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Drive for Show, Putt for Dough, Cheat for Tax Deductions

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[NB: Check the byline, thanks. /~Rayne]

I swear every time I think I’ve met the limit of repulsion for Trump, I meet a new threshold.

You’re doubtless aware of the New York Attorney General’s Motion to Compel against The Trump Organization, Inc.; Seven Springs LLC; Allen Weisselberg; Eric Trump; Charles Martabano; Morgan, Lewis & Bockius LLP (MLB); Sheri Dillon; Donald J. Trump; Ivanka Trump; and Donald Trump, Jr. in relation to investigation of “fraudulent or misleading asset valuations to obtain a host of economic benefits, including loans, insurance coverage, and tax deductions.”

Martabano is a real estate attorney; MLB is a tax attorneys practice which sought to cut ties with Trump; Sheri Dillon has been a partner at MLB working on the Trump account. The rest of the named you are likely familiar with from previous news and posts.

This motion is only in relation to a civil action by NYAG Letitia James; the District Attorney of the County of New York (DANY) Alvin Bragg is conducting a parallel criminal investigation.

I’ve written before about Trump National Golf Club Westchester and the generally scammy and scummy way Trump and Trump org treated the community of Briarcliff where the course is located.

NYAG’s motion opened up a new can of angry bees from a location I haven’t looked at previously because it wasn’t a Trump golf course resort.

Seven Springs is an example of a golf course which didn’t happen, and what Trump did to try and keep the property while paying out as little as possible to do so.

This sounds relatively harmless; who doesn’t try to keep their expenses down?

Except Seven Springs is yet another example of Trump’s lousy judgment and his externalizing his failures onto others.

~ ~ ~

This is Seven Springs as it was back when it was owned by Eugene and Agnes Meyer (also known as the parents of Washington Post’s former publisher Katharine Graham née Meyer). It was built for the Meyers in 1915 for what then was an unfathomable amount of money – $2 million for a little over 28,000 square feet. (Note the rows of young trees planted at the top of the photo as well as the trees to the right side which follow the embankment to the Byram Lake Reservoir.)

(source: Histree.com)

Agnes Meyer died in 1970; under the successor Meyer Foundation, Seven Springs was then used as a conference center by Yale University. In 1984 the foundation cut its ties with Yale and gifted the property to Rockefeller University.

In 1995 – three years after his divorce from his first wife Ivana and a year before he bought the former Briar Hall Golf and Country Club in Westchester – Trump bought Seven Springs from Rockefeller University

Trump originally planned to develop the property into a golf course. A number of architectural design firms worked competitively on plans over a handful of years.

But nothing came of the effort for a number of reasons, the biggest barrier being the approval of the local community and his neighbors.

This is Seven Springs as it appears on Google Maps in satellite view. It is located almost half way between two golf courses – the Mt. Kisco Country Club (opened in 1928) and the Summit at Armonk (opened in 1961).

Mt. Kisco Country Club at upper left; the Summit at Armonk at lower right; Seven Springs in center to left of Byram Lake Reservoir. (source: Google Maps)

The addition of a Trump course at Seven Springs would mean three golf courses inside less than a 10-mile radius. Seven Springs is located on undulating terrain with granite underneath and wetlands on the property, making development extremely complicated and pricey.

Surface water from Seven Springs acreage drains into the Byram Lake Reservoir which provides drinking water for the Mt. Kisco community; a new golf course with all its lawn chemicals and additional automobile traffic dropping gasoline, oil, and more would increase pollutants in the reservoir. One can understand the community’s reluctance to approve a Trump course when there has already been one nearby for decades; the community knows just how much a golf course can affect the reservoir.

The property also abuts the Eugene and Agnes E. Meyer Nature Preserve immediately to the south which is owned by The Nature Conservancy. It is undeveloped woodlands overlooked by the 28,000 square foot house at Seven Springs.

~ ~ ~

This is what pissed me off.

