Donald Trump Even Refuses to Pay His Top Staff

Republican presidential nominee Donald Trump has run an unusually cheap campaign in part by not paying at least 10 top staffers, consultants and advisers, some of whom are no longer with the campaign, according to a review of federal campaign finance filings.

Those who have so far not been paid, the filings show, include recently departed campaign manager Paul Manafort, California state director Tim Clark, communications director Michael Caputo and a pair of senior aides who left the campaign in June to immediately go to work for a Trump Super PAC.

The New York real estate magnate and his allies have touted his campaign’s frugality, saying it is evidence of his management skills. His campaign’s spending has totaled $89.5 million so far, about a third of what Democratic rival Hillary Clinton’s campaign has spent.

But not compensating top people in a presidential campaign is a departure from campaign finance norms. Many of the positions involved might typically come with six-figure annual paychecks in other campaigns.

“It’s unprecedented for a presidential campaign to rely so heavily on volunteers for top management positions,” said Paul Ryan, an election lawyer with the campaign finance reform advocacy group Campaign Legal Center.

The Trump campaign said the Reuters’ reporting was “sloppy at best” but declined to elaborate.

One of the 10 who were unpaid, Michael Caputo, told a Buffalo radio station in June after he resigned from the campaign, that he was not volunteering. Rather, he said he just had not gotten paid. Caputo confirmed to Reuters on Thursday that the Trump campaign has still not paid his invoices.

In another instance, two high-level former Trump campaign advisers, former Chris Christie campaign manager Ken McKay and Manafort lobbying associate Laurance Gay, departed the Trump campaign in June and went to work for the Trump-backed Super PAC, Rebuilding America Now. In June, the Super PAC paid each of them $60,000, the filings show.

Federal campaign law stipulates that people working for campaigns, who may possess strategic knowledge of a campaign or work as a campaign’s agents, must wait for 120 days before going to work for a Super PAC, a political spending group that can accept unlimited sums of money from wealthy donors so long as it does not coordinate with a campaign.

Through a spokesperson, McKay and Gay said they were volunteering for Trump and did not possess strategic information so the rule did not apply to them.

Another example of free labor is Rick Gates, who was Manafort’s deputy. According to two former high-level Trump staffers, Gates essentially functioned as the Trump campaign manager for more than two months, all while not collecting a paycheck.

By contrast, Democratic nominee Hillary Clinton’s campaign manager Robby Mook earned roughly $10,000 in July, the same amount as President Barack Obama’s campaign manager Jim Messina did in 2012. That same year, Republican nominee Mitt Romney’s campaign manager, Matt Rhoades, was making nearly $7,000 bi-monthly.

Others who, according to the FEC filings, have not been paid include finance chairman Steven Mnuchin, national political director Rick Wiley and senior adviser Barry Bennett, who were not available for comment. Nor were Manafort, Gates and Clark.

Many campaigns have volunteers who work as low-level ground troops, knocking on voters’ doors and passing out campaign buttons. There are instances in other campaigns of senior staff opting not to draw a paycheck. For example, John Podesta, a longtime adviser to Clinton who is now her campaign chairman, considers his role honorary and does not draw a salary.

What is unusual, however, is for a campaign to have such a large group of people in top positions who are unpaid.

After Manafort resigned in August, Trump promoted his senior adviser and top pollster, Kellyanne Conway, to become his new campaign manager.

Before then, Conway ran a Super PAC affiliated with Texas Senator and Republican presidential candidate Ted Cruz. For work from June 2015 to June 2016, the Super PAC paid the firm she owns more than $700,000.

She officially joined the Trump campaign July 1. But so far, according to campaign finance reports that detail spending through July 31, Conway has not been paid by the Trump campaign.

She did not respond to a request for comment.

Reality

Donald Trump has had a long history of refusing payment to the little guys, contractors and employees, now it appears he won’t look out for the big guys either.

After Being Called Out Donald Trump Flip-Flips on Raising Federal Minimum Wage, Then Lies

Donald Trump says he backs raising the minimum wage to $10 per hour and that states should decide.

“Well, I would leave it and raise it somewhat,” the GOP presidential nominee told Bill O’Reilly on Fox News’s “The O’Reilly Factor” on Tuesday.

“You need to help people, and I know it’s not very Republican to say, but you need to help people,” he added.

“I would say $10, but with the understanding that somebody like me is going to bring back jobs, I don’t want people to be in that $10 category for very long. But the thing is, Bill, let the states make the deal. They’re not doing that for the most part.”Trump also accused former Democratic candidate Bernie Sanders of distorting his position on the issue.

“When Bernie Sanders said that I want to go less than what the minimum wage — I mean honestly, Bill, these people are lying so much and every fact checker said Trump never said that,” he said. “I never did say it. I believe it should be raised.”

(h/t The Hill)

Reality

However, Trump’s claim that he never wanted to go less then the minimum wage is a complete and total lie and we have the videos to prove it.

Trump’s public comments regarding wages being too high started in August, 2015 when during a speech he told Michigan auto workers right to their faces that they make too much money.

He said U.S. automakers could shift production away from Michigan to communities where autoworkers would make less. “You can go to different parts of the United States and then ultimately you’d do full-circle — you’ll come back to Michigan because those guys are going to want their jobs back even if it is less.

