NOVEMBER 21, 2022
WASHINGTON, D.C. — When former President Donald J. Trump returned briefly last week to his office at Trump Tower in New York, he was joined by his son Eric Trump and the top executive of a Saudi Arabian real estate company to sign a deal that creates new conflict-of-interest questions for his just-launched presidential campaign.
The deal is with a Saudi real estate company, which intends to build a Trump-branded hotel, villas and a golf course as part of a $4 billion real estate project in Oman. The agreement continues a practice that had been popular for the Trump family business until Mr. Trump was elected president — selling branding rights to an overseas project in exchange for a generous licensing fee.
But what makes this project unusual — and is sure to intensify the questions over this newest transaction — is that by teaming up with the Saudi company, Mr. Trump is also becoming part of a project backed by the government of Oman itself.
The deal leaves Mr. Trump, as a former president hoping to win the White House again, effectively with a foreign government partner that has complex relations with the United States, including its role in trying to end the war in Yemen and other important foreign policy agenda items for Washington.
The deal Mr. Trump signed was with Dar Al Arkan, the Saudi-based real estate company that is leading the project in collaboration with the government of Oman, which owns the land. It is the second deal signed recently between Mr. Trump and his family that has direct financial ties to a Middle East government.
The Trump Organization also hosted the Saudi-government-backed LIV Golf tournaments at the family-owned golf clubs in New Jersey and Florida. The Saudi government’s $620 billion Public Investment Fund has financed the LIV Golf effort, which then paid venues like Trump National Doral in Miami and Trump National Golf Club Bedminster in New Jersey to host two of its tournaments this year.
The Trump administration, including Jared Kushner, Mr. Trump’s son-in-law, had close ties with Saudi Arabia during Mr. Trump’s tenure in the White House. Mr. Kushner has also received financial support from the Saudi government, a $2 billion investment in his newly formed private equity firm, Affinity Partners.
Before being elected president, Mr. Trump and his family had signed deals to license the Trump name in locations including Indonesia, Turkey, the Philippines, Dubai, India, Panama and Canada, and it owns golf resorts in Scotland and Ireland. One planned skyscraper deal in Dubai, announced in 2005, involved Nakheel, the Dubai-government-controlled real estate company. But that project was eventually abandoned.
Eight months before Mr. Trump entered the presidential race in 2015, the family company announced plans to license its name for a 33-story hotel in Baku, Azerbaijan, and the partner there was the son of a government minister. That project was also ultimately abandoned.
But elsewhere, the Trump Organization’s foreign deals generally did not directly involve a financial role by a foreign government, or at least any public acknowledgment of direct foreign government financing or a major land contribution, according to an examination of the transactions by The New York Times.
During Mr. Trump’s time in the White House, the Trump International Hotel in Washington was frequently a destination for foreign government officials, including delegations in town for planned meetings with Mr. Trump. The governments of Malaysia, Saudi Arabia, Qatar, the United Arab Emirates, Turkey and China each spent money at the hotel, according to documents that his former accounting firm turned over to Congress. The hotel received more than $3.75 million from foreign governments from 2017 to 2020, the House investigators estimated.
The Trump Organization has asserted that it paid all profits from these hotel stays to the Treasury Department through annual voluntary payments.
But this new deal — in which the Trump Organization benefits from land or financial capital provided by foreign governments — only elevates the potential for a conflict of interest to emerge, as Mr. Trump continues his dual roles as a White House candidate and business executive, ethics lawyers said.
“This is yet another example of Trump getting a personal financial benefit in exchange for past or future political power,” said Kathleen Clark, a law professor at Washington University in St. Louis. “The Saudis and Oman government may believe that giving Trump this licensing deal will benefit them in the future, should Trump become president again. This deal could be a way to ensure that they will be in Trump’s good graces.”
The Aida project in Oman is slated to be built 20 minutes outside the capital city of Muscat, on a series of hills overlooking the Arabian Sea on land controlled by the Omani Company for Development and Tourism, an Oman-government-owned tourism agency. It will include 3,500 luxury villas, two hotels with a total of 450 rooms and a golf course, as well as various restaurants and stores.
The project is part of what the government there is calling Oman Vision 2040 to try to diversify the small nation’s economy by building new hotels and golf courses and other tourist attractions. Officials in Oman did not respond Sunday to a request for comment on the project, nor did representatives for Dar Al Arkan, which is one of Saudi Arabia’s largest real estate companies.
Relations between the United States and Oman were not nearly as warm during Mr. Trump’s tenure as they were with Saudi Arabia. Oman declined to sign the agreement, called the Abraham Accords, that normalized relations between other Middle East nations and Israel.
Executives at Riyadh-based Dar Al Arkan sent out a news release on Sunday confirming the deal with Trump Organization for the new project in Oman, while also distributing photos of Mr. Trump and Eric Trump at Trump Tower in New York with executives from Dar Al Arkan.
It is one of the first times since Mr. Trump was elected president that he has publicized his role in a new family real estate deal. The Trump family stopped signing new international deals after Mr. Trump was elected. The real estate deal with the Saudi partner in Oman is the first since he left the White House.
Ziad El Chaar, the chief executive of Dar Al Arkan Global, who attended the deal-signing event, used to work at Damac Properties, the Trump family’s partner in Dubai, where the family has licensed its name to what is known as Trump International Golf Club Dubai and Trump Estates at DAMAC Hills, a gated community adjacent to the fairways.
“We are confident the relationship with Trump will further enhance the beauty of Aida and attract investors from around the world looking to be part of an exceptional project,” Mr. El Chaar said in the statement released on Sunday.
Eric Trump, in a statement, said that the family company did not believe the new deal represented a conflict, and since the time his father was in office, it has worked to avoid any such conflicts. “We are excited to expand our golf and hotel portfolio in this incredible location,” he said on Sunday. “It is going to be an exceptional project.”
Steven Cheung, a spokesman for former President Trump’s campaign, responded to questions about the Oman deal, or whether Mr. Trump will be more involved with his business now, with a statement attacking the Biden administration.
The Oman deal was announced just as Mr. Trump was kicking off his third campaign for the White House, and while the Trump family, and Mr. Trump himself, are the target of a collection of civil and criminal investigations, including tax fraud charges against the Trump Organization and its long-serving chief financial officer, Allen H. Weisselberg.
If the company is convicted, it will face fines and potential blowback from lenders and business partners that might shy away from doing business with a felon; a conviction could also present new political challenges for Mr. Trump. But the maximum possible fine in the tax fraud case is only $1.62 million, a small amount for the company. In his most recent financial disclosure report, filed in early 2021 as Mr. Trump left the White House, Mr. Trump reported assets worth at least $1.3 billion.
Courtesy/Source: NY Times