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Conspiracy in Search of a Theory (Part 1): Epstein/Trump/Deutsche Bank/Russia

July 27, 2020

epsteinDB

Everyone loves a good conspiracy theory, but for that you need an actual theory to explain how all the pieces fit together. Few can equal the ones swirling around erstwhile Trump pal and convicted pedophile Jeffrey Epstein, especially after his alleged suicide by hanging in a Manhattan prison cell under suspicious circumstances. So far, when it comes to linking up Epstein to Trump to Deutsche Bank to Russia, we have lots of shocking data points and some partial connections, but we still don’t know how or if all these rabbit holes connect. Clearly, there’s a lot more to the story if it is ever fully told.

The Epstein/Trump/Deutsche Bank/Russia (ETDBR) nexus is such a complicated jumble that it’s hard to know where to start. But let’s go over some of the major pieces one by one, starting with the most recent. Because there is just so much material, I am making this a multipart post. I have provided links to sources for what follows.

The Attack on Judge Esther Salas and Her Family

On July 19, a man showed up at the home of federal judge Esther Salas in North Brunswick, NJ. He shot and killed her son and wounded her husband; the judge was unharmed. Hours later, NY state police found the body of Roy Den Hollander, an apparent suicide, near Liberty, NY, and law enforcement quickly attributed the Salas family shooting to him. Den Hollander, a Trump-supporting and violently anti- feminist 73 year old lawyer with terminal melanoma, apparently had a grudge against Judge Salas because he believed she was moving too slow on a case he had in her court. He left behind 2,000+ pages of writings on the Internet Archive expressing his views on this and other subjects. Two days later, the FBI linked him to a similar killing of a men’s-rights lawyer in California on June 11. Additional information about Den Hollander released by law enforcement leaves little doubt that he committed both murders.

How does any of this connect with ETDR? Two things:

First, just four days before the attack, Judge Salas had been assigned a civil  lawsuit case brought by investors that involves Deutsche Bank’s handling of financial matters relating to Jeffrey Epstein.

Second, there is a Russia connection. According to NBC News, Den Hollander spent considerable time during the 1990s in Russia, where he reportedly ran a detective agency. He also claimed to have given a speech to the Kremlin in 1993, which he posted on his website. For at least some of that time, certainly from 1999-2000, he reportedly did investigations in Russia for Kroll Associates, for whom he “managed and upgraded…security and intelligence.” According to the company’s Wikipedia page, Kroll was hired by the Yeltsin government in the 1992 to help track down vast sums of money being laundered and sent out of the country through places like Cyprus. [nota bene] The semi-official Russian organ RT calls Kroll a “shadowy firm with ties to US and Israeli intelligence” and adds that “Kroll’s ranks were stacked with former agents of the CIA, FBI, Mossad, and MI6.” The RT story definitely hinted that the official story might not be the real one, but then one must consider the source.

Intriguingly, Robert Maxwell, the British newspaper mogul father of Epstein’s dearest friend and alleged procuress Ghislaine Maxwell, met with Jules Kroll (head of Kroll Associates) two weeks before Maxwell’s mysterious death while on his yacht off the Canary Islands in November 1991. According to participants quoted in a Vanity Fair article published in March 1992, Maxwell was convinced that his enemies were out to destroy him, and he wanted Kroll to find out who was behind it.  He promised to deliver a “a memorandum of suspicions and unexplained events” which he was working on when he died. Reportedly, it was never delivered and Kroll was never formally hired.

Den Hollander also briefly acquired a Russian bride in 2000, and their quick and explosive breakup and divorce evidently fueled his raging misogyny.

So does this really connect in any meaningful way with the ETDBR nexus? A good screen writer could probably concoct a rather Byzantine plot that would make this fit coherently with the larger picture. But maybe it’s all just coincidental. Sometimes the simplest explanation is the best one.

