information companies are legally required to supply, and make[] that information available to the public.” The property values Mr. Trump reported on his personal financial disclosures for numerous domestic properties are also suspect. For his primarily commercial properties located in the United States, dramatic discrepancies often exist between the value of these property as assessed by a municipality and the value Mr. Trump reported on his personal financial disclosures.
The request for investigation is available below and in full with exhibits here. The American Democracy Legal Fund holds candidates for office accountable for possible ethics and/or legal violations. It is run by Brad Woodhouse.
American Democracy Legal Fund
455 Massachusetts Avenue, N.W.
Washington, DC 20001
August 2, 2016
Walter M. Shaub, Jr.
Director
Office of Government Ethics
1201 New York Avenue NW, Suite 500
Washington, DC 20005
Re: Request for Investigation into Donald J. Trump
Dear Mr. Shaub:
We are writing to request that you refer Donald J. Trump to the Department of Justice for investigation for filing an inaccurate personal financial disclosure form (“PFD”) with the Federal Election Commission (“FEC”) in violation of the Ethics in Government Act of 1978, as amended (“the Act”). As Director of the Office of Government Ethics, the Act mandates that you “refer to the Attorney General the name of any individual which such official or committee has reasonable cause to believe has willfully . . . falsified or willfully failed to file information required to be reported.”
As detailed below, Mr. Trump reported income of nearly $5 million and over $20 million on his 2015 and 2016 PFDs stemming from the Trump-owned parent companies of Trump International Golf Links in Aberdeen, Scotland (“Golf Links”) and Trump Turnberry in Ayrshire, Scotland (“Turnberry”). At the same time, Mr. Trump reported losses on these investments for this timeframe on his United Kingdom Companies House official accounts. Companies House is a U.K. government agency with a mandate to “register[s] the information companies are legally required to supply, and make[] that information available to the public.” The property values Mr. Trump reported on his PFDs for numerous domestic properties are also suspect. For his primarily commercial properties located in the United States, dramatic discrepancies often exist between the value of these property as assessed by a municipality and the value Mr. Trump reported on his PFDs.
The Department of Justice should investigate these discrepancies to ensure that the public is granted full disclosure of Mr. Trump’s finances as a candidate for president of the United States.
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Income from Scottish Golf Properties
Mr. Trump submitted a PFD to the FEC in July of 2015, as the Act requires of him as a declared presidential candidate. However, the income generated by Golf Links reported on the PFD differs dramatically from the financial state of the operation as described on Mr. Trump’s Companies House reports in the U.K.
Mr. Trump “has provided starkly contradictory portraits of the financial health of his golf course [Golf Links].” On his Companies House report for calendar year 2014, Trump reported a net loss of $1.8 million for Golf Links operations. Yet, Mr. Trump’s PFD filed in July of 2015 with the FEC reports “income” from Golf Links in the amount of $4,349.651. While the FEC-reported income is likely gross income and the $1.8 million loss is net income, the numbers still do not add up. Mr. Trump’s Companies House report for calendar year 2015 only shows approximately $3.7 million in gross profit. Unless, in the words of a reporter, “the loss-making operation in 2014 suddenly surged into profit in early 2015, when the course was closed for winter until April 1,” then the gross income reported on the FEC report covering calendar year 2014 plus early 2015 does not align with the net loss reported for calendar year 2014 on the Companies House report.
The same discrepancies hold true for Mr. Trump’s financial filings for his other golf course in Scotland, Trump Turnberry. For the calendar year 2014 financials reported to Companies House, Trump reported a loss of $5.6 million for Turnberry. Yet on his 2015 PFD filed with the FEC, Mr. Trump reported income from the project of $20,395,000. Again, while the FEC-filed report may represent gross income and the losses reported on the Companies House report show net losses, nonetheless, the Companies House report only indicates approximately $12 million in gross profit from 2014 − far short of $20 million. Unless company profits exploded in early 2015 during the golf off-season, the income Mr. Trump reported from Turnberry to the FEC should be substantially similar to the gross profits reported to Companies House for calendar year 2014.
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Domestic Property Values
As with the income from the Scottish golf courses, numerous domestic properties are valued dramatically differently in Mr. Trump’s May 2015 PFD from their assessed values. Under the Act, “value” means exact value unless exact value is not known or easily ascertained, in which case a filer can substitute exact value with “a good faith estimate” of value. Mr. Trump’s properties have each been assessed a recent market value by the municipality in which they are located. Despite a known exact market value for these properties, Mr. Trump reported significantly different values for numerous properties than those recorded by the relevant municipality.
According to property records maintained by the New York Department of Finance, Fifty-Seventh Street Associates LLC, a commercial real estate company that appears to hold only one property, 4 East 57th Street, New York, New York, has an assessed market value of $16,611,000 for tax year July 1, 2015 through June 30, 2016. Yet, for a nearly identical time period, Mr. Trump’s May 2016 PFD reported the value of the property at over $50,000,000. Commercial properties in New York, such as office buildings like the property located at 4 East 57th Street, are assessed by accounting for the property’s income-earning potential. Estimated annual income is based, in part, on information provided by the taxpayer (in this case, Mr. Trump) in his or her annual Real Property Income and Expense filing. This means that the market value assessment of $16,611,000 includes Mr. Trump’s company’s own assessment of its value. Consequently, the value of the property as represented by Mr. Trump on his PFD should be comparable, if not the same, as the market value assessed by New York City. Instead, there is, at a minimum, a discrepancy of over $30,000,000 between the PFD value and the assessed value.
Many of Mr. Trump’s PFD property valuations show this same, alarming pattern: the property values represented by Mr. Trump are vastly different from the market value assessed by the relevant municipality. In North Castle, New York, a company owned by Mr. Trump, Seven Springs LLC, owns two buildings located at 82 and 84 Oregon Road. The combined market value of these properties for 2015, according to the North Castle assessor, is $11,391,110. Yet on his PFD covering most of 2015, Mr. Trump again reported the value at over $50,000,000. Similarly, a condominium owned by Mr. Trump located at 721 5th Avenue in New York City was assessed with a market value of $5,206,505. Again, Mr. Trump’s PFD covering the same general time period reported its value at over $50,000,000. These valuation discrepancies are pervasive and warrant investigation by the Department of Justice.
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Request for Action
The significant, widespread discrepancies between both income and property values reported by Mr. Trump on his PFDs compared to those memorialized in government records both domestically and in Scotland represents a violation of the Act’s mandate to provide a “full and complete statement” of all income and assets.
Accordingly, we respectfully request that you promptly refer this matter to the Department of Justice for investigation. Prompt action is necessary to ensure that the public is granted full disclosure of Mr. Trump’s finances as a candidate for president of the United States.
Sincerely,
Brad Woodhouse
CC: Raymond Hulser, Chief
Public Integrity Section
United States Department of Justice