Trump fundraiser puts billionaire UM donor Ross on defensive
Washington — A billionaire New York investor and owner of the Miami Dolphins who is hosting a high-dollar fundraiser for Donald Trump on Friday also has a financial interest in the president’s business empire — including his iconic Manhattan tower.
Shortly after Trump’s election, Stephen M. Ross — a prominent donor to the University of Michigan — tried to take over Ladder Capital, one of Trump’s biggest creditors, which also holds a mortgage on Trump Tower. Though the takeover failed, Ross’ private equity firm Related Companies purchased an $80 million stake in Ladder, which is still owed more than $100 million by Trump, records show.
The campaign fundraiser at Ross’ home in the Hamptons, with tickets costing up to $250,000, provides another stark example of the intersection between Trump’s business and political interests, the sort of comingling of wealth and power that Trump crusaded against during the 2016 race when he derided politicians for taking money from special interests.
“It’s another reminder of how the president’s refusal to divest from the Trump Organization continues to present potential conflicts of interest,” said Brendan Fischer, an attorney with the nonpartisan Campaign Legal Center. “We don’t know what they might want, or what they might be getting in return.”
Unlike other presidents, Trump has refused to divest himself from his business holdings, and he is not legally required to do so. His campaign did not respond to repeated request for comment on Thursday.
Daniel I. Weiner, a former Federal Election Commission attorney, said concern about the influence big donors may wield over a president is not unique to Trump.
“It’s not that this is some completely new universe that we’re living in. It’s that longstanding problems with our political system are now on steroids,” said Weiner, who is now senior counsel at New York University’s Brennan Center for Justice. “It becomes very hard to know where a president’s personal and political interests end and his service to the public interest begins.”
The fundraiser, which was first reported by the Washington Post, has already set off a wave of bad publicity for Ross and Related Companies, which also owns Equinox, an upscale chain of athletic clubs, and the indoor cycling studio SoulCycle.
Some celebrities and activists threatened to boycott. Kenny Stills, a Dolphins wide receiver, also criticized Ross’ decision to hold the fundraiser. He tweeted a screen capture from the website for Ross’ anti-racism initiative RISE which says the program “educates and empowers the sports community to eliminate racial discrimination, champion social justice and improve race relations.”
“You can’t have a non-profit with this mission statement then open your doors to Trump,” he tweeted.
Equinox and SoulCycle tried to separate themselves from Ross and his fundraiser.
“We want to let you know that Equinox and SoulCycle have nothing to do with the event and do not support it,” the gym operator said on Twitter. “We believe in tolerance and equality, and will always stay true to those values. Mr. Ross is a passive investor and is not involved in the management of either business.”
Other brands, such as Nike, have been the target of boycotts in the past, with little effect.
“They usually don’t do much,” said Laura Ries, a brand strategist and president of Ries & Ries in Atlanta. “In the age of Twitter and Instagram, these boycotts blow hot for a day or two and sputter out very quickly.”
In a statement released Wednesday Ross defended his decision to hold the fundraiser, noting that he has known Trump for 40 years.
“I always have been an active participant in the democratic process,” Ross said. “While some prefer to sit outside of the process and criticize, I prefer to engage directly and support the things I deeply care about.”
Ross regularly donates to Republicans — as well as a few Democrats — though he does not appear to have given to Trump in the past, according to FEC records.
Ross was born in Detroit and is the single largest donor to the University of Michigan. He has given $378 million to the school over the years, including $50 million in 2017 to support student projects and faculty recruitment.
Since 2012, Trump’s companies have taken out loans from Ladder Capital and currently owe anywhere between $110 million and $150 million, according to a debt range included in the president’s 2019 financial disclosure. That includes at least $50 million he owes on a 2012 mortgage on Trump Tower, the building where he lives, and represents one of his most successful real estate investments.
Before their takeover attempt was rejected, Related Companies purchased an $80 million share in Ladder Capital and Richard O’Toole, the company’s vice president and general counsel, was installed on the board of directors, filings show.
Related sold off some of its stock earlier this year and O’Toole recently stepped down from the board, but the company continues to hold 5.1 million shares in Ladder, filings show.
Related spokeswoman Joanna Rose said the firm “now owns less than 5% of the shares of Ladder” and added that “any allegation or speculation beyond a simple investment strategy is patently false.”
Ladder did not respond to a request for comment.
Trump has repeatedly been accused of using his position for profit. Foreign governments and businesses flock to his Washington hotel. His Mar-a-Lago club has seen a surge in memberships. And political fundraisers are often held at his properties.
Related has business holdings in the United States and abroad, much of it in real estate, including high-end developments in London and the Middle East, according to the company’s website.
“The timing of the initial purchase certainly seems significant,” said Fischer, of the Campaign Legal Center. “It became clear pretty early on that foreign and domestic interests saw the president’s business holdings as an opportunity to curry favor.”