Bank CEO pleads not guilty in bid for Trump gig
NEW YORK — A banker who prosecutors say tried to buy himself a senior post in President Donald Trump’s administration by making risky loans to former Trump campaign chairman Paul Manafort pleaded not guilty Thursday to a financial institution bribery charge.
Stephen M. Calk, 54, was released on $5 million bail after making a brief appearance in Manhattan federal court.
Calk, who lives in Chicago where The Federal Savings Bank is headquartered, was told by Magistrate Judge Debra Freeman to have no contact with bank employees except for his brother. Prosecutors will submit an official list of bank employees he cannot contact by next week.
The small bank where Calk was CEO when he allegedly carried out the scheme said in a statement Calk already had no involvement with the bank and is on a leave of absence.
“The Special Counsel and a federal judge have determined that The Federal Savings Bank was a victim of Mr. Manafort’s crimes,” the bank said in a statement, adding it isn’t accused of “any wrongdoing.”
Calk attorney Jeremy Margolis said in a statement his client will be exonerated on the “baseless isolated charge.”
Another defense lawyer, Daniel Stein, said: “These loans were simply not a bribe for anything.”
Federal prosecutors said Calk abused his bank position by approving $16 million in high risk loans that were ultimately downgraded by the bank’s primary regulator.
William F. Sweeney Jr., head of New York’s FBI office, said Calk “went to great lengths to avoid banking violations in an attempt to secure a senior position in a presidential administration.”
“His attempt at petitioning for political favors was unsuccessful in more ways than one — he didn’t get the job he wanted, and he compromised the one he had,” Sweeney added.
If convicted, he could face up to 30 years in prison.
Manafort lobbied Trump’s son-in-law, Jared Kushner, to consider Calk for secretary of the Army, according to emails from the weeks leading up to the 2016 election.
Prosecutors said while Manafort’s loans were pending approval, Calk gave Manafort a ranked list of government positions he wanted, starting with secretary of the treasury, followed by deputy secretary of the treasury, secretary of commerce and secretary of defense, as well as 19 ambassadorships similarly ranked and starting with the United Kingdom, France, Germany and Italy.
According to trial evidence, Manafort passed along Calk’s resume to Kushner in a Nov. 30, 2016, email, along with two other names of people he said “should be a part of the Trump administration.”
Kushner responded, “On it!” Calk was formally interviewed for the position of under secretary of the Army in early January 2017 at the Presidential Transition Team’s Trump Tower offices, prosecutors noted.
But Calk never got an administration post, though he did approve Manafort’s loans.
Prosecutors said Calk began to exploit his position in July 2016 as head of the bank and its holding company, knowing Manafort urgently needed loans to avoid foreclosure proceedings on multiple properties he and his family owned.
Manafort is serving a 7½-year sentence after his convictions on 10 charges alleging multiple crimes, including bank and tax fraud, misleading the government over his foreign lobbying work and encouraged witnesses to lie on his behalf.