Ivanka’s signature real estate deals were disasters linked to drug cartels and money laundering

The president’s daughter has been at the center of a pair of the presidential projects tied most closely to grand corruption.

Why is the president's daughter consistently at the center of the Trump projects tied closest to foreign money laundering? (CREDIT: AP/JACQUELYN MARTIN)
Why is the president's daughter consistently at the center of the Trump projects tied closest to foreign money laundering? (CREDIT: AP/JACQUELYN MARTIN)

Before her father became president, Ivanka Trump tied herself more closely to two of her father’s international projects than any others.

One, in Panama, was the current president’s first international foray — a building, according to the developer, that Donald Trump wanted to be Ivanka’s “baby.” The other, in Azerbaijan, was a project Ivanka herself claimed she “oversaw” — one for which, according to an Azeri lawyer involved with the project, the president’s daughter “personally approved everything.”

Neither project succeeded, at least from the Trumps’ point of view. The board of directors of Panama’s Trump Ocean Club eventually fired Trump’s management company, citing budget over-runs and improper bonuses. Meanwhile, the development of Trump Tower Baku was so poorly managed — thanks to shoddy construction and missing payments — that The New Yorker dubbed the building “Trump’s worst deal.” Both remain marked blots on the president’s supposed business chops — and on the record of his daughter, who remains a special adviser to the president.

But a pair of recent, in-depth investigations reveal the bungled buildings point to far more concerning missteps than mistimed bonuses or poor designs. The president and his daughter appear to have been, at best, unwitting accomplices to money laundering and grand corruption on a significant scale.

The project in Azerbaijan has been tied to allegations of money laundering from the Azeri dictatorship and those close to the Iranian Revolutionary Guard; the project in Panama has been tied to allegations of money laundering from South American drug cartels. In both instances, the Trumps apparently ignored clear signs of the corruption and money laundering drenching Ivanka’s pet projects.

“Trump’s current wealth has depended in part on securing significant infusions of untraceable foreign funds.”

“Trump’s business approach,” wrote anti-corruption group Global Witness in a recent report, “has been to lease his name and for him and his family to drum up sales in some of the world’s dirty money hotspots, in some instances aided — knowingly or unwittingly — by networks of money launderers. The result is that Trump’s current wealth has depended in part on securing significant infusions of untraceable foreign funds.”

While neither the president nor his daughter appear willing to comment on their dealings in Panama or Azerbaijan, a series of reports over the past few months have helped highlight how Trump and his daughter missed even the most basic red flags when it came to these buildings.

Panamanian Paper

The president’s and his daughter’s Panamanian construct, Trump Ocean Beach, was once described by Ivanka as her family’s “largest project in all of the Americas.”

In a report published last week, Global Witness details how the building to which Trump leased his name helped launder “proceeds from Colombian cartels’ narcotics trafficking.” And as Global Witness found, Donald Trump himself “was one of the beneficiaries” of such laundering practices. Information available from a bonds sales prospectus revealed that the Trump Organization would see revenue from every unit sold at Trump Ocean Club.

Even if Trump and Ivanka were somehow unaware that the building served as a spigot for laundering cartel cash, it would have been difficult to miss the signs that Trump Ocean Club — set up during the years that Panama came into its own as an offshore haven — was being used for money laundering on a massive scale.

There were several obvious signs that Trump Ocean Club was laundering cash:

  1. Many of the units were purchased in cash, an easy means of obscuring payments. According to the lawyer for a convicted fraudster — a criminal who acted as a “key player” in laundering drug money at Trump Ocean Club, per Global Witness — the cash that purchased the Trump Ocean Club units found its way to Panama via “mules” crossing the border from Colombia.
  2. Numerous units were purchased in bulk, a common practice behind money laundering.
  3. Numerous units were purchased via anonymous, untraceable shell companies, dozens of which contained “Trump” in their names. Anonymous shell companies, as real estate brokers from Seattle to New York to London can attest, remain one of the most popular means of laundering ill-gotten gains.
  4. Some purchases were even conducted via “bearer shares,” according to sources. “Bearer shares,” in which the holder of a certain piece of paper is the literal holder of the related share, remain so notoriously linked to money laundering that they’ve been outlawed in jurisdictions like the Bahamas, the United Kingdom, and — as of 2013, after the bulk sales at Trump Ocean Club — Panama.

“When I was in Panama I was regularly laundering money for more than a dozen companies.”

As with other assorted Trump properties, including those in South Florida, many of the clientele in Panama were among the wealthiest actors from Russia — a reality that may have piqued the interest of special prosecutor Robert Mueller. Some of the buyers, according to those interviewed by Global Witness, were connected to Russia’s mafia underworld, a type of client familiar to Trump.

But if these glaring signs weren’t enough, a Reuters investigation also found that Alexandre Henrique Ventura Nogueira, the building’s primary broker, admitted that he offered money laundering among his services. “When I was in Panama I was regularly laundering money for more than a dozen companies,” said Ventura Nogueira, who was arrested in Panama a few years ago on charges of forgery and fraud.