Suicide of Thomas Bowers, Deutsche Bank private banker

On November 19,  2019 the body of Thomas Bowers was found in his Malibu, California home. The Los Angeles County medical examiner quickly ruled the death was suicide by hanging. Until 2015, Bowers had been the head of Deutsche Bank’s private wealth management division, and as such had approved controversial loans to Donald Trump. (Note: There is some question about when Bowers left DB. David Enrich, who wrote extensively about the bank for the NY Times and published a book about it, says he left in 2013.)

The bare outlines of Deutsche Bank’s extraordinary relationship with Trump have been extensively reported. As the NY Times reported in March 2019: “Over nearly two decades, Deutsche Bank’s leaders repeatedly saw red flags surrounding Mr. Trump. There was a disastrous bond sale, a promised loan that relied on a banker’s forged signature, wild exaggerations of Mr. Trump’s wealth, even a claim of an act of God. But Deutsche Bank had a ravenous appetite for risk and limited concern about its clients’ reputations. Time after time, with the support of two different chief executives, the bank handed money — a total of well over $2 billion — to a man whom nearly all other banks had deemed untouchable.”

According to the NYT investigation (source for most of what follows), the first DB loan to Trump was approved in 1999 for $125 million for “a gut renovation” of 40 Wall Street. At the time, Trump was a “a casino magnate whose bankruptcies had cost banks hundreds of millions of dollars.” Next came $300 million for a building across from UN headquarters. Another request for Trump Marina casino in Atlantic City went south when a top Deutsche Bank executive, Edson Mitchell, discovered that the signature of the credit officer who had approved the deal had been forged. Tragically, Edson Mitchell died in December 2000 in the crash of a small plane in which he was the only passenger.

Nonetheless, the bank’s commercial real estate division, then headed by Justin Kennedy (son of Supreme Court Justice Anthony Kennedy), continued to lend money to Trump, including funds to buy the General Motors Building in Manhattan. [Justice Kennedy retired in July 2018, reportedly after extensive consultations with the White House, creating the vacancy filled by Brett Kavanaugh.] A DB team was formed to sell hundreds of millions of dollars in bonds for Trump Hotels and Casino Resorts. In 2004, Trump defaulted on the bonds, and the investment banking section of the bank stopped doing business with Trump–for a while.

But Trump continued to hit up Justin Kennedy and the commercial real estate unit to ask for more loans to build his 92-story Trump International Hotel and Tower in Chicago, saying that Ivanka would be in charge. Trump claimed his net worth was $3 billion, but a bank investigation concluded that it was only about $788 million. Still DB agreed to lend over $500 million for the project with Trump personally guaranteeing $40 million. When the Great Recession hit in 2008 and the bulk of the loan became due that November, Trump used a “force majeur” clause in the deal as grounds to sue Deutsche Bank for $3 billion in “damages”. DB countersued and demanded the $40 million Trump had personally guaranteed. At that point, senior investment banking executives again cut ties–sort of.

Around the same time, DB was expanding its private banking section, and in September 2006 hired Rosemary Vlablic for a reported $3 million/year. She reported directly to Thomas Bowers, head of DB’s Private Wealth Management section. According to the NYT, she was encouraged to make loans that rival banks considered too large or complex. In 2010, Trump and DB settled their litigation, with Trump promising to pay up by 2012. Jared Kushner, who had married Ivanka in 2009, was a client of Vlablic. Jared introduced her to Trump, who flew her to Miami to see the Doral resort that he needed $100 million to buy. A DB team looked over Trump’s assets and concluded that he was overvaluing his assets by as much as 70%, but he had a television hit with The Apprentice, and had money coming in from that. What Trump was asking for was a complicated and unorthodox deal, involving borrowing from one part of the bank to pay another. Vlablic and Bowers approved the loans, but needed approval from higher-ups in Frankfurt. According to the NYT account, Josef Ackermann, Deutsche Bank’s chief executive, supported the loans and the bank’s committee approved them.

[Digression: Josef Ackermann’s scandal-ridden tenure at Deutsche Bank ended in 2012. In 2014, he was recruited by Wilbur Ross and his Russian partner Viktor Vekselberg to become the new chairman of the Bank of Cyprus, which was a haven for expatriated Russian money. Ross became Trump’s Secretary of Commerce in March 2017. For more detail, see here. End of digression.]

