As the 2020 presidential campaign hurtles toward a close, questions remain about a last-minute $10 million lifeline Trump threw to his previous campaign, the one that catapulted him into the presidency.
Speculation has swirled around the source of that money, with one report suggesting Trump might have gotten the funds from a casino magnate looking for help building a bullet train from Los Angeles to Las Vegas. Another report pointed to the possibility of a shadowy foreign donation funneled through an Egyptian bank.
But nothing is known about whether the $10 million loan — which the campaign however appears to have reported as a contribution — was ever repaid, who might have repaid it, and whether it would even be legal to do so. The very existence of the loan was a closely guarded secret until this month, when a newly unsealed document indicated that Trump’s closest advisers convinced him to let the campaign borrow the money from him after he refused to just write a check.
While the Trump campaign didn’t respond to requests for comment on this story, the president and his advisers have always maintained his finances are above board. But now, with his 2020 run under fire for a lack of financial transparency, and once again short on cash, significant questions remain about the mysterious 4-year-old loan and what it might say about the frothy final days of the 2016 election.
“If this was a loan, it should have been reported as a loan,” said Brendan Fischer, director of federal reform at the Campaign Legal Center, which monitors money in politics. If it were a loan, he said, the transaction should also have been recorded on financial disclosures Trump was required to file, along with details of how the money was repaid. “If there is some off-the-books mechanism that Trump is using to get repaid for his loans, that should be disclosed,” Fischer added.
AN URGENT REQUEST
It was late in the second presidential debate, and Trump was on the back foot. In the wake of the Access Hollywood tape, released just three days earlier, he was forced to defend what he referred to as “locker room talk,” while separately acknowledging that he did not pay income tax. But he found something to brag about when it came to campaign financing.
Unlike Hillary Clinton, he said, he couldn’t be bought by powerful corporate interests, because he was using his own money rather than taking big donations.
“By the time it’s finished, I’ll have more than $100 million invested,” he claimed, adding that the campaign by that point was “pretty much self-funding.”
Federal Election Commission data, however, shows that Trump had by then put up barely half that amount — $56.1 million. Records show that the campaign would return more than $12 million through payments for use of Trump’s hotels, restaurants, golf resorts, and an airline he owns, and also through reimbursements to his children for their travel during the campaign.
Meanwhile, the campaign had been vastly outspent by Clinton, who was leading in most opinion polls. In the face of so many challenges, it was proving increasingly difficult for Trump’s campaign to raise funds, and it was spending money far faster than it could raise it. By the third debate, on Oct. 19, his war chest had dwindled to just $16 million, less than half of what it had been at the beginning of the month. That day, Reuters released data suggesting that Clinton had a 95% chance of winning the electoral college.
Despite all that, a few hours before the debate, Steve Bannon, the campaign’s CEO, said Trump was confident: “Right now he really, really thinks he’s going to win.”
But behind the scenes, Bannon would later tell the FBI, the campaign was imploding.
Not long after the debate, Bannon, Jeff DeWit, the campaign’s chief operating officer; Brad Parscale, its digital media director; and Jared Kushner, Trump’s son-in-law, put their heads together to discuss finances, according to the FBI’s account of a 2018 interview with Bannon that BuzzFeed News published this month. Bannon told investigators that it became apparent that if the campaign was going to make it over the finish line, Trump was going to have to write a very big check.
Kushner said “that was not going to happen,” according to the account of Bannon’s interview. Trump liked to back winners, Bannon recalled Kushner saying, adding that his father-in-law was “a probability guy” who “was not a guy who while six to eight points down, was going to write $25 million checks.”
Bannon said they figured that $10 million would at least allow them to get out the final television advertisement they had planned.
That’s when, Bannon said, Steve Mnuchin, the former Goldman Sachs banker who was then Trump’s national finance chair, put forward a novel solution. In a meeting in the 26th-floor offices of the Trump Tower in Manhattan, Mnuchin proposed that Trump put forward $10 million immediately. The campaign could repay him down the line with the small donations that were still coming in. It would be structured like a loan, complete with paperwork like a term sheet. According to the FBI document, “Mnuchin called it a cash advance.”