According to Reuters, Ventura Nogueira worked closely with Ivanka on the Panamanian project, meeting with her at least 10 times. Ventura Nogueira told the publication that Ivanka was “ultimately responsible for all aspects of the [Trump Ocean Club] licensing deal for the Trump Organization.” The building, added Global Witness, came with Ivanka’s “personal touch.”

The president's daughter praised her Panamanian project on her Facebook. (SCREENGRAB)
The president's daughter praised her Panamanian project on her Facebook. (SCREENGRAB)

The president’s daughter has remained mum publicly on the project, despite singing its praises in its early days. “Some people say it resembles a giant ‘D,’” she said a few years ago, laughing.

According to information available, the president looked to profit handsomely from the building: “Trump stood to gain $75.4 million from the [Trump Ocean Club] by the fall of 2010,” according to Global Witness, pointing out that the building was “one of Trump’s most lucrative licensing deals to date.” Moreover, Global Witness added, the Trumps “likely continue to profit from the Trump Ocean Club” — a likelihood the president, and his daughter, continue to avoid addressing, ignoring questions from multiple reporters about the Panama property.

The Azeri Laundromat

While the Trumps’ involvement in Panama netted them a fine profit, their work in Azerbaijan didn’t reach nearly the same level of revenue. As an in-depth look from The New Yorker’s Adam Davidson earlier this year found, the Trump Tower Baku project attempted to capitalize on the country’s oil boom, which coincided with the country’s slide into kleptocracy. The project was effectively taken over by Ivanka — and began floundering almost as quickly.

Not only was Ivanka the most senior Trump Organization official attached to the project, but, as she said, she also “oversaw” the building’s construction nearly from the get-go.

“Corruption warning signs are rarely more obvious.”

At the beginning, Ivanka wasn’t shy about pushing the project to her international audience. On her website, Ivanka claimed that the “new Trump Tower will join a wave of modern architecture in the city and will make for an exciting addition to the Trump Organization’s expanding portfolio.” Elsewhere, on her Instagram, Ivanka lavished praise on the building’s host city, saying the building would open in 2015.

But then, things started to go wrong. The building’s location, for some reason, saw the tower placed in one of city’s lesser-developed neighborhoods, rather than the heart of Baku. The Trumps also opted to work with close relatives of Azerbaijan’s then-transportation minister, Ziya Mammadov — an oligarch described by U.S. diplomats as “notoriously corrupt even for Azerbaijan.”

The red flags for the project in Azerbaijan, a country that remains a stalwart of international kleptocracy, were impossible to miss.

As an assistant dean at George Washington University Law School told Davidson, “The entire Baku deal is a giant red flag — the direct involvement of foreign government officials and their relatives in Azerbaijan with ties to the Iranian Revolutionary Guard. Corruption warning signs are rarely more obvious.”

According to Davidson’s research, the construction of the building, which may well have been used to launder funds from those tied to Iran’s Revolutionary Guard, put the Trumps in possible violation of the U.S.’s Foreign Corrupt Practices Act (FCPA). The FCPA, originally passed in 1977, remains one of the U.S.’s primary tools in combating foreign corruption, prohibiting American individuals and companies from bribing foreign officials. Indeed, the FCPA was, as Southern Illinois University Law Professor Mike Koehler wrote a few years ago, the “first law in the world governing domestic business conduct with foreign government officials in foreign market.”

For good measure, the Iranian government maintains an outsized track record of using shell companies — especially American shell companies — to hide its financing, including, in one notable instance, holding a New York skyscraper to draw revenue and skirt sanctions.

Trump has made his opposition to the FCPA known in the past, describing it once as a “horrible law.” But even the president, and his daughter alongside, isn’t immune from laws he may dislike. The allegations of the Trumps’ dealings in Azerbaijan were significant enough that multiple senators in Washington called for an inquiry into the president’s and his daughter’s work in Baku.

At some point earlier this year, Ivanka removed all information about the Azerbaijan project from her website, although it remains available via Internet Archive.

A screenshot from Ivanka's website, since taken down, praising her project in Azerbaijan - a project later described as "Trump's worst deal."
A screenshot from Ivanka's website, since taken down, praising her project in Azerbaijan - a project later described as "Trump's worst deal."

And the building, as anyone who’s visited Baku recently will note, stands as a shell – stripped of its promise and Trump’s name alike.

American kleptocrats

The Trumps have distanced themselves from the projects once shepherded by Ivanka in both Panama and Azerbaijan – but not before both projects attracted allegations of massive money laundering, and not after the president and his daughter decided to ignore some of the clearest signs of grand corruption that exist.

It remains unclear if the Trumps were aware of the direct sources of cartel-linked funds in Panama, or of how gleefully Azerbaijan’s dictatorship or Iran’s Revolutionary Guard viewed the Trumps’ Baku project. As Global Witness wrote, “This narrative of plausible deniability re-occurs across Trump’s projects.”

But as the FCPA makes clear, even a willful blindness isn’t a sufficient defense against allegations of international bribery and money laundering. Neither, in Ivanka’s case, is scrubbing your website of references to a building tied to kleptocrats’ funds — nor ignoring the most glaring signs of drug cartel money laundering, plain for the rest of us to see, from voters to special prosecutors alike.