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Trump's Financial Report? That's Rich

(Bloomberg View) -- Donald Trump has once again made his income and wealth objects of fascination and confusion in the 2016 presidential race -- this time, by filing an updated personal financial disclosure form with the Federal Election Commission.

“I filed my PFD, which I am proud to say is the largest in the history of the FEC,” Trump said on Tuesday. “I have built an incredible company and have accumulated one of the greatest portfolios of real estate assets, many of which are considered to be among the finest and most iconic properties in the world. This is the kind of thinking the country needs.”

While Trump’s iconic (but relatively modest) real estate portfolio hasn’t actually allowed him to claim membership in the top tier of major New York real estate developers for decades now -- based on the square footage or value of the properties he’s owned and brought to market -- the new personal finance disclosure did give him the opportunity to put more public clothing on his finances.

What were the “incredible” numbers the presumptive Republican presidential nominee disclosed in the new filing? More than $557 million in “income,” up from $362 million he disclosed in an FEC document filed last July. Hold on, though.

In a press release, the Trump team also described that $557 million as “revenue.” To be clear, “income” is meant to be the amount of money Trump puts in his own pocket each year and “revenue" is the amount of money his businesses pull in (before expenses and other goodies that reside above the bottom line). As he did in his July release, Trump appears to be conflating income and revenue in his public disclosures.

These figures also look a little odd when paired with reporting from Crain’s Aaron Elstein, which showed that Trump received a New York State tax break reserved for households with annual incomes of $500,000 or less. Trump received the breaks automatically because he was on a list of eligible recipients. “Could a reason be that his income in certain years was actually under the $500,000 threshold?” Elstein asked. “No one who knows will say.” (Trump’s representatives and state officials agree that taking the break was a mistake.)

Trump also noted in the press release this week that his net worth had recently ballooned to an unspecified figure “in excess of $10 billion.” That’s soared handsomely from the $8.7 billion he said he was worth when he announced his presidential run last June, and the $10 billion he said he was worth only a month after that. It’s also far more than the $2.9 billion figure that my Bloomberg News colleague Caleb Melby arrived at after reviewing Trump’s holdings in July. Trump, who flirted with personal bankruptcy in the early ’90s, has never publicly offered an independently vetted assessment of all his debts. Indeed, much of the financial information he discloses is self-reported. Until that changes, there’s a good chance that a strong dose of grade inflation runs through all of the net worth figures cited above.

There’s a method to all of this for Trump. Despite a long history of major business failures, he has used claims of outsized wealth as proof that he’s a business titan and savvy deal-maker -- skills he claims will accompany him to the White House. Trump has also gotten decades of traction with the media by offering wildly differing statements about how much money he has, coaxing flocks of newspapers, magazines, TV shows and Web sites into ping-pong matches in which interviewers guess at what he’s worth just as he sends another magical number back over the net. (Disclosure: I wrote a Trump biography, “TrumpNation,” for which he sued me in 2006 because, among other things, it questioned the size of his fortune. The suit was later dismissed.)

Trump has courted inclusion in the Forbes 400 list of the wealthiest Americans ever since the tally was first launched in 1982. He made the cut that year, when the magazine gave him props for an unspecified share of a family fortune estimated to be $200 million. Casino regulators, on the other hand, combed through his books as part of a licensing process at the time and they calculated that Trump had just $6,000 in savings, received a $100,000 salary from his wealthy father, and had snared a $1 million commission for completing a New York hotel deal -- all balanced against a $35 million credit line from a bank. In short, he appeared to be light on savings and potentially swamped in debt, which isn’t typically a recipe for robust personal wealth.

Trump climbed the Forbes list in subsequent years, earning his place in 1989 based on the notion that he had $1.7 billion. Then he disappeared entirely in 1990, not to return until 1996. Forbes speculated that Trump’s wealth in 1990 may have dropped to zero, when, in fact, his personal loan guarantees of $900 million at the time put him well below even that. He appeared on the Forbes 400 again in 1996 and has been a mainstay ever since.

In 2004, while I was trying to assess Trump’s wealth, he told me that he was worth $4 billion to $5 billion before lowering the figure later that day to $1.7 billion. My sources -- individuals who worked with Trump and had a good sense of his finances -- thought he was worth $150 million to $250 million. Trump sued me for publishing that figure as part of a range of assessments of his wealth, saying it had damaged his reputation and business. Among the documents discussed during the litigation was a Deutsche Bank assessment from 2005 that put Trump’s net worth at about $788 million; at the time, Forbes had pegged Trump at $2.7 billion, he was telling bankers and regulators that he was worth $3.6 billion, and he was telling me he was worth $5 billion to $6 billion (a billion or two more than what he had told me the year before).

By any measure, Trump is a really rich dude. But his fixation on ceaselessly tossing out sky-high figures displays a routine neediness that’s cause for concern in a candidate for the presidency. It also is something you don't see in a long line of wealthy businesspeople stretching from Rockefeller and Buffett through Gates and Zuckerberg -- all of whom chose to do other things than brag about their riches.

“A fellow asked me that once and I said, ‘I don’t know,” Nelson Bunker Hunt once told a congressional panel grilling him about his net worth. “But I do know people who know how much they are worth generally aren’t worth much.”

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

To contact the author of this story: Timothy L. O'Brien at [email protected] To contact the editor responsible for this story: David Shipley at [email protected]

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