With Manhattan District Attorney Cyrus Vance expected to indict the Trump Organization for financial malfeasance, possibly as soon as this week, former federal prosecutors have taken to the cable airwaves and social media to predict the downfall of the former president’s family business. Yesterday was the deadline for Trump’s lawyers to present evidence that could help his organization avoid criminal charges.
“I can’t underscore enough how devastating an indictment would be to the Trump Org,” tweeted Daniel Goldman, a former assistant U.S. attorney in the Southern District of New York who prosecuted mafia families and insider traders. “Every lender would call their loans and no way Trump Org can pay them all, likely leading to bankruptcy.”
“That would be almost a death blow to the Trump Organization,” Mr. Goldman told MSNBC’s Nicolle Wallace. “No bank will ever do business with an indicted company.”
A spokesperson for the Trump Organization did not respond to a request for comment.
The Trump Organization, which includes the president’s hotels, resorts, golf clubs and real estate holdings, is at least $1 billion in debt, according to a bombshell Forbes investigation from October 2020. About two thirds of that debt load is carried across Trump’s real estate portfolio in New York and San Francisco.
Another roughly $370 million in debt is spread between three of Trump’s hotels. The company owes Deutsche Bank a reported $170 million for the Trump International Hotel in Washington D.C; $125 million for Trump National Doral in Miami; and more than $75 million for Trump International Hotel & Tower in Chicago.
Trump’s hotel management and licensing business is down $24 million since 2019, Forbes reported last fall, while his golf resorts in Miami and Europe are down another $120 million.
Former acting U.S. Solicitor General Neal Katyal told MSNBC’s Ari Melber yesterday that he expected multiple indictments against both the Trump Organization and its employees. “Anyone who knows anything about criminal prosecutions, you don’t just run in and charge the big fish right away. You build your case, slowly and methodically,” he said. “And even these smaller indictments could really undermine the Trump Organization’s financing. Many times, loan agreements say that the loan can be called if the organization is indicted.”
Richard Signorelli, another former prosecutor with the Southern District of New York, echoed that theory on Twitter, speculating that an indictment of the Trump Organization would “likely result in its destruction as a viable entity.”
“For Donald Trump’s businesses, just getting charged could be devastating, even before any potential guilty verdict,” Paul Butler, a professor at Georgetown Law, told MSNBC’s Ayman Mohyeldin. Butler is a former federal prosecutor with the U.S. Department of Justice, where his specialty was public corruption.
“When an organization with a lot of debt gets charged with a crime, banks can call the loans. They can require all the outstanding debt to be paid back immediately,” said Butler. “If the Trump Organization doesn’t have enough assets to pay off its loans, it would have to consider bankruptcy. And so this could be the beginning of the end of Donald Trump’s business empire.”