The GOP PAC-thetic Effort to Disclaim Cambridge Analytica

In the wake of Friday’s news that Cambridge Analytica had not deleted psychographic data based off Facebook data, Republicans have claimed they didn’t rely on CA in 2016’s election. Major Garrett, for example, reported that, for most but not all uses, the Trump campaign replaced CA with RNC data after proving the latter more accurate.

In late September 2016, Cambridge and other data vendors were submitting bids to the Trump campaign. Then-candidate Trump’s campaign used Cambridge Analytica during the primaries and in the summer because it was never certain the Republican National Committee would be a willing, cooperative partner. Cambridge Analytica instead was a hedge against the RNC, in case it wouldn’t share its data.

The crucial decision was made in late September or early October when Mr. Trump’s son-in-law Jared Kushner and Brad Parscale, Mr. Trump’s digital guru on the 2016 campaign, decided to utilize just the RNC data for the general election and used nothing from that point from Cambridge Analytica or any other data vendor. The Trump campaign had tested the RNC data, and it proved to be vastly more accurate than Cambridge Analytica’s, and when it was clear the RNC would be a willing partner, Mr. Trump’s campaign was able to rely solely on the RNC.

Cambridge Analytica data was used for some targeted digital advertising and a large TV buy, but the main source of “get out the vote” and matching digital outreach data came from the RNC.

This story is not much different from one that got told last fall, in the wake of Brad Parscale’s testimony before the House Intelligence Committee. After using CA data for the first month of the general, the campaign transitioned to using RNC data (for whatever reason).

But according to both Parscale and [CA Chief Product Officer] Oczkowski, the campaign didn’t use Cambridge’s trove of data, opting instead for the RNC’s data file.

“The RNC was the voter file of record for the campaign, but we were the intelligence on top of the voter file,” Oczkowski says. “Sometimes the sales pitch can be a bit inflated, and I think people can misconstrue that.”

Parscale describes the firm’s work this way: “As I’ve said multiple times over prior statements, Matt Oczkowski and his team created a daily tracker of polling, so that I could see how Trump was doing in key swing states. They provided that to me daily.” Parscale says Cambridge also helped the campaign with what he calls “persuasion online media buying. They also helped us identify potential donors. And they created a visualization tool that showed in each state which areas were most persuadable and what those voters care about.”

As I noted at the time, however, Oczkowski claimed to be unaware of what CA was doing because the PAC activities were firewalled from campaign activities.

“I had absolutely no understanding any of this was going on, and I was surprised as everybody else when I saw the story” about Nix’s approach to Assange, Oczkowski says. During the campaign, he says his team was walled off from the rest of Cambridge, because the company was also working with a Trump Super PAC. Federal regulations prevent campaigns from coordinating with Super PACs. Of the 13 Cambridge staffers who worked in Trump’s San Antonio office, only four remain at the company.

Which, of course, suggests that the interesting stuff with CA was happening at the Super PAC, which just happens to have been run by the Mercers.

Today, Daily Beast reported that a Cambridge Analytica employee, Emily Cornell, gleefully pounced on the opportunity presented by the release of more stolen Hillary emails.

Cambridge Analytica hoped to capitalize on Russian hacking of Hillary Clinton and her ally, an email written by one of its employees indicates.

Emily Cornell, the employee, sent the email on July 29, 2016. It went out to people working with Make America Number One, the pro-Trump super PAC funded by Republican super-donors Robert and Rebekah Mercer.

After noting some of the firm’s work for the super PAC, Cornell wrote: “With her campaign getting hacked, I can only imagine what a new swatch [sic] of emails will do to her already fractured base!”

This seems to confirm two things. First, the Mercer directed efforts remained happy to exploit Russia’s theft even later in the process (remember the Alexander Nix email to Julian Assange kept Mercer in the loop). And also, the Trump campaign claim to have ditched Cambridge Analytica are only meaningful insofar as they really maintained that firewall between campaign and PAC.

Three Things: Flying Moochin’ Mnuchin Air

Usually when I pull together a Three Things post they’re unrelated topics worth a quick look but not necessarily a full-blown post. This time these three things are related and I can’t write a post on each one because my blood pressure won’t handle it, thanks to Moochin’ Mnuchin.

~ 3 ~

Citizens for Responsibility and Ethics in Washington (CREW) recently FOIAd Treasury Secretary Steve Mnuchin’s travel data. You’ve probably heard by now about his use of military aircraft for eight trips costing nearly one million dollars. CREW looked at the regulations covering government travel and authorization for spending. Take the time to read their work, it’s worth the effort.

And then read the FOIAd records CREW shares, but only after you’ve taken your blood pressure medications and/or prepared for a tooth-grinding tension migraine. There were repeated indications to Mnuchin and staff these trips were expensive — one cost $26,953.33 when commercial airfare for the same trip was $688 per person.

It’s this trip which first made me do a double take, because Mnuchin’s plane was on the ground in Miami on June 15, 2017, for a mere two hours and 45 minutes or less.

Mnuchin traveled to Miami to attend the Conference on Prosperity and Security in Central America held at FIU’s campus, roughly 15 minutes by car from Miami International Airport. Assuming the travel times were prompt and on the mark, Mnuchin made it to the conference for a fucking two-hour lunch.

An institutionally-prepared $13,476-an-hour lunch.

But get this — here are the other U.S. attendees at this event:

U.S. Vice President Mike Pence, Secretary of State Rex Tillerson, Secretary of Homeland Security John Kelly, and Secretary of Treasury Steven Mnuchin co-hosted the Conference on Prosperity and Security in Central America in Miami, Florida on June 15-16, 2017 with Mexican Foreign Secretary Videgaray Caso, Interior Secretary Osorio Chong, and Secretary of Finance José Antonio Meade Kuribeña, and attended by President Jimmy Morales of Guatemala, President Juan Orlando Hernández of Honduras, and Vice President Oscar Ortiz of El Salvador. Other meeting participants included U.S. and Latin American private sector leaders, senior government representatives from Belize, Canada, Chile, Colombia, Costa Rica, the European Union, Nicaragua, Panama, and Spain, and leaders from the Inter-American Development Bank, the International Monetary Fund, and the World Bank. …

Mnuchin was a bloody co-host. Why did he not travel with one of the other co-hosts? Why did he have to commission his own military aircraft instead of tagging along with another cabinet member? Or even the vice-president?

Mnuchin’s use of military aircraft was repeatedly justified by the need for secure communications. The June 15 trip to Miami was one such occasion; a call on the return leg needed an aircraft on which persons without adequate security clearance would be traveling.

CREW noted this as well:

Two days before the scheduled departure, Treasury advised the FAA that “due to a new need to access to secured comms during this mission, which cannot be accommodated on the available aircraft, we are going to have to pull this mission down and will have to utilize another means of transport.” (UST 00024). The call was scheduled during the two and one-half hour return flight (UST 000063). The use of a military aircraft increased the cost of the approximately two-hour flight to $45,136 (UST 00003). In other words, a scheduling conflict that the Secretary apparently did nothing to avoid cost the government an additional $18,000. Of note, the five listed individuals on the manifest could have made the same trip on a commercial aircraft for approximately $3,440 (or $688 per person, UST 00001). …

Again, Mnuchin was a conference co-host. There were other cabinet members traveling to Miami. What was so bloody important that he couldn’t travel earlier with the rest of the U.S. co-hosts? Why did Mnuchin schedule a call needing secure communications two days before the trip?