Then during the 4th GOP debate on November 10th, 2015, Trump said he would lower the minimum wage during a Republican debate:

Taxes too high, wages too high.

And then on again on November 11th, 2015 during an interview with Fox News, Trump went the extra step to explain why wages are too high:

Whether it’s taxes or wages, if they’re too high we’re not going to be able to compete with other countries.

Is anyone really surprised that a billionaire businessman wants to keep American worker’s wages low?

Media

Hotel Fights Back After Trump Refuses To Pay

A Virginia hotel is fighting back against Donald Trump after the GOP presidential nominee criticized the air conditioning — or lack thereof — at a Monday event there.

“If we are in a ballroom, it’s not supposed to be so hot that everybody in the audience is using a fan,” Trump said during the campaign event at the Hotel Roanoke and Conference Center.

And he threatened to not pay his bill for the room — a frequent move by Trump’s companies when he says he receives inadequate service.

“You ought to try turning on the air conditioning or we are not going to get you paid,” Trump said. “I pay my bills so fast with somebody good. With somebody average, I pay them OK. With somebody great, a lot of times I give them bonuses … This is ridiculous.”

Attendees at the event appeared warm and uncomfortable, and laughed when Trump commented on the lack of air conditioning.

On Tuesday, the hotel pushed back, saying it had operated the air conditioning fully and pointing to the number of people in the room as the issue.

“The Hotel Roanoke and Conference Center is committed to providing exceptional service and accommodation for all guests and members of the community,” hotel spokesman Michael Quonce said in a statement. “The hotel’s HVAC system was on and working properly through the event. We made every effort to create a comfortable environment for all of our guests given soaring temperatures and a ballroom filled with hundreds of attendees.”

The Trump campaign did not immediately respond to a request for comment.

(h/t CNN)

Reality

Separate investigations have found that Trump has a pattern of not paying or underpaying contractors and individuals he has worked with, alleging that the work was substandard. And lawsuits show Trump’s organization wages Goliath vs David legal battles over small amounts of money that are negligible to the billionaire and his executives — but devastating to his much-smaller foes.

Reports published by USA Today and The Wall Street Journal in June found Trump’s companies were facing hundreds of claims that Trump has stiffed people he contracted with for decades.

Both reports analyzed court records and interviewed the people behind the claims, and found that the average working American that Trump has geared his campaign toward are some of the same people his business hasn’t paid.

Often, the issue is settled out of court for less than the sum owed under the weight of costly legal proceedings.

Trump maintains that he pays for adequate service and even pays extra when work is performed exceptionally well.

Media

Judge Orders Trump to Pay Nearly $300,000 in Attorney’s Fees in Doral Painter’s Lawsuit

While developer Donald Trump was busy getting the Republican Party’s presidential nomination this week, he was losing big in a Miami-Dade County courtroom.

Circuit Court Judge Jorge Cueto, presiding over a lawsuit related to unpaid bills brought by a local paint store against the Trump National Doral Miami golf resort, ordered the billionaire politician’s company to pay the Doral-based mom-and-pop shop nearly $300,000 in attorney’s fees.

All because, according to the lawsuit, Trump allegedly tried to stiff The Paint Spot on its last payment of $34,863 on a $200,000 contract for paint used in the renovation of the home of golf’s famed Blue Monster two years ago.

Trump National’s insistence that it had “paid enough” for the paint despite a contract, according to the lawsuit, caused The Paint Spot to slap a lien on the property and Cueto to order the foreclosure sale of the resort.

In time, Donald Trump’s company got the judge to cancel the June 28 courthouse auction after it placed the $34,000 in escrow, and the case was put on hold while Trump National’s owner, Trump Endeavor, considered an appeal.

But the lien remained.

And Cueto was asked to rule on the fees for The Paint Spot’s three $500-an-hour attorneys and two $150-an-hour paralegals that lawsuit loser Trump Endeavor will have to pay.

The golf company, according to the court file, objected to the hourly rates because it paid its lawyers $400 an hour, according to court records.

This week, Cueto ruled that the fees were reasonable, and then some.

First, he ruled Trump should pay for nearly 500 hours of legal work, since the store’s legal team had to prepare for a trial that never took place.

Then, Cueto tacked on a 75 percent “risk” fee, partly because the store’s lawyers took the risk that they would never be paid if they lost.

Total: $282,949 and 91 cents, including copying and expert testimony.

“I’m happy I have a judgment,” said Juan Carlos Enriquez, owner of The Paint Spot. “But he [Trump] hasn’t paid yet.

“You know how he says he’ll surround himself with the greatest people if he is president? In this case, he might not be surrounded by the right people.”

Trump bought the property in 2012 for $150 million then launched into a major renovation.

Alan Garten, Trump’s in-house lawyer, didn’t return a call for comment.

(h/t The Miami Herald)

Update

Trump appealed but a state appeals court in Florida on Thursday affirmed a circuit court’s decision to order Trump National Doral Miami golf resort to pay a small paint company and its attorney hundreds of thousands of dollars after failing to pay a tenth of that for paint and other materials during a renovation project.

