Quote:
Originally Posted by pxmcc
you made a number of excellent points. trump's problem in the civil NY AG suit, as i see it, isn't that he screwed Deutzche (sp?) Bank. it's the "2 sets of books" problem: one set for the irs and anyone else he is trying to avoid paying, and another set for bankers and similarly situated parties he is trying to impress to get the lowest possible loan rates from. his property valuations appear to fluctuate widely depending on who the counterparty is. that may smack of fraud for the NY AG's civil case and a potential criminal case she has referred to her local u.s. atty's office. (she appears to have given up on the state criminal AG's office because apparently that AG is a bumbling fool who gave up investigating trump before he even started, leading to several resignations of line prosecutors. he says the crim case is alive and well, but i highly doubt it.)
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I have "two sets of book" for my business. It's mainly because of the way the IRS requires depreciation and amortization to be handled. It's different than GAAP. Banks know that and I can assure you they know how to reconcile the differences. LOL
The only harm DeutscheBank suffered was because they may have failed to do due diligence. The articles I've read on it say that they feel like they based interest rates on misleading financials provided by the Trump organization. Sounds like they feel like they could have gotten more money out of Trump and are having some remorse about that. That's not harm, that's remorse because maybe they didn't do their due diligence. Without harm there cannot be damages. The AG isn't even asking for damages so what's the basis of the suit?
After 2008 the laws and rules put in place pretty much compel a lender to treat every borrower exactly the same. They took the relationship factor out of the equation. Now I think some of those loans took place before 2008 but the point is that they were almost forced to ignore the relationship after 2008 and treat the Trump Organization the same as they would a brand new customer.
When you hand over financials they are either audited and come with an Auditors Statement or they aren't. If they aren't they are pretty much worthless. An Accountants review might be a third possibility but it's not anywhere near a full blown audit.
When I bought my business property my bank wanted my financials for 3 years, they also wanted tax returns(which I have professionally done) which in some small way backs up the financials. They also have all my banking info and they went through my accounts with a fine tooth comb and had questions about certain transactions that seemed to be random. It wasn't a full blown audit but they made sure I was worthy of a six figure mortgage.
In the Case of DeutscheBank they were loaning hundreds of millions. Does anyone really think they just took Trump's financials and called it good? Sure, The fact that they had been his biggest lender for a decade or more meant they had a pretty good relationship. I think Trump paid off a couple or really big loans in the months leading up to his candidacy or somewhere along that time frame. He probably didn't want those loans from a German financial institution because of the optics of it. I imagine DeutscheBank may have been a little upset by that and the early pay off may be what they are claiming as lost interest income or at least a portion of it. Still no harm though.
The point is that DB is one of the world's biggest multinational financial institutions. They've got high priced attorneys and accountants in house as well as independents available to comb over every inch of data supplied and even not supplied. If they didn't do that then it's not Trump's fault.
BTW A company I worked for back in the late 80s had a mid 6 figure mortgage and a sizeable line of credit with a local bank. The bank covenants just for that relationship required reviewed (not audited) financials each year by a CPA.
