A New York grand jury has indicted banker Stephen Calk for allegedly lending millions of dollars to Paul Manafort in hopes of getting a job in the Trump administration.
The Southern District of New York charged him with financial institution bribery. If convicted, he could face up to 30 years in prison.
The indictment does not name Manafort, but clearly refers to him, describing “the borrower” as the chairman of a presidential campaign from June to Aug. 2016. The indictment notes that the candidate won. It says Manafort “urgently needed” to borrow money from the bank to keep from foreclosing on properties. Calk had his bank lend Manafort $16 million “in exchange for the Borrower’s requested assistance in obtaining various positions for CALK, including Secretary of the Treasury, Secretary of Defense, and Secretary of the Army.”
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The bank wasn’t big, but the loans were. So, according to the indictment, Calk had a holding company he controlled acquire a portion of the loans from the bank. And Manafort, who faced mounting debts, was grateful.
“I also want to again thank you for fixing my issue,” he emailed Calk shortly after the banker jacked up the size of a proposed loan by $1 million, per the indictment. “It means a lot to me. You are becoming a very good friend and I look forward to building our relationship into both a deeper business and personal one.”
At first, Calk’s risk earned him some benefits. The indictment says Manafort put him on the campaign’s “prestigious economic advisory committee” as a thank-you. And after Trump won the election, while he was looking to borrow even more money from the bank, Manafort recommended that the Transition Team give Calk an administration job. He even scored Calk an interview to be Under Secretary of the Army––a job he didn’t get.
Calk lied to the Office of the Comptroller of the Currency, the government entity that regulates the bank, by saying he never wanted an administration gig.
At first, the bank balked at lending to Manafort, which they viewed as risky. But after Trump won the election, Calk had the bank reverse course. On Nov. 11, 2016, the bank sent final loan paperwork to Manafort’s lawyer. Manafort and Calk had an 18-minute phone conversation the next day. And on Nov. 14, Calk sent Manafort a ranked list of dozens of administration posts he wanted, in order of his interest: Treasury Secretary, Deputy Treasury Secretary, Commerce Secretary, Secretary of Defense, and then 19 ambassadorships, starting with the U.K., France, and Italy. He later sent an updated list, titled “Stephen M. Calk Perspective Rolls [sic].”
“Are you aiding in the transition in any type of formal capacity?” Calk emailed Manafort later that day, per the indictment.
“Total background but involved directly,” Manafort replied.
“Awesome,” Calk wrote.
On Nov. 16, according to the indictment, the bank closed on a $9.5 million to Manafort. And Manafort kept asking for more, so talks about an additional $6.5 million loan ran concurrently with talks about Calk getting an administration post. He got pushback about that effort, and others noted that Manafort had missed interest payments on one of his properties for months. But Calk kept pushing for a second loan, and noted that Manafort was “influential” with “other people and a few other situations at hand.” The bank finalized that loan on Jan. 4, 2017. And on Jan. 10, Calk interviewed to be secretary of the army.