And why over the last year was there repeated insistence on the availability of secure communications, unlike Mnuchin’s predecessors? What changed so dramatically about the Treasury Secretary’s job?

What might have been happening on June 15 about which Mnuchin knew more than 48 hours in advance?

~ 2 ~

Remember last year when I noted the odd timing of Jared Kushner’s unannounced, unpublicized trip to Saudi Arabia during which he had a pajama party of sorts with Crown Prince Mohammed bin Salman where they discussed who knows what?

It seemed quite the coincidence that Kushner arrived during Treasury Secretary Mnuchin’s publicized trip to Saudi Arabia. What incredible timing!

Except it wasn’t a coincidence. Our forgetful Boy Wonder was on the same goddamned military aircraft with Mnuchin, who had insisted on a military plane for access to secure communications.

Here’s a screenshot from page 57/126 (from document 2018-2-15-Production-redactions-applied.pdf via CREW), an amended request to White House by Treasury for mission support, required to obtain a military aircraft. Note the Requesting Principal and the trip’s purpose as well as the date, August 31:

Here’s a screenshot of page 59/126 from the manifest included with the same amended request:

Kushner isn’t mentioned in the request or the agenda except as a line item in the manifest; he appeared to be included in every leg of this trip, including a visit to United Arab Emirates and Qatar. There’s an awful lot of redacted material related to this trip, too, big swaths blanking out what could be entire emails or attachments.

Worth noting the FOIAd documents dated July 25 reflect this Middle East trip was originally scheduled for September; by August 31 the trip has been pushed back to October. The mission requested a plane with secure communications capability from the first, which does make sense in this case given the level of discussions being held between Treasury Department, Saudi Arabia, UAE, and Qatar.

But the frequent insistence on secure communications capability and Kushner’s presence on this October trip spawns several questions: is the use of military aircraft a flying backchannel? Is Mnuchin equally invested in the use of a backchannel?

Was this trip really another negotiation related to the blockade of Qatar and was Kushner involved for that reason? Is this why his presence wasn’t openly communicated?

~ 1 ~

And then there’s the possibility Moochin’ Mnuchin took his spouse, our generation’s Marie Antoinette, for a vacation in Edinburgh, Scotland and other European locations using one of our military aircraft. I may have an aneurysm if I don’t stop here. Just look at the itinerary on page 66/126 and tell me what you make of it. I can’t find coincident formal events scheduled for Scotland or Italy, or for virtual attendance during this trip’s time frame. CREW reported the trip was their goddamned honeymoon (modifying epithet all mine).

Did Mnuchin and Linton seriously tie up a military aircraft so they could go walkabout in Scotland? Let me guess Linton is a big fan of the premium cable show Outlander and she wanted to take in the show’s shooting locations. The sole argument presented for the use of our military aircraft is “to be able to monitor issues [redacted], and participate in scheduled [redacted]” and the need for access to secure communications.

Don’t we have an undersecretary or a deputy to do whatever [redacted] so Mnuchin can take his honeymoon on his own time, on his own dime? Or is [redacted] something in which nobody else should be involved?

Go ahead and argue this trip request says it’s a “reimbursable mission.” This request is dated August 1, and his trip was from August 3 through August 12. This means our government personnel had to drop everything else they were doing during what is traditionally a short-staffed month and scramble to get this aircraft and crew and flight plan together for his damned honeymoon.

I suppose I should be less surprised by this wasteful crap bordering on theft after Mnuchin unnecessarily flew by military plane with the same high maintenance prima donna spouse to Fort Knox, just in time on August 8 to observe the rare complete solar eclipse.

I’m still suspicious of Mnuchin’s need for an entire bloody military plane and crew for his honeymoon so he has access to secure communications. Again, is this a flying backchannel he’s using? Does his wife have a security clearance necessary to hear whatever it is that’s so secret that he has to do it while on his honeymoon?

~ 0 ~

This is an open thread. Bring your pitchforks and torches.

The Trump Toadies Who Are Worried about Being Unmasked

Last week, Zoe Tillman noted this FOIA lawsuit from attorney Gene Schaerr, working on behalf of someone who wants to remain anonymous “at present,” suing to obtain records on the unmasking of Trump campaign and transition officials. The thing is, Shaerr isn’t just asking for unmasking records generally.

The odd collection of people being FOIAed

He’s asking for unmasking records pertaining to a really curious group of people:

  1. Steve Bannon
  2. Rep. Lou Barletta
  3. Rep. Marsha Blackburn
  4. Florida Attorney General Pam Bondi
  5. Rep. Chris Collins
  6. Rep. Tom Marino
  7. Rebekah Mercer
  8. Steven Mnuchin
  9. Rep. Devin Nunes
  10. Reince Priebus
  11. Anthony Scaramucci
  12. Peter Thiel
  13. Donald Trump Jr.
  14. Eric Trump
  15. Ivanka Trump
  16. Jared Kushner
  17. Rep. Sean Duffy
  18. Rep. Trey Gowdy
  19. Rep. Dennis Ross
  20. Pastor Darrell C. Scott
  21. Kiron Skinner

Some of these would be obvious, of course: Trump’s spawn, Bannon, Priebus, and Mnuchin. I’m really interested to see Rebekah Mercer (especially given the more we learn on Cambridge Analytica). Mooch is there. The litigious Peter Thiel is there (making him at least a reasonable candidate to be paying for this lawsuit, except for reasons I lay out below).

Mike Flynn, the one person we know to have been unmasked, is not in there (which is particularly odd given all the efforts to find some way to unring Flynn’s guilty plea, though that came after this FOIA was filed).

Then there are the eight members of Congress (in addition to the corrupt FL AG, Pam Bondi, who helped Trump out of a legal pinch in FL after Trump gave her a donation).

Lou Barletta, who’s a loud opponent of “illegal immigration,” a member of the Homeland Security Committee, and who, not long after this FOIA was first filed, prepared a challenge to PA’s Bob Casey in the Senate last year.

Marsha Blackburn, who works on a number of data issues in Congress, and is running to replace Bob Corker as TN Senator. Blackburn worked closely with Tom Marino to shield pharma and pill mills from DEA reach.

Chris Collins from upstate NY. His most interesting committee assignment is on Energy and Commerce, though he has worked on broadband issues.

Tom Marino, former US Attorney for Pennsyltucky who is on the Judiciary Committee. Trump tried to make him the Drug Czar, until it became clear he had pushed through a bill that hurt DEA’s ability to combat the opioid epidemic.

Devin Nunes, whose efforts to undermine the Mueller investigation have been epic, and who first manufactured the unmasking scandal. He’d be a great candidate to be Schaerr’s client, except he would probably just leak this information, which he has already seen.

Sean Duffy, a WI congressman who is chair of the investigations subcommittee of the Financial Services committee, and has been an opponent of CFPB.

Trey Gowdy took over as Chair of the Oversight Committee last year and also serves on the Judiciary and Intelligence Committees. Because of those appointments, even without being designated by Devin Nunes to take the lead on the Mueller pushback, he would have already had the most visibility on the Mueller investigation. But because Nunes put him in charge of actually looking at the intelligence, he is the single Republican who has seen the bulk of the Mueller investigative materials. During Nunes week, he announces his retirement suddenly, and has warned about the seriousness of the Mueller investigation, and he just gave a crazy interview to Fox News (which I’ll return to).

Dennis Ross, from FL, serves on the Financial Services committee.

