Donald Trump’s son-in-law Jared Kushner is the scion of a real estate empire that dwarfs the size of the Trump Organization’s direct ownership of buildings, and the New York Times just revealed that only days after the election, he met with the head of a major Chinese insurance company aiming to complete a high-profile deal. Nobody has previously reported on Kushner’s Chinese transaction, though The Times says that the deal has been six months in the making for Ivanka Trump’s husband.
On the night of Nov. 16, a group of executives gathered in a private dining room of the restaurant La Chine at the Waldorf Astoria hotel in Midtown Manhattan. The table was laden with Chinese delicacies and $2,100 bottles of Château Lafite Rothschild. At one end sat Wu Xiaohui, the chairman of the Waldorf’s owner, Anbang Insurance Group, a Chinese financial behemoth with estimated assets of $285 billion and an ownership structure shrouded in mystery. Close by sat Jared Kushner, a major New York real estate investor whose father-in-law, Donald J. Trump, had just been elected president of the United States.
Mr. Wu and Mr. Kushner — who is married to Mr. Trump’s daughter Ivanka and is one of his closest advisers — were nearing agreement on a joint venture in Manhattan: the redevelopment of 666 Fifth Avenue, the fading crown jewel of the Kushner family real-estate empire. Anbang, which has close ties to the Chinese state, has seen its aggressive efforts to buy up hotels in the United States slowed amid concerns raised by Obama administration officials who review foreign investments for national security risk.
Kushner’s meeting with Anbang Insurance raises more questions than can be answered in one news report, but the best start is: Who actually owns Anbang Insurance in the first place? Even The Times couldn’t give a real answer to the question in an exhaustive investigative report, but now whoever the heck the Chinese owners really are, they’ve got a direct pipeline to the only person we truly know has the President-elect’s ear.
As The Times reported today, it’s not Kushner’s first deal with Chinese financiers either, and the most recent building paid with their cash was Trump branded.
One of the newest Kushner projects — a Trump-branded luxury apartment tower that opened in November in Jersey City — got nearly a quarter of its financing, about $50 million, from Chinese investors who are not publicly identified.
Jared Kushner is considered the key advisor to Donald Trump’s campaign and now his transition team as well. Kushner gave an exclusive interview to Forbes at almost the exactly the same time of his meeting with Anbang Insurance Group, yet somehow omitted discussing his deal to redevelop 666 Fifth Avenue in the story entitled “How Jared Kushner Won Trump The White House.”
Kushner demurred about his future plans in that Forbes interview – given from 666 Fifth Avenue – about his plans to try and join the Trump Administration, but The Times reports today that he’s going to go full steam ahead into public service.
Anti-nepotism laws written after the Kennedy administration were supposed to prevent this kind of thing but it seems that won’t stop Kushner’s grip on power:
But it may be a moot point. With or without a government title or a $170,000 federal salary, there’s no law that bans a president from seeking counsel from whomever he wants. It’s clear America’s tech and entrepreneurial leaders, who heavily backed Clinton and collectively denounced Trump, will use Kushner as a go-between and that Trump will lean on him just as heavily.
“I assume he’ll be in the White House throughout the entire presidency,” says News Corp. billionaire Rupert Murdoch. “For the next four or eight years he’ll be a strong voice, maybe even the strongest after the vice president.”
This particular meeting was scheduled in advance of the election according to Kushner’s spokesperson Risa Heller, but that doesn’t change the official mysteries shrouding the multi-billion dollar Chinese insurer’s ownership structure. She told The Times:
It was just coincidence that Mr. Kushner’s Nov. 16 dinner at the Waldorf with Mr. Wu took place the week after the election, Ms. Heller said, adding that it had been in the works for a while.
Even the Wall Street investment bankers at Morgan Stanley were afraid of advising Anbang Insurance, lest they violate the Patriot Act’s central banking regulation called “know your customer.” The entire point of the Patriot Act regulating banks in that way is to prevent global money laundering activities.
But Anbang’s shadowy ownership suggests a possible state-ownership conflict so obviously, that even President Obama had to end the long tradition of US executives staying at the Waldorf Astoria Hotel in New York when he visited the UN, because the Chinese insurer bought the famous hotel’s parent company. The Times reports:
Anbang’s deep ties to the Chinese state have also led to a break in presidential protocol. Presidents have long stayed at the Waldorf, but when Mr. Obama visited New York for the opening of a session of the United Nations General Assembly in September 2015, he decided to seek other accommodations. American officials were vague about the reasons for the change at the time; a senior national security official cited security, counterintelligence and cybersurveillance concerns.
The Times reported last year that Anbang is owned by a few dozen companies, which in turn are owned by a number of shell companies that are controlled by roughly 100 people, many of whom have ties to a county in China that is the home of Mr. Wu, whose own power stems in part from marriage. In his case he married Zhuo Ran, a granddaughter of Deng Xiaoping, the leader who brought China out of the chaos of the Mao era. Mr. Wu also counts as a central business partner the son of a People’s Liberation Army marshal, and he has recruited several former government insurance regulators to serve on his board.
This situation as led to federal scrutiny of Anbang’s global shopping spree in which they tried (and failed) to buy Mariott, acquired some hotels, but not the ones near American military bases, and backed out of yet other purchase deals because state regulators demanded more information on the Chinese firm according to The Times.
National security concerns have also complicated Anbang’s efforts to acquire other properties in the United States. One deal, to buy the Hotel del Coronado in San Diego, fell apart in October amid concerns from the Committee on Foreign Investment in the United States, which comprises the heads of nine federal agencies and is charged with reviewing the national security risks of transactions involving foreign governments or state-connected companies. The Hotel del Coronado is near a naval base…
And while Anbang’s planned $1.57 billion purchase of Des Moines-based Fidelity & Guaranty Life, first announced in November 2015, was cleared by the committee, also known as Cfius, it stalled after the New York State Department of Financial Services demanded more information about Anbang’s shareholding structure.
Once inaugurated, President-elect Trump would be allowed to choose the members of the above referenced Committee On Foreign Investment in the United States (Cfius) and it seems readily apparent that Anbang’s relationship with Jared Kushner may have a political payoff well in excess of the value of any single real estate deal.
Jared Kushner’s deal with this massive Chinese insurer is just a single foreign conflict of interest problem facing the Trump Administration. Depending on the details of Kushner’s relationship to Anbang, it could result in massive consequences on how foreign investment in the United States is handled, or could provide avenues for self-enrichment to the Trump family or President-elect using the highest office in the land.
It provides Americans yet another reason why Donald Trump should only be allowed into the Oval Office as a tourist because his life is a series of unending problems and conflicts which cannot be managed ethically by a President.
But after January 20th, Trump’s foreign conflict problem will become America’s problems, and until Congress decides to actually enforce our Constitution, the unexpected results of these entanglements will be landing across the country for some time to follow.
Grant Stern is an Editor-At-Large for OccupyDemocrats and published author. His new Meet the Candidates 2020 book series is distributed by Simon and Schuster. He's also mortgage broker, community activist and radio personality in Miami, Florida., as well as the producer of the Dworkin Report podcast. Grant is also an occasional contributor to Raw Story, Alternet, and the DC Report, and a senior advisor to the Democratic Coalition