| Trial of
Manafort Lender Calk Continues at SDNY,
Defense Says He Thought It Was OK
By Matthew
Russell Lee, Patreon
Podcast
BBC
- Guardian
UK - Honduras
- ESPN
SDNY COURTHOUSE,
June 23 – After months of preliminaries,
the trial of Stephen Calk for
conspiracy to trade his bank's
loans to Paul Manafort for the
Secretary of the Army position
began on June 23. Inner City
Press live tweeted, here,
previous coverage here,
podcast here
Then the defense
opening statement and first
witness, here,
and Inner City Press question
to Calk on Scaramucci, here
(& Alamy photo here)
Defense: The
question in this case is
whether Stephen Calk thought
he was doing anything wrong in
making loans to Paul Manafort.
The answer is no. The loans
were approved by the
committee.
Defense:
The facts will show that Mr.
Calk thought these were great
loans, with big collateral.
And that he wanted to serve
his country. He didn't think
he was doing anything corrupt.
Defense: In April of 2016,
Calk was introduced to a loan
officer named Dennis Raico.
Mr. Raico described Manafort
as a political rockstar... But
Paul Manafort was committing
fraud on the bank. Steve Calk
didn't know that.
Defense:
Manafort said he operated as
an advisory to many, including
Dole, "someone who ran for
president." Manafort said he
had $9.2 million free and
clear, it was passed on to
Steve Calk by Dennis Raico.
Defense:
Let me know you the term sheet
for the loan. 7.25% interest
rate, two points, the
borrowers had to have an
account of $2.5 million with
The Federal Savings Bank. Cash
collateral is the best
collateral.
Defense:
The evidence in his case will
show that the underwriting
department approved both of
these loans... He was a
campaign surrogate in the Fall
of 2016. Then something
surprising happened: Donald
Trump won. Mr. Calk wanted to
serve his country. He made a
list
Defense:
Manafort put in a good word.
And Mr. Calk was given an
interview, in Trump
Tower. You will see, Mr.
Calk loved these loans. This
case is not about partisan
politics. The name Donald
Trump is going to come up.
Some like his, some don't.
Defense: Don't let the name
Trump influence you. When you
hear the evidence, we will ask
you to find not guilty.
Judge Schofield:
US, call your first witness.
1st, a limited instruction.
You will hear from an OCC
employee. But the OCC has no
view of these loans.
OCC Witness
Paulson: The OCC is
responsible for federal
chartered bank, the FDIC is
responsible for state
chartered banks. [Inner City
Press not: the Federal Reserve
is responsible for state
member banks as well.] Paulson
says OCC is for fair access...
After some back
and forth about the OCC taking
over for the Office of Thrift
Supervision, disgraced, Judge
Schofield excuses jurors for
the day.
Earlier:
Judge Lorna G. Schofield is
speaking to the jurors, who
have just come in. "My duty is
to instruction you on the law.
You must take the law as I
give it to you." We're in one
of the 3 big courtrooms in 40
Foley Square, light streaming
in through the tall windows
Judge Schofield:
"The law presumes Mr. Calk to
be innocent." If however after
consideration of the evidence
you are convinced that the
government have proved its
case, you must find him
guilty... Opening statements,
which you are about to hear,
is not evidence
Judge Schofield:
Mr. Calk is charged with
financial institution bribery,
and conspiracy to commit it.
The
government alleges that Mr.
Calk, while CEO of The Federal
Savings Bank, sought a senior
position with the Trump
administration through loans
to Paul Manafort
Judge
Schofield: In the second
charge, Mr. Calk is charged
with conspiring with others to
commit this financial
institution bribery.
Finally, Judge Schofield is
instructing the jurors who to
handle their notebooks - leave
them in the courtroom at
night.
Judge Schofield,
to the jurors: Don't go home
and Google the case. Don't
read any blogs, or Twitter.
That's for after the trial.
And now, the opening
statement(s).
Assistant US
Attorney: This is a case about
greed. But not greed for
money. Greed for power.
AUSA: It's
about this man [pointing],
Stephen Calk, who gave out
millions in loans to try to
get a position. $16 million to
Paul Manafort, a political
lobbyist. This, for that.
Loans, for influence. That is
why we're here. Calk took a
bribe from Paul Manafort.
AUSA: In
July of 2016, Manafort asked
for a loan. He was running the
presidential campaign for
Donald Trump. The loan had red
flags, but Calk pushed it
forward. The bank made 2
loans. The first closed
shortly after Election Night,
the next 5 weeks later AUSA:
Calk interviewed for the job
at Trump Tower. Manafort got
him in the room. When a
reporter asked how he got on
the campaign, he didn't say
one word about Manafort. He
didn't tell his board of
directors. But he got caught
and he's here to account for
it. Inner City Press
@innercitypress · 33m AUSA:
The bank's money was FDIC
insured. It had loan officers
paid on commission. It has a
credit committee of 3,
including Calk. But Calk
always got his way. He owned
most of the bank. Manafort
asked for $5.7 million on a
property in California. They
met in NYC
AUSA: Calk joined
by video from Chicago. He
offered to help with the
campaign. The next day, the
bank agreed to do the loan.
Then Manafort asked for Calk's
resume and asked him to join
the Economic Advisory Council
of the campaign, to advise
President Trump
AUSA:
Meanwhile, the loan was
undergoing underwriting.
Problem were found. Manafort's
credit score had dropped. He
had earned no income in 2016.
He had a credit card bill of
$300,000 and faced
foreclosure. And he had
suspicious deals with foreign
politicians.
AUSA: The
only thing the loan had going
for it was collateral. But
foreclosure is expensive.
Manafort was a bad bet. Only
two people were pushing the
loan forward: the loan officer
who was getting a commission,
and Calk. And you'll find out
what he was getting.
AUSA:
Manafort said there was a loan
on the property. Calk said, No
problem, the bank would pay
off the loan. Manafort said he
needed another million
dollars. Calk told the loan
officer to do it. At the
closing table, Manafort
proposed a totally new loan.
AUSA: The
night that President Trump won
the election, Calk told
Manafort the loan would be
wrapped up the next day,
whether or not another bank
was on board. Calk offered to
come to New York. He told the
loan officer to ask Manafort
is he was in the running for
Secretary of the Treasury.
Calk had a list:
Commerce, Defense. Ultimately
he set his eyes on Secretary
of the Army. He emailed
Manafort a memo.
AUSA: The 1st
loan closed a week after the
election, for $9 million. And
Calk got a recommendation for
Secretary of the Army, he was
added to a list. Manafort
needed $6.5 million to finish
construction on a brownstone
in Brooklyn.
AUSA: Manafort
asked a person in Trump Tower
about Calk's status. The
counter-offer was Deputy
Secretary of the Army. Then
Calk emailed the loan
documents to Manafort, then
flew to NY for an interview in
Trump Tower. In total $16
million for this.
AUSA: The
bank's regulator called for an
emergency meeting. Calk lied,
and said he didn't want the
government job. You're going
to hear from people from this
regulator. [The OCC - also
dubious, see e.g. Otting and
Brooks, watch this feed.] Calk
wasn't qualified.
AUSA: At
the end of this case we'll ask
you to consider all the
evidence. And you'll reach the
conclusion that Stephen Calk
is guilty. Judge Schofield
declared 10 minute
break.
***
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