Aftershocks from Michael Cohen’s testimony before the House Oversight Committee continue to rattle the Trump presidency, as last night Rachel Maddow dug into Donald Trump’s extreme overvaluation of a Trump property in Bedford, NY based on documents Cohen presented to Congress. In short, Trump tried to secure a cash loan from Deutsche Bank in 2012 by claiming the value of the property to be $291 million. That’s the same property he claimed was worth $18 million in 2013, and in the range of $25 million to $50 million according to a 2018 financial disclosure. Trump originally purchased the Bedford property for $7.5 million in 1995.
The $291 million Bedford property value inflation story is one of many examples of Trump’s fraud or attempted fraud, and the barrage of similar stories tends to have a numbing effect. But this is huge, because what the story does is remove any reasonable doubt that Trump, Cohen, and Paul Manafort are all guilty of the exact same type of simpleminded fraud. It’s not a complex idea to hype value to secure loans; for example, it was a big factor in the mortgage lending crisis that led to the Great Recession a decade ago. The obvious difference is the conspiratorial nature and much higher stakes of Trump’s fraudulent deceit that the same property valued at $18 million 2013 was worth $291 million in 2012 on loan application papers sent to Deutsche Bank.
That’s why Manafort and Cohen were caught: it doesn’t take a genius criminal mind to pretend that something you have is worth more than it is on a loan application, and these people are no geniuses. In the pre-2008 housing world, lenders were flush with cash and practically giving it away, mitigating the fraudulent behavior of people who inflated their incomes, etc. to become homeowners. That’s irresponsible on the part of those who got loans they ultimately couldn’t afford, but understandable. What Cohen and Manafort are going to prison for, and Donald Trump, along with at least one of his clueless sons, will certainly be prosecuted for, is all about intent to defraud on an enormous scale.
The revelation also guarantees that Trump Organization CFO Allen Weisselberg will testify to Congress. When that happens, Republicans will have a hard time attacking Weisselberg’s character in order to obscure his evidence-based testimony like they tried with Cohen. It’s one thing to learn about even a huge crime like the Bedford property inflation scam from a convicted felon and notorious schemer like Cohen, even when he brings evidence. It’s another to hear it from Weisselberg, who hasn’t been convicted of anything because he’s been cooperating with investigators for almost a year.
Weisselberg also cultivated anonymity over the years. And, unlike Cohen, who only worked for Trump for a dozen years, Weisselberg went to work for Fred Trump in 1970 and inherited The Donald. Weisselberg knows everything about how deep and far-flung Trump Organization fraud reaches, and that’s why his testimony is when the real earthquake hits.