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Dems digging into Trump finances post-Mueller

The Hill logo The Hill 4/21/2019 Sylvan Lane

Maxine Waters in glasses looking at the camera: Dems digging into Trump finances post-Mueller © Getty Dems digging into Trump finances post-Mueller Democrats are pressing forward with their investigations into President Trump's personal finances well beyond the boundaries of the special counsel probe.

Mueller's probe focused on questions of collusion in the 2016 election and potential obstruction of justice. But Democratic Reps. Maxine Waters and Adam Schiff of California, who chair the House Financial Services and Intelligence Committees respectively, are taking a deeper look at Trump's business empire, including potential dealings with Russian nationals, for any evidence of financial crimes.

Trump's attorneys have sought to prevent House Democratic investigators from obtaining his financial records. And Republican lawmakers have dismissed the probe as a partisan fishing expedition to undermine the president.

But Democrats insist the investigation into Trump's financial history is a crucial component of their oversight over the financial sector, raising concerns about money laundering by Russian nationals.

"The potential use of the U.S. financial system for illicit purposes is a very serious concern," Waters said in a Friday statement.

"The Financial Services Committee is exploring these matters, including as they may involve the President and his associates, as thoroughly as possible pursuant to its oversight authority, and will follow the facts wherever they may lead us."

In turning the spotlight on Trump's finances, Democrats are also crossing a red line for Trump. The president himself warned Mueller against investigating his family's businesses in a New York Times interview in 2017.

Trump is also facing a series of probes by the U.S. Attorney's Office for the Southern District of New York, which is looking into potential campaign finance violations.

Waters and Schiff launched their joint investigation with a primary focus on the broader issue of Russian money laundering, an area of bipartisan interest. But the probe is inextricably linked to Democratic claims of conspiracy between the Trump campaign and Russia to influence the 2016 election.

Waters has long raised questions about Trump's potential ties to Russian oligarchs, which the president and his attorneys have denied. Waters has been a vocal critic of the president. She was the first elected official to support Trump's impeachment and renewed her call for a House trial after the release of the Mueller report.

"Congress' failure to impeach is complacency in the face of the erosion of our democracy and constitutional norms," Waters said Thursday. She added that refusing to begin the impeachment process "would set a dangerous precedent and imperil the nation."

Waters began laying the groundwork for a Financial Services probe into Trump's finances in 2017 while Democrats were still in the minority.

Democrats honed in on Deutsche Bank as the FBI investigation into Russia's influence on the 2016 election gained steam. The German company's extensive history with Trump and 2017 settlement with the Justice Department over money laundering from Russia made it a natural target for Democrats seeking to tie the president to the Kremlin.

The bank has loaned over $2 billion to Trump over the years, including at times when his businesses were struggling to get loans from other financial institutions. Trump still reportedly owes the bank hundreds of millions in loans.

Deutsche Bank also provided records to Robert Mueller, who looked into the Trump Organization's activities in Russia, but his redacted report failed to mention the bank.

Waters said last month that Deutsche Bank had begun cooperating after two years of declining her requests for Trump's documents.

But Deutsche is only one of several banks Democratic lawmakers are targeting. Waters and Schiff also subpoenaed a wide array of records from JPMorgan Chase, Citigroup, Morgan Stanley, Bank of America, Wells Fargo, and Capital One, Royal Bank of Canada and Toronto Dominion Bank.

There is bipartisan support in the House for an investigation into dirty money flowing through the U.S. financial system from Russia. Republicans in both chambers have expressed interest in cracking down on Russian money laundering, including through a probe of Deutsche Bank.

But Democrats and Republicans are deeply divided over investigations into Trump's personal and business financial records, even if it relates to Russian money laundering.

Rep. Patrick McHenry (N.C.), the top Republican on the Financial Services Committee, asked Waters in a Wednesday letter to abandon what he called "partisan oversight" and focus on shared worries about illicit Russian financing.

"I am concerned that our committee is moving away from the shared goals of oversight towards bending to the political whims of others," McHenry wrote to Waters.

"It is our job to work across the aisle to safeguard the economy and the American people," McHenry added. He noted that a letter he sent to Deutsche Bank earlier this year requested documents related to "various money laundering schemes."

Waters may also explore Trump's finances beyond any business connections to Russia, focusing on allegations of bank, tax, and insurance fraud.

The New York Times reported in March that Trump allegedly misled Deutsche Bank about the true nature of his wealth and the value of his assets while applying for loans. The Times also documented Trump and his family's extensive history of tax schemes that critics say may have violated federal and state laws.

Trump's former attorney, Michael Cohen, made similar allegations to lawmakers.

Testifying before the House Oversight Committee in February, Cohen accused Trump of manipulating the value of his assets to slash his tax bill, inflate his insurance coverage and rank higher on the Forbes list of wealthiest people.

Cohen also said that the president used his personal foundation to pay an individual for bidding up the price of a portrait of Trump up for auction. Trump agreed to shut down the foundation in December after the New York attorney general sued the president, alleging the charity engaged in a "shocking pattern of illegality."

The new scrutiny on Trump's finances is only one of a number of fronts Democrats are pursuing with the Mueller over.

House Judiciary Chairman Jerrold Nadler (D-N.Y.) on Friday issued a subpoena for the Department of Justice to turn over the unredacted version of Mueller's report. And House Democrats lead by Ways and Means Chairman Richard Neal (D-Mass.) are fighting to obtain Trump's tax returns.

Rep. Elijah Cummings (D-Md.), chairman of the Oversight Committee, also requested ten years of Trump's financial records from accounting firm Mazars USA following Cohen's testimony.

Trump's legal team is already pushing back. Two of Trump's attorneys, Stefan Passantino and William Consovoy, asked the firm to defy the subpoena.

"It is no secret that the Democrat Party has decided to use its new House majority to launch a flood of investigations into the president's personal affairs in hopes of using anything they can find to damage him politically," Consovoy and Passantino wrote to Mazars, according to Politico.

"The chairman's attempt to assume for Congress the role of police, prosecutor, and judge is unconstitutional."

And Republicans, including McHenry and Rep. Jim Jordan (Ohio), the ranking member of the Oversight Committee, complain that Cummings is coordinating his efforts with Waters and Schiff. They see it as further proof that the probes are a partisan exercise.

That means documents from Mazars could be available to Waters, who called on Congress to boost scrutiny of Trump's finances after Cohen's testimony.

Democrats, though, are vowing to push ahead with their investigation.

"I think there's more than we know about," Waters said.

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