Trump To Pay Thousands For Retaliating Against Workers On Day He Accepts The GOP Nomination

Just a few hours before he officially accepts the presidential nomination of the Republican party, Donald Trump agreed to pay a $11,200 federal settlement for retaliating against workers who voted to unionize at his eponymous Las Vegas hotel.

Trump, who claims he “never settles” when sued, agreed to pay the workers after the National Labor Relations Board found that Trump’s corporation had unfairly challenged the union vote and illegally retaliated against the workers who led the organization effort. Trump must now pay back wages to two workers, one of whom the hotel fired and another who was denied a promotion for convincing her 500-plus co-workers to join the Culinary Workers Union in Las Vegas. Under the terms of the settlement, Trump did not admit breaking federal labor laws.

Workers at the hotel told reports at the LA Times that the Trump corporation threatened and intimidated them in the lead up to the union vote.

Trump co-owns the Vegas hotel with mogul Phil Ruffin, who took the podium Wednesday night at the Republican National Convention in Cleveland to extol Trump’s virtues as a boss.

“As a result of his vision, he’s put tens of thousands of American workers to work,” Ruffin said. “And these are high-paid jobs.”

But the workers employed at Trump’s Vegas hotel tell a different story.

Trump hotel housekeeper Maria Jaramillo told ThinkProgress in February that she is paid much less and has much fewer health benefits than workers at other hotels on the Las Vegas Strip.

“At Mandalay Bay I had health insurance for free, a retirement [account], every year I got a raise, I got holiday pay,” she said, explaining that she left that job to raise her children and couldn’t get it back. “Over here [at Trump International] we don’t get an [annual] raise, we have to pay for our insurance, and we have no retirement. It’s a big difference. I’m not making enough to give my kids a better future.”

The Trump International Hotel pays its workers, on average, $3 an hour less than the city’s other hotels. And while the company was forced by the National Labor Relations Board to recognize the union earlier this year, they have so far refused to begin negotiating a contract.

“We deserve one. We’re not second-class workers,” Jaramillo said.

Throughout his campaign, Trump has pitched himself as a friend of the working class, mainly by promising to stop the outsourcing of jobs to other countries. Yet that message may not be resonating in Cleveland, the host city of the RNC.

A group of local workers gathered on the eve of the convention on Sunday to denounce Trump’s record of repeatedly refusing to pay workers and contractors he has hired, of opposing a raise in the federal minimum wage, and of fighting workers’ attempts to organize.

“We’ve all heard Mr. Trump’s appeals to working people,” said Mike Kilbane, a lifelong Cleveland resident and construction worker. “But it’s a ruse, a smokescreen. It’s faux populism, a sad attempt to divide the working class in this country.”

Citing Trump’s dealings with his workers in Las Vegas and elsewhere, Kilbane continued: “This man is a card-carrying member of the ruling class, someone who has known privilege and entitlement his entire life. He puts his own personal gain and profit over any other consideration, and he’ll do anything to make sure it continues.”

(h/t Think Progress)

Links

Culinary Workers Union 226 article.

Trump’s Vegas Hotel Spent Half A Million Dollars To Stop Maids From Unionizing

GOP presidential hopeful Donald Trump fashions himself a friend of union workers. He has bragged about having good relationships with labor unions. When the AFL-CIO recently endorsed his Democratic rival, Hillary Clinton, Trump claimed it was he who deserved the labor federation’s coveted backing.

“I believe [union] members will be voting for me in much larger numbers than for her,” Trump declared last month.

Before entering the voting booth, those union members might want to know how much money one of Trump’s businesses has spent in an effort to persuade low-wage workers not to unionize.

The Culinary Workers Union recently organized housekeepers and other service workers at the Trump International Hotel in Las Vegas. The union won the election in December — but not without a fight from hotel owners Trump Ruffin Commercial LLC. That’s a joint venture between the likely GOP nominee and casino magnate Phil Ruffin, himself a major financial backer of Trump’s presidential run.

According to Labor Department disclosure forms reviewed by The Huffington Post, Trump Ruffin shelled out more than half a million dollars last year to a consulting firm that combats union organizing efforts. The money was paid from Trump Ruffin to Cruz & Associates in a series of seven payments between July and December, totaling $560,631.

Nearly $285,000 of that money was paid over the course of two weeks in December, shortly after the hotel held its union election.

Despite the heavy investment from Trump Ruffin, the union prevailed by a vote of 238 to 209. Trump Ruffin argued in a filing with the National Labor Relations Board that the union illegally swayed the vote, but a regional director for the NLRB rejected those claims. The hotel has asked that the board members in Washington review that decision. According to an NLRB spokeswoman, the board has not yet determined whether it will grant that review.

A lawyer for Trump and a campaign spokeswoman did not immediately respond to requests for comment on the payments. Lupe Cruz, the owner of Cruz & Associates, did not respond to a voicemail left at his office on Friday.

Cruz, himself a former union organizer, is known for his consulting work on behalf of employers battling unions. Trump Ruffin’s disclosure forms listed the payments to Cruz as being for “consultation services and employee educational meetings.”