On top of the Republicans, the list includes two of the few African Americans (with David Clarke, Omarosa, and Tim Scott) who supported Trump.  Darrell Scott was head of a Michael Cohen invented diversity group hastily put together in April 2016. Kiron Skinner is a legit scholar of Reagan who teaches at Carnegie Mellon and has a bunch of other appointments.

As I said, aside from the big obvious players, this list is a curious collection. Of note, however, four people on it should have a sound understanding of how NSA spying and FISA work: Thiel, Nunes, Gowdy, and Marino. But (again aside from the big players), the international ties of most of these people (Thiel and Skinner are big exceptions) are not readily apparent.

The whack understanding of FISA laid out on the complaint

I’m interested in the FISA knowledge of some people named in this list because of the crazy depiction of FISA that the complaint lays out.

The complaint highlights two departments of NSA, claiming they’re the ones that deal with improper use of intelligence (but does not include the Inspector General).

On information and belief, at least two departments within the NSA handle complaints regarding the improper use of intelligence. These departments are known publicly by the codes “S12,” a code name apparently referring to the agency’s Information Sharing Services authority, and “SV,” a code name apparently referring to the agency’s Oversight and Compliance authority.

As part of the FOIA to NSA, Schaerr asked for anything submitted to these departments.

All reports made to S12 and SV regarding improper dissemination of any individual listed in Question 2, above. See National Security Agency, United States Signals Intelligence Directive 18, § 7.5 (January 25, 2011).

That’s an oddly specific request, unless whoever is behind this request knows there are reports there.

That might suggest Nunes, Gowdy, or Marino is behind the request. But then consider how unbelievably wrong the complaint gets FISA.

After introducing FISA, it turns exclusively to Section 702, which is odd because the unmasking pseudo-scandal has thus far been based off the unmasking of individual orders.

Plaintiff’s requests in this case concern the Defendants’ use of the Foreign Intelligence Surveillance Act of 1978 (FISA).1 Section 702 of FISA (“Section 702”) empowers the Attorney General and the Director of National Intelligence to jointly authorize “the targeting of persons reasonably believed to be located outside the United States to acquire foreign intelligence information.” 50 U.S.C. § 1881a(a) (emphasis added). Section 702 expressly forbids use of this surveillance process to target persons who are either “United States persons” or located “inside the United States.” Id. at 1881a(b).

The complaint then makes three utterly false statements about how labor is divided between the FBI, NSA, and CIA.

14. The FBI collects data on outgoing communications, i.e., from persons in the United States to persons outside the United States.

15. The NSA collects data on incoming communications, i.e., from persons outside the United States to persons inside the United States.

16. The CIA, like the FBI and NSA, analyzes the information that comes from the FBI’s and NSA’s data collection. Unlike the other agencies, the CIA uses the information to engage in international intelligence operations.

The FBI collects on domestic targets, which can include incoming and outgoing comms, plus anything domestic (such as Sergey Kislyak’s calls across town to Mike Flynn; update — the December 29 calls would have been from DC to Dominican Republic, where Flynn was vacationing). The NSA likewise collects incoming and outgoing comms, as well as stuff that takes place entirely overseas (though very little of the latter is done under 702). Both the other agencies, in addition to CIA, use FISA information to engage in international intelligence operations.

The complaint then claims, in contradiction to a bunch of public information, that minimization equates to completely anonymizing US person data.

Section 702 also requires that foreign intelligence surveillance be conducted consistently with “minimization procedures.” Id. § 1881a(e)(1). These procedures are designed to “minimize the acquisition and retention, and prohibit the dissemination, of nonpublicly available information concerning unconsenting United States persons,” but in a manner still “consistent with the need of the United States to obtain, produce, and disseminate foreign intelligence information.” Id. § 1801(h)(1). As relevant here, minimization procedures must be designed to ensure the anonymity of United States persons who may be incidentally surveilled. Id. § 1801(h)(1), (2).

This comment comes immediately after a paragraph on finished intelligence reports, so this may be an incorrect statement of what masking is.

It then makes a claim about how data gets circulated that entirely ignores the sharing of raw data under 702, and further makes claims relying on this article that aren’t actually supported by the article (admittedly, the article doesn’t describe the sharing of raw data, but its focus in primarily on traditional FISA).

Generally, original raw intelligence is not circulated to other agencies; instead, intelligence reports are created and circulated internally. See, e.g., Gregory Korte, What is ‘unmasking?’ How intelligence agencies treat U.S. citizens, USA Today, (Apr. 4, 2017; 2:14 p.m.), 2017/04/04/ what-unmasking-how-intelligence-agencies-treat-us-citizens/100026368. In the process of summarizing the intelligence, agencies exclude the names of U.S. citizens from the reports, referring to them instead with identifiers like “U.S. Person 1.” Id.

The complaint then describes what sounds like a muddle of upstream collection and back door searches, but gets both wrong.

The NSA also has the ability to search the internet data it collects by entering the name of an individual into a database search tool. This process is known as “upstreaming” and has the effect of creating additional raw intelligence that may contain the names of American persons. Such intelligence is also subject to the usual masking requirements and procedures.

This is wrong because upstream collection uses selectors, not names, whereas back door searches, which can use a name, are done by all three agencies. Such intelligence would not necessarily be masked at FBI if it made it into an investigative report.

The complaint then points to that godawful Circa report that itself muddles the difference between 702 and 704/705b to claim that they were upstream violations during the campaign cycle.

News reports—as well as a declassified Foreign Intelligence Surveillance Court (FISC) opinion—also note that some Americans had their names upstreamed, in violation of internal policies, during the 2016 election cycle, which the opinion described as a “serious Fourth Amendment issue.” See Declassified FISC Court opinion at 19-20, available at; Circa News, Obama intel agency secretly conducted illegal searches on Americans for years, May 23, 2017),

The violations in question, while serious, actually involve back door searches on upstream collection, and to the extent the searches were done on 704/705b targets, would only have happened were there an individualized FISA order against one of the named people (in fact, NSA’s back door searches on US persons are generally limited to people with individualized orders, those who may be targets of a foreign power, or urgent searches following a terrorist attack or similar situation).

In short, it’s a remarkable garble of how FISA really works. That doesn’t exclude Nunes’ involvement (I would hope both Marino and Gowdy have a better understanding of FISA than this, but don’t guarantee it). But it seems to be an attempt to declassify stuff it knows about, even while it exhibits a remarkable misunderstanding of what it’s talking about.

So why are all these Trump toadies worried about being unmasked

All of which brings me to the puzzle: what the hell is his anonymous client up to? Why is the client concerned about this specific selection of transition officials, but not (say) Mike Flynn?

Update: Laura Rozen notes that this list is the list provided here, except with this chunk taken out, and with some weird alpha order going on.


10 Years Out: What’s with the Bear in the Middle?

[NB: Check the byline — it’s me, Rayne. I am not a registered financial representative or a lawyer; this post is based on my own observations and opinions. As always, your mileage may vary.]

On a chilly March evening ten years ago tonight, I was yelling at loved ones: Sell. For gods’ sake, SELL.

My own household had moved its investments from a number of mutual funds to guaranteed income. Every fund in the portfolio to that point contained a chunk of an investment bank and was therefore exposed to what I felt was sure to come.