Trump had to have known when he bought Seven Springs that the nature preserve which had once been part of the Meyers’ 1000-acre holding was next door to the immediate south of the estate. One of the tentative plans for a golf course snugged up to the north boundary of the preserve.

Once Trump finally gave up on this course after stringing along star-struck course developers for years, he decided he would pursue real estate development, tentatively subdividing Seven Springs to build up to 14 McMansion-sized homes.

But he apparently wanted or needed a through way across the 213 acres for both the purposes of development and for the future home owners.

He sued The Nature Conservancy and the community for an easement to build a road — extending Oregon Road which leads to Seven Springs along the drive on the property and then through the nature preserve over an unpaved path to where Oregon Road begins again south of the preserve.

Again, Trump had to have known when he bought the 213-acre parcel that it did not include an easement into/through the nature preserve. An unpaved path from Seven Springs into the preserve once existed, but a gate had been installed in 1990 between Seven Springs and the preserve. Rockefeller University had known about a previous easement but allowed it to expire during its ownership of Seven Springs.

The easement was extinct, demised, non-extant, and even more dead because Trump had allowed more than 10 years to pass between purchasing Seven Springs and suing for an easement.

And yet in August 2006 Trump went to court to get his way, costing The Nature Conservancy and the community time and money to fight off his demand for an easement and road through pristine woodlands because he didn’t have the goddamned foresight to see the Seven Springs property was problematic as golf course and residential development when he bought it in 1995.

Never mind the fact the course would be in competition with two well-established courses.

~ ~ ~

Now it gets messy.

Because he can’t develop the property at all without some accommodation for a road and the neighbors and community aren’t happy but he wants to hang onto the property for his family’s use, Trump pursued tax deductions.

It’s not clear from the NYAG’s motion when Trump began pursuit of a tax deduction for a 150-acre conservation easement on Seven Springs property. In exchange for promising not to develop property, Trump’s organization obtained a $5 million tax credit from 2014 to 2018 for Seven Springs and Trump National Golf Club Los Angeles combined.

He also pursued a very similar conservation easement tax deduction at Trump National Golf Club Los Angeles worth multiple millions in tax credits. The land set aside from development was used as a driving range – no buildings constructed, no fairways or greens, just a patch of mowed lawn for practice shots but still part of the golf course business, and surely not open to the public for free. This tax deduction, too, is being examined by NYAG.

Which part of the 213-acre Seven Springs property did he set aside to conserve?

The part which had been cleared of trees planted by the Meyers?

The part which has been cleared of trees and brushed out down the slope to the Byram Lake Reservoir, which realistically can’t be developed anyhow because of that slope?

The part which couldn’t be developed because of the lack of local approvals and the road he couldn’t add?

MOUNT KISCO, NY – SEPTEMBER 30 2020: President Trump’s Seven Springs estate in Mount Kisco, New York, seen here Sept. 30, 2020.
(Johnny Milano for The Washington Post)

Which is the question at the heart of NYAG’s investigation into Seven Springs: how can Trump place a value on the 150-acre conservation easement for a tax deduction based on high-end residential development, when it couldn’t be developed?

How can a permanent swath of lawn punctuated with trees be the same value as new McMansion construction?

It’s not worth roughly $2-3 million a year in tax deductions on the face of it.

~ ~ ~

Another really irritating part of this beyond the pudgy orange weasel himself is the absence of the Internal Revenue Service and the New York State Department of Taxation and Finance. How did this scofflaw get away with millions of dollars in sketchy tax deductions all this time?

This situation should never have gotten this far out of hand; the first time a taxpayer, human or corporate, takes multi-million tax deductions on conservation easements, that’s the time an agent from either the IRS or the state tax authority physically inspects the property and investigates its backstory to ensure it’s a legitimate conservation easement.

But like everything else Trump has gotten away with so far, the right authorities to deal with him at the time he violated a law or regulation failed to do their duty and the public has no idea why.

If I took a multi-million tax deduction on a conservation easement this year, you can bet I’d be sucked into an audit as fast as you can blink.

