PORTFOLIO: How are you?

IVANKA TRUMP: Good! How’s it going?

ANDREA BERNSTEIN: In 2008, Ivanka Trump takes a phone call from Portfolio Magazine. The transcript of the interview was published, but the audio has never been heard. 

PORTFOLIO: Tell me. You’re the Vice President of Development of Acquisitions of the Trump Organization. 

BERNSTEIN: She describes what she does.

IVANKA TRUMP: We’re really building all over the world right now. 

BERNSTEIN: She mentions Dubai and Scotland. 

IVANKA TRUMP: And a lot of what I do is, uh, get involved in the acquisition process. Um, and then the initial due diligence process.

BERNSTEIN: She talks about 70 projects in the pipeline. One of them is the Trump Ocean Club Panama. 

IVANKA TRUMP: We have many projects that are actively selling. I sold 40 units in Panama last month. 

BERNSTEIN: She says she sold 40 units. “You did?” she was asked. She backs off. 

IVANKA TRUMP: We did — our project. 

BERNSTEIN: “We did,” she says. “Our project.” 

IVANKA TRUMP: It’s an a thousand-unit building. We’ve sold over 90% of it. 

BERNSTEIN: It was more like 79%.

IVANKA TRUMP: In Panama, we sold at a 500% premium to anything the luxury market had ever experienced prior to our entry.

BERNSTEIN: She says the Trumps sold units in the Panama building for five times as much as other luxury units in the same market. They did not. 

[HEAVY MUSIC PLAYS]

BERNSTEIN: We now know: no 500% premium, no personal sales by Ivanka Trump, no 90% sold. Five years after this interview, the Trump Ocean Club Panama went bankrupt. Of those 1000 units, buyers walked away from nearly half. They forfeited their deposits. The Trumps? They made tens of millions. 

[THE SOUNDS OF LOUD ARGUING IN AN INDISTINCT FOREIGN LANGUAGE]

BERNSTEIN: After Donald Trump became president, the Trumps suffered an international embarrassment at the Trump Ocean Club in Panama City. There was a dispute about their management with a group of owners of the hotel condo units. Trump management was voted out, but they refused to leave. There was an actual physical brawl. 

[THE SOUNDS OF A PHYSICAL ALTERCATION]

BERNSTEIN: Eventually the Trump Organization was replaced. 

[SOUNDS OF A CHISEL AND HAMMER]

BERNSTEIN: A worker took out a yellow crowbar and a hammer, prying the letters “T-R-U-M-P” off a stone wall in front of the building.

The President's company issued a statement distancing itself from the property Ivanka had once called “our project.” This statement said, quote, “The Trump Organization was not the owner, developer, or seller of the Trump Ocean Club Panama project. Because of its limited role, the company was not responsible for the financing of the project, and had no involvement in the sale of units.

[MUSIC BECOMES SLOW AND DRAMATIC]

BERNSTEIN: But like the Ivanka Trump claims we just heard, this also was false. A WNYC-ProPublica investigation of a dozen deals around the globe found the Trumps — Donald and his children — were way more than just licensers in places like Panama. They were deeply involved in many aspects of the deals. They misled people. When the projects didn't work out for buyers and investors — and they often didn't — the Trumps profited anyway.

I'm going to step back a moment and give you a quick history of the Trump family business. Recently, there was a huge New York Times investigation of Donald Trump and his father, Fred Trump. What it showed — contrary to the myth, Donald Trump was not a self-made man. He got over $400 million in today's dollars from his dad. In 2004, Donald and his siblings sold off their dad's empire. A Trump lawyer called the story false. This was around the time that big banks mostly stopped lending to Trump. They'd been burned one too many times.

As we now know, Donald Trump then changed his own business model from building buildings to selling his name. You've probably heard a lot about this business model. It was a brilliantly pure licensing strategy — so the story goes. But as we found out, this is a myth, too. Our investigation found that what happened in Panama was typical of a dozen Trump projects around the globe.

[TRUMP, INC. THEME MUSIC PLAYS]

BERNSTEIN: Hello and welcome to Trump, Inc., a podcast from WNYC and ProPublica that digs deep into the secrets of the Trump family business. I'm Andrea Bernstein. 

HEATHER VOGELL: I’m Heather Vogell. I'm a reporter at ProPublica.