It was obvious to anyone who was really paying attention that something was really off. Trying to buy a house in 2004 was almost impossible where I live, in spite of the ongoing migration of manufacturing jobs offshore. In the target price range for a 2000-square foot house, there were only a handful of homes listed and they all needed more than $50K in improvements. The nearby farmers’ fields were full of a new crop: single-family homes, mostly 3-bedroom and up, had eaten acres and acres in less than a year. It was insanity — there was no way this pace could be maintained, not with my state’s problematic over-reliance on the automobile industry.

Instead of buying an existing home, I built a new one. It didn’t make sense to spend $50K on improvements requiring a lot of construction if I couldn’t guarantee I could hire a contractor when new construction was so hot. I didn’t build in the top end neighborhood, either. I left myself some room in case I had to leave the area quickly for a new job; I also left room for the market to improve.

Except it didn’t. The last landscaping contractor must have pulled away from my new home in 2005 just as the bubble began to deflate. There were signs it was going to get worse, too, what with fuel prices skyrocketing. Banks increasingly offered crazy terms on mortgages just so they could something, anything, not taking the hint the market was saturated. Given the number of people relying too heavily on adjustable rate mortgages with ridiculously low entry rates, the increased gasoline price costing the average family more than $1000 a year was certain to cause credit card defaults and foreclosures.

Something ugly was coming.

~ ~ ~

In March 2008 — almost exactly a month after the Washington Post published an op-ed by New York’s then-Governor Eliot Spitzer exhorting action on subprime mortgages — 85-year-old  American investment bank Bear Stearns crashed and burned.

After urgent, fancy foot work by the Federal Reserve Bank, J.P. Morgan and other key investors, settlements were made with bail out money and remnants of the firm were ultimately snapped up by J.P. Morgan for what amounted to the cost of Bear Stearn’s headquarters building, about $2 per share. By St. Patrick’s Day, Bear Stearns was no more, completely subsumed.

It would be another six months before the next large investment bank crashed — Lehman Brothers — taking the global economy with it.

~ ~ ~

At the time the crash was blamed on lax controls on lending to home buyers, encouraging an excess of subprime mortgages, combined with investment banks’ more recent taste for collateralized debt obligations bundling mortgages into tranches for slicing up and trading.

But not all of the trash loans were residential mortgages stuffed into tranches. Some of the loans were to developers and contractors who were building commercial facilities and multi-family buildings. Some of these loans were packaged into funds which were more like offshore corporations.

The two funds triggering Bear Stearns’ meltdown were just that: offshore funds incorporated in the Cayman Islands in 2003, holding various assets including tranches of poorly-collateralized mortgages, managed by Bear Stearns Asset Management (BSAM). What mortgages were in these two funds the public doesn’t really know; were they single-family residential mortgages or commercial facilities mortgages, or some combination? The information is out there somewhere but it’s not at the public’s fingertips.

The financial media still paints a messy picture even a decade later, blaming Bear Stearns management but not its own persistent failure to provide a more comprehensive and accessible picture of the financial industry’s health.

These two funds collapsed because too many mortgages within their CDOs failed; the effect on the bank was like pulling out two critical load-bearing pieces in a game of Jenga. The cascading demand for cash to resolve the failures may have pushed other investment banks’ equally sketchy funds to fail as well, crashing the entire heap nearly a decade ago.

~ ~ ~

It was a surprise blast from the unpleasant past to see Bear Stearns’ name pop up in the middle of recent testimony before the House Permanent Subcommittee on Intelligence. Fusion GPS’ Glenn Simpson cited the investment bank as a source of financing for Donald Trump and some sketchy condominium development.

[SIMPSON]… There’s the Trump vodka business that was earlier. And then ultimately, you know, what we came to realize was that the money was actually coming out of Russia and going into his properties in Florida and New York and Panama and Toronto and these other places.

And what we, you know, gradually begun to understand, which, you know, I suppose I should kick myself for not figuring out earlier, but I don’t know that much about the real estate business, which is I alluded to this earlier, so, you know, by 2003, 2004, Donald Trump was not able to get bank credit for — and if you’re a real estate developer and you can’t get bank loans, you know, you’ve got a problem.

And all these guys, they used leverage like, you know, — so there’s alternative systems of financing, and sometimes it’s — well, there’s a variety of alternative systems of financing. But in any case, you need alternative financing.

One of the things that we now know about how the condo projects were financed is that you have to — you can get credit if you can show that you’ve sold a certain number of units.

So it turns out that, you know, one of the most important things to look at is — this is especially true of the early overseas developments, like Toronto and Panama — you can get credit if you can show that you sold a certain percentage of your units.

And so the real trick is to get people who say they’ve bought those units, and that’s where the Russians are to be found, is in some of those pre-sales, is what they’re called. And that’s how, for instance, in Panama they got the credit of — they got a — Bear Stearns to issue a bond by telling Bear Stearns that they’d sold a bunch of units to a bunch of Russian gangsters.

And, of course, they didn’t put that in the underwriting information, they just said, we’ve sold a bunch of units and here’s who bought them, and that’s how they got the credit. So that’s sort of an example of the alternative financing. … [bold mine, excerpt pages 95-96]

The timing mentioned, 2003-2004, is very close to the time that Bear Stearns launched the two Cayman-based funds which failed first. Is it possible Trump’s financing provided by Bear Stearns ended up in the funds’ CDOs? Probably not — Simpson refers to bonds. But let’s look at a financial statement from one of the subject funds:

It’s difficult to tell what’s in any of the CDOs listed in this summary. Who knows what mortgages are in them or from where they originated without access to more details?

Note the bonds at the bottom — again, what’s in them? What percentage of these bonds consisted of dicey or outright fraudulent financing for construction related to money laundering? Again, we can’t tell without access to more granular details. We don’t know whether bond(s) offered to Trump developments were in Bear Stearns’ first two failed funds or if they helped cause the eventual financial pyroclastic flow toward Bear Stearns’ end.

~ ~ ~

Another thing sticks in my craw — a bit from Michael Lewis’ The Big Short:

The bond market, because it consisted mainly of big institutional investors, experienced no similarly populist political pressure. Even as it came to dwarf the stock market, the bond market eluded serious regulation. Bond salesmen could say and do anything without fear that they’d be reported to some authority. Bond traders could explore inside information without worrying that they would be caught. Bond technicians could dream up ever more complicated securities without worrying too much about government regulation — one reason why so many derivatives had been derived, one way or another, from bonds. … [bold mine]

In other words, nobody would look askance at all at bonds sold to finance a condominium development with rather thin commitment to payment. Nobody looked askance at the ratio of CDOs to bonds, either, though Bear Stearns would try to offset the CDOs’ losses by liquidating bonds. This fund as an example couldn’t manage this offset based on the ratio alone; it would have been catastrophically worse if the collateral beneath the bonds was as fraudulent as many subprime adjustable rate mortgages in CDOs were at the time.

The root cause of the 2008 crash remains the collapse of poorly collateralized as well as fraudulent mortgages. But I have to wonder:

— With so much attention on CDOs and mortgage defaults combined with a lack of bond market adequate monitoring, how much did crappy bonds, based on fraudulent representations of collateral, contribute to the crash?

— If there was so little regulation and oversight of the bond market, how much sketchy or fraudulent project financing was in bonds on the banks’ books — including projects like Trump’s, based on promises to pay made by offshore vehicles or non-U.S. citizens?

— With so little regulation and oversight, would it have been possible for one or more nation-states using offshore finance vehicles to “weaponize” banks’ books? How many of the crappy bonds contributing to the 2008 crash were based on poorly collateralized pre-sales to Russian oligarchs and gangsters?

