Deutsche Bank has launched an investigation into the longtime banker of president Donald Trump and son-in-law Jared Kushner for her purchase of a New York condo from a company partly owned by Kushner, according to two news reports.
The connection appeared in personal financial revelation filed previously by Kushner and wife Ivanka Trump, who hold jobs as White House senior advisers.
Banker Rosemary Vrablic and two colleagues bought an apartment on Park Avenue in Manhattan for about $1.5 million in 2013 from Bergel 715 Associates, The New York Times first reported Sunday. It was sold two years later for $1.85 million.
The first daughter and Kushner received $1 million to $5 million from Bergel 715 in 2019, according to the couple’s required financial revelations, which they filed Friday. It was the first time Bergel had emerged in their filings.
A source who knows the business arrangement told The Times that Kushner owns a stake in Bergel, and did so when Vrablic bought the condo. But the money reported from Bergel was not connected to the banker’s purchase, according to the source.
The Deutsche Bank investigation will prove whether if Vrablic acted amiss by buying the condo, according to The Hill. It’s usually against policy at banks for employees to do business other than banking with clients to avoid quarrel of interest, the Times noted.
“The bank will closely examine the information that came to light on Friday and the [facts] from 2013,” bank spokesman Daniel Hunter said in a statement after learning of the Kushner linked to the condo.
Kushner and Donald Trump were clients of Vrablic when the banker purchased the condo. Kushner introduced his father-in-law to her in 2011 when president Donald Trump was having troubles finding a bank that would loan him money after his repeated bankruptcies and loan defaults, including one to Deutsche Bank, the Times noted.
By 2013, the men had received about $190 million in Deutsche Bank loans with Vrablic’s assistance and hundreds of millions after that, according to the Times.
Trump borrowed $175 million for his Trump National Doral golf resort in Florida, and for the Trump International Hotel & Tower in Chicago in 2012. The bank later funded the Trump International Hotel in Washington, the Times reported.
Deutsche Bank is Trump’s biggest creditor. It has lended the Trump Organization some $2 billion since 1998, and there are currently an approximately $350 million in loans outstanding, according to the Times. The loans are allegedly backed by a personal guarantee from Trump himself.
Christopher Smith, the general counsel for Kushner’s family firm Kushner Companies, told The Hill in a statement that “Kushner is not the managing partner of that entity and has no involvement with the sales of the apartments.”
It’s not vividly clear how large a stake Kushner holds in the company.
Vrablic was unavailable for a comment.
Deutsche Bank was penalized a total of $630 million in 2017 in the U.S. and Britain over a $10 billion Russian money-laundering scheme. It was recently hit with a $150 million penalty for the bank’s lack of oversight in dealings with the late sex offender Jeffrey Epstein.
The U.S. Department of Justice last year opened another investigation into bank compliance with rules avoid money laundering. The investigation included a review of suspicious activity, including some connected to Kushner, sources told the Times. In the middle of the investigation the president’s Trump Organization was allegedly pressing to delay its bank loan payments.
The sticky situation emphasized the great power of Trump as president to negotiate a deal for his business, particularly with a bank under investigation by his own administration.
David Enrich, a Times business reporter who recently wrote a book on Deutsche Bank, “Dark Towers,” told NPR that the bank has been “worried” about a situation like this.
Bank officials are now “forced to choose between doing what seems like it’s financially right for the bank and for its regulators, versus doing what’s right to protect the relationship with someone who has the ability to inflict enormous damage on the institution if he is so inclined,” Enrich explained.
The scenario is the “absolute nightmare that someone (ahem) warned about” when Trump took office, Walter Shaub, the former head of the U.S. Office of Government Ethics under both Barack Obama and Trump, tweeted.
Trump did not relieve from his businesses when he moved into the White House as other presidents have done to prevent conflicts of interest.