Companies often enlist the services of anti-union consultants to deal with an organizing campaign. The consultants’ goal is to convince enough workers that forming a union would be against their best interests so that the union eventually loses the election. Unions derisively call these consultants “union busters.” Their tactics can be subtle or not so subtle. When companies retain such firms, they are required to disclose their payments in filings to the Labor Department.

While there’s nothing out of the ordinary about the Trump hotel’s use of labor consultants, the more than half a million dollars spent by the hotel is significant. (For perspective, another Trump enterprise — his presidential campaign — began the month of June with only $1.3 million on hand.) The large sum indicates just how badly hotel management wanted to keep workers from unionizing, despite Trump’s public claims that he is an ally of rank-and-file workers.

The billionaire has spent much of the last week trying to align himself with the downtrodden working class, particularly by speaking out against U.S. trade pacts with other countries. Trump and much of organized labor share the perspective that these have been raw deals for the average American worker.

At different points in his campaign, Trump has also boasted that as a business owner, he’s gotten along well with unions. “I’ve worked with unions over the years — I’ve done very well with unions,” he said at a town hall meeting in February. “And I have tremendous support within unions.”

But the Culinary Workers Union accused management at Trump’s hotel of violating labor law numerous times by allegedly retaliating against pro-union employees during the organizing campaign. The NLRB’s general counsel, who acts as a kind of prosecutor, found merit in many of those charges, accusing the hotel of illegally firing one worker and intimidating others. The labor board has not yet ruled on the matter.

The bargaining unit at Trump International in Las Vegas includes more than 500 housekeepers, restaurant employees and guest services workers, many of them Latino and Filipino. The union has urged the hotel to accept the election results and start bargaining over a first contract.

“We asked the company to sit down and bargain with us back in December, and they should have,” Bethany Khan, a union spokeswoman, previously told The Huffington Post. “They’re running out of time and options to delay this.”

The union claims that housekeepers at Trump’s hotel earn about $3 less per hour than housekeepers at other unionized hotels on the Vegas Strip.

(h/t Huffington Post)

Reality

And yet the candidate claims to be a friend of regular working people.

Hundreds Allege Donald Trump Doesn’t Pay His Bills

USA TODAY – During the Atlantic City casino boom in the 1980s, Philadelphia cabinet-builder Edward Friel Jr. landed a $400,000 contract to build the bases for slot machines, registration desks, bars and other cabinets at Harrah’s at Trump Plaza.

The family cabinetry business, founded in the 1940s by Edward’s father, finished its work in 1984 and submitted its final bill to the general contractor for the Trump Organization, the resort’s builder.

Edward’s son, Paul, who was the firm’s accountant, still remembers the amount of that bill more than 30 years later: $83,600. The reason: the money never came. “That began the demise of the Edward J. Friel Company… which has been around since my grandfather,” he said.

Donald Trump often portrays himself as a savior of the working class who will “protect your job.” But a USA TODAY NETWORK analysis found he has been involved in more than 3,500 lawsuits over the past three decades — and a large number of those involve ordinary Americans, like the Friels, who say Trump or his companies have refused to pay them.

At least 60 lawsuits, along with hundreds of liens, judgments, and other government filings reviewed by the USA TODAY NETWORK, document people who have accused Trump and his businesses of failing to pay them for their work. Among them: a dishwasher in Florida. A glass company in New Jersey. A carpet company. A plumber. Painters. Forty-eight waiters. Dozens of bartenders and other hourly workers at his resorts and clubs, coast to coast. Real estate brokers who sold his properties. And, ironically, several law firms that once represented him in these suits and others.

Trump’s companies have also been cited for 24 violations of the Fair Labor Standards Act since 2005 for failing to pay overtime or minimum wage, according to U.S. Department of Labor data. That includes 21 citations against the defunct Trump Plaza in Atlantic City and three against the also out-of-business Trump Mortgage LLC in New York. Both cases were resolved by the companies agreeing to pay back wages.

In addition to the lawsuits, the review found more than 200 mechanic’s liens — filed by contractors and employees against Trump, his companies or his properties claiming they were owed money for their work — since the 1980s. The liens range from a $75,000 claim by a Plainview, N.Y., air conditioning and heating company to a $1 million claim from the president of a New York City real estate banking firm. On just one project, Trump’s Taj Mahal casino in Atlantic City, records released by the New Jersey Casino Control Commission in 1990 show that at least 253 subcontractors weren’t paid in full or on time, including workers who installed walls, chandeliers and plumbing.

The actions in total paint a portrait of Trump’s sprawling organization frequently failing to pay small businesses and individuals, then sometimes tying them up in court and other negotiations for years. In some cases, the Trump teams financially overpower and outlast much smaller opponents, draining their resources. Some just give up the fight, or settle for less; some have ended up in bankruptcy or out of business altogether.

Trump and his daughter Ivanka, in an interview with USA TODAY, shrugged off the lawsuits and other claims of non-payment. If a company or worker he hires isn’t paid fully, the Trumps said, it’s because The Trump Organization was unhappy with the work.

“Let’s say that they do a job that’s not good, or a job that they didn’t finish, or a job that was way late. I’ll deduct from their contract, absolutely,” Trump said. “That’s what the country should be doing.”