— What assurances do we have today — especially with Mick Mulvaney defunding the Consumer Finance Protection Bureau and knocking off an opportunity to look more deeply into credit reporting by killing off the Equifax investigation — that investment banks have changed their practices and ensured legitimate projects are financed?

—What assurances do we have that our legislators see the slippery slip when they approve legislation like S. 2155 just this week, weakening Dodd-Frank reforms?

~ ~ ~

Recall the state of the economy between Bear Stearns’ and Lehman Brothers’ crashes. Oil prices rose to over $150/barrel, resulting in $4/gallon gasoline. Other commodity prices rose in tandem with fuel prices. The home buyers who could least afford any change in their household expenses were the same ones targeted for subprime mortgages with shady terms; it came down to paying for gas to get to work and feeding the family, or making the mortgage payment.

The price of oil at the time had been driven up by excess speculation. Legislation passed in June 2008 requiring all commodity futures trading to require a minimum of 30% margin upfront rather than 10%. Oil prices dropped drastically and reduced in volatility almost overnight, but it was already too late. Too many home buyers could no longer afford their payments and mortgage defaults began to snowball.

Which brings me to yet another question: if the bond market could have been “weaponized” at that time, could a volatile commodities market likewise have been used as a trigger?

Are there any other weak points in our market which could be “weaponized,” for that matter?

~ ~ ~

On this tenth anniversary after the crash began with Bear Stearns’ collapse, I feel more secure about my retirement portfolio. There were no frantic phone calls to family members exhorting moves to safety this evening. My exposure to the remaining weaknesses of investment banking have been minimized as much as possible, though I remain vulnerable because I have a mortgage. Real estate isn’t the sure return it once was. Only uber-wealthy investors buying into certain urban markets come out on top. But wealthy real estate investors can still cause self-inflicted damage.

Atlanta, Georgia’s market has turned around since the crash — but it was home to another failed Trump real estate project, a 363-unit Trump Tower which went into foreclosure with pre-sales of only 100 units. (In January 2017, Trump ranted about Atlanta as Rep. John Lewis’ district, calling it “falling apart” and “crime infested.” One wonders what crime he meant…)

Hollywood, Florida had a brush with a failed Trump project:

In 2006, he and billionaire condo king Jorge Perez began selling a 23-story apartment building near Mar-a-Lago, but the project was abandoned a year later because of slow sales. Another Perez-Trump deal, the 200-unit Hollywood oceanfront tower, was foreclosed in 2010 after selling less than 15% of its units. (The building eventually opened, still Trump-branded, but without Perez.)

So did the Miami, Florida area:

Trump Sunny Isles, a three-tower residential complex outside Miami, has also struggled. Trump partnered with Perez again and another developer named Gil Dezer to build the project, which targeted wealthy Latin Americans. . . .

Unfortunately, the last two towers of the development opened in the middle of the financial crisis, and Perez bailed on them. . . .

And Puerto Rico, too, was home to a Trump-branded golf course which failed in 2015.

Though with so many failures followed by continued attempts, it’s worth asking if this is a business model. How does Trump continue to benefit from so much failure? How do the backers he has benefit from staking Trump money or title?

Trump’s business alone wasn’t the cause of the 2008 crash. There were far more players involved — millions, if we want to blame residential homeowners who were misled by banks to believe they could safely contract a mortgage in spite of either inadequate collateral or income and ultimately forced into foreclosure. But at least one of Trump’s business projects was in the mix if Fusion’s Simpson’s testimony is truthful; what would keep Trump or real estate investors like Trump from contributing to (if not causing) another crash today?

We must ask when we see that Trump’s former campaign manager Paul Manafort and his former son-in-law Jeffrey Yohai were engaged in sketchy real estate development projects the community/regional Banc of California may have deterred by forcibly shutting their accounts.

And ask again when we see a community bank like The Federal Savings Bank of Chicago involved in another of Manafort’s bank frauds.

The damage could be even worse, in the case of Trump’s son-in-law Jared Kushner, who is over his head in debt on 666 Fifth Avenue and whose family business is distressed, possibly causing geopolitical turmoil to shakedown new financing.

How many of these flimsy real estate deals and junky mortgages, loans, and bonds are there in the system when we can now see these affiliated with the president and his campaign advisers? How many of them will it take to cause another crash if legislators continue to pick away at safeguards?

Let’s hope I’m not writing another financial postmortem like this one in March 2028.

BREAKING! Robert Mueller Would Be Fucking Stupid If He DIDN’T Subpoena Trump Organization

The NYT has everyone all huffing and puffing about their scoop that Robert Mueller has subpoenaed documents from the Trump Organization.

The special counsel, Robert S. Mueller III, has subpoenaed the Trump Organization to turn over documents, including some related to Russia, according to two people briefed on the matter. The order is the first known time that the special counsel demanded documents directly related to President Trump’s businesses, bringing the investigation closer to the president.

The breadth of the subpoena was not clear, nor was it clear why Mr. Mueller issued it instead of simply asking for the documents from the company, an umbrella organization that oversees Mr. Trump’s business ventures. In the subpoena, delivered in recent weeks, Mr. Mueller ordered the Trump Organization to hand over all documents related to Russia and other topics he is investigating, the people said.

The NYT then goes on to suggest this tells us anything new about how long this investigation will take.

The subpoena is the latest indication that the investigation, which Mr. Trump’s lawyers once regularly assured him would be completed by now, will drag on for at least several more months. Word of the subpoena comes as Mr. Mueller appears to be broadening his investigation to examine the role foreign money may have played in funding Mr. Trump’s political activities.

It further speculates this might cross a “red line” they put there themselves back in July, a red line commentators routinely report incorrectly as pertaining to any business interests of his.

Mr. Mueller could run afoul of a line the president has warned him not to cross. Though it is not clear how much of the subpoena is related to Mr. Trump’s business beyond ties to Russia, Mr. Trump said in an interview with The New York Times in July that the special counsel would be crossing a “red line” if he looked into his family’s finances beyond any relationship with Russia.

BREAKING: Robert Mueller would be fucking stupid if he weren’t subpoenaing this information.

First, of all, we know that in the late part of last year, Mueller was locking in testimony from everyone involved in the June 9 Trump Tower meeting, and he subsequently recalled at least one of the participants back for seconds. We know there’s good reason to believe the public story the participants are telling about the meeting doesn’t make sense, and that they may be hiding a second part of the meeting. We know Mueller is examining Trump’s relationship with the Agalarovs, in particular. We know from what Sam Nunberg has told us he was asked about the Miss Universe contest. From his subpoena, we know that Mueller is dating his investigative scope from the time, in 2015, when Trump was considering yet another Moscow Trump Tower deal. Several key witnesses, notably Don Jr and Rhona Graff were interviewed [by Congress] as Trump Organization employees, represented by Abe Futerfas.

All of this pertains to Trump’s business! And it is common practice among prosecutors, especially prosecutors dealing with shifty types, to first ask for voluntary production, and then subpoena it. It would be stupid of Mueller to not do the same here.

Robert Mueller is not stupid. Therefore it is not BREAKING news that he is subpoenaing this information, and it may even mean he’s doing that just so he can finalize presentations to the grand jury, particularly given the “recent weeks” timing — the most interesting detail about this report.

One more thing. As I said, while the NYT got their own reporting right, most people quoting from it misquote what Trump actually said about any red line. Here’s the exchange.