Once NYAG and DANY are done with their investigations, local, state, and federal governments need to look at what triggers should set off audits and investigations because whatever they’re currently relying on isn’t working.

$2-3 million is one hell of a lot of tax revenue which could have paid for many public services in New York State and beyond.

And I haven’t even mentioned the other Trump properties in New York though I’ve written about them before.

Nor have I mentioned the easement lawsuit and the creation of conservation easements for tax purposes occurred while Trump was appearing in The Apprentice, kitted out and scripted to look as if he was a successful, honest businessman and real estate developer season after season.

~ ~ ~

Eric Trump, he of 500-plus invocations of the Fifth Amendment under questioning by NYAG, said of Seven Springs, “It was home base for us for a long, long time…”

Yeah? Well, all your base are belong to us if Seven Springs ends up seized for taxes.

Seriously, fuck this base.

Not-So-Casual Water: Insurance Fraud Alleged at Trump-Westchester

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Hope you were able to get out on the links this weekend if you’re a golfer and your local weather was good. The season here in Michigan is wrapping up this week or next from the looks of things.

Wonder when the course will close at Trump National Golf Club Westchester this year, if it hasn’t already?

Rolling Stone published another piece about the course; this time ex-employees dished about insurance claims made related to flooding at the course in 2011.

Recall that Trump reported in FEC financial filings that Westchester was worth an estimated $50 million.

Trump org fought with the local tax authority, insisting the course should have an assessed value of $1.4 million — much lower than the fire sale price of $7.5 million Trump paid for the course in 1996 when it went into foreclosure.

But the former insiders said Trump org claimed a loss of $1.3 million due to flooding in 2011.

There’s no indication at all that the golf course’s business was disrupted by the flooding, which one might think was likely if half or more of the course had been so badly damaged.

The local municipality sued Trump because of damage caused by changes to his course which disturbed water flows. It’s pretty obvious from a Google Maps terrain view that the water flows toward the municipality of Briarcliff from the Trump course so Trump and his organization can’t say they couldn’t have anticipated a problem in the event of heavy rains.

That top red arrow points to the area nearest the intersection of Pleasantville Road (Nw to SE, east side of course) and State Road (ends at Pleasantville Road, runs NE to SW). Google Streetview images show the street surface on State Road near the intersection has been repaired and worked over at some point since 2009.

If you’re just Joe Duffer out on the course, you can see the manufactured water features — specifically two waterfalls denoted by red arrows — which must rely on water level being artificially maintained along with drainage in case of overflow. The creek and wash area have two feature cart bridges over them under which excess water should flow east in the direction of the red arrow. The waterfalls aren’t attractive unless the water is kept up high which means any extra water from surfaces like parking lots and fairways draining toward the pond will overflow rapidly into a wash which ends…????


Somewhere under Pleasantville Road I hope there’s a big drain.

On the east side of Pleasantville Road is the Walter M. Law Park and the Briarcliff Manor Public Library. The park includes tennis courts, a swimming pool, a baseball diamond, and a pond which looks like it might be fed from water coming from under Pleasantville Road.

In 2011, floodwaters damaged the park area, causing heartburn for the local municipality:

The dispute began not long after a series of storms on June 23, 2011, dumped 5 inches of rain on the region. Waters swamped the village’s Law Memorial Park swimming pool and deposited silt about a third of a mile from the course, next to the Briarcliff Manor Public Library. Also flooded were the playing fields behind the swimming pool, where a geyser gushed from a manhole whose cover popped up from the drainage system blockage.

Briarcliff Manor met with Trump org several times about the damage and reparation. After hashing over the problem fruitlessly it billed Trump org $238,000 for the damage done because Trump’s course had made “unauthorized alterations” to the watercourse which elevated the waterfall ponds’ levels by up to six feet. Trump org denied doing anything to cause the problem, leaning into the argument that the rain was an unanticipated 300-year flood event.

Neighbors of the golf course were further upset by Trump’s balking at the property value assessment when Trump org argued the course owed only $47,000 and not $470,000 based on the much lower property value of less than $2 million.