‘VISIBLY WINCED’

To be sure, Trump and his companies have prevailed in many legal disputes over missing payments, or reached settlements that cloud the terms reached by the parties.

However, the consistent circumstances laid out in those lawsuits and other non-payment claims raise questions about Trump’s judgment as a businessman, and as a potential commander in chief. The number of companies and others alleging he hasn’t paid suggests that either his companies have a poor track record hiring workers and assessing contractors, or that Trump businesses renege on contracts, refuse to pay, or consistently attempt to change payment terms after work is complete as is alleged in dozens of court cases.

In the interview, Trump repeatedly said the cases were “a long time ago.” However, even as he campaigns for the presidency, new cases are continuing. Just last month, Trump Miami Resort Management LLC settled with 48 servers at his Miami golf resort over failing to pay overtime for a special event. The settlements averaged about $800 for each worker and as high as $3,000 for one, according to court records. Some workers put in 20-hour days over the 10-day Passover event at Trump National Doral Miami, the lawsuit contends. Trump’s team initially argued a contractor hired the workers, and he wasn’t responsible, and counter-sued the contractor demanding payment.

“Trump could have settled it right off the bat, but they wanted to fight it out, that’s their M.O.” said Rod Hannah, of Plantation, Fla., the lawyer who represented the workers, who he said are forbidden from talking about the case in public. “They’re known for their aggressiveness, and if you have the money, why not?”

Similar cases have cropped up with Trump’s facilities in California and New York, where hourly workers, bartenders and wait staff have sued with a range of allegations from not letting workers take breaks to not passing along tips to servers. Trump’s company settled the California case, and the New York case is pending.

Trump’s Doral golf resort also has been embroiled in recent non-payment claims by two different paint firms, with one case settled and the other pending. Last month, his company’s refusal to pay one Florida painter more than $30,000 for work at Doral led the judge in the case to order foreclosure of the resort if the contractor isn’t paid.

Juan Carlos Enriquez, owner of The Paint Spot, in South Florida, has been waiting more than two years to get paid for his work at the Doral. The Paint Spot first filed a lien against Trump’s course, then filed a lawsuit asking a Florida judge to intervene.

In courtroom testimony, the manager of the general contractor for the Doral renovation admitted that a decision was made not to pay The Paint Spot because Trump “already paid enough.” As the construction manager spoke, “Trump’s trial attorneys visibly winced, began breathing heavily, and attempted to make eye contact” with the witness, the judge noted in his ruling.

That, and other evidence, convinced the judge The Paint Spot’s claim was credible. He ordered last month that the Doral resort be foreclosed on, sold, and the proceeds used to pay Enriquez the money he was owed. Trump’s attorneys have since filed a motion to delay the sale, and the contest continues.

Enriquez still hasn’t been paid.

Unpaid hourly workers

Trump frequently boasts that he will bring jobs back to America, including Tuesday in a primary-election night victory speech at his golf club in suburban New York City. “No matter who you are, we’re going to protect your job,” Trump said Tuesday. “Because let me tell you, our jobs are being stripped from our country like we’re babies.”

But the lawsuits show Trump’s organization wages Goliath vs David legal battles over small amounts of money that are negligible to the billionaire and his executives — but devastating to his much-smaller foes.

In 2007, for instance, dishwasher Guy Dorcinvil filed a federal lawsuit against Trump’s Mar-a-Lago Club resort in Palm Beach, Fla., alleging the club failed to pay time-and-a-half for overtime he worked over three years and the company failed to keep proper time records for employees.

Mar-a-Lago LLC agreed to pay Dorcinvil $7,500 to settle the case in 2008. The terms of the settlement agreement includes a standard statement that Mar-a-Lago does not admit fault and forbids Dorcinvil or his lawyers from talking about the case, according to court records.

Developers with histories of not paying contractors are a very small minority of the industry, said Colette Nelson, chief advocacy officer of the American Subcontractors Association. But late or missing payments can be devastating for small businesses and their employees.

“Real estate is a tough and aggressive business, but most business people don’t set out to make their money by breaking the companies that they do business with,” she said, stressing she couldn’t speak directly to the specifics of cases in Trump’s record. “But there are a few.”

In the interview, Trump said that complaints represent a tiny fraction of his business empire and dealings with contractors and employees, insisting all are paid fairly. “We pay everybody what they’re supposed to be paid, and we pay everybody on time,” he said. “And we employ thousands and thousands of people. OK?”

The slot-machine cabinets

Despite the Trumps’ assertion that their companies only refuse payment to contractors “when somebody does a bad job,” he has sometimes offered to hire those same contractors again. It’s a puzzling turn of events, since most people who have a poor experience with a contractor, and who refuse to pay and even fight the contractor in court, aren’t likely to offer to rehire them.

Nevertheless, such was the case for the Friels. After submitting the final bill for the Plaza casino cabinet-building in 1984, Paul Friel said he got a call asking that his father, Edward, come to the Trump family’s offices at the casino for a meeting. There Edward, and some other contractors, were called in one by one to meet with Donald Trump and his brother, Robert Trump.

“He sat in a room with nine guys,” Paul Friel said. “We found out some of them were carpet guys. Some of them were glass guys. Plumbers. You name it.”