SCHMIDT: Last thing, if Mueller was looking at your finances and your family finances, unrelated to Russia — is that a red line?

HABERMAN: Would that be a breach of what his actual charge is?

TRUMP: I would say yeah. I would say yes. By the way, I would say, I don’t — I don’t — I mean, it’s possible there’s a condo or something, so, you know, I sell a lot of condo units, and somebody from Russia buys a condo, who knows? I don’t make money from Russia. In fact, I put out a letter saying that I don’t make — from one of the most highly respected law firms, accounting firms. I don’t have buildings in Russia. They said I own buildings in Russia. I don’t. They said I made money from Russia. I don’t. It’s not my thing. I don’t, I don’t do that. Over the years, I’ve looked at maybe doing a deal in Russia, but I never did one. Other than I held the Miss Universe pageant there eight, nine years [crosstalk].

SCHMIDT: But if he was outside that lane, would that mean he’d have to go?


HABERMAN: Would you consider——

TRUMP: No, I think that’s a violation. Look, this is about Russia. So I think if he wants to go, my finances are extremely good, my company is an unbelievably successful company. And actually, when I do my filings, peoples say, “Man.” People have no idea how successful this is. It’s a great company. But I don’t even think about the company anymore. I think about this. ’Cause one thing, when you do this, companies seem very trivial. O.K.? I really mean that. They seem very trivial. But I have no income from Russia. I don’t do business with Russia. The gentleman that you mentioned, with his son, two nice people. But basically, they brought the Miss Universe pageant to Russia to open up, you know, one of their jobs. Perhaps the convention center where it was held. It was a nice evening, and I left. I left, you know, I left Moscow. It wasn’t Moscow, it was outside of Moscow.

Aside from the prompted feel of the question (as if Trump or Chris Ruddy set these reporters up to pose the questions so Trump could “warn” Mueller), it pertains only to business unrelated to Russia. Trump seems to admit that the mobbed up Russians buying his condos would be pertinent, his Miss Universe contest, and his serial efforts to get a Trump Tower in Moscow.

Even the example the NYT points to today — the involvement of UAE in some pre-inauguration meetings — pertains to Russia, as one of the points of the meetings were to set up a back channel with … Russia.

I think Jared Kushner’s business ties … that’s a different issue. But as to the substance of Trump’s purported red line, nothing in today’s report says Mueller has crossed that (even if he cared about such things).

So let’s sum up:

  1. Robert Mueller would be fucking stupid not to subpoena stuff he had already received
  2. Robert Mueller is not fucking stupid
  3. Therefore, that Robert Mueller has subpoenaed this stuff is not BREAKING news

Shew. Glad I got that off my chest.

Update: I realized in reading CNN’s version of this BREAKING news that they reported in January that Mueller had already obtained documents from Trump Org voluntarily.

Why Do You Send Your Digital Guy to Meet with the Russian Ambassador?

The HPSCI Democrats have released the report they should have had ready to go last night: their 21-page report on all the thing the HPSCI Russian investigation didn’t cover but should have. It’s an interesting list (though it seriously lets the GOP off the hook for treating this investigation as an obstructive lark). I’ll likely reflect on what kind of mirror it holds up to the Republican sense of which witnesses they had to vet for Trump.

For now, I want to point at an interesting little detail. In the section describing why HPSCI should know more about the Trump campaign’s digital operations, the report reveals that Jared Kushner sent the Trump campaign Assistant Director of Data Analysis, Avi Berkowitz, to go meet with Russian Ambassador Sergey Kislyak a month after the election, around the same time Russia was floating back channels so banks could bail out Kushner’s failing family real estate empire.

Trump Campaign Digital Operation: The Committee ought to interview all relevant persons involved or associated with the Trump campaign’s digital operation to determine whether the campaign coordinated in any way with Russia in its digital program. The Committee will not be able to fully evaluate the campaign’s digital operation without speaking to a broader crosssection of individuals who can provide greater insight into the digital operation’s day-to-day activities or its relationship with Cambridge Analytica. The Committee also must interview individuals from other companies who conducted technology-related work on behalf of the Trump campaign or on behalf of other entities being funded through independent expenditures to gain a full picture of whether there was any coordination between Russia’s extensive social media efforts on Trump’s behalf and the campaign itself.

For example, Avraham (Avi) Berkowitz, served as Assistant Director of Data Analytics on the Trump Campaign. He was also an associate of Jared Kushner and Brad Parscale. The Committee has reason to believe that Mr. Kushner may have dispatched Mr. Berkowitz to meet with Russian Ambassador Kislyak in December 2016. Theresa Hong, who served as Digital Content Director for the Trump campaign, should also be asked to testify. Ms. Hong has spoken to the press about the campaign’s digital operation and her team’s work alongside Cambridge Analytica.

That very same month, I asked whether dark marketing had a role in all the mobs seemingly providing pressure in support of Trump at key moments.

That Berkowitz made that visit did get reported last spring. But not with the emphasis that Berkowitz was so central to the campaign’s digital organization.

Maybe (as someone suggested to me on Twitter) Jared was just sending Berkowitz to retrieve the thumb drives they had shared during the campaign?

The Mueller Subpoena Starts at the Moment a Real Estate Deal in Moscow Might Get Trump Elected

Axios got a copy of a subpoena someone got from Robert Mueller last month. It asks for all communications (including handwritten notes) “this witness sent and received regarding the following people.” The list of people includes a lot of people you’d expect, but it’s missing a few:

  1. Carter Page
  2. Corey Lewandowski
  3. Donald J. Trump
  4. Hope Hicks
  5. Keith Schiller
  6. Michael Cohen
  7. Paul Manafort
  8. Rick Gates
  9. Roger Stone
  10. Steve Bannon

Cooperating witnesses George Papadopoulos and Mike Flynn aren’t on this list, but cooperating witness Rick Gates is (which may date the subpoena to before Gates flipped on February 23). The order is of particular interest (or, maybe they’re just alpha order by first name): Page, the long term suspected Russian asset, followed immediately by Lewandowski, who was in the loop on the stolen email offer, followed by the President and those closest to him, followed by Manafort and his closest aide. Then Stone and then — in the same month he gave 20 hours of testimony — Bannon.

Neither Don Jr nor Kushner is on this list. Given the emphasis on communications “regarding” the listed people, and given the way that Abbe Lowell purposely avoided giving “about”communications to Congress (and possibly to Mueller), and also given that Jonathan Swan is Axios’ key White House scoopster, I actually don’t rule out the witness being Jared. Or, as I joked on Twitter, like Flynn and Papadopoulos, maybe he has already flipped and so isn’t on this list.

Whoever it is, the absences on the list are probably a function of who is legitimately in this person’s circle.

Perhaps most telling, however, is the timing: November 1, 2015, to the present. Recall that on November 3, sometime FBI informant Felix Sater sent Michael Cohen (on the list) an email promising that a real estate deal in Moscow might lead to Trump becoming President. (Here’s the original WaPo scoop on the story.)

On November 3, 2015, two months before the GOP primary started in earnest and barely over a year before the presidential election, mobbed up real estate broker and sometime FBI informant Felix Sater emailed Trump Organization Executive Vice President and Special Counsel to Trump, Michael Cohen. According to the fragment we read, Sater boasts of his access to Putin going back to 2006 (when the Ivanka incident reportedly happened), and said “we can engineer” “our boy” becoming “President of the USA.”


