New York prosecutors investigating Trump Chicago skyscraper loan: report

The Manhattan District Attorney’s investigation into former President Trump’s finances has reportedly expanded, with prosecutors subpoenaing documents from an investment company that loaned the Trump Organization millions of dollars for its Chicago skyscraper.

CNN, citing people familiar with the matter, reported that prosecutors issued a grand jury subpoena to Fortress Investment Management late last year as part of their probe into Trump’s finances. Fortress Investment previously issued the Trump Organization a $130 million loan for the construction of what would become Trump Tower Chicago, CNN noted.

According to court filings cited by the network, Fortress by 2012 forgave more than $100 million of the original loan, which at that time totaled around $150 million, including interest and fees.

The forgiveness was completed “to secure a partial re-payment of about $45 million at a time when the real estate market was suffering from the financial crisis,” CNN reported.

Prosecutors are now reportedly zeroing in on how the Trump Organization handled the loan from Fortress. They are investigating whether Trump and the organization documented the forgiveness as income — which is required by the Internal Revenue Service — and paid taxes on the money, CNN reported, citing people familiar with the matter.

The Trump Organization did not respond to CNN’s request for comment. CNN did note, however, that Alan Garten, the Trump Organization’s chief legal officer, told The New York Times last October that the company and Trump appropriately accounted for and paid all taxes due on forgiven debts.

The Times, which obtained portions of Trump’s tax-return data last September, reported that his forgiven debts were recorded as canceled debts in his tax returns. According to the Times, Trump took advantage of a clause from the Great Recession bailout that “allowed income from canceled debts to be deferred for five years, and then spread out over the next five.”

These developments come as the office of Manhattan District Attorney Cyrus Vance Jr. (D) received access to several years of Trump’s tax records after an effort by the former president to keep them out of the hands of prosecutors.