MEG CRAMER: And I’m Meg Cramer, senior producer of Trump, Inc. 

BERNSTEIN: Today on the show, Heather and Meg are going to take you deep into what happened in the Panama deal.

[MUSIC OUT]

BERNSTEIN: They’ve spent months digging up court records and thousands of pages of documents in New York, Florida, and Panama. They’ve spoken to people close to the deal — to brokers, regulators. Those false claims you heard of Ivanka Trump making about sales at the Trump Ocean Club? They fit into a much bigger pattern. 

VOGELL: So, what we found was that — 

BERNSTEIN: This is Heather.

VOGELL: — there appears to be a pattern of deception that is sort of threaded throughout Trump's real estate deals going back at least the last 14 years. When he was doing a lot of these licensing deals — some overseas, some at home — 

CRAMER: — we kept seeing the same categories of misrepresentations. 

BERNSTEIN: This is Meg. 

CRAMER: One is the “I'm the developer, I'm putting my own money in” — when he wasn't. 

VOGELL: This is something that we heard Trump himself saying in a number of deals. It's something, at times, that his developer partners would say, or that marketing materials would imply. 

CRAMER: This happened not only in Panama, but in Florida and Mexico, too. 

BERNSTEIN: This is important, because it sends a misleading signal to investors that a project is so sound the international billionaire Trumps are putting their own money in.

VOGELL: The other category that was very prominent was “We're already X percent sold,” and that can be sort of a shorthand for the viability of a project, especially one that hasn't been built yet.

DONALD TRUMP: So I was in Panama. We're now doing a great, great project in Panama that's selling like hotcakes. 

[SLOW MUSIC PLAYS]

CRAMER: The Trump Ocean Club in Panama posted this video when those units were not selling like hotcakes.

BERNSTEIN: This is important because units in a building that's heavily sold are more valuable than if all the other units in your hallway are empty. 

VOGELL: This also happened in SoHo, where the Trumps told buyers their hotel condo was 60% sold when it was actually 15% sold. 

CRAMER: There are omissions too, like in a project in Mexico where Ivanka Trump said she was buying a unit herself.

IVANKA TRUMP: [OVER FUNKY MUSIC] The best site in Northern Baja, and — arguably — in Mexico. And I personally am very excited about it. I actually chose to purchase a unit, um, in the first tower.

CRAMER: What she didn't say was that she had a special insider's deal. She wasn't taking on the same financial risk as regular buyers. 

VOGELL: And typically these types of misrepresentations occur at a very key point for these deals, right when the early sales were happening and things like construction financing were predicated on their ability to kind of get people to commit to buy units once they're built. 

CRAMER: The sales are important in and of themselves, and also because they're being used to get to much bigger pots of money, like bank financing.

BERNSTEIN: So it's important for the Trumps to say things like, “They're buying in. Units are selling fast,” even before the buildings are built to convince lenders, “Hey, give us money.” 

[PLUNKY MUSIC PLAYS]

VOGELL: And then when things don't go so well — the developers go bankrupt, or the deal collapses, or it can't get financing — then all of a sudden it’s, “Oh no, no, no, no.” The Trumps say, “We had nothing to do with that project. We were just the licensors. We just gave them our name. We didn't have anything to do with the — really, the mechanics of the deal.” So their tone really changes.

BERNSTEIN: That project in Mexico where Ivanka said she was buying a unit? It was never built.

NEWS ANCHOR: It’s not clear where the money went. The Trump Organization now says it was never the developer. It designed the product, and simply lent its name to the project. 

IVANKA TRUMP: I’m sorry for everyone. But we are in the same boat. We had to terminate our contract because, um, our agreements weren't obligated either.

BERNSTEIN: This is from a 2009 interview with CBS about the Baja project.

IVANKA TRUMP: We were never the developer of this project, and that was made clear. We never took anyone's deposit. We never had ask— access to any of the escrow accounts. We lived up to our obligation under a license agreement.

BERNSTEIN: In that same interview, Ivanka Trump says other projects are going really, really well. 

IVANKA TRUMP: The Trump Organization has really never been stronger. I mean, we were at the top of an unprecedented growth cycle from a real estate development perspective. So the market is retreating, and there are some markets that are retreating faster than others. With that said, we have projects all over the world that are incredibly successful, that are under construction right now, that have their financing secured. Um, and that are, um, virtually sold out. So, from Hawaii to, uh, Toronto, to, um, Istanbul. 