That lower property tax amount is audacious considering Trump’s financial henchman Alan Garten claimed the flooding of the public park occurred because “…a drainage pipe under the village fields was clogged. It was clogged because the village [Briarcliff Manor] was too cheap to put up a grate to prevent rocks and boulders from coming in.”

(Where would the money come from, Garten? Tax revenues?)

What was it, then, the Trump org claimed against its insurance coverage compared to what they paid? Were the claims under investigation in relation to the 2011 flooding? Were they also in relation to more recent flooding due to high water levels from Hurricane Ida in August this year?

Or were there other claims we don’t know about yet?

What were the real terms of the settlement Trump org made with the local taxing authority, the Ossining Board of Assessment Review, when the Rolling Stone said,

The Trump Organization ultimately paid the town $50,000 to settle the lawsuit but, under the terms of the settlement, did not admit any wrongdoing, according to a copy of the settlement obtained in a request made under New York’s Freedom of Information Law. The settlement came on July 12, 2016, a few days before Trump accepted the Republican nomination for president.

50 grand seems suspiciously light when the engineering analysis to assess the problem and determine a solution likely cost the municipality more than that amount.

The timing is even more suspicious — how convenient the problem was resolved right then, before Trump’s campaign began in earnest.

The specifics of the agreement remain a mystery which seems to be par for this course and Trump’s organization.

What Lies Beneath the Turf

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We learned this past week that the Westchester County, NY district attorney is investigating the Trump National Golf Club Westchester.

… The full scope of the investigation could not be determined, but the district attorney, Mimi E. Rocah, appears to be focused at least in part on whether Mr. Trump’s company, the Trump Organization, misled local officials about the property’s value to reduce its taxes, one of the people said. …

While in the White House Trump declared on mandatory financial disclosure statements the Westchester golf course was worth $50 million; however the Trump org claimed the 140-acre property with its 75,000 square foot clubhouse was worth only $1.4 million for local tax purposes.

For comparison, nearby residential homes (currently listed for sale) are assessed at much higher rates:

Home A, 1.12 acres, listed at $1.5M, assessed at $1.03M ($2543/month taxes)
Home B, 2.75 acres, listed at $2.3M, assessed at $1.4M ($3768/month taxes)
Home C, 3.52 acres, listed at $2.7M, assessed at $2.5M ($4,400/month taxes)

While there may be some rationale for a commercial property assessed at such ridiculously low value compared to these residential properties within walking distance, it doesn’t make sense when golf courses are being converted to residential property during a contraction of the golf industry, and when the municipality and neighbors have had a history of sewer and drainage problems caused by the golf course, resulting in damage to individual and community property.

The gap between the local tax assessment and the financial report valuation has been known for years now, noted well before Election Day 2016.

The possibility of tax and insurance fraud by the Trump organization has been clear for years now as well, in no small part because of testimony before the House Oversight Committee in February 2019 by Trump’s former attorney, Michael Cohen (beginning at 4:43:30):

Transcript:

Ms. Ocasio-Cortez: OK. Thank you.
Second, I want to ask a little bit about your conversation with my colleague from Missouri about asset inflation. To your knowledge, did the President ever provide inflated assets to an insurance company?
Mr. Cohen: Yes.
Ms. Ocasio-Cortez: Who else knows that the President did this?
Mr. Cohen: Allen Weisselberg, Ron Lieberman, and Matthew Calamari.
Ms. Ocasio-Cortez: And where would the committee find more information on this? Do you think we need to review his financial statements and his tax returns in order to compare them?
Mr. Cohen: Yes, and you would find it at The Trump Org.
Ms. Ocasio-Cortez: Thank you very much.
The last thing here. The Trump Golf organization currently has a golf course in my home borough of the Bronx, Trump Links. I drive past it every day going between The Bronx and Queens. In fact, The Washington Post reported on the Trump Links Bronx course in an article entitled “Taxpayers Built This New York Golf Course and Trump Reaps the Rewards.”
That article is where many New Yorkers and people in the country learned that taxpayers spent $127 million to build Trump Links in a, quote, “generous deal allowing President Trump to keep almost every dollar that flows in on a golf course built with public funds.” And this doesn’t seem to be the only time the President has benefited at the expense of the public.
Mr. Cohen, I want to ask you about your assertion that the President may have improperly devalued his assets to avoid paying taxes. According to an August 21, 2016, report by The Washington Post, while the President claimed in financial disclosure forms that Trump National Golf Club in Jupiter, Florida, was worth more than $50 million, he had reported otherwise to local tax authorities that the course was worth, quote, “no more than $5 million.”
Mr. Cohen, do you know whether this specific report is accurate?
Mr. Cohen: It’s identical to what he did at Trump National Golf Club at Briar Cliff Manor.
Ms. Ocasio-Cortez: To your knowledge, was the President interested in reducing his local real estate bills, tax bills?
Mr. Cohen: Yes.
Ms. Ocasio-Cortez: And how did he do that?
Mr. Cohen: What you do is you deflate the value of the asset, and then you put in a request to the tax department for a deduction.
Ms. Ocasio-Cortez: Thank you.
Now, in October 2018, The New York Times revealed that, quote, “President Trump participated in dubious tax schemes during the 1990’s, including instances of outright fraud that greatly increased the fortune he received from his parents.” It further stated for Mr. Trump, quote,  “He also helped formulate a strategy to undervalue his parents’ real estate holdings by hundreds of millions of dollars on tax returns, sharply reducing his tax bill when those properties were transferred to him and his siblings.”
Mr. Cohen, do you know whether that specific report is accurate?
Mr. Cohen: I don’t. I wasn’t there in the 1990’s.
Ms. Ocasio-Cortez: Who would know the answer to those questions?
Mr. Cohen: Allen Weisselberg.
Ms. Ocasio-Cortez: And would it help for the committee to obtain Federal and State tax returns from the President and his company to address that discrepancy?
Mr. Cohen: I believe so.
Ms. Ocasio-Cortez: Thank you very much. I yield the rest of my time to the chair.

Here’s the rub: Trump’s dispute with local tax authorities in Westchester County, NY and the disparity in its property valuation goes back more than five years; this is publicly known, amply reported, even discussed here at emptywheel.

Why is it only after the August 2021 election of a new district attorney, Mimi Rocah, took office was the possibility of tax and insurance fraud finally investigated?

The Westchester course is only one of 11 in the U.S., though. They include:

Trump National Golf Club, Bedminster, NJ
Trump National Golf Club, Charlotte, NC
Trump National Golf Club, Colts Neck, NJ
Trump National Golf Club, Hudson Valley, NY
Trump National Golf Club, Jupiter, FL
Trump National Golf Club, Los Angeles, CA
Trump National Doral Golf Club, Miami, FL
Trump International Golf Club, West Palm Beach, FL
Trump National Golf Club, Pine Hill, NJ
Trump National Golf Club, Washington, DC

In reports to the Federal Election Commission, Trump reported more than half of these were worth $50 million or more while regularly suing the snot out of local tax authorities who dared to assess Trump golf courses for values higher than a million or two.

Again, this has been known and reported for years. Trump has and continues to treat every real estate asset as it were the reason for a SLAPP-type suit to cow government to his demands. It’s a pattern.

Why have the local, state, or federal governments failed to investigate these courses in the same way Westchester County is now investigating Trump National Golf Club Westchester?

Especially after Michael Cohen not only testified that golf courses came up as a means to launder payments to Stormy Daniels, and that asset valuations were skewed artificially to reduce Trump’s insurance premiums? It’s not as if there hasn’t been adequate reason to investigate this pattern of deflated asset valuations.

It’s been more than two and a half years since Michael Cohen testified before the House Oversight Committee that the Trump org reported deflated assets to reduce tax exposure while making false statements to the FEC and the public about golf course market value.

How many more years will pass before another domestic Trump golf course is investigated?

