Another day, another story of breathtaking corruption in Trump World. This time it’s new details about how former President Donald Trump and his son-in-law Jared Kushner enriched themselves with the help of the Saudis. The story deals yet another blow to the U.S.’s global reputation by exposing the vulnerability of our government to shady quid pro quos.
Last year The New York Times described how a Saudi sovereign wealth fund led by Saudi Crown Prince Mohammed bin Salman (often referred to as MBS) invested billions of dollars in Kushner’s fledgling private equity firm six months after the end of the Trump presidency, even though the fund’s advisers assessed that investing in Kushner’s company would be a financial and reputational risk for MBS. The imprudence of the investment was a red flag — ethics experts raised questions about whether it suggested the Saudi crown prince was looking to advance or make good on a political deal.
Kushner was a senior White House official, and details about who invested in a company he launched the day after he left the White House are a matter of public interest.
A new Washington Post report adds more details: Kushner created the company that turned into a private equity fund the day after he left the White House and “structured those funds in such a way that it did not have to disclose the source.” And filings from the Securities and Exchange Commission show that Kushner has declined to describe how almost all of his fund’s assets are from a sovereign wealth fund. The Post reports that Kushner’s company “stands to receive a $25 million management fee annually from the Saudi investment plus a share of the profits.”
In other words, Kushner has sought to block the public from knowing about the source of investment in his company. It’s legal, but it isn't appropriate. Kushner was a senior White House official, and details about who invested in a company he launched the day after he left the White House are a matter of public interest. Kushner treated Saudi Arabia especially well when he was at the White House. Among other things, he worked to shield MBS from diplomatic consequences after the murder of Saudi dissident Jamal Khashoggi, which the U.S. intelligence community believes MBS ordered. Kushner also developed a close personal relationship with MBS — they reportedly chatted late into the night several times during a personal visit.
Kushner’s decision to not disclose the source of money for his private equity firm suggests that he may have known the financial relationship represented, at the very least, a conflict of interest. In a worst-case scenario, his choosing not to disclose the source of the funds could be an attempt to cover up clues to deal-making that involved exchanging political favors for money.
Shortly after Trump left office, the Saudi sovereign wealth fund-backed LIV Golf series began holding tournaments on his golf courses. The Post report notes that Saudi Arabia invested in Trump at a time when he was in financial need, in part because of the pandemic’s effect on his businesses and in part because his brand had become divisive. Trump also made a deal with a Saudi real estate company that plans to build a Trump hotel in Oman. Making things even weirder is that the deal makes Trump, a former president of the United States, a partner with the government of Oman. That raises yet another set of questions about the propriety of his entering into a partnership with another government.
Kushner and Trump declined to comment to the Washington Post for the story. (Trump's spokesman said that Trump has "used his superior negotiating skills to ensure this country is never beholden to anyone.")
Barring decisive reporting about some kind of explicit deal, we are left speculating as to whether any of these investments were discussed while the Trump White House went to extraordinary lengths to foster a closer relationship between Washington and Riyadh, or whether it’s a sign that MBS wants to invest in the future of U.S.-Saudi relations. Neither scenario is good.
Some observers have expressed concern that if Trump were to return to office, he might be beholden to Saudi Arabia because he feels indebted to the country. That’s not an outcome that I’m particularly worried about, because, as the Biden presidency has demonstrated, the U.S. is already perfectly happy to be pushed around by Riyadh even without corrupt deal-making in the mix. Saudi Arabia already has immense leverage over the U.S. because of its geopolitical power as an oil producer — and it uses it.
The bigger issue at stake is how it diminishes the credibility of the U.S. as a democracy and diplomatic player. As information about Trump-era corruption continues to leak, governments around the world will note how vulnerable America is to impropriety, and bad actors abroad will be encouraged to probe for more shady deal-making opportunities as a way to do business with the U.S. And domestically speaking, this kind of behavior diminishes public trust in the the government.
Ultimately, the problem is bigger than Trump and his allies. Their ability to disregard concerns about conflict of interest is something that speaks to a systemic problem: inadequate regulation of the capacity of government and former government officials to profit off of office. Unless we change rules and norms, this will keep happening.
