The Trump Organization
The Trump Organization, Inc. is an American conglomerate. Privately owned by Donald Trump, it consists of most of Trump's business ventures and investments, with around 250 of its affiliates and subsidiaries using the Trump name. Donald Trump joined the organization in 1968, began leading it in 1971, renamed it around 1974, and handed off its leadership to his children in 2017 after he won the 2016 United States presidential election.
The Trump Organization, through its various constituent companies and partnerships, has or has had interests in real estate development, investing, brokerage, sales and marketing, and property management. Trump Organization entities own, operate, invest in, and develop hotels, residential real estate, resorts, residential towers, and golf courses in various countries.
They also operate or have operated in construction, hospitality, casinos, entertainment, book and magazine publishing, broadcast media, model management, retail, financial services, food and beverages, business education, online travel, commercial and private aviation, and beauty pageants. Trump Organization entities also own the New York television production company that produced the reality television franchise The Apprentice. Retail operations include or have included fashion apparel, jewelry and accessories, books, home furnishings, lighting products, bath textiles and accessories, bedding, home fragrance products, small leather goods, vodka, wine, barware, steaks, chocolate bars, and bottled spring water.
Because the Trump Organization’s financial statements and Donald Trump's personal tax returns are private, the company’s overall valuation is not publicly known, and published estimates have varied widely. Trump has released limited documentation supporting his public valuation claims. On several occasions, Trump has been accused of deliberately inflating the valuation of Trump Organization properties through aggressive lobbying of the media to bolster his perceived net worth.
By 2019, the Trump Organization was being scrutinized by New York investigators for possible financial fraud. In July 2021, New York prosecutors charged the organization with 10 counts in an alleged 15-year tax avoidance scheme. In November, The Washington Post reported that between 2011 and 2015 the organization presented several properties as being worth far more to potential lenders than to tax officials.
In August 2022, the organization's chief financial officer, Allen Weisselberg, pleaded guilty to committing more than a dozen felonies, including criminal tax fraud and grand larceny.
In September 2022, New York Attorney General Letitia James announced a civil lawsuit against the organization. A separate criminal case by the Manhattan district attorney was brought to trial in October; on December 6, the organization was convicted on 17 criminal charges.
In September 2023, the judge presiding over the civil suit ruled that Trump, his adult sons and the organization repeatedly committed fraud and ordered their New York business certificates canceled and their business entities sent into receivership for dissolution in what has been described by observers as a "corporate death penalty". Trump and the organization were ordered to pay nearly $355 million before interest in February 2024, with further restrictions placed on the Trump Organization's business certificates, and on both Trump and his adult sons' ability to do business in New York.
On March 25, 2024, the required payment was lowered to $175 million with a 10-day deadline. Trump posted the bond on April 1, 2024, thus ensuring that his assets and properties could not be seized until at least the time his appeals finished.
History
Background
Donald Trump's grandparents Frederick Trump and Elizabeth Christ Trump were a German immigrant couple who moved to the borough of Queens in 1907. Frederick began developing real estate there. He died during the "Spanish flu" pandemic in 1918, leaving an estate valued at $31,359.Elizabeth carried on in the real estate business after her husband's death. She had contractors build houses on the empty lots Frederick had owned, sold the houses, and earned income off the mortgages she provided to buyers.
Her middle child, Donald Trump's father Fred Trump, entered the carpentry trade after graduating high school in 1923. Fred would later say he completed his first single-family home in 1924, but other sources date his start as a builder to 1927. In that year, Fred reached the age of majority, and "E. Trump & Son", a name Elizabeth had used in ads since 1921, was formally incorporated.
In 1929, with Fred at the helm, the company began developing pricier houses in nearby Jamaica Estates. In the deepening depression, the company went out of business. In 1933 Fred opened a supermarket, called "Trump Market", then quickly sold it and returned to the real estate business. Around this same time, Fred Trump and a partner acquired the mortgage-servicing subsidiary of Brooklyn's J. Lehrenkrauss & Co., which had gone bankrupt and subsequently been broken up amid charges of fraud. This gave Trump access to the titles of many properties nearing foreclosure, which he bought at low cost and sold for a profit. He quickly became known as one of New York City's most successful young businessmen. In 1935, the company moved to Brooklyn, where, in addition to Queens, Trump was a prolific builder of single-family homes.
During World War II, Trump constructed apartments and temporary housing for military personnel in Virginia and Pennsylvania. In 1944, he shifted his focus back to Brooklyn and began planning to develop large apartment buildings. He opened the 1,344-unit Shore Haven complex in 1949, followed by Beach Haven in 1950 and Trump Village in 1964.