In the meeting, Donald Trump told his father that the company’s work was inferior, Friel said, even though the general contractor on the casino had approved it. The bottom line, Trump told Edward Friel, was the company wouldn’t get the final payment. Then, Friel said Trump added something that struck the family as bizarre. Trump told his dad that he could work on other Trump projects in the future.

“Wait a minute,” Paul Friel said, recalling his family’s reaction to his dad’s account of the meeting. “Why would the Trump family want a company who they say their work is inferior to work for them in the future?”

Asked about the meeting this week, Trump said, “Was the work bad? Was it bad work?” And, then, after being told that the general contractor had approved it, Trump added, “Well, see here’s the thing. You’re talking about, what, 30 years ago?”

Ivanka Trump added that any number of disputes over late or deficient payments that were found over the past few decades pale in comparison to the thousands of checks Trump companies cut each month.

“We have hundreds of millions of dollars of construction projects underway. And we have, for the most part, exceptional contractors on them who get paid, and get paid quickly,” she said, adding that she doubted any contractor complaining in court or in the press would admit they delivered substandard work. “But it would be irresponsible if my father paid contractors who did lousy work. And he doesn’t do that.”

But, the Friels’ story is similar to experiences of hundreds of other contractors over the casino-boom decade in Atlantic City. Legal records, New Jersey Casino Control Commission records and contemporaneous local newspaper stories recounted time and again tales about the Trumps paying late or renegotiating deals for dimes on the dollar.

A half-decade after the Friels’ encounter, in 1990, as Trump neared the opening of his third Atlantic City casino, he was once again attempting to pay contractors less than he owed. In casino commission records of an audit, it was revealed that Trump’s companies owed a total of $69.5 million to 253 subcontractors on the Taj Mahal project. Some already had sued Trump, the state audit said; others were negotiating with Trump to try to recover what they could. The companies and their hundreds of workers had installed walls, chandeliers, plumbing, lighting and even the casino’s trademark minarets.

One of the builders was Marty Rosenberg, vice president of Atlantic Plate Glass Co., who said he was owed about $1.5 million for work at the Taj Mahal. When it became clear Trump was not going to pay in full, Rosenberg took on an informal leadership role, representing about 100 to 150 contractors in negotiations with Trump.

Rosenberg’s mission: with Trump offering as little as 30 cents on the dollar to some of the contractors, Rosenberg wanted to get as much as he could for the small businesses, most staffed by younger tradesmen with modest incomes and often families to support.

“Yes, there were a lot of other companies,” he said of those Trump left waiting to get paid. “Yes, some did not survive.”

Rosenberg said his company was among the lucky ones. He had to delay paying his own suppliers to the project. The negotiations led to him eventually getting about 70 cents on the dollar for his work, and he was able to pay all of his suppliers in full.

Unpaid based on ‘whimsy’

The analysis of Trump lawsuits also found that professionals, such as real estate agents and lawyers, say he’s refused to pay them sizable sums of money. Those cases show that even some loyal employees, those selling his properties and fighting for him in court, are only with him until they’re not.

Real estate broker Rana Williams, who said she had sold hundreds of millions of dollars in Manhattan property for Trump International Realty over more than two decades with the company, sued in 2013 alleging Trump shorted her $735,212 in commissions on deals she brokered from 2009 to 2012. Williams, who managed as many as 16 other sales agents for Trump, said the tycoon and his senior deputies decided to pay her less than her contracted commission rate “based on nothing more than whimsy.”

Trump and Williams settled their case in 2015, and the terms of the deal are confidential, as is the case in dozens of other settlements between plaintiffs and Trump companies.

However, Williams’ 2014 deposition in the case is not sealed. In her sworn testimony, Williams said the 2013 commission shortage wasn’t the only one, and neither was she the only person who didn’t get fully paid. “There were instances where a sizable commission would come in and we would be waiting for payment and it wouldn’t come,” she testified. “That was both for myself and for some of the agents.”

Another broker, Jennifer McGovern, filed a similar lawsuit against the now-defunct Trump Mortgage LLC in 2007, citing a six-figure commission on real-estate sales that she said went unpaid. A judge issued a judgment ordering Trump Mortgage to pay McGovern $298,274.

Turning the tables on lawyers

Even Trump’s own attorneys, on several occasions, sued him over claims of unpaid bills.

One law firm that fought contractors over payments and other issues for Trump — New York City’s Morrison Cohen LLP — ended up on the other side of a similar battle with the mogul in 2008. Trump didn’t like that its lawyers were using his name in press releases touting its representation of Trump in a lawsuit against a construction contractor that Trump claimed overcharged him for work on a luxury golf club.

As Trump now turned his ire on his former lawyers, however, Morrison Cohen counter-sued. In court records, the law firm alleged Trump didn’t pay nearly a half million dollars in legal fees. Trump and his ex-lawyers settled their disputes out of court, confidentially, in 2009.

In 2012, Virginia-based law firm Cook, Heyward, Lee, Hopper & Feehan filed a lawsuit against the Trump Organization for $94,511 for legal fees and costs. The case was eventually settled out of court. But as the case unfolded, court records detail how Trump’s senior deputies attacked the attorneys’ quality of work in the local and trade press, leading the firm to make claims of defamation that a judge ultimately rejected on free speech grounds.