A Fine Crop of Golf

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I’m fried. I’m mentally and emotionally burnt right out, which is probably the aim of Agent Orange Chaos — to grind us all down until we roll over and allow this country to be a haven of corruption.

Imagine everything you need becoming even more transactional than it is now — systematically corrupt. Need a new cable TV line installed? Pay a bribe for access. Need to move to a different apartment? Pay a bribe to access a better list of buildings. Need a specialty item for your health, something that can’t be obtained through Amazon? Pay a bribe.

Sure, we’re used to paying fees for access in many different ways. But Americans are not used to the kind of petty and persistent corruption which is endemic in other parts of the world. Instead we pay taxes to support a legal system which is supposed to ensure fair dealing. Imagine paying these taxes and not having any expectation of justice AND paying bribes or extortion all along the way.

We’re so unused to and under-educated about the idea of corruption touching everything we do that I think we suffer from cognitive dissonance. It’s right there in front of us and yet we fail to recognize for what it is and for the slide in our ethical standards it represents.

One example niggling at me is Trump and his goddamned golf. You’ve probably read some of my posts about golf before in which I spell out the possibilities for corruption if one owned a golf course and how normative the golf life is to a class of people.

Our country is drowning right now, staring at multiple crop failures across a huge expanse of farm land, and our fearless leader is surely off golfing on our dime instead of looking into how to help farmers weather both the affects of the deepening climate emergency and the fallout from fearless leader’s hacktastic tariffs.

Corruption. Skimming money off us while farms and farm land drowns.

And too many farmers who will receive federal aid are not universally single family owned farms but mega corporate oligarchs — like the crooked Brazilian meat packing billionaires who will receive $62 million in aid for distribution to the farms supplying them meat.

But you know in your gut this won’t happen. And it’s corruption.

Journalists have covered the Brazilians raking in cash from our tax dollars, fortunately. They saw the problem and reported on it. But the public hasn’t mustered adequate outrage because this hasn’t yet hurt them in the wallet.

Wait until winter when holiday baking begins.

I don’t need to wait that long to feel it. I’m plenty pissed off because it’s another Saturday, another day at the golf course, and we’ve completely lost count of that orange mooch’s sponging. Which of his courses is he at, with our Secret Service personnel renting more golf carts to follow him around while he plays another round cheating both at the game and at life?

Ah, and there it is, he’s leeching us dry yet again with each crappy swing of his club:

As of the end of the day he’s been in office 876 days — which means he has spent 29.7% of his total time at one of his properties, 22.2% of his time in office play golf at one of his clubs.

Corruption. Just makes me want to puke.

We’re just supposed roll over and let them grab our taxpaying pussy while they tee off on our dime. They’ll argue our legitimately-elected representatives don’t have the right to oversight when he’s manipulating our tax system for his own personal gain to our collective detriment.

Like the New York park land he donated after he was refused permits to develop a couple million dollars of property into golf courses — Trump org declared them worth $26 million to write off the capital loss and reduce the taxes paid.

What really pisses me off is the story no reporter has yet covered as far as I can tell: if Trump’s Bedminster NJ golf course is classified as farm land for tax purposes so he can avoid paying tens of thousands of dollars in property taxes, is Trump org going to claim federal relief for this farm, too?

It’s right there under our noses. So corrupt and he and his oligarchic sponsors want this to become the norm.

Fuck that. If this guy was your direct employee you’d have fired his ass  already.

This is an open thread.

Foiling a Good Walk

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Don’t be surprised if Donald Trump decides to spend even more time at his golf courses between now and 2020. He should be worried if the courses will remain a part of the Trump organization let alone how much more time he can spend golfing in his lifetime.

At two points during the House Oversight Committee hearing this past Wednesday, Trump’s golf courses came up.

When Rep. Carolyn Maloney (D-NY) asked Michael Cohen about the “catch-and-kill” program by which Trump avoided being publicly exposed by his extra marital sexual partners, Cohen explained why he ended up financing the payment to Stormy Daniels (Miss Clifford).

