The American presidential campaign was entering its homestretch, and the man in charge of Donald Trump’s chaotic candidacy was happily anticipating the mayhem that would be unleashed if Deutsche continued to unravel. Steve Bannon, who had made a small fortune working at Goldman Sachs, was an unlikely populist, but he had watched with boiling fury as millions of people lost their homes and their savings during the financial crisis. His father was one of the victims, having seen his retirement fund wiped out. Triggered, Bannon recast himself as a fiery destroyer of the globalist order. Big institutions—governments, corporations, multinational alliances, national political parties, you name it—became his blood enemies. He called himself an “economic nationalist.”
In Deutsche, Bannon saw evil. It was, of course, one of the world’s largest banks, and it had done more than its share to plunge America and the world into a savage recession, even as its traders and executives were bathed in riches. But more than that, Bannon was a fan of political disintegration in a literal sense. His bet was that if Deutsche went down—or even if it needed a government bailout, as looked increasingly likely—it would sow such mayhem that it would doom Germany’s powerful chancellor, Angela Merkel. And with isolationist movements engulfing much of Europe—British voters had just opted to leave the European Union, for example—Merkel looked like one of the last things standing between Europe’s political and financial union and the every-country-for-itself anarchy that Bannon craved. As Val sought vengeance and bank executives toiled to right their sinking ship, Bannon gossiped to American journalists that Deutsche was sinking and that it was taking Merkel, and the entire postwar European integration project, down with it.
What made Bannon’s gleeful diatribes especially ridiculous was that the man he was trying to install in the Oval Office to enact his anti-globalist agenda was, at that moment, relying on Deutsche more than ever.
First of all, there was the money. At the behest of Jack Brand and Christian Sewing and others, Deutsche in March 2016 had overruled Rosemary Vrablic and shot down Trump’s request to borrow money for his Scottish golf resort, Turnberry. In addition to the concerns about Trump’s reputation, the bank’s financial straits made it much harder to continue justifying tens of millions of dollars of loans at rock-bottom interest rates—which is what Trump had grown accustomed to. Trump by now owed the bank about $350 million, representing half of all of his outstanding debt. Deutsche was by far his biggest creditor, and Trump was the single biggest borrower from the private-banking division. To borrow that money, Trump had provided Deutsche with his personal financial guarantees. If he failed to pay the loans back, the bank could come after his personal assets, making his life—and his ability to project the public impression of massive wealth—exceedingly difficult.
There was also the loan to Don Jr. And there was the $15 million credit line to Jared Kushner and his mother, the biggest lending facility that Jared or either of his parents had access to. That sum was soon dwarfed when, weeks before the election, Deutsche agreed to refinance a $370 million loan to the Kushner family real estate company that it had used to buy a 250,000-square-foot space in the former headquarters of The New York Times. Jared personally guaranteed the loan.
In addition to all the money Deutsche had dispensed, the bank had become an occasional prop for the presidential candidate. One of the many critiques of Trump was his shaky record as a businessman. Exhibit A was the fact that his companies had repeatedly filed for bankruptcy. So lousy was Trump’s record, critics observed, that he had been frozen out of the banking system. “He’s written a lot of books about business—but they all seem to end at Chapter 11,” Hillary Clinton sneered in a June 2016 speech in Columbus, Ohio. “Go figure. And over the years, he intentionally ran up huge amounts of debt on his companies and then he defaulted. He bankrupted his companies—not once, not twice, but four times.”
Sue Craig, a reporter at The New York Times, was preparing an article about Trump’s excommunication from Wall Street. Her research and interviews were mostly done by the time in March that Trump picked up the phone and called her to dispute the fundamental premise of her story. “I can do business with the biggest banks in the world,” he insisted. “I just don’t need any money.” That was not true, and Craig—who had an extensive network of Wall Street sources—persisted. Trump cited his relationship with Deutsche as proof that he was not entirely on the outs. “They are totally happy with me,” he asserted. “Why don’t you call the head of Deutsche Bank?” Craig knew that John Cryan was the bank’s CEO, so she was taken aback by what came out of Trump’s mouth next: “Her name is Rosemary Vrablic.” He kept going. “They are very happy. I do business with them today. You have got to speak to the head of Deutsche Bank. Do you have Rosemary Vrablic’s number? Why don’t you call her? She is the boss.”
