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Make no mistake, getting Donald Trump’s tax returns is important. Treasury Secretary Steve Mnuchin should be held in contempt of Congress and arrested until he hands over the documents as he is legally required to do.
In a vacuum, the tax returns aren’t going to tell us a hell of a lot. Sure, they’ll (likely) show that Trump has been a bold liar about his assets and net worth. They’ll show that he has taken advantage of every tax loophole, including the ones he signed into law for himself.
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Will they show tax fraud? Will they even show non-standard tax avoidance? That’s hard to know, mainly because tax lawyers are the smartest lawyers in the game and so you don’t end up with people like Michael Cohen doing your taxes.
But that’s in a vacuum. In context, Trump’s tax returns can be singularly damaging, if they can be lined up with other evidence of assets or income.
That’s why the House Intelligence and Financial Services committees subpoena of Trump records from Deutsche Bank, today, are particularly significant. Trump’s taxes might be the anvil, but Deutsche Bank could be the hammer, and Trump might be caught in the middle.
The game here is very simple: You want to deflate your assets and income when filing your taxes, but inflate them when applying for a loan. We don’t make international financial criminals out of people who engage in a bit of puffery between the two. But if there are material discrepancies between what Trump said to Deutsche and what he said to the IRS, that could be grounds for tax fraud. Or bank fraud. Or, you know, both.
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And that’s assuming that Trump isn’t involved in Deutsche’s various other scandals. As the New York Times wrote of the Trump/Deutsche connection:
Mr. Trump and Deutsche Bank were deeply entwined, their symbiotic bond born of necessity and ambition on both sides: a real estate mogul made toxic by polarizing rhetoric and a pattern of defaults, and a bank with intractable financial problems and a history of misconduct.
Trump has reportedly borrowed over $2 billion from Deutsche bank, over the years.
You can see why Trump is fighting so hard to not release his tax returns. The committees called the Deutsche Bank subpoenas “friendly subpoenas,” meaning that the bank is eager to cooperate but can’t release some information without an official subpoena of the records.
We’ve seen what happened when Trump’s lawyer turned on him. What do you think is going to happen if his banker starts cooperating with authorities?
House committees subpoena Trump’s bank records [CNBC]
Elie Mystal is the Executive Editor of Above the Law and a contributor at The Nation. He can be reached @ElieNYC on Twitter, or at [email protected]. He will resist.