May 17, 2017

Funding for Trump hotel traces back to Russian bank

Charles Rex Arbogast / AP

Alexander Shnaider, a Russian-Canadian developer who partnered with Trump to build the Trump International Hotel and Tower in Toronto, used hundreds of millions of dollars that can be traced back to Vnesheconombank (VEB), a Russian government-run bank under investigation in the U.S., to help finance the project, reports the WSJ.

Why this matters: A Trump Organization spokesman told the WSJ that the company had no financial dealings with VEB. Trump has also repeatedly stated that he has no ties to Russia. Meanwhile, federal investigators are looking into the links between Trump's staff and Russian financial institutions. This all comes as Trump has been under fire for sharing Israeli intelligence with top Russian officials.

The breakdown:

  1. Midland Resources, a holding company then owned by Shnaider and a partner, acquired a stake in Zaporizhstal, a Ukranian steel mill, for roughly $70 million after the collapse of the Soviet Union.
  2. In 2010, Shnaider and his partner sold Midland Resources' stake in the steel mill for roughly $850 million to an unnamed buyer, who used funds from VEB to make the purchase.Midland Resources transferred ownership of its share to the unknown investor through 5 offshore companies"Two people with knowledge of the deal" told the WSJ that the buyer was "an entity acting for the Russian government" and that VEB initiated the sell and financed the purchase.
  3. Shnaider, now hundreds of millions of dollars richer, used about $15 million to help finance The Trump Toronto Hotel, which in turn paid licensing fees to Donald Trump.

The Putin link: At the time Shnaider sold his stake in the steelmaker, Vladimir Putin was serving as the chairman of VEB's supervisory board. As the WSJ points out, any major deals would have needed his approval first. The U.S. later sanctioned the bank after Russia invaded Ukraine and occupied Crimea in 2014.

The Jared Kushner link: Trump's son-in-law met with VEB's chairman in December. Sean Spicer said Kushner was simply fulfilling his role as the "primary point of contact with foreign government officials."

Go deeper

The growing coronavirus recession threat

Illustration: Aïda Amer/Axios

In just a matter of weeks, top economists and investment bank analysts have gone from expecting the coronavirus outbreak to have minimal impact on the U.S. economy to warning that an outright recession may be on the horizon.

What's happening: The spread of confirmed coronavirus cases in Europe, the Middle East and the U.S., and the speed at which they are being discovered has set the table for the outbreak to have a larger and much costlier impact.

Mass shooting in Milwaukee: What we know

Milwaukee Mayor Tom Barrett in 2012. Photo: John Gress/Corbis via Getty Images

Six people died in a shooting at the Molson Coors Brewing Company in Milwaukee on Wednesday, including the gunman, Mayor Tom Barrett told reporters at a Wednesday evening press conference with local police.

Details: All of the victims worked at the brewery complex, as did the shooter who died of "an apparent self-inflicted gunshot wound," police confirmed in a statement late Wednesday.

Go deeperArrowUpdated 7 hours ago - Politics & Policy

Coronavirus updates: South Korea case count tops 2,000

Data: The Center for Systems Science and Engineering at Johns Hopkins, the CDC, and China's Health Ministry. Note: China numbers are for the mainland only and U.S. numbers include repatriated citizens.

33 people in California have tested positive for the coronavirus, and health officials are monitoring 8,400 people who have recently returned from "points of concern," Gov. Gavin Newsom said Thursday.

The big picture: COVID-19 has killed more than 2,850 people and infected over 83,000 others in some 50 countries and territories. The novel coronavirus is now affecting every continent but Antarctica, and the WHO said Wednesday the number of new cases reported outside China has exceeded those inside the country for the first time.

Go deeperArrowUpdated 8 hours ago - Health