The Securities and Exchange Commission late last year dropped its inquiry into a financial company that a month earlier had given White House adviser Jared Kushner’s family real estate firm a $180 million loan.
While there’s no evidence that Kushner or any other Trump administration official had a role in the agency’s decision to drop the inquiry into Apollo Global Management, the timing has once again raised potential conflict-of-interest questions about Kushner’s family business and his role as an adviser to his father-in-law, President Donald Trump.
The SEC detail comes a day after The New York Times reported that Apollo’s loan to the Kushner Cos. followed several meetings at the White House with Kushner.
“I suppose the best case for Kushner is that this looks absolutely terrible,” said Rob Weissman, president of Public Citizen. “Without presuming that there is any kind of quid pro quo … there are a lot of ways that the fact of Apollo’s engagement with Kushner and the Kushner businesses in a public and private context might cast a shadow over what the SEC is doing and influence consciously or unconsciously how the agency acted.”
Apollo said in its 2018 annual report that the SEC had halted its inquiry into how the firm reported the financial results of its private equity funds and other costs and personnel changes. Apollo had previously reported that the Obama administration SEC had subpoenaed it for information related to the issue.
The SEC, which often makes such inquiries of financial firms, declined Friday to comment on the probe or its decision to halt it.
Apollo said the company founder who met with Jared Kushner did not discuss with him “a loan, investment, or any other business arrangement or regulatory matter involving Apollo.” It added that the Kushner loan to refinance a Chicago skyscraper went through the “standard approval process” and that the founder was not involved in the decision.
Kushner Cos. said in a statement that the implication that Kushner’s position in the White House had affected the company’s relationships with lenders is “without substantiation.”
Peter Mirijanian, a spokesman for Jared Kushner attorney Abbe Lowell, had no comment on the dropped SEC inquiry or whether it was influenced by Kushner’s contacts with Apollo. He added that Kushner has “had no role in the Kushner Companies since joining the government and has taken no part of any business, loans or projects with or for the Companies after that.”
According to the Times report, Kushner also met with the CEO of Citigroup at the White House early last year. Property records show that Citigroup lent $325 million in March to Kushner Cos. and two partners for a collection of buildings in Brooklyn.
Both lenders had important business before the federal government last year, according to lobbying records and regulatory filings. Both Apollo and Citigroup were pushing for tax breaks in the recently passed overhaul, and Citigroup was lobbying for a rollback of some financial crisis regulation.
Combined, the two companies spent nearly $7 million on lobbying last year.
For its part, Citigroup said in a statement that it didn’t deal with Kushner Cos. at all in arranging the loan, and talked instead to one of the Kushner Cos. partners. It added that its CEO was not involved in the transaction and “never discussed it” with Jared Kushner.
Details on the loans, like the interest rates charged, are not publicly available, so it’s unclear whether the Kushner Cos. got any special breaks.
The Kushner family’s biggest holding, a skyscraper on Fifth Avenue, is 30 percent unoccupied and has a $1.2 billion mortgage due early next year. That has fueled speculation that the company needs money, and fast.
But the Kushner Cos. has repeatedly pushed back on depictions that it is anything but in solid financial shape and needs help.
The company said Thursday that linking the loans to Jared Kushner’s meetings at the White House has “nothing to do with reality.”
“Jared does not tell us who he meets with nor do we ask him,” said Kushner Cos. spokeswoman Christine Taylor. “We do not update Jared on what’s going on in our business nor does he ask.”
Regardless, ethics experts said the optics are bad and Kushner should not have been having meetings with Apollo and Citigroup officials while his family business was seeking loans from them.
“I’d never seen anybody come in to the government with as much debt exposure as Trump and Kushner,” said Virginia Canter, a former ethics official in the Obama and Clinton White Houses who is now with Citizens for Responsibility and Ethics in Washington.
“Where are you?” Ms. Krim said she wrote in a text to Ms. Ortega, but the nanny did not respond, Panicking, Ms. Krim grabbed her third child, Nessie, then 3, who she had taken to swimming classes, and rushed to her home on West 75th Street.
The apartment was dark and eerily quiet, she said. The stroller for her son, Leo, 2, was in the living room, and Lucia’s backpack was on top of it. With Nessie in tow, she checked each room but couldn’t find the nanny or the children. She went downstairs and asked the doorman if they were home; he said they were.