Mr. Sater, a Russian immigrant, said he had lined up financing for the Trump Tower deal with VTB Bank, a Russian bank that was under American sanctions for involvement in Moscow’s efforts to undermine democracy in Ukraine. In another email, Mr. Sater envisioned a ribbon-cutting ceremony in Moscow.

“I will get Putin on this program and we will get Donald elected,” Mr. Sater wrote.

That’s the start date Mueller uses for potential communications among people including Trump’s closest aides, including Cohen (but not including Sater) in the Russian investigation.

Update: Adding, we know that on October 21, 2016, the FBI had investigations into Manafort, Page, Stone, and possibly Gates. Is it possible this list is the sum of all those against whom sub-investigations have been opened (or were at the time this subpoena was issued)?

Mueller Wants to Know How Far the Game of Email Telephone Got within the Trump Campaign

NBC has a story that has gotten a lot of people excited, reporting that Mueller’s team has been asking:

  • Policy towards Russia: Why Trump took policy positions that were friendly toward Russia and spoke positively about Russian President Vladimir Putin
  • Roger Stone: Whether Stone was aware of information the group had before it became public and when it might be released
  • Trump’s knowledge: Whether Donald Trump was aware that Democratic emails had been stolen before that was publicly known, and whether he was involved in their strategic release

I think this story is both less and more than people are making it out to be.

It’s being overhyped for its facial value. Of course Mueller is going to ask about what the president knew and when he knew it. Of course he’s going to chase down whether Roger Stone’s repeated claims to know what was coming were bluster or not.

But on at least two counts, I think there’s more to this story than meets the eye.

First, as I noted when George Papadopoulos’ plea came out, the FBI charged the former foreign policy advisor for lying about whether he had been told of dirt on Hillary in the form of emails (which we now know they said they might anonymously leak to help Trump) before or after he joined the campaign. That they believed this important enough to charge suggests that, after two full months of cooperation, they got the answer they expected.

FBI found those lies to be significant enough to arrest him over because they obscured whether he had told anyone on the campaign that the Russians had dirt in the form of Hillary emails.

To be sure, nothing in any of the documents released so far answer the questions that Papadopoulos surely spent two months explaining to the FBI: whether he told the campaign (almost certainly yes, or he wouldn’t have lied in the first place) and when (with the big import being on whether that information trickled up to Paul Manafort and Jared Kushner before they attended a meeting on June 9, 2016 in hopes of obtaining such dirt).

I’m sure that’s intentional. You gotta keep everyone else guessing about what Mueller knows.

But we can be pretty sure what the answers are.

There’s no way Papadopoulos’ plea would have been rolled out in the way it was except to get everyone he had told about the emails (as well as those who were instructing him on how to negotiate a meeting with Putin) on the record first.

So Mueller has a good idea of who learned first hand from Papadopoulos about the emails. What he may not know (or may be trying to lock in with further testimony) is how far that game of telephone extended; did it include Trump, and if so via what interlocutors. (Rick Gates may be, or may already have, enlightened Mueller on this point.)

These questions are also interesting against the background of something else suggested by the Papadopoulos plea (and subsequent NYT reporting), which I laid out here. Papadopoulos appeared to be signaling Ivan Timofeev, and those signals were closely tied to email releases.

In this post I did a timeline of all the known George Papadopoulos communications. The timeline made something clear: on two occasions, Papadopoulos alerted Ivan Timofeev to something in a Trump speech. On each occasion, something happened with emails.


I’m not saying that the timing of these email releases were dictated by the speeches. Of course they weren’t. They were timed to do maximal damage to the Hillary campaign (not incidentally, in a way that coincided with the “later in the summer” timing Don Jr asked for in his communications with Rob Goldstone).

Rather, I’m saying that Papadopoulos seems to have been signaling Timofeev, and those signals closely mapped to email releases.

And those signals are among the things he tried to destroy.

Importantly, that signaling pertained to public statements on policies of Russian interest. I laid out three apparent incidences in that post, incidences mentioned in the plea.

In this post, I suggested what might be a fourth: when Trump’s twitter account tweeted about Hillary’s emails just 40 minutes after the June 9 Trump Tower meeting started and incorporated a potentially accurate number for how many staffers Hillary had.

I want to return to a detail many others have already noted, Donald Trump’s tweet, just 40 minutes after the Trump Tower meeting started, referencing Hillary emails (albeit the ones she deleted off her server, not the still secret stolen ones).

Given that George Papadopoulos seemed to treat other public statements from the campaign (most notably Trump’s April 27 foreign policy speech) as signals to the Russians the campaign was prepared to take the next step, could this tweet be the same? A response, seemingly from the candidate himself, accepting a deal presented in the meeting?


I’m at least as interested in why Trump (or rather, Scavino or Parscale or Don Jr) used the number “823” in the tweet. In the aftermath of the John Sipher interview Jeremy Scahill did, Sipher suggested to me might be some kind of signal, a code; he’s the pro–maybe he’s right.

But I was wondering whether it might, instead, reflect real-time knowledge of the Hillary campaign’s finances and resources. That is, I wondered whether that number might have, itself, reflected the sharing of some kind of data that could verify the Russians had compromised Hillary’s campaign (or at least researched it substantively enough to know more than the Trump camp did). The public use of the number, then, might serve as a signal that that message, and the inside data, had been received.

While the specific number is difficult to check, I’ve been told the 823 number would have been at least “in the ball park” of the real number of Hillary’s campaign staffers on June 9, 2016.

If this (or, specifically mentioned in the NBC story, Trump’s July call for Russia to release Hillary’s emails) were part of the signaling, then Trump either could have been in the loop, or one of the flunkies who ran his iPhone account before he switched to iPhone himself could have been.

Which leads me to one more question reported by NBC today, almost as an afterthought. At least one witness was asked about the boundaries of Dan Scavino’s job.

At least one witness has been asked about Trump aide Dan Scavino, specifically about any involvement he may have had in the campaign’s data operation. Scavino currently runs the White House’s social media operations and is one of Trump’s closest aides.

I’m particularly interested in this given the report that Scavino was involved in negotiations through Rob Goldstone for promotions on Russian social media platform VKontakte, and the odds that he might have been the one tweeting any signaling tweets using Trump’s campaign.

So while these questions are, on the one hand, bloody obvious, they also may suggest a far more advanced understanding of how this operation might have worked.

Kushner Floats! Was Trump’s Witch Hunt Outburst about Jared Losing Clearance?

President Trump had one of his regular tweetbursts this morning about the Mueller investigation, culminating in an all caps tweet WITCH HUNT!

These outbursts are admittedly routine. But there was something unusual about this one. As MMFA’s Lis Starr noted, the three tweets leading up to this, citing Judge Napolitano, Johnathan Turley, and Ken Starr, were all reruns of Fox coverage from the last several days.

In other words, Trump resorted to the DVR to be able to justify his rant this morning. Clearly, he’s even more obsessed today than normal.

That, plus one more detail, makes me wonder whether Trump was reacting to new approaches put in place after Jared (and probably Ivanka) had his clearance downgraded to Secret on Friday.

A memo sent Friday downgraded the presidential son-in-law and adviser and other White House aides who had been working on interim clearances.

Presidential son-in-law and adviser Jared Kushner has had his security clearance downgraded — a move that will prevent him from viewing many of the sensitive documents to which he once had unfettered access.

