Things have been a little bumpy lately for former Trump campaign manager Paul J. Manafort, who is currently under multiple investigations by the FBI, the Treasury, and the House and Senate select committees on intelligence for his various “Russian entanglements.” But a new report from WNYC’s Ilya Marritz and Andrea Bernstein, based on public documents compiled by Julian Russo and Matthew Termine at 377union.com suggests that Manafort may have some questionable entanglements closer to home.
Over the last 11 years, WNYC says, Manafort has “engaged in a series of puzzling real estate deals,” which, taken together, “fit a pattern used in money laundering,” according to experts. This, of course, isn’t enough to confirm that the deals were used in money laundering, but it does “raise questions” about what, exactly, he was up to during a time when WNYC notes he was also “consulting for business and political leaders in the former Soviet Union.”
Here, WNYC breaks down the facts we know to be true:
Between 2006 and 2013, Manafort bought three homes in New York City, paying the full amount each time, so there was no mortgage.
Then, between April 2015 and January 2017—a time span that included his service with the Trump campaign—Manafort borrowed about $12 million against those three New York City homes: one in Trump Tower, one in Soho, and one in Carroll Gardens, Brooklyn.
So, the pattern is this: Buy a home in an all-cash deal using a shell company, transfer the properties into his own name for no money, take out huge mortgages against them.
This is not necessarily shady. Buying properties using LLCs isn’t uncommon in New York, WNYC points out. Neither is borrowing against those properties. And until now—thanks to Manafort’s other entanglements—there’s “no indication” that these real estate dealings have raised any eyebrows. (Manafort’s official stance: “My investments in real estate are personal and all reflect arm's-length transactions,” according to an statement emailed to WNYC.)
But while Manafort’s dealings could turn out to be totally above board, the pattern is enough for nine current and former law enforcement and real estate experts who spoke with WNYC to agree that the deals “merit scrutiny.”
WNYC details the sales of all three properties, but let’s use the Trump Tower apartment as a case study. Manafort, a longtime GOP lobbyist, worked “for clients who wanted something from the politicians he helped elect”—politicians like Ferdinand Marcos of the Philippines and Mobutu Sese Seko of Zaire. Then, in the 2000s, Manafort joined forces with partner Rick Davis to form a new firm, David Manafort. In 2005, they began “pursuing work” with Russian oligarch Oleg Deripaska. According to an investigative report from the AP, the pair pitched a plan to nudge U.S. news and politics in a pro-Putin direction, and, in 2006, they signed a $10 million annual contract with Deripaska.
But here, the plot thickens: Also in 2006, a shell company called “John Hannah LLC” purchased apartment 43-G in Trump Tower for $3.675 million. (“John Hannah” is a combination of Manafort’s and Davis’s middle names.) The LLC shared its Virginia address with Davis Manafort, as well as a mysterious Delaware corporation, LOAV, Ltd.—as WNYC notes, there are “virtually no public records.” One thing we do know about LOAV, Ltd., though, is that it—and not Davis Manafort—signed the contract with Deripaska.
So, to recap, there are three companies here tracing back to Manafort: Davis Manafort, John Hannah LLC, and LOAV, Ltd. A lawyer for John Hannah signed the deed on the Trump Tower apartment, but Manafort’s actual name did not become associated with the property until March 2015, WNYC reports. On March 5, 2015—three months before Donald Trump announced his candidacy—John Hannah LLC transferred the apartment to Manafort for $0. A month later, Manafort borrowed $3 million against the condo, according to public records obtained by WNYC.
That’s more or less the same story for the Soho place and the townhouse in Carroll Gardens, only with different LLCs.
And there’s another weird thing: In the case of the Carroll Gardens brownstone, Manafort (as MC Brooklyn Holdings) bought the property for $3 million, but then, after transferring it to his own name, took on home loans totaling $6.8 million from Federal Savings Bank. According to Zillow, though, the house is still only worth $4.5 to $5 million. David Reiss, a professor of real estate law at Brooklyn College, told WNYC that it’s extremely rare for a home loan to exceed the value of the property.
Federal Savings Bank President Steve Calk declined to discuss the specifics of the loan. Coincidentally, Calk was an early Trump fundraiser and now serves as one of his economic advisers.
What does all this mean? It’s not at all clear, says WNYC. It isn’t clear where Manafort got the money in the first place, and it isn’t clear why he borrowed $12 million against the three properties. It’s possible everything is above board, but experts seem to agree that at the very least, this is worth adding to Manafort’s long list of investigations.