Was Trump confused or lying about Vrablic’s role?* Either way, he was using his years-long ties to the German bank to knock down the notion that he was a pariah in the financial world.
After Edson Mitchell pushed him out of Deutsche, Mike Offit had puttered around on the outskirts of finance. He had done some consulting, but mostly he had retreated from Wall Street. His nerve damage made working at a bank unpleasant at best, and he didn’t miss the politics of operating inside a huge institution. Anyway, he had plenty of money to live on, not least because his wife, Dara Mitchell, the Sotheby’s art saleswoman, was raking in millions. Offit decided to follow in his father’s footsteps and become a writer. He did some freelance pieces for finance publications and a stint as a columnist for a luxury lifestyle magazine. In 2014, he published a book, Nothing Personal: A Novel of Wall Street, about a pair of murders committed by and against employees of a fictional German investment bank. Characters and scenes were plucked from Offit’s adventures in banking; he would tell people that one sleazy character was modeled on Steven Mnuchin, who had stiffed him at Goldman after he got sick. On the back cover were a few blurbs. “Michael Offit offers a colorful insight into how the big money is made—and/or taken—on Wall Street,” one said. “Nothing Personal will hold your attention whether you are in finance or not. A riveting story.” The blurb was from Donald Trump.
Two years later, in October 2016, the presidential campaign was winding down, and it was time for Offit to repay that favor. Trump was getting pilloried for his pattern of bankruptcies. Offit wasn’t a big fan of Trump’s politics, but he loathed Hillary, and he was willing to do just about anything to avoid her winning the White House. (Offit held his nose and tried to ignore the fact that Mnuchin was the finance chairman of Trump’s campaign.) He pondered how Trump might be able to blunt the attacks about his personal finances. It didn’t take him long to gin up a strategy. Who were the biggest financial villains out there? Hedge funds! And they were the villains Trump should blame for his checkered financial history. He’d had to declare bankruptcy because greedy hedge funds were so obsessed with wringing every last dollar out of poor Donald Trump that they had refused to let him renegotiate his crushing debts. This was not really true, but it sounded good, and the line of attack meshed with Trump’s populist rhetoric on the campaign trail, where he’d accused hedge fund managers of getting away with “murder” through the tax code. “These are guys that shift paper around and they get lucky,” he’d declared in a TV interview.
Offit’s wife had forbidden her husband from doing anything to assist Trump, who had grossed her out ever since Offit had worked with him at Deutsche. But the election was looking like a landslide, and Offit convinced her to let him email Trump with his political advice. On a Friday evening, Offit typed up a lengthy message, explaining that Trump’s argument that he was simply using the bankruptcy law in an advantageous way wasn’t resonating with voters. “I believe there is a much better answer, that may help defuse this issue, and am just arrogant enough to suggest it,” Offit wrote. He got no response and wasn’t even sure that Trump had read the email.
Tammy McFadden had worked in Deutsche’s Jacksonville offices—a few buildings down from the FBI’s field office—for eight years when, in the summer of 2016, some suspicious Jared Kushner transactions landed in her inspection queue. Deutsche’s computer systems automatically scanned thousands of transactions every day, looking for any hints of impropriety, and then sent those flagged transactions to experts for review. McFadden, a veteran anti-money-laundering compliance officer attached to Deutsche’s private-banking division, was one of those experts.