Federal records show that Trump had made his first loan to the campaign in April 2015, several months before he formally declared his candidacy. Eventually, he loaned a total of $47.5 million to the effort. But in July 2016, at almost the same time he accepted the Republican nomination for president, he formally forgave all those previous loans, converting them to outright donations.
At $10 million, the new loan Trump was being asked to make would be the single largest chunk of money he’d put into his campaign, and, based on Bannon’s recollections, the candidate was far from convinced.
Although federal campaign finance laws put strict limits on how much individuals can donate to politicians, there are no such caps for candidates who choose to donate to their own campaigns. By the time billionaire Michael Bloomberg dropped out of the Democratic primary this past March, he had contributed nearly $900 million of his own money to his campaign, putting him atop a long list of self-funded efforts that fell short.
Candidates are also free to loan money to their campaigns, and many do. But there are more stringent rules about those transactions when it comes to repayment, particularly for loans that come late in the campaign cycle.
Campaign finance law states that such loans may be repaid only with campaign contributions made on or before Election Day, and that any contributions coming in after the election can be used to pay only up to $250,000 of the loan. Anything beyond that is considered a donation.
According to Bannon, he, Mnuchin, and Kushner had a five-hour conversation with Trump that started in the Trump Tower and continued onto the Boeing 757, dubbed “Trump Force One,” that he flew to campaign stops. “They kept working on Trump until he couldn’t take it anymore,” investigators said that Bannon told them. Finally Trump agreed to the plan.
Mnuchin had prepared the documents in advance and pulled them out as soon as he got a yes — including a term sheet and information on how to wire the money into the campaign’s accounts, the FBI document says. Last week, Treasury Secretary Steven Mnuchin acknowledged the loan had been made and the fact that he helped convince Trump to execute it, but provided no other details and did not respond to a request for comment.
“Trump was convinced the cash would be there,” the FBI document continues. “Trump understood the logic of it.”
During the final 20 days of a race for federal office, campaigns are required to file notice of any contributions or other deposits of $1,000 or more within 48 hours of receiving the funds. So on Oct. 28, 2016, just 11 days before the election, the $10 million was duly reported to the Federal Election Commission — but not as a loan. It was reported as a “candidate contribution.”
To Fischer, of the Campaign Law Center, the idea that Trump would write a large check, sign documents characterizing it as a loan, then almost immediately recast it as a donation, “just doesn’t add up.”
One of the people present during the negotiations with Trump who agreed to speak to BuzzFeed News only on condition of anonymity said it wasn’t until after the election that Trump was persuaded to forgive the loan. (According to this source, his advisers told him “it would look bad” to insist on repayment.)
If so, Trump waited at least two weeks to reverse course and donate the money, which would mean that at the time the campaign reported it, the $10 million donation should still have been characterized as a loan.
On the same day the money was reported to election officials, Trump appeared on Fox News and mentioned the $10 million. When asked whether he’d come through with his pledge to put a total of $100 million into the race, he hedged. “We’ll see what’s needed,” he said. Other than some in-kind contributions for rent and payroll, records show Trump did not donate again, meaning his total contributions for the cycle fell about $33 million short of his pledge.
Bannon, who was indicted on fraud and money laundering charges in August, did not respond to requests for comment on the loan, and the White House referred requests to the campaign, which did not respond to multiple messages seeking clarification.
Meanwhile, the most recent filings from the 2020 race show that Trump — once again lagging in the polls — has taken a different approach this time around. Other than a $5,000 donation to his own super PAC in October 2017, he hasn’t donated or loaned a dime.
“I would raise a billion dollars in one day, if I wanted to,” said Trump, campaigning Monday in Prescott, Arizona. “I don’t want to do that, I don't want to do it. I put in a lot of money when I ran originally, I put in a lot of money into this campaign, my primary campaign. And I never thought it was appreciated. They never gave me credit for it.” ●
Ken Bensinger is an investigative reporter for BuzzFeed News and is based in Los Angeles. He is the author of "Red Card," on the FIFA scandal. His DMs are open.
Contact Ken Bensinger at email@example.com.
Kadia Goba is a political reporter for BuzzFeed News and is based in Washington, DC.
Contact Kadia Goba at firstname.lastname@example.org.
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