Former federal prosecutors speculate that an indictment could bring Donald Trump’s business down.
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With Manhattan District Attorney Cyrus Vance expected to indict the Trump Organization of financial violations earlier this week, former federal attorneys have called on cable and social media to predict the demise of the former president’s family business. Yesterday the deadline for Trump’s attorneys to produce evidence that could help his organization avoid criminal charges.
“I cannot emphasize enough how devastating an indictment against the Trump organization would be,” tweeted Daniel Goldman, a former US assistant attorney in the southern borough of New York who prosecuted mafia families and insider traders. “Any lender would cancel their loans and there is no way Trump Org can pay them all, which is likely to lead to bankruptcy.”
“That would almost be a death knell for the Trump organization,” Goldman told MSNBC’s Nicolle Wallace. “No bank will ever do business with an accused company.”
A spokesman for the Trump organization did not respond to a request for comment.
The Trump organization, which owns the president’s hotels, resorts, golf clubs, and real estate holdings, owes at least $ 1 billion, according to a Forbes investigation from October 2020. About two-thirds of this debt burden is borne by Trump’s real estate portfolios in New York and San Francisco.
Another approximately $ 370 million in debt is spread across three of Trump’s hotels. The company allegedly owes Deutsche Bank $ 170 million for the Trump International Hotel in Washington DC; $ 125 million for Trump National Doral in Miami; and more than $ 75 million for the Trump International Hotel & Tower in Chicago.
Trump’s hotel management and licensing business has declined $ 24 million since 2019, Forbes reported last fall, while its golf resorts in Miami and Europe have dropped another $ 120 million.
Former US attorney general Neal Katyal told MSNBC’s Ari Melber yesterday that he was expecting multiple charges against both the Trump organization and its employees. “Anyone who is familiar with law enforcement doesn’t run right in and accuse the big fish. You’re building your case slowly and methodically, ”he said. “And even these minor charges could really undermine funding for the Trump organization. Often it says in loan agreements that the loan can be terminated if the organization is charged. “
Richard Signorelli, another former New York borough attorney, repeated this theory on Twitter, speculating that an indictment against the Trump organization “would likely result in its destruction as a viable entity.”
“It could be devastating for Donald Trump’s company just to be charged before there is a potential guilty verdict,” Paul Butler, a professor at Georgetown Law, told MSNBC’s Ayman Mohyeldin. Butler is a former federal attorney with the US Department of Justice, where his specialty was public corruption.
“If an organization with large debts is charged with a crime, banks can cancel the loans. They can request that any outstanding debt be paid back immediately, ”Butler said. “If the Trump organization doesn’t have enough assets to pay off its loans, it would have to consider bankruptcy. And so this could be the beginning of the end of Donald Trump’s business empire. “
It remains to be proven, however, that an indictment would bring down the Trump organization. Forbes estimates the former president’s net worth at $ 2.4 billion.