No recent president has run up against the idea of financial transparency quite like Donald Trump.
He’s fought the release of his tax returns and refused to divest his businesses, which he still frequents. His hotel down the street from the White House has become a favorite destination not just for him, but also for foreign diplomats and corporate executives with business before the government. And the business, run day to day by Trump’s sons, owes massive loans to a foreign bank that is regulated by the US government.
But Trump, while subject to a constitutional ban on accepting gifts from foreign or state governments, is technically exempt from federal conflict of interest laws. That is not true of another wealthy top White House official who also retains expansive business interests: Jared Kushner.
The president’s son-in-law and senior adviser, who has divested from some but not all of his own family real estate interests, is a prime example of how broadly interpreted ethics laws and vague disclosure requirements have failed to accommodate the arrival of public servants who don’t limit their financial and other entanglements while working for the government.
We got a fresh look at Kushner’s vast wealth and its many sources on Friday, when the White House released this year’s financial disclosure forms.
Like all White House employees, Kushner files annual ethics disclosures, which list positions he holds outside of government, assets with broad ranges of value, outside-of-government income and his liabilities. This year’s showed relatively little change in Kushner’s millions of dollars in income from investments and other holdings, most related to his family real estate company Kushner Companies, from what he’s reported in previous years.
Some of the things we knew about Kushner already are that he’s in charge of coming up with a Middle East peace plan, he’s been chummy with the Saudi crown prince the CIA thinks ordered the murder of a US-based journalist and he had trouble getting a security clearance.
But there is so very much we don’t know about him. According to a report in the Guardian, a real estate company called Cadre in which he has an interest got some money from Saudi Arabia through an offshore fund run by Goldman Sachs. Their report is based on two unnamed sources. CNN has not independently verified the report.
If true, does that mean Kushner can’t be involved in Middle East policy? Apparently not. The situation illustrates that the US laws meant to identify conflicts of interest don’t do much to prevent them, particularly when it comes to extremely rich people like Kushner with complicated financial root systems.
Cadre is among scores of LLCs in which Kushner reported owning a stake. In his filings, Kushner reported leaving his official positions with Cadre in 2017 and is not involved in day-to-day operations. According to the new disclosures, his ongoing investment, however, is valued at $25 million to $50 million, though he reported receiving no income from it in 2018.
Here’s another example having to do with Kushner’s interest in Cadre. Last November, the company pitched opportunities to take advantage of a tax break created by the 2017 tax overhaul that encourages real estate investment in low-income areas. Is it a conflict that Kushner’s wife, Ivanka Trump, a fellow White House adviser, pushed hard for the so-called “opportunity zone” tax break in the new tax law? She’s showed up at events promoting the investment opportunity. Watchdog groups asked the Justice Department to launch an investigation.
A spokesman for Kushner and Trump told CNN at the time that the watchdog request was “a politically motivated and meritless complaint.”
But federal law “prohibits Government employees from participating personally and substantially in official matters where they have a financial interest. In addition to their own interests, those of their spouse, minor child, general partner, and certain other persons and organizations are attributed to them,” according to the Office of Government Ethics, which certifies them for other executive branch employees like Kushner, though not for the President.
Like his father-in-law’s assets, Kushner’s wealth is spread out like roots from a tree, and hard to follow in the very general forms he and other administration officials are required to file each year. Trump has argued those forms are more detailed than tax returns, but ethics watchdogs say that for a candidate like Trump, both should be released, and that the laws should be updated.
“We have never seen an administration before with this level of issues with financial disclosures, both in number and scale,” said Jordan Libowitz, spokesman for the watchdog group Citizens for Responsibility and Ethics in Washington. “The tone is set at the top, and when you have a President that does not appear to care about ethics issues — especially around finances — it’s not surprising that you have an administration that doesn’t either.”
The White House did not respond to a request for comment.
Kushner’s time in public service has been fraught with concerns from the moment he was hired, when Department of Justice attorneys reasoned that an anti-nepotism law applied only to executive agencies and that the White House itself, overseeing the executive branch, was not an executive agency.
When career officials, perhaps concerned foreigners might seek leverage over Kushner, whose financial empire is highly leveraged, denied him security clearance, Trump ultimately pushed it through, according to a New York Times report — which he’s entitled to do, though the President and Ivanka Trump both denied the President was involved.
The Washington Post reported in 2018 that officials in four countries — the United Arab Emirates, China, Israel and Mexico — discussed ways of taking advantage of Kushner by exploiting his complicated business interests, though it’s not clear what came of those conversations.
Yet in May of 2017, Kushner’s family business, from which he has stepped away from day-to-day involvement, tried to drum up investors in China for a New Jersey real estate project. His sister name-dropped her brother and pointed to a US visa program for real estate investors. He took meetings at the White House with banks that later loaned his family business hundreds of millions of dollars. The meetings, according to all parties at the time, were not connected to the loans.
Kushner’s family company was also searching for financing to get rid of more than $1.4 billion in debt related to a Manhattan office building, and Kushner was actively involved in seeking foreign financing even after the presidential election in 2016, though before Trump took office, according to a New York Times report. Kushner’s company ultimately entered a long-term lease with the global real estate firm Brookfield to get out from under the debt it held on its marquee Manhattan property at 666 Fifth Ave.
We know all of this because of reporters and public interest groups, not because of government compliance forms.
While Trump has broken decades of precedent by refusing to release his tax returns, there is currently no expectation that White House staff will release their own tax records. But the financial disclosures raise their own questions about what the American people can and can’t know about their top government advisers — which is its own problem, since part of the job of government officials has traditionally been to avoid even the appearance of conflicts.
That’s why it’s also an issue that Ivanka Trump has continued to win trademarks from the Chinese government for her defunct businesses, just as her father was pursuing a trade agreement with Beijing.
Repeated updates and revisions and omissions identified and subsequently fixed in Kushner’s and Ivanka Trump’s ethics forms have also driven home the idea that they do not paint the full picture of his interests. Kushner also had to update his security clearance forms repeatedly to detail his meetings with foreign officials.
Kushner and Ivanka Trump are far from the only wealthy people serving in the Trump administration. And many have had trouble filling out their conflict of interest forms.
The Office of Government Ethics, which administers but does not audit the financial disclosures, does not audit the information in the filings, but it does verify there are no conflicts for certain officials. It said Commerce Secretary Wilbur Ross filed inaccurate reports when he retained ownership of bank stock he said he had sold.
Treasury Secretary Steven Mnuchin was found to have failed to comply with the rules because he transferred his interest in a Hollywood production company, StormChaser productions, to his now-wife, Louise Linton, whose assets are considered his for government filing purposes. The Office of Government Ethics had still not certified Mnuchin’s report when The Center for Public Integrity reported in March that Mnuchin was still owed money by the company. Mnuchin has said the forms were filed on time and were OK’d by an official at the Treasury Department.
Transportation Secretary Elaine Chao was found by the Wall Street Journal to have not sold stock she said she would sell. That seems innocent enough, except the company is a supplier of highway construction materials and Chao oversees federal funding for highway construction. The lack of sale was discovered in the financial disclosure filed by her husband, Senate Majority Leader Mitch McConnell.
Under current rules, there are essentially no consequences for these types of missteps.
Libowitz said Congress should fix that and expand the law to apply to the President and vice president as well — something Democrats pushed as part of an ethics and election overhaul proposal earlier this year, but which has not gotten a vote in the Senate — where McConnell runs the show. He’s made clear it won’t while he’s around.