‘Tons of these stories out there’

Trump claims in his presidential personal financial disclosure to be worth $10 billion as a result of his business acumen. Many of the small contractors and individuals who weren’t paid by him haven’t been as fortunate.

Edward Friel, of the Philadelphia cabinetry company allegedly shortchanged for the casino work, hired a lawyer to sue for the money, said his son, Paul Friel. But the attorney advised him that the Trumps would drag the case out in court and legal fees would exceed what they’d recover.

The unpaid bill took a huge chunk out of the bottom line of the company that Edward ran to take care of his wife and five kids. “The worst part wasn’t dealing with the Trumps,” Paul Friel said. After standing up to Trump, Friel said the family struggled to get other casino work in Atlantic City. “There’s tons of these stories out there,” he said.

The Edward J. Friel Co. filed for bankruptcy on Oct. 5, 1989.

Says the founder’s grandson: “Trump hits everybody.”

Links

USA Today article

 

 

 

A Trump University Book Includes Tax Avoidance Strategies

Trump University logo

Donald Trump’s opponents have posited no shortage of theories for why the New York billionaire would be wary of releasing his tax returns. High on the list? The likely use of extensive tax avoidance strategies.

None other than Trump University — the now-defunct education company named after the tycoon — heartily touts a book explicitly designed to help people do just that: avoid taxes.

The book, “Asset Protection 101: Tax and Legal Strategies of the Rich,” lays out in extensive detail strategies to keep the U.S. government away from the readers’ assets. It minces no words on its intent, at one point telling readers “the topic of asset protection is amazing, cunning, baffling, powerful and tricky.”

Trump wrote the foreward to the book, which was authored by attorney J.J. Childers and published in 2007 under the Trump University banner — part of a series of books promoted as “practical, straightforward primers on the basics of doing business the Trump way — successfully.”

“If you’re not satisfied with the status quo in your career, read this book, pick one key idea and implement it. I guarantee it will make you money,” the presumptive Republican nominee wrote in his foreword.

Trump touts the book — and the others in the Trump University series — as a recipe to riches, calling the contents “the most important and powerful ideas in business — the same concepts taught in the most respected MBA curricula and used by the most successful companies in the world, including The Trump Organization.”

“I created Trump University to give motivated business-people the skills required to achieve lasting success,” Trump wrote.

Asked about the book and Trump’s personal strategies on tax avoidance, Trump’s spokeswoman Hope Hicks pointed to Trump’s tax plan, which is posted on the campaign’s website. As to Trump’s returns themselves, Hicks reiterated that Trump “is undergoing a routine audit and plans to release the returns when the audit is complete.”

The IRS has corrected this false claim: “Federal privacy rules prohibit the IRS from discussing individual tax matters. Nothing prevents individuals from sharing their own tax information.”

The book itself is an in-the-weeds breakdown of strategies to shield income and property from the Internal Revenue Service. With sections including “Tax Secrets of the Wealthy,” “Lawsuit Protection Secrets of the Wealthy” and “Estate and Retirement Planning Secrets of the Wealth,” it’s composed of the ins-and-outs of how, in its words, readers can set themselves up to “pay as little tax as legally possible.”

In short, it’s a certified public accountant’s dream manual.

Or, as the book puts it:

These strategies are one of the primary reasons why people make statements such as, “the rich just keep getting richer.” It’s true. The difference between the rich and others is that the rich take the time to learn the system. Others simply sit around and complain about the system. If you feel like the rules of the game discriminate against one group or another, you’re right. Businesses get far more in deductions than do individuals. If you don’t like the treatment that you’re getting as an individual, it’s time for you to get down to business. You can do that by starting a business so that you can take advantage of the tax secrets of the wealthy.

Examples

Get your head around reality

The rich have an army of lawyers and accountants solely focused on taxes. Those lawyers and accountants are paid very well to make sure the rich find as many loopholes as possible to shield their cash and property. And with good reason, according to the book:

Asset protection is the foundation of all wealth building; you must understand it if you are ever to join the ranks of the financial elite.

Prepare for combat

Those lawyers and accountants are there for a reason — to fight. And that, according to the book, is the attitude needed to truly take advantage of a tax code riddled with loopholes. Just remember: do it legally.

If you plan on becoming (or staying) wealthy you must learn to legally combat your tax bill.

Lawsuits

Maybe worse than the IRS: While the government is certainly Enemy No. 1 in the book, lawsuits — the kind that can threaten accumulated wealth — come in a close second.

Putting your assets in a position that will leave them untouched by litigation is crucial.

Entire family futures have been put in jeopardy. The worst part is that these lawsuits often could have been avoided with a few simple preventative measures.

Shield your retirement

Or the government will take it: The book goes into great detail on how to structure your savings in a way that will shelter them from future taxes, fees or expenses.

Wealthy families in this country take estate planning seriously because they know how bad government intervention can be. You must adopt this mentality.

Don’t be afraid of the IRS

While the U.S. government certainly isn’t revered in the book, it also goes to great lengths to make clear that readers shouldn’t be afraid. Instead, the convoluted tax code provides a series of advantages — the kinds that should be taken advantage of.