Transcript (01:45:13) —

Cohen: Well, going back into the story as I stated when we — Allen Weisselberg and I — left the office and went to his office to make the determination on how the money was going to be wired to the IOLA, the interest on the lawyer’s account for Keith Davidson in California, I had asked Allen to use his money. I didn’t want to use mine. He said he couldn’t. We then decided how else we could do it and he asked me whether or not I know anybody that wants to have a party at one of his clubs that could pay me instead or somebody who may have wanted to become a member of one of the golf clubs. And I also don’t have anybody that was interested in that. And it got to the point where it was down to the wire. It was either we — somebody — wire the funds and purchase the life rights to the story from Miss Clifford or it was going to end up being sold to television and that would have embarrassed the president and it would have interfered with the election.

In his response, Cohen shares three different methods used to launder money, two of which would have gone through a Trump golf course. In a previous post examining profiteering and money laundering through a golf club, these same methods were mentioned as possibilities. A new member’s initiation fee could easily match the amount needed to pay off Miss Cliffords as could charges or fees for a single event held at a Trump course.

Given Cohen’s inability to say how many ‘catch-and-kill’ stories Trump or his organization had to pay off, it’s reasonable to suspect golf courses have been used this way to launder hush money let alone launder money for other purposes.

Toward the end of the hearing, Rep. Alexandria Ocasio Cortes asked Cohen about the property value of a Trump golf course after noting the exceptionally sweet deal Trump org received when developing the Trump Golf Links at Ferry Point, New York.

Transcript (04:50:13) —

Ocasio-Cortes: Thank you very much. The last thing here. The Trump golf organization currently has a golf course in my home borough of the Bronx and Queens. In fact, the Washington Post reported on the Trump links Bronx course in an article titled, ‘Taxpayers Built this Golf Course and Trump Reaps the Rewards’. Many learned that taxpayers spent $127 million to build Trump links in a, quote, generous deal allowing President Trump to keep almost every dollar that flows in on a golf course built with public funds. And this doesn’t seem to be the only time the president has benefited at the expense of the public. Mr. Cohen, I want to ask you about your assertion that the president may have improperly devalued his assets to avoid paying taxes. According to an August 21st 2016 report by the Washington Post, while the president claimed in financial disclosure forms that the Trump National Golf Club in Jupiter, Florida, was worth more than $50 million, he had reported otherwise to local tax authorities thaAt the course was worth, quote, no more than $5 million. Mr. Cohen, do you know whether this specific report is accurate?

Cohen: It’s identical to what he did at Trump National Golf Club at Briarcliff Manor.

Briarcliff offers a good example of Trump org’s treatment of municipal regulations as well as state and local laws. The course management damaged the local storm sewage system with unauthorized modifications, causing damage to residents’ and Ossining’s property. Goodwill was further damaged by years of fighting local tax assessments:

Nowhere has the conflict between the tax assessments on Trump’s properties and his claims of soaring value been more apparent than in Ossining, New York, where his lawyers argued to the city assessor that his Westchester County golf club was worth $1.4 million in 2015, less than a tenth of its appraised value. On the financial disclosure statement candidates are required to file, he valued it at more than $50 million. The city assessor’s office, which valued the property at $15 million, did not respond to a request for comment.

Trump and his organization fought the valuations of all Trump courses in Florida over the last handful of years as well as Mar-a-Lago and several small non-golf estates. The value of the Jupiter course, reported as $50 million on financial disclosure forms furnished to the government, was estimated by Palm Beach County at $19.7 million. But Trump org sued Palm Beach for a fifth time disputing the county’s valuation, electing to pay taxes on a property worth $5 million less than the county’s estimate.

Trump org also appealed its tax bill for the Trump National Doral Golf Club; they’ve tried for each of the last five years to shave its tax liability with Miami-Dade county. They weren’t sucessful.

Briarcliff and the Florida golf clubs aren’t the only courses for which Trump’s organization claimed lower property values in order to avoid tax obligations.

