For Trump Organization, First Indictments Foreshadow More Legal, Financial Troubles
Thursday's indictments of the Trump Organization and its longtime chief financial officer are unlikely to be the end of the legal and financial troubles that former President Donald Trump will face in the coming months and years.
Though Trump himself was not named as a defendant in the charges brought by the office of Manhattan District Attorney Cyrus Vance Jr. and unsealed on Thursday, numerous experts have said they believe CFO Allen Weisselberg will be pressured to flip on his boss under intense threat of jail time and financial penalty, The New York Times and Yahoo Finance report.
Even if Vance and New York State Attorney General Letitia James, who is collaborating with Vance's office in its investigation, never bring charges against Trump himself, his business could be dramatically affected by the indictments already handed down. The Trump Organization has $590M in loans coming due in the next four years, over half of which is personally guaranteed by Trump, the Times and Bloomberg report. The company has about $289M in cash reserves, according to Bloomberg.
Criminal charges may not be explicitly outlined in loan agreements as triggers for repayment accelerations, but they are often used by lenders seeking a default, financial experts told Bloomberg. Trump Organization Executive Vice President Eric Trump, the former president's second-oldest son, has claimed that the company has relatively low leverage on its properties, Bloomberg reports.
Another complication for the Trump Organization's properties could come if the investigation from Vance and James produces charges related to the company's alleged practice of understating the values of its properties in tax documents and overstating them to lenders. The extent of the investigation and its knock-on effects may still take years to be fully revealed.