Vlablic’s ties to the Trumps continued to deepen. “Deutsche Bank lent money to Donald Trump Jr. for a South Carolina manufacturing venture that would soon go bankrupt. It provided a $15 million credit line to Mr. Kushner and his mother, according to financial documents reviewed by The Times.”

Trump wanted to buy the Buffalo Bills NFL franchise, and needed to show that he could pull off a billion dollar transaction. He asked Vlablic for help with the loan, and produced “bare-bones financial statements” estimating his worth at $8.7 billion–a figure that his lawyer, Michael Cohen, later testified to Congress had been “inflated” with Trump’s knowledge. The bank’s own analysis reportedly concluded that they needed to reduce Trump’s valuation of his assets by up to 70%. They agreed to the loan anyway, but the bid for the Bills wasn’t successful.

Next up was Trump’s bid to turn the Old Post Office building on Pennsylvania Avenue into a luxury hotel. Trump needed about $200 million and again turned to Vlablic and DB in February 2013, as he was still considered too risky by other banks. Ultimately, DB came through with a loan for $170 million for the project two years later, and Trump plumped up his brokerage account with the bank.

By August 2015, the NYT report concludes, Deutsche Bank had lent Trump more than $300 million under Rosemary Vlablic, who (as previously mentioned) reported directly to Thomas Bowers. Thus Bowers presumably knew chapter and verse about many of Trump’s financial dealings that House of Representatives committees have been unsuccessfully trying to pry loose.

Jeffrey Epstein also had major financial ties to Deutsche Bank, the details and consequences of which are what the lawsuit in Judge Salas’ court seeks to establish.

Both the Wall Street Journal and the New York Times have reported that Epstein had been a client of DB’s private-banking division–i.e., the one formerly headed by Thomas Bowers–since at least 2013.

According to the NY Times:

In a $150 million settlement announced on Tuesday [July 7, 2020], the New York Department of Financial Services said Mr. Epstein, a convicted sex offender, had engaged in suspicious transactions for years, even though Deutsche Bank deemed him a “high risk” client from the moment he became a customer in summer 2013.

“Despite knowing Mr. Epstein’s terrible criminal history, the bank inexcusably failed to detect or prevent millions of dollars of suspicious transactions,” Linda A. Lacewell, the department’s superintendent, said in a statement.

A year and a day after Mr. Epstein was arrested on federal sex-trafficking charges, the settlement described how bank employees had relied on informal meetings and institutional momentum to allow suspicious activity to proceed largely unchecked. Instead of performing appropriate due diligence on Mr. Epstein and the activity in his accounts, regulators wrote, the bank was focused on his potential to “generate millions of dollars of revenue as well as leads for other lucrative clients.”

It wasn’t until after the Miami Herald published in late 2018 an explosive investigation into Epstein’s activities that Deutsche Bank decided that he was no longer desirable as a client. “The process proved more complicated and time-consuming than executives had initially anticipated because Deutsche Bank’s private-banking division had opened several dozen accounts for Mr. Epstein and his businesses.” In July 2020, Deutsche Bank agreed to pay a penalty of $150 million to settle charges by a New York state regulator that the bank suffered from “significant” compliance failures in its relationships with the late financier Jeffrey Epstein, Danske Bank Estonia and FBME Bank..

What’s not clear is whether or how much Epstein’s ties with Deutsche Bank involved Thomas Bowers. If, as David Enrich asserts, Bowers left his job in the private-banking division in 2013, then he probably would have had little or no knowledge of Epstein’s financial activities with the bank. If, on the other hand, he continued in that position until 2015, then he might well have known quite a lot.