Trump National Golf Course in Hudson Valley, New York, was assessed at $6 million; the organization claims the property is only worth $2 million. The Trump organization doesn’t own the real estate, operating instead as a lessee. It’s not clear if ownership factors into Trump org’s argument against paying higher taxes; the municipality charges the lessee, however.

The Bedminster course was used to claim a $39.1 million federal tax deduction in 2005 relying on a land conservation rule, and a deduction as farmland because the course kept a small number of goats on the premises.

The Los Angeles course may be the most confusing to make sense of its value. Trump said it was worth $264 million when it opened in 2006, claimed it was worth at least $50 million on federal financial disclosure filings, but only $10 million when filing property taxes in 2008.

While the average business makes a reasonable effort to reduce its tax burden, the Trump organization made it a pattern of habit, particularly with its golf course businesses. It’s odd that each course’s asset valuation established by a local municipality was questioned multiple years in a row, even when the municipality had already gone out of its way to provide unusual benefits to the Trump organization (ex. a long-term lease of county-owned property adjoining the West Palm Beach airport while allowing the course to contest the value the county assigned to the real estate).

The pattern of behavior was tightly entwined with asset inflation for other purposes. One reason was for bank loans, elevating the amount the Trump organization could borrow. Cohen testified that he knew Deustche Bank had received these arbitrary numbers.

Rep. William Clay (D-MO) asked about specific Trump organization financial statements from 2011, 2012, and 2013 Cohen had in his possession pertaining to Trump and his organization, with regard specifically to manipulation of asset values.

Transcript (01:48: ) —

Clay: Thank you…can you explain why you had these financial statements and what you used them for?

Cohen: These were used by me for two purposes. One was discussing with media, whether Forbes or other magazines, to demonstrate Mr. Trump’s significant net worth. That was one function. Another was when we were dealing later on with insurance companies. We would provide them with copies so that they would understand that the premium on the individuals’ capabilities to pay would be reduced.

It’s not clear whether Cohen meant individuals singular or plural. The proliferation of disparities between asset valuations reported by media, by members of the Trump family and organization, and by different government entities now makes more sense — the confusion allows easy misrepresentation of value for insurance purposes.

Transcript (04:43.46) —

Ocasio-Cortes: Okay, thank you. Secondly, I want to ask a little bit about your conversation with my colleague from Missouri about asset inflation. To your knowledge, did the president ever provide inflated assets to an insurance company?

Cohen: Yes.

Mr. Trump’s federal financial disclosure statements need to be audited for false statements if they were completed using manipulated asset data.

The House Oversight Committee now has testimony and evidence suggesting further investigation into bank and insurance fraud by Trump and the Trump organization is warranted.

But it isn’t the House Oversight Committee alone which should now investigate insurance fraud. While insurance in the U.S. must comply with federal law, it’s regulated at state level. Insurance commissioners and state attorneys general in each state where the Trump organization owns, operates, and insures businesses including golf courses should now review Trump’s insurers and policies. How did insurers write policies for Trump organization for so long given the disparities between property values established by municipalities and the asset values published by so many different media outlets?

It’s easy to see there’s a problem with the perception of Trump org’s asset valuations by comparing a few articles written about the golf courses. Outside Florida it’s not well known that Trump org doesn’t own the real estate underneath Trump International Golf Club, West Palm Beach, Florida. It’s even less well known that Trump org does not own the real estate beneath the Hudson Valley, New York course. Many articles reported, however, that these courses are wholly owned by Trump without any additional detail about what assets are included.

How has this gap in public knowledge been used?

The entire financial industry needs to take a good look at itself and consider how it may have been played. Cohen mentioned media outlets like Forbes coming to him for asset valuations which they published, replicating and dispersing deceit read most often by finance people. Because he appeared to own multiple golf courses in addition to other real estate, the perception of Trump’s wealth wasn’t adequately questioned.

It will hurt not only municipalities if Trump org golf courses were to suddenly cease operations.

This is an open thread.