Leadership under Donald Trump
worked for his father's business while attending the University of Pennsylvania, and in 1968 officially joined the company. In the early 1970s, Fred gave himself the title chairman of the board and named Donald president of the company. Around 1973, Donald began referring to the business as the Trump Organization. The business had previously been referred to on occasion as the Fred C. Trump Organization, the Fred Trump Organization, or the Trump Organization, but had not had a single formal name.Civil rights suit
In 1973, the U.S. Department of Justice's Civil Rights Division filed a civil rights suit against the Trump Organization charging them for violating the 1968 Fair Housing Act by refusing to rent to Black people. The National Urban League had sent Black and White testers to apply for apartments in Trump-owned complexes. The White testers got the apartments, whereas the Black testers did not. According to court records, four superintendents or rental agents reported that applications sent to the central office for acceptance or rejection were coded by race.A 1979 Village Voice article quoted a rental agent who said Fred Trump had instructed him not to rent to Black people and to encourage existing Black tenants to leave. In 1975, a consent decree described by the head of DOJ's housing division as "one of the most far-reaching ever negotiated" required Trump to advertise vacancies in minority papers and list vacancies with the Urban League. The Justice Department subsequently stated that continuing "racially discriminatory conduct by Trump agents has occurred with such frequency that it has created a substantial impediment to the full enjoyment of equal opportunity."
Manhattan developments and more
Donald Trump focused his efforts on major development projects in Manhattan, including the renovation of the Commodore Hotel, in partnership with Hyatt, as the Grand Hyatt New York ; the construction of Trump Tower in partnership with The Equitable ; and the development of Trump Plaza. He also opened three casino hotels in Atlantic City, New Jersey: Trump Plaza, Trump Castle, and Trump Taj Mahal.In 1989, New York State officials ordered the Grand Hyatt New York, a hotel owned at the time by the Trump Organization and the Hyatt Corporation, to pay New York City $2.9 million in rent that had been withheld by the hotel in 1986 due to "unusual" accounting changes approved by Donald Trump. An investigation by New York City auditors noted that the hotel was missing basic financial records and found the hotel was using procedures that violated generally accepted accounting principles.
Amid a real estate slump in 1990, the Trump Organization approached a financial crisis and was believed to be on the brink of collapse, with Donald Trump and his companies owing 72 banks a total of $4 billion, of which Trump personally guaranteed $800 million. Trump hired Stephen Bollenbach as the company's first chief financial officer, while Allen Weisselberg continued to serve under him as controller. Trump spent the following years renegotiating his debts, and gave up some properties, including the Trump Shuttle airline and a stake in the Plaza Hotel in Manhattan. Bollenbach left the company in 1992. In 1995, Trump took another major step towards financial stability, launching a publicly traded company for the Trump casinos, Trump Hotels & Casino Resorts. By 1996, Trump was widely considered to be making a comeback. The casino company did not fare as well, however, and Trump eventually lost his stake in the company to bankruptcy.
In 1997, Fred Trump transferred ownership of the bulk of his portfolio of apartment buildings to his four surviving children, submitting tax returns claiming the properties were worth $41.4 million. Fred died in 1999. In 2004, the four siblings sold the apartments for $737.9 million to a group led by Rubie Schron, marking the family's exit from ownership of their father's business.
Financing
During the property boom of the 1980s, Trump acquired numerous properties and by 1990 owed $4 billion to 72 banks. When the market entered a slump in 1990 that placed the organization at risk of collapse, Trump and his lenders acted to restructure his debts, although they disagree on who identified the problem and initiated negotiations. The resulting restructuring required his banks to forgive some of Trump's debt. Trump's casinos later entered bankruptcies in which his bondholders took deep losses. After these incidents, Trump had difficulty borrowing new money from most mainstream financial institutions.Deutsche Bank, which did not have a significant presence on Wall Street during the 1980s, expanded rapidly in the U.S. during the 1990s. Trump obtained a loan of approximately $425 million from them in 1998. In the process of its rapid expansion, the bank engaged in numerous questionable practices, including manipulating currencies and interest rates, laundering billions of dollars for Russian oligarchs and misleading international bank regulators. The bank was fined $630 million in 2017 for facilitating a $10 billion Russian money laundering scheme. The bank provided Trump with a variety of services including financial instruments designed to shield him from risks and outside scrutiny, and helped connect Trump to wealthy clients who were interested in Western real estate. During the 2000s and 2010s, Trump borrowed $2 billion from the bank, owing it about $360 million in 2016.
From 2000 on, the Trump Organization held 50% of TD Trump Deutschland AG, a corporate venture with a German company, planning to build a skyscraper named "Trump Tower Europe" in Frankfurt, Berlin or Stuttgart, but allegedly never paid the full amount of their €2 million share. At least three lawsuits followed and the company was disestablished in 2005.
By mid-2016, it was alleged that the organization, specifically under the leadership of Donald Trump, had a history of not paying for services rendered. Several hundred contractors or workers for the organization have filed lawsuits or liens saying they were not paid for their work, and others say they had to settle for cents on the dollar.
Trump's eldest son, Donald Jr., was quoted as saying at a 2008 New York real estate conference, "In terms of high-end product influx into the US, Russians make up a pretty disproportionate cross-section of a lot of our assets ... We see a lot of money pouring in from Russia." James Dodson, a golf magazine writer, said that during a 2014 golf game, he asked Trump's son Eric how the organization was funding its golf resort acquisitions, to which Trump responded, "Well, we don't rely on American banks. We have all the funding we need out of Russia." Eric Trump later denied making the statement, although some of the company's financing apparently involves Russian money. The organization has many projects in foreign nations, leading some to point to a conflict of interest with foreign nations as a result of Donald Trump's position as the president of the United States.