‘Tan­gled web’: Trump’s busi­nesses could cre­ate con­flicts of in­ter­est

Daily Freeman (Kingston, NY) - - STATE NEWS - By Bernard Con­don

Asked on TV ear­lier this year whether a Pres­i­dent Don­ald Trump would ever mix pol­i­tics with busi­ness, his el­dest son, Don­ald Jr., said there was no risk of that. The son, an ex­ec­u­tive in his fa­ther’s com­pany, in­sisted the two wouldn’t dis­cuss the busi­ness if Dad ever got to the White House.

Then Don­ald Jr. added two words: “Trust me.”

The Amer­i­can peo­ple may have lit­tle choice.

The tra­di­tion stretch­ing back to Jimmy Carter in the late 1970s is for pres­i­dents to put per­sonal hold­ings such as stocks into a “blind trust” run by an in­de­pen­dent trustee with no ties to the oc­cu­pant of the Oval Of­fice. But as with so many other ar­eas of pol­i­tics, Trump looks ready to up­end this time-hon­ored prac­tice.

Trump’s plans to hand con­trol of his Trump Or­ga­ni­za­tion to three of his adult chil­dren and not a trustee can­not be con­sid­ered a blind trust, said Ken­neth Gross, head of po­lit­i­cal law at the firm Skad­den, Arps, Slate, Meagher & Flom.

Even if the pres­i­den­t­elect were to ap­point a trustee with no fam­ily ties, that would prob­a­bly not re­move the po­ten­tial for Trump to use his new power over pol­icy to en­rich himself. Liq­ui­dat­ing Trump’s hold­ings would be dif­fi­cult, and so he would al­ways be aware of what as­sets he holds.

Vot­ers have long wor­ried about elected of­fi­cials us­ing their power to line their pock­ets — or those of busi­ness part­ners — and shape poli­cies to ad­vance their pri­vate in­ter­ests. But rarely has an in­com­ing pres­i­dent rep­re­sented such po­ten­tial for con­flicts of in­ter­est.

No pre­vi­ous com­man­der in chief has brought with him such a sprawl­ing busi­ness em­pire with so much com­plex­ity, opaque­ness and op­por­tu­nity for self­deal­ing.

Trump owns golf clubs, of­fice tow­ers and other prop­er­ties in sev­eral coun­tries. He holds own­er­ship stakes in more than 500 com­pa­nies. He has struck li­cens­ing deals for use of his name on ho­tels and other build­ings around the world and has been land­ing new busi­ness in even more coun­tries — in the Mid­dle East, In­dia and South Amer­ica.

Gross calls Trump’s hold­ings “un­prece­dented” in size and com­plex­ity for a pres­i­dent, a “tan­gled web” of po­ten­tial con­flicts that would be dif­fi­cult to un­ravel.

As it turns out, Trump doesn’t even have to try.

Pres­i­dents are not re­quired to set up blind trusts. In fact, they can even run a busi­ness from the White House, though Trump has said he will not. Fed­eral ethics rules put strict lim­its on nearly all govern­ment em­ploy­ees and elected of­fi­cials to pre­vent self-deal­ing, but the rules do not ap­ply to the pres­i­dent.

One area where the pub­lic in­ter­est could clash with the per­sonal in­volves Trump’s in­flu­ence over fed­eral agen­cies whose de­ci­sions affect his busi­nesses.

In turn­ing the govern­ment-owned Old Post Of­fice into his new Wash­ing­ton ho­tel, Trump struck a com­plex rental and man­age­ment deal with the Gen­eral Ser­vices Ad­min­is­tra­tion. As pres­i­dent, he will ap­point the head of the GSA.

And one of Trump’s lenders, Deutsche Bank, is in set­tle­ment talks with the Jus­tice Depart­ment over its role in the mort­gage blowup that sparked the 2008 fi­nan­cial cri­sis. Trump will ap­point the head of that agency, too.

For his part, Trump has dis­missed the idea that he is even in­ter­ested in his busi­ness now. In an in­ter­view with CBS’ “60 Min­utes” on Sun­day, he said he was fully en­gaged in ef­forts to “save our coun­try.”

“I don’t care about ho­tel oc­cu­pancy,” he added. He called mat­ters like that “peanuts.”

The Trump Or­ga­ni­za­tion said in a state­ment that it is “vet­ting var­i­ous struc­tures” with the goal of trans­fer­ring man­age­ment to three of Trump’s chil­dren, along with a “team of highly skilled ex­ec­u­tives.”

Carter started the tra­di­tion of pres­i­den­tial blind trusts when he put his peanut farm in one. All the pres­i­dents who fol­lowed also set up one, ac­cord­ing to Gross, save for Barack Obama, who mostly had hold­ings in plain-vanilla in­dex funds.

With a blind trust, own­ers can’t con­trol their port­fo­lio and may not even know what’s in it. Trus­tees some­times sell off hold­ings and in­vest the money else­where with­out the owner’s knowl­edge.

“It’s one thing to sell 1,500 shares of Proc­ter & Gam­ble. You can do that eas­ily,” Gross said. “It’s an­other thing to sell a golf course in a for­eign coun­try or ex­tri­cate from a brand­ing con­tract.”

In the 2012 pres­i­den­tial elec­tion, Repub­li­can nom­i­nee Mitt Rom­ney, who had vast hold­ings from work­ing at buy­out firm Bain Cap­i­tal, pledged to put his wealth in a blind trust cer­ti­fied by the Of­fice of Govern­ment Ethics.


Pres­i­dent-elect Don­ald Trump, right, kisses his son Eric farewell af­ter din­ing at the 21 Club Tues­day in New York.

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