Kushner is not alone. All White House aides working on the highest-level interim clearances — at the Top Secret/SCI-level — were informed in a memo sent Friday that their clearances would be downgraded to the Secret level, according to three people with knowledge of the situation.

The SCI acronym stands for sensitive compartmentalized information, a category of information that comes from sensitive intelligence sources and must be walled off.

The memo was not signed by chief of staff John Kelly, but it comes as the retired Marine general and other top White House aides are grappling with the fallout of a scandal involving former White House staff secretary Rob Porter, which revealed that dozens of White House aides had yet to receive permanent clearances but nonetheless had access to some of the country’s deepest secrets.

There are several interesting tidbits about the Politico story reporting that Jared has finally been stripped of his TS/SCI interim clearance. First, John Kelly didn’t sign the memo, even though that’s who Trump put in charge of over-riding typical clearance process to protect his spawn. If Don McGahn signed it, it might mean Friday’s memo came after a follow-up to Robert Mueller’s boss, Rod Rosenstein, informing him, back on February 9, of significant new information that required review before he could be cleared.

Also, Politico cites a statement from Abbe Lowell, Jared’s defense attorney.

Kushner’s attorney Abbe Lowell said in a statement that Kushner “has done more than what is expected of him in this process.”

Lowell added that the changes would “not affect Mr. Kushner’s ability to continue to do the very important work he has been assigned by the president.”

But the statement is just the same one he used back on February 16, when news of Jared’s impending clearance problems first came out. Lowell still has yet to issue any new bravado since he went silent in the face of last week’s more serious reports.

Meanwhile, Jared is not staying out of trouble. The Trump 2020 campaign announced that Brad Parscale — one of the people most suspect for coordinating data analysis with the Russians — would run his 2020 re-election campaign. The announcement included this quote from Kushner.

Jared Kushner, Senior Advisor and Assistant to the President, and President Trump’s son-in-law, said, “Brady was essential in bringing a disciplined technology and data-driven approach to how the 2016 campaign was run. His leadership and expertise will be help [sic] build a best-in-class campaign.”

Even aside from the typo, this is a no-no, as it ties Kushner’s official White House role to a campaign document.

I almost wonder whether all their fundraising is about paying lawyers at this point. On Friday, CNBC reported that when RNC stopped paying the legal defense of people like Don Jr, it started paying rent at Trump Tower. And the legal defense to pay Trump aides’ legal fees also just went active. Increasingly, it seems, the Trump “campaign” is all about staying out of prison.

Meanwhile, the Kushner family’s partner on the underwater 666 Fifth Avenue is negotiating to get out.

Kushner Cos. says it’s negotiating to buy the 49.5 percent of a debt-laden office tower on Manhattan’s Fifth Avenue that it doesn’t already own from partner Vornado Realty Trust.

Christine Taylor, a spokeswoman for Kushner Cos., declined to elaborate on terms for either the purchase or a restructuring of the building’s debt. A Vornado representative didn’t immediately respond to a request for comment. The talks were first reported Tuesday by the Wall Street Journal.

Earlier this month, Vornado recategorized how it accounts for the property, 666 Fifth Ave., because “we do not intend to hold this asset on a long-term basis,” it said in an annual report. That language typically means the company plans to unload an asset within a year, a person familiar with Vornado’s thinking said at the time.

That’s going to shine a lot more light on Kushner’s finances, and his efforts to abuse his position as his father-in-law’s “peace” negotiator to get bailed out by any number of slimy foreign oligarchs.

Jared’s in real trouble. It’s a wonder he can stay afloat amid this witch hunt.

Update: Bingo.

Officials in at least four countries have privately discussed ways they can manipulate Jared Kushner, the president’s son-in-law and senior adviser, by taking advantage of his complex business arrangements, financial difficulties and lack of foreign policy experience, according to current and former U.S. officials familiar with intelligence reports on the matter.

Among those nations discussing ways to influence Kushner to their advantage were the United Arab Emirates, China, Israel and Mexico, the current and former officials said.

It is unclear if any of those countries acted on the discussions, but Kushner’s contacts with certain foreign government officials have raised concerns inside the White House and are a reason he has been unable to obtain a permanent security clearance, the officials said.


White House officials said [National Security Advisor HR] McMaster was taken aback by some of Kushner’s foreign contacts.

“When he learned about it, it surprised him,” one official said. “He thought that was weird…It was an unusual thing. I don’t know that any White House has done it this way before.”

Meanwhile, the normally loquacious Abbe Lowell is outsourcing the no-commenting to a spokesperson.

“We will not respond substantively to unnamed sources peddling second-hand hearsay with rank speculation that continue to leak inaccurate information,” said Peter Mirijanian, a spokesman for Kushner’s lawyer.

Update: Let’s look more closely at something loquacious Abbe Lowell had to say the last time he wanted to go on the record about his client, on February 16.

Lowell said Kushner’s job is “to talk with foreign officials, which he has done and continues to do properly.”

He was denying, 11 days ago, something only now being aired: that Kushner wasn’t properly alerting the NSC of his contacts with foreign leaders. But now we know, he wasn’t properly alerting the National Security Advisor — the one that replaced the one who lied to the FBI about his contacts with foreigners, I mean.

No wonder Lowell has gone silent.

Abbe Lowell’s Unusual Silence in the Face of Jared Kushner’s Clearance Woes

Abbe Lowell’s a very good defense attorney. He’s also of the ilk that works the press.

As one example, note Lowell’s false bravado quotes from one of the first stories to contemplate how John Kelly’s new rules about long term clearance problems would (not) affect Jared’s work.

Abbe Lowell, an attorney for Kushner, said Kelly’s directive “will not affect Mr. Kushner’s ability to continue to do the very important work he has been assigned by the president.” White House officials declined to comment on how the new policies would specifically affect Kushner.


Lowell, Kushner’s attorney, said Kushner had disclosed more information on his security forms than was required out of an abundance of caution.

“My inquiries to those involved again have confirmed that there are a dozen or more people at Mr. Kushner’s level whose process is delayed, that it is not uncommon for this process to take this long in a new administration, that the current backlogs are being addressed, and no concerns were raised about Mr. Kushner’s application,” he said in a statement.


Lowell said Kushner’s job is “to talk with foreign officials, which he has done and continues to do properly.”

Which is, in my opinion, why the following detail, in three different stories about the “important new information” DOJ obtained that would delay Jared’s clearance, is so significant. Lowell declined to comment to the original story in WaPo.

Kushner’s lawyer, Abbe Lowell, declined to comment.

Then there was this NYT story which seems to reflect White House officials and Jared’s lawyers realizing (for the first time?!?!?!) that he’s not just a witness in this investigation.

The White House was not told what the issues were involving Mr. Kushner, President Trump’s son-in-law and senior adviser. But the notification led White House lawyers and aides to believe that they were more problematic than the complexity of his finances and his initial failure to disclose contacts with foreign leaders.


The interview led Mr. Kushner’s lawyers to believe that he was considered a witness, not a target, in the special counsel investigation.

For that story, too, Lowell went silent.

[A] lawyer for Mr. Kushner, Abbe D. Lowell, declined to comment.

With Axios, Lowell appears to have just blown off the request for comment.

Kushner’s lawer, Abbe Lowell, did not immediately respond to Axios’ request for comment.

I don’t mean to make light of this. It’s no laughing matter. But Lowell’s silence appears to indicate either that he is sussing out second-hand — or he has since the February 16 story learned directly — that his client is in deeper shit than he realized.