Over the years, McFadden had received a number of internal awards from the bank for her strong performance. But by 2015, she had begun making waves, standing up for what she thought was morally and ethically right. First, she protested that the private bank had created dozens of accounts for and was lending money to Jeffrey Epstein, a politically connected financier who had repeatedly been accused of sexually abusing girls and young women. (Epstein for many years had run his companies out of Henry Villard’s old Madison Avenue mansion.) A few years after being convicted of soliciting prostitution from a minor, Epstein had been cut off from his previous bank, JPMorgan, at which point he decamped to Deutsche, as willing as ever to ignore clients’ ugly backgrounds. Some of McFadden’s colleagues had alerted superiors to suspicious overseas transactions in Epstein’s accounts, fearing that he might have been moving money around as part of a sex-trafficking operation. Deutsche’s higher-ups did nothing. McFadden, too, refused to sign off on Epstein’s activity, but managers didn’t want to hear it—he was a lucrative client. (He would remain a client until June 2019—weeks before he was criminally charged with sex trafficking of girls as young as fourteen.) “If they’re willing to do business with Jeff, Lord help us all,” McFadden would tell me.
Next, in early 2016, McFadden had noticed that many customers of the private bank, including quite a few of Vrablic’s super-rich clients, didn’t have the proper documentation attached to their accounts. This was especially problematic for customers who were classified as “politically exposed persons”—a designation that is supposed to subject them to extra vetting because of the heightened risk that they could be involved in bribery or other public corruption. After initially noticing the problem in a couple of isolated accounts, McFadden did a broader review and found more than a hundred politically exposed clients who didn’t have the requisite documentation showing things like where their money came from. Among those customers, she realized, were Donald Trump and his family members. When McFadden alerted her superiors, they told her not to worry about it. McFadden didn’t let it go, lodging a complaint with the HR department and, in the process, angering her bosses.
Now, in the summer of 2016, with Trump having clinched the Republican nomination and Kushner serving as his adviser, McFadden was assigned the task of reviewing a number of transactions in the Kushner Companies’ accounts that had triggered alerts in Deutsche’s computer system. Right off the bat, she could see why the transactions had tripped up the software: Kushner’s real estate company was moving money to a number of Russian individuals. That didn’t mean there was anything improper—it certainly wasn’t proof of money laundering—but it was unusual. McFadden did some research, looked into the recipients of the money and into the Kushner Companies’ history of moving funds overseas, and concluded that the appropriate response was for Deutsche to file a “suspicious activity report” with FinCEN, the arm of the Treasury Department responsible for policing financial crimes. Banks file thousands of such reports every year, and this didn’t strike McFadden as an especially close call. She typed up a report and sent it to her superiors.
Normally, a proposed suspicious activity report would be reviewed by another money-laundering expert, one who was outside the business unit where the transactions in question originated—in this case, the private-banking division. It was important to keep things separate; otherwise, employees with financial interests in seeing transactions go through unimpeded would be calling the shots, potentially compromising the effectiveness of Deutsche’s already questionable anti-money-laundering safeguards. This time, though, word traveled back to McFadden that her report was being killed—by managers in the private bank.* McFadden was pretty sure this was an example of the private bank trying to preserve its lucrative relationship with the Kushners (and therefore the Trumps), at the cost of not adhering to anti-money-laundering laws. She hadn’t survived at banks for decades without knowing how to stand up for herself and her work—more than a decade earlier, she’d sued Bank of America for racially discriminating against her and other black employees—and now she started making more noise. That was not the way to get ahead at Deutsche, as guys like Eric Ben-Artzi could have told her. Bosses derided McFadden to colleagues as a crazy, difficult woman. Soon she was transferred to another division and then, in April 2018, fired.
McFadden had found something important. The Kushners—with their long-standing ties not just to Deutsche but also to Bank Leumi, which had its own problematic history of doing business with Russians—were moving money to Russians at the same time that Russia was interfering in the American presidential election, trying to tilt it in favor of Jared Kushner’s father-in-law. (And Kushner’s personal banker, Vrablic, had learned the nuts and bolts of banking at . . . Bank Leumi.) It was hard not to be a little suspicious.
What exactly were the purposes of the transactions that McFadden had spotted? What did they show about the interests of Kushner, Trump, or his presidential campaign in Russia? With McFadden gone, and her suspicious activity report deleted, the answers to those questions vanished inside Deutsche’s computer systems.