Federal agency says it doesn't track foreign spending at Trump Hotel

Alexander NazaryanNational Correspondent
Yahoo News

WASHINGTON — The federal government does not know how much money foreign governments and entities have spent at the Trump International Hotel in Washington, D.C., according to testimony from Emily W. Murphy, head of the General Services Administration, which is in charge of leasing federal buildings. Murphy also said that she did not know if the Trump Organization is preparing to sell its lease to the Old Post Office, the grand building that houses the hotel, to a foreign entity.

“The only thing I know is what I’ve read in the paper,” Murphy said, speaking specifically of what foreign governments may have already spent at the controversial property.

The Trump International Hotel in Washington, D.C. (Photo: Mark Tenally/AP)
The Trump International Hotel in Washington, D.C. (Photo: Mark Tenally/AP)

Democrats seized on her admission. “This is a remarkable lack of curiosity on the part of GSA,” said a plainly annoyed Rep. Peter DeFazio, D-Ore. 

Murphy, who was appointed by Trump, also said she had not read the legal memorandums written by GSA officials about the propriety of the Trump lease. Those memorandums remain secret, as do financial records relating to the hotel. 

Rep. Dina Titus. (Photo: Tom Williams/CQ Roll Call via Getty Images)
Rep. Dina Titus. (Photo: Tom Williams/CQ Roll Call via Getty Images)

“The Trump Organization is violating the law, and the Trump administration is letting them get away with it,” Rep. Dina Titus, D-Nev., who chaired the hearing, told Yahoo News afterward. “It’s an obvious conflict of interest. The potential transfer of hundreds of millions of dollars into the president’s pocket creates even more legal and ethical issues that the Trump administration is desperate to ignore.”

The hearing was conducted in front of the House Economic Development, Public Buildings, and Emergency Management Subcommittee, which is part of the Transportation and Infrastructure Committee.

The Trump Hotel is not part of the ongoing impeachment proceedings, which are focused on allegations that the president held up foreign assistance designated for Ukraine in order to prompt investigations that would benefit him domestically. But since the start of his presidency, Trump has also faced allegations that he has used his office to enrich the Trump Organization, his marketing and real estate business. 

Those allegations have crystallized into lawsuits alleging that Trump has violated the Emoluments Clause of the U.S. Constitution, which prevents him or any other figure in the federal government from making an income from a foreign government.

GSA Administrator Emily W. Murphy. (Photo: Bill Clark/CQ Roll Call via Getty Images)
GSA Administrator Emily W. Murphy. (Photo: Bill Clark/CQ Roll Call via Getty Images)

One of the emoluments lawsuits has been filed by Citizens for Responsibility and Ethics in Washington, or CREW, a government watchdog group that opposes the Trump administration. Tuesday’s hearing did little to allay concerns about potential corruption on Trump’s part, said CREW policy director Jennifer Ahearn. “GSA has repeatedly refused to acknowledge the Trump family’s and Trump Organization’s conflicts of interest in maintaining a lease at the Old Post Office building,” Ahearn told Yahoo News.

“Her admission that GSA has not looked into whether the Trump Organization has done business with foreign governments is unsurprising,” Ahearn continued, “given GSA’s inaction to address the ethics concerns that were clear before Donald Trump even assumed the presidency.” 

Foreign governments have routinely booked rooms and events at the Trump International Hotel, which is just a few blocks from the White House. So have many Republicans. While observers like Zach Everson of the 1100 Pennsylvania blog have pieced together who stays and dines at the hotel from social media postings and calendar entries, no official record of comings and goings exists.

Rep. Greg Pence arrives at the Capitol on Jan. 8. (Photo: Drew Angerer/Getty Images)
Rep. Greg Pence arrives at the Capitol on Jan. 8. (Photo: Drew Angerer/Getty Images)

The hotel also features in the impeachment inquiry. It is where former special envoy to Ukraine Kurt Volker had breakfast with Rudy Giuliani, the former New York City mayor who is now Trump’s personal attorney. And an associate of Giuliani, Lev Parnas, recently provided congressional investigators with a secret recording from a dinner at the hotel at which Trump ordered the dismissal of Marie Yovanovitch, the U.S. ambassador to Ukraine, whom he perceived to be hostile to his political interests there.

Among the figures who have turned the Trump Hotel into a kind of clubhouse is Rep. Greg Pence, R-Ind., brother of Vice President Mike Pence. Greg Pence, who has spent some $45,000 at the hotel, happens to be a Republican member of the subcommittee before which Murphy appeared on Tuesday morning, and he used his opening remarks to downplay the significance of the hearing. He suggested that instead of “bashing the president,” the committee should focus on “crumbling infrastructure.” Pence characterized the investigation into the Trump Hotel lease as a “partisan fishing expedition,” echoing language Republicans have used to describe the impeachment inquiry, as well as the earlier investigation into Russian electoral interference.