BERNSTEIN: Toronto, as we now know, was never virtually sold out. Sales were never brisk in the failed project in Fort Lauderdale or a tower in Las Vegas or a hotel condo in SoHo in Lower Manhattan, contrary to reports of healthy sales by Trump Organization officials. Hawaii was fully reserved at one point. 

The Trump Organization didn't respond to a long list of questions about these transactions. The White House didn't have a comment. 

[REPETITIVE MUSIC PLAYS]

BERNSTEIN: You may have heard about a theme running through some of the Trumps’ deals over the years, that the Trumps have linked up with some shady people in Azerbaijan, India, Panama. 

Our reporting shows it's not just about who the Trumps worked with — it’s about what they did. And yes, there are questions about whether what they did was illegal. We'll have more on that later. 

VOGELL: I started to look into more and more of these deals and what happened to them. And I was really surprised at how many of them failed in one way or another: bankruptcy, a foreclosure, never finished construction, never started construction. And it just made me wonder, um, first of all, why would Trump keep doing this? And secondly, why are people partnering with him if some of the deals that he tends to be getting involved in are going belly-up?

So, you know, that led me to this question of, “What is the engine at the heart of these deals?” There must be something that Trump is getting out of it, and there must be something that the developers are getting out of it. 

BERNSTEIN: That question is what brought Heather and Meg to Panama City.

[MUSIC OUT, REPLACED WITH THE SOUNDS OF TROPICAL BIRDS]

CRAMER: Technically, it's not called “the Trump Ocean Club” anymore. But in the spring, when we visited, you could still see the faded outline of T-R-U-M-P on the sign by the driveway. The marketing materials described the Ocean Club as sail-shaped. It's more like, if Georgia O'Keeffe were an architect, she would have designed a building like this.

There are two infinity pools, even a place to moor your yacht if you have one. There's a rooftop garden, dotted with pink and purple tropical flowers. A piano in the lobby.

VOGELL: As far as we can tell, Trump didn't put any of his own money into the building. It was financed, instead, with $220 million in corporate bonds.

CRAMER: For the purposes of this story, think of a bond as a kind of bank loan. Instead of writing a big $220 million check, the bank breaks the loan into pieces and sells those pieces to investors. Effectively, it’s the investors, not the bank, who are putting up the money. 

VOGELL: There's one really important thing to know about this financing. In order to get it, the developers had to show that the Trump Ocean Club was a sound investment. And the way they did that was by getting a huge number of buyers to commit to units ahead of time. 

CRAMER: One of the reasons we came to Panama was to find out more about those early buyers, and about the financing. In Panama, these records are kept at the office of Panama's Securities Commission. So we went there. 

CRAMER: Heading to the car, Heather and I talked about one thing in particular we were hoping to find —

VOGELL: The best thing we could hope to find in there would be to find the licensing agreement …

CRAMER: — Trump's licensing agreement. It's the document that lays out in detail, what his role in the deal was, and what he got paid for it. 

CRAMER: [OVER THE NOISE OF GETTING IN A CAR] I don't know why it wouldn't be in there. I mean, they've got all the other backup for the claims and the bond prospectus is in there.

[THE SOUND OF CARS DRIVING BY]

CRAMER: Our driver dropped us off in front of a tall glass building. We rode a cramped elevator up to the eighth floor. Someone let us over to a folding table with a huge stack of documents. 

CRAMER: There’s like one, two, three, four, five, six, seven, eight —

CRAMER: It’s all the records they could find about the Trump Ocean Club bonds. So we go through them. 

CRAMER: — nine, ten, eleven, twelve, thirteen really fat folders.

[A BEAT]

VOGELL: This is amazing. 

CRAMER: What is it? 

VOGELL: This is all about presales. And it's all about how those really early presales were going to work. 

CRAMER: And then, a photocopied document with a familiar angular signature: Donald Trump. 

VOGELL: I just found the license agreement between Trump and developers of the project. And it describes Trump as “a world-renowned builder and developer of luxury real estate,” among other things, “who enjoys the highest reputation in these fields.”

