These Are Donald Trump’s Most Expensive Scandals
Donald Trump has been at the center of his share of scandals. These situations not only garnered media attention but also turned out to be quite expensive. Trump has managed to make his way through these scandals, but the financial consequences were quite hefty in many cases.
Here are Donald Trump’s most expensive scandals. Some of these outrageous scandals might surprise you.
Violation of casino rules
- Cost: $30,000
Donald Trump faced fines for breaking casino rules. Trump’s Taj Mahal casino was in trouble back in 1990. It is reported that Fred, Trump’s father, decided to help out by purchasing 700 chips worth $3.5 million. Fred’s purchase helped the Trump Taj Mahal pay a debt that was owed. However, Fred didn’t intend to gamble. Consequently, the New Jersey gaming commission ruled the purchase was a loan that went against casino operating rules.
Alleged mafia ties
- Cost: $200,000
There has been a lot of buzz about Donald Trump’s alleged mafia ties. Investigative journalist Michael Isikoff reported Trump had close ties to Robert LiButti, an associate of John Gotti. It is reported the Trump organization purchased nine luxury cars for LiButti. Findings published in a New Jersey Division of Gaming Enforcement report revealed that Trump Plaza was fined $200,000 for discouraging black employees from coming to LiButti’s table. The organization was also fined for gifting LiButti the cars.
- Cost: $750,000
In 1986, Trump aimed to expand his Atlantic City casino business. He was determined to get a foothold in the industry. His goal was to do this through a hostile takeover of Holiday and Bally Manufacturing Corporation, two rival casino organizations. However, Bally was tipped off by Trump’s purchase of company stock and fought back by suing for antitrust violations. Although Trump ended his attempt at a takeover, things did not end well. Trump didn’t report his stock purchases, which exceeded minimum disclosure levels, so he was slapped with a $750,000 fine from the Federal Trade Commission.
Failure to pay workers
- Cost: $5 million
Workers who put in their time at various Trump properties said they were not paid for their services, reports USA Today. The newspaper discovered that some of those contracts were worth hundreds of thousands of dollars. Unfortunately, some small businesses had to shut down or had significant financial difficulty as a result of the Trump organization’s failure to pay. A group of contractors filed $5 million in liens against a Trump hotel in Washington based on allegations that Trump hasn’t paid for their services.
Condo hotel mishap
- Cost: $2.84 million
Several lawsuits were filed by condo buyers who said their money was taken deceitfully, reports The New York Times. Problems arose when some buyers raised concerns about how involved Trump was with the properties. Some buyers said they purchased their properties because of the Trump name. However, they felt taken advantage of when they became aware that Trump was not intimately involved. At times, Trump has sold the right to use his name to developers, but that might be his only link to a property.
It was revealed that Trump’s partners for Trump SoHo had a criminal history. He later settled a lawsuit with buyers for $2.84 million, agreeing to refund 90% of $3.16 million in deposits.
- Cost: $25 million
In 2005, Trump announced he would open Trump University to teach others his secrets to real estate success. However, his plan quickly unraveled, and the school shut its doors in 2010. Students shelled out up to $35,000 in tuition for programs that former Trump University employees said used forceful sales tactics and hired instructors who lacked appropriate qualifications, reports The New York Times. In addition, the school was in violation of New York state law for operating without a New York State Education Department license. Trump agreed to pay $25 million to settle several lawsuits.
Trump Taj Mahal bankruptcy
- Cost: $65 million
Trump’s Taj Mahal casino opened in April 1990 in Atlantic City. However, it faced financial trouble six months later. The Washington Post reported the casino “defaulted on interest payments to bondholders as his finances went into a tailspin.” Trump had to take out a $65 million loan to try to keep the struggling casino afloat. In July 1991, the casino filed for bankruptcy. Ownership of the casino eventually changed hands, and it was managed by Carl Icahn. However, the property closed its doors in 2016.
Trump Plaza bankruptcy
- Cost: $550 million
In 1992, one of Trump’s Atlantic City casinos, the Trump Plaza, declared bankruptcy after losing more than $550 million. Trump had to give up his stake in the casino but kept his title as CEO. He also gave up his salary and his role in daily operations. Although Trump didn’t personally file for bankruptcy, he did emerge with roughly $900 million in personal debt.
Trump Hotels and Casino Resorts bankruptcy
- Cost: $1.8 billion
In 1995, Donald Trump formed Trump Hotels and Casino Resorts as a publicly traded company. The organization consolidated Trump Taj Mahal, Trump Castle, and Trump Plaza casinos, in addition to other properties, under one umbrella. Just nine years later, Trump filed for Chapter 11 bankruptcy protection, listing roughly $1.8 billion in debt.
Trump Hotels and Casino Resorts was renamed Trump Entertainment Resorts. It later filed for bankruptcy in 2009 with a debt of $1.2 billion. Trump reduced his ownership share of the business to 10% and relinquished his role as chairman of the board.
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