Donald Trump campaigned for president as a savvy billionaire who would apply his business knowledge to improving the U.S. economy, cutting taxes for Americans and negotiating better trade deals.
But there is a problem with his vast network of businesses under the Trump Organization, including foreign investments and debts; could create record conflicts of interest when he takes the oath of office as U.S. president in January, so say government ethics experts said.
Federal law does not stop the president from being involved in private business while in office, even though members of Congress and lower-ranking executive branch officials are subject to strict conflict-of-interest rules. “There are no legal restrictions, no legal requirements,” said Noah Bookbinder, the executive director of the nonpartisan watchdog Citizens for Responsibility and Ethics in Washington.
But the majority of presidents in recent decades have voluntarily placed their personal assets, including property and financial holdings, in blind trusts overseen by independent advisers to avoid any appearance of problems, experts said. Under a blind trust, the owner has no say or knowledge in how the assets are managed.
Trump’s businesses include licensing deals, hotels and golf courses around the world. During the campaign, he filed a 104-page financial disclosure statement, as required by law that showed he had financial interests in more than 500 entities with names like China Trademark LLC and DT Marks Qatar LLC but had few details.
While many wealthy men have been president, no one has risen to the White House with such a complex array of assets.
Trump’s spokeswoman did not respond to a request for comment on how he planned to manage his businesses while he was in the White House.
While campaigning, Trump said he would transfer day-to-day operations to his children. But experts in government ethics said that would do little to shield Trump but now he is talking two of his children serving on his cabinet.
Turning operations to his children does get around giving him the time to be the president, but it doesn’t do anything to clear the conflicts of interest,” said Kenneth Gross, a Washington, D.C.-based lawyer who has counseled high-ranking political appointees on ethics laws. “His family’s interests, his children’s interests, are co-existent with his own.”
The nature of Trump’s businesses, Gross said, makes a blind trust all but meaningless – even if he were inclined to shift control of his empire from his family, an idea he has rejected.
Gross advised Michael Bloomberg, a New York billionaire businessman, when he became mayor of New York City. Bloomberg stepped away from day-to-day operations at his data and media company, Bloomberg LP, and donated all terminals that were used by city agencies to avoid any impression of profiting from public funds.
Some of the possible problems for the Republican president-elect are clear. One of his latest ventures, a luxury hotel in Washington just blocks from the White House, leases its property from the U.S. government, putting Trump on both sides of any landlord-tenant disputes.
Others are muddy still. Trump has licensing deals and assorted real estate holdings in many countries that could profit from foreign government subsidies or tax breaks. Companies in which he holds an interest owe hundreds of millions of dollars in debt to foreign banks that are subject to U.S. regulations, such as Deutsche Bank and Bank of China, according to the New York Times and the Wall Street Journal.
His properties include hotels in countries like:
- South Korea.
Also golf courses in:
- United Arab Emirates;
Conflicts of interest could grow from countries trying to stimulus policies by doing business with any of his companies or even his children. His daughter Ivanka has a line of fashion products, which along with other Trump-branded items are made in countries like China.
Trump has accused China of currency manipulation and threatened to put tariffs on its imports.
GOVERNMENT REVIEW OF TRUMP INC DEALS
Trump’s opponent, Democratic nominee Hillary Clinton, received problems over the Clinton Foundation, the charity founded by her husband, former President Bill Clinton. That was in spite of an ethics agreement that Hillary Clinton signed in 2009 in order to become Obama’s secretary state that was planned to guarantee donors could not sway U.S. foreign policy. Under the deal, the State Department was allowed to review any new contributions from foreign governments.
Unlike Clinton, however, Trump is not answerable to anyone else as president. And he has already shown himself more than willing to haze the lines between campaigning and marketing, holding events at his own properties and hyping his companies during campaign speeches. A blind trust would do very little to help Trump given the properties that are high-profile and have his name.
“You can’t put a golf course in a blind trust; it would be pointless,” said Robert Kelner, a Washington lawyer and an expert on government ethics. “The idea behind a blind trust is that it’s blind – you don’t know what assets are held.”
The only solution, experts said, would be for Trump to sell off his businesses and place the proceeds in a blind trust.
With no legal requirements, Trump’s actions as president are only subject to the will of the voters or to built-in checks and balances like Congressional oversight. It is quite possible that he will do nothing – trying to run government and businesses at the same time.
The potential for conflicts is worsened by the lack of publicly known details about Trump’s holdings. Even his net worth is unclear. Trump has boasted of more than $10 billion in wealth, but financial magazines have valued his fortune at less than half that. He has refused to release his tax returns, breaking with decades of presidential campaign tradition, and legal experts said he is under no obligation to do so as president.
His dealings with foreign governments are largely unknown. He will likely face scrutiny of policy decisions that affect countries where he is known to have business interests, said Bookbinder.