Democrats were unlikely to take the suggestion, since the Old Post Office, now emblazoned with Trump’s name, is to them representative of the conflict of interest they believe to be endemic to the current administration. The lease was signed in 2013, when Barack Obama was president and Trump was two years from announcing a run of his own. In recent months, the Trump Organization has considered selling that lease. The company, which is now run by the president’s sons Eric and Donald Jr., could make as much as $500 million from that sale.

The Trump International Hotel in Washington, D.C. (Photo: Alex Brandon/AP)
The Trump International Hotel in Washington, D.C. (Photo: Alex Brandon/AP)

Murphy was not at GSA when that lease was signed, but Democrats nevertheless see her as an all-too-willing accomplice in the ongoing matter. An attorney by training, she had previously worked for the Republican National Committee, and for Republicans on Capitol Hill. Last year she faced intense questioning about her role in keeping the FBI from moving its headquarters from its current location, on Pennsylvania Avenue across from the Trump Hotel, to the Washington suburbs. Trump wanted the FBI to rebuild its current headquarters instead of moving; Murphy told Congress that he had been uninvolved in the decision to keep the FBI from doing so, but according to a report by the GSA inspector general, Murphy and Trump did actually discuss the move.

A spokesperson for GSA did not respond to a request for comment.

In the course of Tuesday’s hearing, a sometimes flustered Murphy offered Democrats few assurances — if any at all — that GSA was conducting the kind of oversight they were hoping for. In her opening remarks, for example, Murphy did not mention the Trump International Hotel by name, though she did reference her inability to reveal documents that are “highly deliberative in nature and contain attorney-client communications.” That was a reference to the hotel documents Democrats have long been eager to see.

Murphy’s circumspection only deepened Democrats’ irritation as the morning went on. 

Initial proposals for offers on the Trump International Hotel lease were due to the Trump Organization last week. Under questioning from Titus, Murphy said she had not heard from the Trump Organization about potential buyers. Nor could she say how GSA would determine whether the buyer was a “qualified transferee,” which is one of the stipulations of the 2013 lease.

A representative for the Trump Organization did not answer a question about the current status of the lease sale.

Democrats fear that a government seeking to gain favor with the Trump administration could try to buy the hotel. “Let’s just say that Vladimir Putin or one of his oligarch friends decide to buy the hotel for an outrageous price,” an irate DeFazio said in his opening remarks, referencing the Russian president, for whom Trump has routinely expressed fondness. 

Murphy was vague in describing what kind of review a foreign buyer would undergo, though by no means did she rule out such a review. She said merely that she would not “speculate on hypotheticals.” Democrats retorted that such a scenario was far from hypothetical.

Rep. John Garamendi speaks on the House floor on Dec. 18. (Photo: House Television via AP)
Rep. John Garamendi speaks on the House floor on Dec. 18. (Photo: House Television via AP)

Murphy and Republicans on the subcommittee repeatedly noted that the original Old Post Office lease was signed by the Obama administration.

The GSA inspector general report made public early last year found that agency “unwillingness to address the constitutional issues” surrounding the lease was improper. “Like any other federal agency, it is not only appropriate that GSA address potential violations of the Constitution that arise with its activities, GSA cannot ignore them,” the inspector general found. “GSA did not fulfill that obligation.”

Democrats were angered by what they saw as Murphy’s apparent lack of concern for those constitutional issues. In a testy exchange, Rep. John Garamendi, D-Calif., asked Murphy to confirm “that the GSA has no idea, whatsoever, as to how much spending by foreign governments accounts for the income and profits at the Trump Hotel.”

“That’s correct, sir,” Murphy said.

“So you have no idea about foreign expenditures at the hotel, correct?”

It was at this point that Murphy said that all her information about foreign spending at the Trump Hotel was based on “what’s been reported in the paper.”

“I see,” Garamendi said in response to that admission. “Have you ever made an attempt to request information from the Trump Organization regarding foreign spending at the hotel?”

Murphy said she had not, because that was the duty of a subordinate “contracting officer.” 

Garamendi was unsatisfied with the explanation. “We understand stonewalling well around here,” he said sharply. He added — holding up a copy of the document for her to see — that Murphy should “carefully read the Constitution of the United States and your oath of office, in which you said you would uphold the Constitution, including the Emoluments Clause.”

As the hearing concluded, Trump’s impeachment trial began on the other side of Capitol Hill. 

Speaking to Yahoo News following the hearing, Garamendi did not want to say whether his committee could potentially recommend articles of impeachment based on the Emoluments Clause. He said he would not consider the matter until the current impeachment effort had run its course. A representative for Titus said much the same thing.

 

This article has been updated with the proper name of the subcommittee in which the hearing took place, as well as with Rep. Pence’s role in that subcommittee. He is not, as a previous version of this article said, its ranking member.


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