Manafort Bankers, Associates Summoned to Talk to Manhattan D.A.Richard Esposito and David Voreacos
Investigators want to know how Manafort used money from loans
Ex-Trump campaign chairman already charged in separate probe
Manhattan prosecutors investigating Paul Manafort’s New York business activities are scheduling interviews with 10 to 20 of his work associates and lenders, including Stephen Calk, whose Chicago-based bank provided millions of dollars in loans on Manafort family properties.
Manhattan District Attorney Cyrus Vance Jr.’s office has already subpoenaed lenders for documents related to transactions by Manafort, President Donald Trump’s onetime campaign chairman, and is proceeding to conduct the interviews, according to a person familiar with the investigation.
Separately, the Manhattan U.S. attorney has recently looked into Calk’s bank as part of a probe into whether Manafort may have engaged in mortgage fraud, honest-services fraud and bank fraud, according to another person familiar with that investigation. Manafort is already under federal indictment for money laundering and other charges.
The district attorney’s office wants to know how deeply Calk was involved in loans made by Federal Savings Bank, where he is chief executive officer, for Manafort’s benefit, the person said. Investigators also want to know if Manafort used the money for the purposes outlined in the loan documents, the person said.
The two men are linked to the Trump campaign. Calk was named as an economic adviser to the campaign in August 2016, the same month Manafort resigned as its chairman.
Calk’s bank, with $342 million in assets, focuses on loans for military members, veterans and first-time home buyers, according to its website. It made three loans that benefited Manafort totaling $16 million. One went to a company affiliated with Manafort in late 2016 and two went to Manafort and his wife in early 2017.
A spokeswoman for Federal Savings Bank didn’t return repeated messages seeking comment from Calk or the bank. A spokesman for Manafort and his family declined to comment, as did representatives from Vance’s office and the Manhattan U.S. attorney’s office.
There’s another Manafort inquiry in New York, by Attorney General Eric Schneiderman, whose office is investigating potential money laundering. A spokeswoman declined to comment.
No charges are imminent in Vance’s inquiry, the person familiar with the matter said. That investigation is separate from the much broader one by Special Counsel Robert Mueller, who is probing Russian meddling in last year’s presidential election.
Last month, Mueller charged Manafort and an associate with failing to report political consulting work in Ukraine, laundering millions of dollars and hiding offshore accounts. Both Manafort and the associate, Rick Gates, used the money to finance a lavish lifestyle in the U.S., according to an indictment announced on Oct. 30. Both men pleaded not guilty.
Unlike people who are convicted of charges brought by federal prosecutors, those found guilty of a state crime -- in a matter brought by Vance’s office, for instance -- couldn’t be pardoned by the president.
Vance started his investigation into Manafort in the spring and now has teams of investigators and prosecutors searching for evidence of possible tax evasion, falsification of business records or potential larceny involving bank deception, the person familiar with the matter said.
Besides Manafort, investigators are examining real estate transactions involving his immediate family and former son in law, the person said.
The head of investigations for the Manhattan district attorney, Michael Sachs, is leading the probe and focusing on the business dealings of Jeffrey Yohai, the former husband of Manafort’s daughter, Jessica. Manafort and his family invested in property with Yohai in California and New York. The California investments may result in a $4 million loss for the Manaforts.
Prosecutors are seeking to find out whether the money Yohai raised ended up in real estate investments, according to the person familiar with the probe. A lawyer for Yohai, Aaron May, declined to comment.
Investigators are also examining loans involving Manafort’s properties in the Hamptons, Brooklyn and Manhattan, including his condominium in Trump Tower, the person said.
Manafort and his wife own property in Florida, Virginia, New York City and Bridgehampton, New York. Some of it was purchased or owned through limited liability companies controlled by the Manaforts, a common tactic used by wealthy buyers. The couple purchased some of the properties with cash. They borrowed heavily against some properties, too.
— With assistance by Greg Farrell