CRAMER: The license agreement, signed in 2006. This document is a treasure trove of information on the Panama deal. It lays out what Trump's obligations are, and how he can make money. He gets a million dollars upfront, and he gets at least a 4% cut of sales.

VOGELL: But get this — even if they don't sell, the contract has a special provision that he will still get a commission. He gets a commission if they sell, he gets a commission if they don't sell. 

CRAMER: There’s something else we found — an amendment to this document signed in 2007 that totally changed our understanding of what Trump did for the Panama deal. There's a line in it that says Trump is, quote, “responsible for licensee securing financing from Bear Stearns for the construction of the building.”

Bear Stearns is the investment bank that issued the $220 million in bond financing. Trump got a cut — at least $2.2 million. 

BERNSTEIN: This detail — that Trump brought in Bear Stearns and was paid for it — directly contradicts the 2017 statement from the Trump Organization. It said Trump was not responsible for the financing. Now, we know that's not true. 

These documents that Heather and Meg found? They link Trump to many more aspects of the deal than he's acknowledged in the past: the ways he makes money, the Trump family's oversight of sales and marketing, Trump's direct tie to Bear Stearns financing that made it all possible.

CRAMER: The Trump Ocean Club in Panama City was pitched by someone you've probably never heard of: Roger Khafif. Heather talked to him on the phone a couple of times. 

VOGELL: Roger Khafif’s an easy guy to talk to. He's affable. He's uses colorful language. He's intense. He makes big promises. Um, he's a very determined guy, from what people told me, and sometimes that determination comes across a bit as stubbornness.

CRAMER: Khafif is a Panamanian citizen of Lebanese descent. 

VOGELL: He was an importer-exporter of clothing and textiles. He worked in the free trade zone in Panama, near the Panama Canal, and he had started dabbling a bit in real estate. 

CRAMER: He had a plot of land, right on the water in an up-and-coming neighborhood in Panama City. He didn't have the money to build, but court records showed his company agreed to pay over a million dollars to the middleman who introduced him to Trump.

VOGELL: He flew up to Trump Tower to meet with Trump in New York, and to pitch him the project and the idea that he had. And Trump didn't give him an answer off the bat. So Khafif left and flew back down to Miami. The next day, the phone rang, and he picked it up, and it was someone that sounded a lot like Trump on the phone. But he thought, at first, that it was a prank call — that it was a friend of his — and it turned out that it actually was really Trump.

CRAMER: Khafif says that, a week later, Ivanka Trump flew down to Panama to check the place out. Trump and Khafif were in business.

[GUITAR MUSIC PLAYS]

CRAMER: When Trump signed the deal in March of 2006, the Ocean Club was still an undeveloped plot of land. To start building, they needed the bonds, and to get the bonds, they needed to start selling — quickly. Trump was ready to make his first pitch. 

VOGELL: So they have this press conference in Trump Tower, in the marble atrium, and everybody's got their nice business suits on, and, uh, Khafif is there. He's got this pale pink tie and this well-cut dark suit. And Ivanka is there, and Don Jr.’s there, and Trump's there, of course. 

And they announced this incredible project that they're going to do in Panama — one of the biggest buildings, if not the biggest building, in Latin America. So at this press conference, Trump makes what may be his first misrepresentation about this deal.

According to one account, Trump says that, in addition to being a licenser, the Trump Organization has a financial interest in the deal, but he wouldn't say how much. He'd left the impression, though, that he had an ownership stake — which he didn’t. 

BERNSTEIN: There’s a concept in real estate sales. It's called puffery. It's okay to say you have the world's best building, even if you don’t. This happens all the time. It's not okay to mislead potential buyers on something material — a specific, verifiable statement you know is inaccurate — in the hopes that will encourage buyers to put down their money. That could be fraud.

[MUSIC OUT]

CRAMER: Trump’s press conference in New York kicked off an international selling spree. Brokers went to Dubai, Russia, Canada, Spain, trying to find buyers to sign sales contracts. 

VOGELL: So these contracts played, like, an incredibly important role for this project. Basically, the developers didn't have a lot of equity — a lot of their own money that they were putting into it. So what they needed — what they could bank on, basically — was collecting a bunch of promises — legal commitments from buyers — to pay a pretty sizable amount of money for each of these units. So then they could go to the bank and they could say, “Look, we've got all these people who are going to pay this significant amount of money for these units.”