Allegations that Bowers’ ties with Epstein were more extensive and long-standing appear to come mainly from a website called True Pundit, which Media Bias/Fact Check calls: “not only Questionable, but also a far right conspiracy site that rarely publishes credible news. This is a far right conspiracy source that cannot be trusted for accurate news reporting.” Politifact calls it “a conservative website and aggregator” and the one check listed for the site is rated “pants on fire”. True Pundit also seems to be the primary source for the allegation that the FBI was planning to interview Bowers at the time of his death. The aim of several right-wing websites that have picked up on these allegations appears to be to deflect attention away from the bank’s ties with Trump toward those with Epstein.

Eventually, the court cases in New York (Trump v. Vance) and New Jersey (Karimi v. Deutsche Bank–the one in Judge Salas’ court) may provide more details about Deutsche Bank’s entanglements with both Trump and Epstein, but it will probably be quite some time before such details become public. Unfortunately, the Supreme Court’s ruling on congressional attempts to subpoena Trump’s financial record (Trump v. Mazars) has dealt a major blow against success in shaking those loose and making them public.

Suicide of William S. Broeksmit

The NY Times described William S. Broeksmit as “a derivatives trader with a risk manager’s nose for spotting financial dangers”. He was recruited from Merrill Lynch by the late and aforementioned Edson Mitchell to create for Deutsche Bank “a world-class investment bank in London and spare no expense in doing so.”

But on Jan. 26, 2014, instead of meeting his wife and son for lunch, Mr. Broeksmit slung a dog leash over a door in his London home, and hanged himself from it. Left by his side was a neat stack of company documents related to Deutsche’s New York banking operations, and suicide notes addressed to relatives, as well as one to [Anshu] Jain [Mitchell’s successor and eventual co-CEO of DB, 2012-2015]. “You were good to me,” Mr. Broeksmit wrote to the man he had known for over 30 years, adding, “I am eternally sorry.”

It was really only years later, after the 2016 presidential campaign and election, that the general media started looking again at Broeksmit’s death in the light of Trump’s unorthodox financial relationship with Deutsche Bank and its involvement in a series of banking scandals. In May 2017 Daily Kos published a story headlined “Was suicide of Deutsche Bank executive linked to Trump and Russia money laundering?” The piece was prompted by an article in the German newspaper Die Welt that referred to the bank’s loans to Trump and $10 billion in laundered money for Russian  customers. The unstated inference was that given revelations about Trump’s  suspiciously numerous ties with Russia and his primary financial backer’s involvement in Russian money laundering that the two were somehow connected and that Broeksmit had known important things.

On October 1, 2019, David Enrich published an extraordinary account in the NY Times of his contacts with Val Broeksmit, the step-son of the deceased banker. (The source for what follows, unless otherwise indicated.) Val, a sometime musician with various personal issues,  had found the passwords for his step-father’s email accounts, and in July 2014 he shared some documents with Enrich, who was then working for the Wall Street Journal. Based on that, Enrich wrote in the WSJ that DB’s “giant U.S. operations suffer from a litany of serious financial-reporting problems that the lender has known about for years but not fixed.”

The elder Broeksmit had also stumbled across, but failed to realize the import of, documents relating to the manipulation by DB and other banks of the London Inter-Bank Offered Rate (LIBOR), the benchmark that determines interest rates around the world. This blew up into a huge scandal in 2012, and Deutsche Bank ultimately paid $2.5 billion in fines and penalties in the US and Europe for its participation. William Broeksmit had been worried that he might be prosecuted or bankrupted. 

In early 2017, Val Broeksmit met with Glenn Simpson of Fusion GPS (of Steele dossier fame), and they traveled together to DC, where he shared documents with a Senate investigator and a former prosecutor in the Manhattan DA’s office. The documents eventually ended up in hands of money laundering investigators in the New York Fed. “A few months later, the Fed fined Deutsche Bank $41 million for violations inside the American unit that Bill Broeksmit had overseen.”

This is all very interesting material, but so far there is nothing in the public record that specifically connects William Broeksmit to either Trump or Epstein. He clearly had extensive knowledge, however, about DB’s shady practices and was disturbed by what he knew. Whether that included knowledge about the bank’s alleged involvement in laundering money for Russian oligarchs is unclear.

TO BE CONTINUED…

 

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