Former Trump Adviser Sentenced for Soliciting Loans for Potential White House Role

A former economic adviser on Donald Trump’s presidential campaign has been sentenced to a year and a day in prison for issuing millions of dollars in risky loans to campaign manager Paul Manafort in exchange for a place on the 2016 presidential campaign, and help trying to get a senior role in the White House.

According to an unsealed indictment filed in the Southern District of New York, Stephen Calk, who was the founder and former head of The Federal Savings Bank, “engaged in a corrupt scheme” to use his position to land a job in the Trump administration, even seeking out a cabinet-level title. The indictment said that between approximately July 2016 and January 2017, Manafort sought millions of dollars in loans from the Chicago-based bank, which he urgently needed in order to terminate or avoid foreclosure on multiple properties he and his family owned.

Calk offered to extend $16 million in loans to Manafort in exchange for Manafort’s help obtaining a high-level position in the Trump administration. While Manafort’s loans were pending approval, Calk provided Manafort with a ranked list of the governmental positions he was seeking, which led with secretary of the Army, followed by deputy secretary of the Treasury, secretary of commerce, and secretary of housing and urban development, as well as 19 desired ambassadorships, similarly ranked, with the UK, France, Germany, and Italy as his top choices. Calk was formally interviewed for the position of undersecretary of the Army in January 2017, though he was not hired to the post.

The indictment said Calk approved of the loans to Manafort despite being aware of “significant red flags” concerning his ability to repay the loans, such as his history of defaulting on prior loans. It also said the loans were so large that Manafort’s debt became the bank’s single largest lending relationship. To sidestep the bank’s legal limit on loans to a single borrower, Calk authorized the bank’s holding company, which he also controlled, to acquire a portion of the loans from the bank, which was “a maneuver never before performed by the bank,” the indictment said. In return, Manafort provided Calk with “valuable personal benefits,” including an appointment to a prestigious economic advisory committee affiliated with the campaign and recommending Calk for an administration position.

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To conceal his scheme, Calk made false and misleading statements to the Office of the Comptroller of the Currency (OCC) regarding the Manafort loans. For example, Calk falsely told OCC regulators that he had not known that Manafort’s properties had been in foreclosure prior to issuing the loans, and that he had never desired a position in the presidential administration, according to the court documents.

“Stephen Calk abused his position as the CEO of a federally insured bank to try to buy himself prestige and power by trading millions of dollars in high-risk loans for influence with a presidential campaign and consideration for positions at the highest levels of the Defense Department,” US Attorney Damian Williams said in a statement.

In addition to the prison term, Calk was sentenced to two years of supervised release and 800 hours of community service. He was also ordered to pay fines totaling more than $1.2 million.