The fact is, you don’t have to be scared of the IRS. Americans have every right — some would say a duty — to pay as little tax as possible.

A business can be one hell of a tax shelter

The chapter titled “The Greatest Tax Shelter in the World: Owning Your Own Business” includes a section on breaks known as like-kind exchanges, or the use of “1031,” as it’s often called, for the section of the tax code where it resides. Use of such strategies is so valuable, it’s a shock they’re legal, according to one passage in the book:

Would you be interested in avoiding paying the tax on the sale of your property completely while maintaining or even increasing your overall net worth? Of course, any wise investor would. Amazingly, this can indeed happen and even better, it is totally legal.

The break allows real estate owners to sell a piece of property and avoid taxes on any capital gains by buying a new one shortly thereafter. Continued use of the break, which basically comes down to swapping properties, would result in deferred capital gains that, if deployed strategically — and repeatedly — by an active real estate investor, could completely avoid taxation.

The tax code is undoubtedly skewed toward easing burdens on small businesses. (Because seriously, what lawmaker is going to vote against a loophole that benefits small business?)

The best advice I can give to anyone looking to keep a larger percentage of their hard-earned money is to do what it takes to own your own business.

Real estate is king

In a passage that lines up rather nicely with Donald Trump’s primary line of business, the book makes clear that real estate — either through rental-income or through appreciation — is a great way to use the tax code to actually build wealth.

There are very few business opportunities that allow you to build wealth without paying taxes and then subsequently pay reduced rates when the time comes to settle up with Uncle Sam. Real estate, however, is a prime exception.

The book, citing Trump himself, makes clear that the tax code favors those in the real estate business. Between strategies like like-kind exchanges and cost segregation, real estate provides ample opportunity to take advantage of the tax code.

Embrace depreciation

Depreciation — the “mother of all tax deductions” could “potentially allow a business owner to deduct up to $108,000 of asset purchases while actually spending little to no money now.”

It’s all on you

Well, technically it’s not (see: lawyers, accountants.) But the key theme of the book is that the tax code is so riddled with loopholes that anyone who doesn’t take advantage is simply leaving money on the table.

As it concludes:

When all is said and done, you have a decision to make. You are the one responsible for what you do with what you’ve been presented. You can go on doing things the same old way, which would produce the same old results. Or you can do things the way millionaires do things.

(h/t CNN, CNN)

Reality

The book explains why the wealthy, who can afford the high-priced lawyers and accountants, are awesome and everyone else is just a sucker who has to pay their fair share in taxes.

Keep in mind all of these loopholes are 100% legal. What a sanctioned Trump book that brazenly mocks and highlights the separation between the haves and the have-nots shows is how he rarely looks out for the little guy. A common belief among Trump supporters.

Links

Sample of ‘Asset Protection 101’ on Google Books

Horrific Living Conditions for Migrants Building Trump Dubai Golf Course

Immigrant workers in Dubai building a golf course bearing Donald Trump’s name are packed in labor camps that are low even by the city’s “unbelievably low standards,” according to a report aired by Vice in April.

“The conditions of the guys building the Trump International Golf Course were the worst I’ve ever seen,” said correspondent Ben Anderson. “Having guys live 21 to a room with rats running around above them; having to work extremely hard in extreme heat for two years just to break even, just to pay off the debts they accrued getting there.”

During his report, Anderson tailed a group of buses taking workers back to their camp after working on the course. The camp, he learned, was two hours outside of Dubai in an area that lacked even an access road. One worker said he earned $231 a month, but could not leave because the company that contracted him took his passport.

Besides being stuffed into dormitories, he said, workers had to make do with restrooms that “didn’t look fit for human beings.”

Their working situation, Anderson explained, was described by Human Rights Watch officials as looking “like a trafficking network.”

According to the Daily Beast, the golf course is not being built directly by a company belonging to the Republican presidential candidate, which released a statement saying it has “a zero tolerance policy for unlawful labor practices at any project bearing the ‘Trump’ name.”

Anderson said the horrific conditions workers endure in Dubai are endemic to the United Arab Emirates, where service workers are particularly in danger of mistreatment.

“Trump is just the latest in a long line of Westerners who have gone there, taken — I assume — large amounts of money and turned a blind eye to something which is very obvious and very well-documented,” he said.

(h/t Vice, Raw Story)

Media

Links

Vice episode on HBO Go and HBO Now.

Trump Throws a Fit Over Faulty Microphone

Republican presidential front-runner Donald Trump ranted about a poorly working microphone at a campaign rally, pledging not to pay the “bastard” who set it up.

And by the way I don’t like this mic, whoever the hell brought this mic system, don’t pay the son of a bitch who brought it in,” said Trump through visible annoyance and several pops. “This mic is terrible, stupid mic keeps popping… Don’t pay him. You know I believe in paying but when somebody does a bad job like this you shouldn’t pay the bastard. Terrible! Terrible!

Media

Links

http://www.mediaite.com/online/trump-throws-tantrum-over-faulty-microphone-dont-pay-the-son-of-a-bitch-who-installed-it/

http://thehill.com/blogs/blog-briefing-room/news/265843-angry-trump-rants-about-bastard-who-set-up-faulty-microphone

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