CRAMER: This is a standard way for developers to get financing. At first, it seemed to be going well. 

VOGELL: They reported an incredible number of sales in that first year in 2006. They said that they [PAUSE] managed to get 585 contracts signed by buyers. And that was not even a full year, if you think about the fact that Trump only made the announcement of his involvement in April of 2006.

CRAMER: Here’s what's notable about the early buyers. One, a lot of them used secretive shell corporations registered in Panama. Two, some buyers purchased multiple units, which can be a red flag for money-laundering. Three, a bond holder claimed developers bought units themselves. That could be a sign they were trying to inflate the sales numbers to secure financing. And four, some buyers that we know about had ties to organized crime. Roger Khafif says everything the developers did was done by the book. 

BERNSTEIN: Last year, one independent broker in the project confirmed to Reuters and NBC that some of his partners and investors were connected to the Russian mafia. Another investor from Columbia was convicted of laundering drug money. After the 2006 rush to get sales contracts signed, the Trump Ocean Club would never match that rate of sales again, even after the building was complete.

[THE SOUND OF CAR HORNS]

CRAMER: Panama City traffic is so bad that everyone plans their meetings for times that are marginally less congested. We had to organize our days around it. Also, no one uses street addresses. Directions are based on landmarks. Kent Davis’ office is in the same building as a casino. Davis is a local broker who sold units in the Trump Ocean Club. He's an American who grew up in Hawaii and now lives in Panama. 

KENT DAVIS: Sorry, I guess I should keep my voice level. 

CRAMER: He has a boyish look: freckles and a tan. During our conversation, he kept leaning way back in his chair, then all the way forward, close to the microphone. 

DAVIS: Trump had the best salesmen. At the end of the day, they were the smoothest — how can I put it? — they were able to control the dialogue, such that they basically were the keepers of all information. So you could never really get a straight answer in terms of what was actually available, what had actually sold, and what the real price was. 

CRAMER: Davis describes a lax selling environment in Panama at the time.

DAVIS: I don't think they did any due diligence on their buyers. None whatsoever. Proof of funds, ability to close — nothing. 

CRAMER: Usually brokers do have an incentive to find buyers who can close. Brokers don't get their full commission until the sale goes through. But for the Trump Ocean Club, they'd get 90% of their commission early on.

DAVIS: The nice thing about Trump is, they preloaded a lot of the commissions. So you got paid the lion's share of your commission as soon as the buyer put down the initial deposit. 

CRAMER: Is that normal?

DAVIS: No. 

CRAMER: Why do you think they’d do that? 

DAVIS: Incentivize brokers. 

CRAMER: This means that, right at the moment the developers need to sell units to unlock financing, brokers are being rewarded for making quick sales that might never go through. 

[REPETITIVE KEYBOARD FLOURISH PLAYS] 

CRAMER: We don't know exactly what the Trumps knew about all of this hustling. 

VOGELL: What we do know about the Trumps’ awareness of sales was that they were getting monthly reports. So they were promised them in the licensing agreement. And what we found in an email in another project that came out in a court case was that they actually were paying attention to these reports. Uh, Eric Trump, at one point, was sort of chastising one of the other developers they were doing a deal with, uh, for not providing this type of report. Basically what he said was, “My staff tracks all these projects and we need this information.”

CRAMER: Remember Ivanka Trump's 2008 interview with Portfolio Magazine? In it, she also said she keeps an eye on things.

IVANKA TRUMP: Um, I’m involved in every aspect, really, of our new construction projects. And a lot of what I do is, uh, get involved in the acquisition process. Um, and then the initial due diligence process. But then, of course, I follow the deals through to, um, pre-development planning, design, interior design, architectural design, sales and marketing, um, and, ultimately, through operations.

[INTENSE MUSIC PLAYS]

CRAMER: In the fall of 2007, the developers said they had found enough buyers to unlock the bond financing. Then, at the last minute, Bear Stearns stalled. This was just a few months before the global financial crisis, and Bear Stearns had a total of eight bond offerings in the works, ready to go. They were all on hold. A few days later, though, they decided the Trump Ocean Club bonds could go through. It was the only one of the eight that did. 