Returning to the apartment, she realized she had not checked the bathroom. It was then that she noticed a light shining from underneath the door.
“First I see Lulu and I instantly know she’s dead,” Ms. Krim said through tears. “She’s lying there in the bathtub, her eyes open. I see Leo — they have blood on them, all over her dress. Then I see the defendant. I see blood all over her.”
Nessie, who was by her mother’s side, screamed, the mother recounted. The two ran out of the apartment, and she told the doorman that her babysitter had killed her children.
“It was the most awful feeling in the world,” Ms. Krim said. “She killed my best friends. These kids were my best friends.”
At times, Ms. Krim stared angrily at Ms. Ortega; other times she sobbed or laughed nervously as she tried to maintain her composure. Ms. Ortega, 55, clad in a long-sleeve gray shirt, stared straight ahead as Ms. Krim testified before a packed courtroom. A man in the audience sobbed.
Photo
Yoselyn Ortega, in court Thursday, has pleaded not guilty by reason of insanity in the killings of the Krim children. Credit
Pool photo by WYNY-TV
In her opening remarks, the assistant district attorney, Courtney Groves, said that Ms. Ortega resented Ms. Krim for providing for her children what Ms. Ortega could not give her own son.
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Ms. Ortega had left her 4-year-old son in the Dominican Republic with her sister. He joined her in New York City in 2012 to finish high school and eventually go to college, the prosecutor said. By then, Ms. Ortega had been working for the Krims for more than two years after meeting the family through her sister. Unknown to the Krims, the prosecutor said, Ms. Ortega had provided a phony reference.
But the rent for her Bronx apartment, her son’s private school tuition and the cost of caring for a teenager became too much for Ms. Ortega, Ms. Groves said.
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Ms. Krim tried to help by giving the nanny additional hours, but Ms. Ortega became enraged that her employer was trying to give her more work, which included cleaning for an extra $100 a week. Ms. Ortega worked in the afternoon, helping to pick up and drop off the children, and was paid at least $500 a week.
On the day of the slayings, Ms. Ortega woke on time for work, sent her son to school, sent him a text to confirm he had arrived, got rid of her cellphone and left her identification and insurance card with her sister. She had seen a psychologist three days earlier.
“She was putting her affairs in order,” the prosecutor said. “She knew when she left for work she would not be coming home. Her plan was to kill the Krim children and then to kill herself.”
She arrived at the Krims’ apartment at 3 p.m., and Ms. Krim asked her to drop Lucia off at her dance class and to take Leo with her, the prosecutor said.
Ms. Ortega left but never took Lucia to her dance class. Before 4 p.m., Ms. Groves said Ms. Ortega returned to the apartment. Once upstairs, she grabbed knives from the kitchen and stabbed Leo five times and Lucia 30 times in her neck and throughout her body, Ms. Groves said. The little girl tried to fight off the nanny, the prosecutor said. Ms. Ortega slit the children’s throats and left them to bleed out into the bathtub. Ms. Ortega, who had cut her wrists earlier, then plunged the knife into her throat, the prosecutor said.
There was no evidence before the slayings that Ms. Ortega suffered from a mental disease or defect, Ms. Groves said.
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But the defense attorney, Valerie Van Leer-Greenberg, said Ms. Ortega and her family suffered “a string of tragedies, suicides, death and mental illness that has spanned generations.”
She said Ms. Ortega suffered from a chronic mental illness and had heard voices and had a distorted sense of reality since she was 16. But she had not been treated until she was hospitalized after the slayings. Ms. Van Leer-Greenberg said Ms. Ortega was “guarded in her symptoms and reluctant to seek care,” because any care in the Dominican Republic “was worse than what she was suffering.”
“You will know a diseased mind when you see it,” she told the jury.
Ms. Krim testified that Ms. Ortega was always on time and reliable: “She was always where I needed her to be.” But there had been a bizarre incident when Ms. Ortega was angry that her son could not attend public school without repeating the 11th grade. Ms. Krim said Ms. Ortega was so upset that she poked her in the chest as she spoke about it.
A photo of the Krim children was on display in the courtroom: Leo, in blue; Lulu and Nessie, their surviving sister, both in orange, sitting on a bench in sunny weather. When asked who was in the photo, Ms. Krim barely managed the words: “My kids.”
