Alleged Trump Tax Records Show Extent of Atlantic City Casino Losses

Posted on: May 8, 2019, 05:51h. 

Last updated on: May 8, 2019, 05:51h.

Philip Conneller @casinoorgphilc Read More
Expertise: Gaming Business, Regulation, Tribal Gaming.

Purported printouts of Donald Trump tax transcripts from the mid-1980s to mid-1990s obtained by the New York Times reveal he lost $1.17 billion — reportedly more than any other individual American — at a time when casinos formed a core part of his business.

Trump tax
Donald Trump pictured in front of the Trump Taj Mahal circa 1990. He described the casino as “the eighth wonder of the world.” A year later, it was the first wonder of the world to go bankrupt. (Image: Getty)

The picture NYT paints shows a period of rampant borrowing, acquisition, and financial loss to the extent that Trump was not required to pay income taxes for eight of the 10 years covered by the NYT records.

Charles Harder, a lawyer for the president, described the information as “highly inaccurate.”

That Trump’s Atlantic City casino businesses struggled is nothing new — he sought bankruptcy protection in 1991 for the Trump Taj Mahal, a year after it opened — and then again in 2006 and 2009 — despite a controversial $65 million bailout from the State of New Jersey.

Trump himself has admitted that his casinos were plagued by high debt and faltering revenues sparked by the recessions of the early 1990s and late 2000s, but it has long been speculated that he got out of Atlantic City relatively unscathed – after all, he said so himself.

Trump Taj Debt Hole

“Atlantic City fueled a lot of growth for me,” said Trump in May 2016. “The money I took out of there was incredible.”

But while the NYT numbers only present a decade of Trump’s secretly guarded finances, they suggest — if accurate — that 1990 and 1991 were a personal disaster financially.

Allegedly, he reported combined losses of $517.6 million for those two years. Over the following three years, his core businesses lost an additional $286.9 million, NYT claims.

The Trump Taj Mahal Hotel and Casino opened in 1990, partly financed with $675 million in junk bonds. Had recession not kicked in that year, it might have been a gamble that paid off for Trump, but the casino failed to generate enough to cover the high interest rates on the bonds. This sucked up revenues from his other casinos, pushing the business towards chapter 11 reorganization.

Trump quit the casino business in 2009, after the third bankruptcy restructuring of his casino company, Trump Hotels & Casino Resorts, although he retained 10 percent until 2014 when the billionaire Carl Icahn rescued the business from another bankruptcy.

Is Trump Tax Leak Illegal?

NYT claims it received the information contained in the returns — which would likely to have run into thousands and thousands of pages and supporting documents — from someone who had “legal access” to the them.

It is a felony, punishable by up to five years, to improperly disclose private tax information.

In 2017, the journalist David Clay Johnston claimed he had been mailed pages of Trump’s tax returns anonymously. The pages showed Trump had large sources of income and was paying his taxes.