VOGELL: So Jack Studnicki, a lead real estate agent for this project, told me how he was walking down Fifth Avenue with Roger Khafif after all of this craziness happened. And he said, at one point, he just put his arm around Roger and said, “You are the luckiest S.O.B. I ever met.”

BERNSTEIN: So, here we are. Bear Stearns, an investment bank that was about to include in the financial crisis that became synonymous with reckless unbridled risk-taking with other people's money agreed to underwrite $220 million worth of bonds. Donald Trump had brought in Bear Stearns. The bonds were purchased by independent investors, and it was all bolstered by huge numbers of dubious presales. Spoiler alert — everything is about to get worse. We'll be right back.

[MUSIC OUT]

[MIDROLL]

[TWANGY MUSIC PLAYS]

BERNSTEIN: Welcome back. Let’s review where we are. It's early days of the Trump Organization's foreign licensing deals. One of their first deals is in Panama. To finance it, there's been a scramble for sales. The brokers have been wrangling buyers in questionable ways. And — did we say this? — it's Panama, which ranked as more corrupt than Brazil, India, and Saudi Arabia on Transparency International's index. 

The Trump Ocean Club bonds are a tough sell, rated “junk.” Bear Stearns is about to collapse. The real estate market melts down, eventually leading to a global recession. In 2009, the bonds are downgraded. Ivanka Trump describes things differently. She says, “Our only problem is, we don't have enough inventory.”

CRAMER: Over the next two years, things don't go well for the building. 

BERNSTEIN: Heather and Meg are gonna take it from here. 

CRAMER: Buyers were promised a beach club on a nearby Island. The planned club kept moving to islands that were farther and farther away from Panama City. It was never finished. The Trump casino, which was advertised as part of the Ocean Club early on, wasn't materializing either. It never did. 

The developers had an obligation to bond-holders to keep up the rate of sales, and to keep buyers locked into their sales contracts. Buyers started to default on their payments.

DONALD TRUMP: Three, two, one! [APPLAUSE]

CRAMER: In July of 2011, with the building late and over-budget, the Trump family traveled to Panama for the opening ceremony. It was the middle of Panama's rainy season, and a downpour during the opening ceremony flooded the streets outside. The Ocean Club was surrounded by new developments, and the neighborhood’s drainage system was overloaded. Inside the hotel, Trump lined up with a row of men in dark suits to cut a ribbon.

He stood between his son, Don Jr., and Panama's president Ricardo Martinelli, who is now in jail facing unrelated corruption charges — which he denies. Martinelli reportedly told Trump at the event that, quote, “everything you touch turns to gold.” Trump was friendly, too. 

DONALD TRUMP: Shake his hand, and grab him, and touch his shoulder. They really love your president. And I want to just thank you very much for being here today. And you're my friend. [APPLAUSE] Great honor.

[MUSIC OUT]

CRAMER: Afterwards, Trump and Martinelli were driven out through the flooded streets in separate SUVs. Just five months later, in November of 2011, the developer defaulted on its bond payment. 

VOGELL: What we could see from our reporting was that the Trumps and their promotions had really pushed this thing into existence, and had done so, at times, in ways that were very questionable. The whole deal had these rotten underpinnings, and when things got tough, a lot of the buyers walked away. 

[MOROSE MUSIC PLAYS]

CRAMER: Investors lost. One told us that a full $120 million of the $220 million in bond financing wasn't paid back. Buyers walked away from their units and forfeited more than $50 million in deposits. Trump was making money — first, by selling his name. Then, by bringing in the financing and taking a cut of investor money without taking on any risk. 

VOGELL: It's hard to think of any aspect of this project that they hadn't figured out a way to draw a fee from. The 2006 licensing agreement shows they were getting 17.5% of what hotel guests paid for their rooms, including [SOUNDS OF AN ACCOUNTANT’S CALCULATOR] what they spent on minibar items, internet service, and even bathrobes.

They were also going to get [SOUNDS OF CALCULATOR] a 20% commission if they were able to help the project save money on a construction contract. They were getting [SOUND AGAIN] 4% for parking unit sales, 12% percent [SOUNDS AGAIN] of commercial space rentals, 4% of the hotel’s gross revenue for managing it,  plus an incentive fee equal to a fifth of the hotel’s net operating income. [THE CALCULATOR’S PRINTER WHIRRS]

BERNSTEIN: The Trump Organization was eventually kicked out as building managers, but Donald Trump? Based on financial statements, government disclosures, and other records, Trump appears to have walked away with between $30 and $55 million. 

