Business with China only sometimes a deal-breaker for Trump

Anthony Scaramucci

Anthony Scaramucci announced to the world in January that he would be leaving Wall Street for the White House to become President Donald Trump’s top public liaison. Not long after, Scaramucci was told by Trump’s chief of staff that the sale of his hedge fund — a deal that includes a well-known Chinese conglomerate — raised too many ethics issues for him to start work immediately.

Scaramucci never left New York.

It’s a different story for Gary Cohn.

The former Goldman Sachs executive, the man who is now Trump’s economic adviser reported for duty on Day One and has become a constant White House presence, often at the president’s side. All the while, Cohn has held a multimillion-dollar stake in a Chinese bank, which he’s now selling.

White House officials say Scaramucci’s transaction is far more complex than Cohn’s holdings, arguing that’s why it gave them pause. But others point to the two cases as an example of Trump’s uneven approach to handling ethics concerns.

The White House yesterday [Macau time] acknowledged it did not secure an ethics pledge from ousted national security adviser Michael Flynn, who served for two weeks after Trump signed an executive order mandating that officials agree to a five-year lobbying ban and lifetime prohibition on foreign lobbying. White House officials offered no explanation for why Flynn didn’t sign the documents.

“At least so far, the ethical standards that are being applied to high-level officials coming in are quite incoherent and seemingly haphazard,” said Meredith McGehee, a chief at the government reform group Issue One who has worked on federal ethics laws and policies for decades.

With so many well-off business executives coming into the administration, the Trump team could minimize conflict-of-interest questions by being more consistent and transparent, she said. “Instead, they seem like they are leading with their chin,” she added.

White House spokesman Sean Spicer said the Trump team “has been very committed to making sure that we institute high standards here and that we’re held to them.”

Business intersections with China are particularly nettlesome, given many Chinese companies’ ties to the country’s Communist Party. Adding another layer of complexity is Trump’s frequent vow to take a tougher stance on China’s trade and currency practices, which could affect Chinese companies’ ability to sell their goods and services in the U.S.

But while Scaramucci raised red flags in the White House, others — including Trump’s son-in-law and the president himself — have Chinese business ties that do not seem to have drawn as much internal hand-wringing.

Gary Cohn

Cohn is in the process of selling his stock in the Industrial and Commercial Bank of China as he works with the Office of Government Ethics to clear out potential conflicts of interest, according to a White House official who requested anonymity to discuss the personnel matter. The New York Times reported last week that Cohn’s ICBC stock was the largest in his portfolio, valued at about USD16 million.

White House officials originally said that the ethics office flagged Scaramucci’s deal to sell his stake in SkyBridge Capital to a buyer group that included a subsidiary of Chinese conglomerate HNA Group as the reason he shouldn’t start government work right away. However, the office issued a statement to Bloomberg News saying it “had no involvement whatsoever” in the decision not to let Scaramucci start work.

Trump’s family has its own business ties to China.

Like Trump, Kushner — who is a senior adviser to the president — followed his father into New York real estate. The 36-year-old sold numerous assets to a family trust and said he has completely stepped away from his businesses and is following all conflicts of interest rules.

Kushner Companies, now led by his relatives, has been negotiating with the Chinese Anbang Insurance Group to provide what could be hundreds of millions of dollars in equity for redevelopment of a Manhattan office building.

“Kushner Companies is in advanced, ongoing discussions around 666 5th Avenue,” a company spokesman said, declining to discuss Anbang specifically. A person with direct knowledge of the talks confirmed the Anbang negotiations to The Associated Press, although the person requested anonymity to discuss the private deal.

Jared Kushner sold his stake in that building to the trust as part of his agreement with the Office of Government Ethics, but his family stands to benefit from the deal. A senior White House official who requested anonymity to discuss a personnel matter said Kushner would recuse himself from any government business to which Anbang Insurance Group is a party.

Yet Kushner took a more cautious approach on a business issue that didn’t involve China. When news surfaced last month that Miami Marlins owner Jeffrey Loria was considering selling the baseball team to the Kushner family and was on deck to become Trump’s ambassador to France, the Kushners called off the deal entirely.

The Kushners said in a statement at the time that they were pulling the plug on the potential deal because “we do not want this unrelated transaction to complicate” Loria’s potential ambassadorship. The senior White House official said that although Jared Kushner had nothing to do with the Marlins negotiation his family wanted to avoid even the appearance of impropriety.

The president himself hasn’t drawn a bright line when it comes to ethics. Although he handed daily management of his businesses to his two adult sons and a senior Trump Organization official, he placed his assets in a revocable trust that he can take control of at any time.

And while the Trump Organization pledged not to enter new foreign deals, it hasn’t stopped selling its domestic properties to foreign buyers.

New York City real estate transaction records show that last month a Chinese businesswoman paid almost $16 million for a condominium in one of Trump’s properties.

Meanwhile, the sale of Scaramucci’s hedge fund is expected to go through this spring. He declined to comment on his plan, but he’s said publicly that he expects to eventually join the White House. Julie Bykowicz, Washington, AP