In Panama, the Trumps engaged in a series of misrepresentations. They made money while buyers and investors lost out. And what happened in Panama [PAUSE]was not just a one-off. 

The WNYC-ProPublica investigation looked at deals from Toronto to the Republic of Georgia. And the elements of what we saw in Panama kept appearing: inflated figures about the numbers of units sold, inside deals, and a sort of Trump sleight-of-hand. The Trumps consistently talk up their investment early in the deals. When things go bad, they talk down their involvement. So what they said is that they were investing when they weren’t, and they didn't oversee aspects of the deals when they did. 

VOGELL: This was part of a pattern that we saw stretching across multiple deals, across multiple countries, across multiple continents. 

BERNSTEIN: The details weren't always the same.

VOGELL: For instance, in Toronto, buyers were shown these projections about the kind of profits they could expect from these hotel condo units. And it turned out the projections were completely off the charts, not realistic in any way. 

BERNSTEIN: Buyers sued. They said Trump misled them over his ownership stake, and that the developers were making false promises about how much money they could make. A judge called the projections “deceptive documents,” and added, “They were replete with misrepresentations of commission, of omission, and half-truth.” The Trumps say they're merely licensors, and there's no factual basis to involve the Trumps in the claims. The litigation is ongoing. 

Then there's Chicago, where Trump works to gin up early sales. 

VOGELL: So what happened in Chicago was that Trump offered a special deal to people who were involved in the project, like brokers and architects, allowing them to buy in early for a discount. But the problem was that, once the project was all done and it was actually selling better, he pulled back that discount. 

BERNSTEIN: Trump canceled the early deals. He said, “We're entitled to the higher prices.” In a Florida project, there was another wrinkle. This time, an insider's price for Trump Organization employees, including Don Jr. There were emails that came out in a court case. 

VOGELL: So the developer was promising Don Jr. and the Trump employees a 5% down payment, and a discounted price, and the rights to flip this property pretty much immediately prior to closing, so that they could make a big $200,000 profit right off the bat. 

So, in the process of that conversation, we saw emails that show they were discussing backdating contracts so that they could get favorable capital gains treatment.

BERNSTEIN: They formed a company, “Busy Boys,” to handle the inside deal. The Florida project was never built. The Trump Organization did not respond to requests for comment. [OVER SUDDEN MUSIC] Oh, and also, the Trump SoHo. 

DONALD TRUMP: Located in the center of Manhattan’s chic artist enclave, the Trump International Hotel and Tower in SoHo is the site of my latest development. This 50-story building … [FADES OUT] 

BERNSTEIN: Last year, a WNYC-ProPublica-New Yorker investigation found there was an actual criminal investigation of Don Jr. and Ivanka Trump's misrepresentations about how much of the Trump SoHo was sold. There was evidence of felony fraud. The Trumps denied wrongdoing. After a lot of legal back-and-forth and a visit to the D.A. by a campaign donor, the case was dropped. The D.A. denied he was influenced by the donor.

[PLUNKY MUSICAL FLOURISH]

VOGELL: So what this suggests to me is that this wasn't just a fluke where the Trumps sometimes would forget the numbers for a particular project and maybe misspeak here or there, but that this was actually a strategy that they employed across deals, where they were misrepresenting the value of these projects as part of a strategy to try to draw more money into them — that this was actually a feature of their business model, not just a fluke.

DONALD TRUMP: [OVER INTENSE MUSIC] My name is Donald Trump and I'm the largest developer in New York. [THE APPRENTICE THEME SONG PLAYS]

BERNSTEIN: Trump used these deals to build his public persona. 

DONALD TRUMP: You’re fired.

BERNSTEIN: And, based in no small part on that celebrity, he became president. He named his daughter Ivanka to be senior White House advisor — even recently floated her name to be the UN ambassador. 

DONALD TRUMP: I think Ivanka would be incredible. That doesn't mean I’d — you — you know, I'd pick her, because you'd be accused of nepotism, even though I'm not sure there's anybody more competent in the world.

BERNSTEIN: Trump is not allowed to appoint his daughter to be UN ambassador.

[MUSIC PLAYS]

BERNSTEIN: So, thanks to Heather and Meg's work, we now understand a lot more about how the Trumps made money in the years immediately preceding their ascendance to the White House. And [PAUSE] we know you're wondering, “Could there be legal consequences?” We wondered too. So we called a former prosecutor. 

DANIEL BRAUN: This is Daniel Braun. I'm a lawyer at Freshfields Bruckhaus Deringer, based in Washington, D.C. Before joining this firm a couple of years ago, I worked for over 15 years at the U.S. Department of Justice as an assistant U.S. attorney in the Southern District of New York, and also as a supervisor at the Fraud Section in Washington, D.C.

BERNSTEIN: I asked him what he makes of the pattern. 

BRAUN: It raises my eyebrows, but the instinct I have from having done this sort of work a lot is: It's one thing to tell a story. It's another to see and hear the evidence. 

BERNSTEIN: Dan is making clear he hasn't seen the evidence, done his own investigation, and isn't drawing any conclusions.

BRAUN: It’s the sort of story that you might well pay attention to, because you're describing the basic elements of a long-running and significant scheme to defraud investors. So, is that the sort of thing that the FBI and the Justice Department pay attention to? It is. It — it has a number of ingredients that you would typically see in an investigation, or even prosecution, of fraud.

BERNSTEIN: Now to be clear, many of these events — if they were even criminal — might have happened outside the statute of limitations, and in a fraud prosecution, it's a valid defense to say you were just talking up the project. That’s puffery. 

BRAUN: “This is a great development.” “This is a really exciting project.” “I think this is gonna be terrific.” Right? Those are all difficult statements to base a case on, for reasons that I'm sure you can appreciate. They — they're subjective, and there's not that much hard fact in the representation. 

BERNSTEIN: So, for example, “90% sold” is a very specific —

BRAUN: Yeah. “90% sold” is a different sort of statement than, “Hey, we're having a lot of success with this project.”

BERNSTEIN:  Does it say anything to you when they consistently say upfront, like, “This is our project,” or they imply that they’re a developer, or they implied that their equity — or that they're putting their own money in — like, that's what they say at the outset, but when things go bad, they're like, “We were just the licenser.” Does that fact pattern say anything to you? 

BRAUN: [LAUGHS] It — it does. Um …

BERNSTEIN: [AFTER A MOMENT OF SILENCE] Go on. [CHUCKLES]

BRAUN: Well … It’s not unusual for people to disclaim responsibility for things once the deal goes bad. But, if they're saying repeatedly that they're deeply involved in a project, for purposes of marketing, it would at least suggest to you that — based on their own experience in doing these deals — that that's the sort of claim that might be important to the people they're speaking to. We have seen those sorts of claims form the basis for criminal cases in a number of different settings. 

[CREDITS MUSIC PLAYS]

BERNSTEIN: Despite the fact that Trumps kept getting accused by buyers and investors of strikingly similar deceptions, that Trump's didn't change their strategy. It worked.

[A MOMENT OF MUSIC]

BERNSTEIN: As of September, the Trump Ocean Club in Panama City is now a JW Marriott. The Trump Organization is actively working on foreign deals: including in Indonesia, India, and the Dominican Republic.

[ANOTHER MOMENT OF MUSIC]

BERNSTEIN: Coming up on Trump, Inc.: 

INTERVIEWER: What’s your guess on your percentage of income that's paid in taxes? 

DONALD TRUMP: Uh, you know what — and I've said this many times, so it's not exactly breaking news — I pay as little as possible. I fight like hell to pay as little as possible. 

BERNSTEIN: This story was reported by Heather Vogell, Peter Elkind, and Meg Cramer, with additional reporting from Katherine Sullivan. For a discussion of more about these Trump deals, you can read the full article TrumpIncPodcast.org.

Trump, Inc. is produced by Meg Cramer, Megan Detrie, and Alice Wilder. Bill Moss is our technical director. We had engineering help this week from Rick Kwan. The editors are Nick Varchaver, Charlie Herman, and Eric Umansky. Robin Fields is the Managing Editor of ProPublica. Jim Schachter is Vice President for News at WNYC, and Steve Engelberg is the Editor-in-Chief of ProPublica. Hannis Brown composed our music.

[MUSIC OUT]

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