The former Trump Taj Mahal Casino and resort in Atalantic City went into liquidation and was subsequently redeveloped. Photo/Getty Images.
The former Trump Taj Mahal Casino and resort in Atalantic City went into liquidation and was subsequently redeveloped. Photo/Getty Images.
IT'S no secret that Donald Trump is freakishly wealthy.
Yesterday, a New York Times investigation revealed that the President helped "his parents dodge taxes" and received far more money from his father's real estate empire than he has claimed in the past.
The report uncovered a pattern of alleged tax evasion that allowed Trump to receive $US413 million (NZ$683 million) in today's dollars from his father's business through alleged dodgy acts.
The announcement has brought renewed calls for Trump to release his tax returns to the public, but the President has consistently refused to do so.
The story contradicts Trump's claim that he received "a small loan of $1 million" to build his "massive empire".
But what you may not know is that Trump's corporations came face-to-face with bankruptcy on several occasions.
While the President has never filed for personal bankruptcy, corporations he was associated with filed for bankruptcy four times.
In 1990, regulators noted the alarming amount of debt on his holdings, totalling $US3.4 billion. According to the Times, they warned that "the possibility of a complete financial collapse of the Trump Organisation was not out of the question".
In April 1990, Donald Trump opened the $US1.2 billion Taj Mahal Casino Resort — his third Atlantic City casino.
It was his biggest deal ever, and he described it as the eighth wonder of the world. In its opening days, more than 60,000 people visited the venue every day.
It was a high time for Trump — his profile was skyrocketing and he had cemented his status as a celebrity businessman.
He was considered a showman, and according to ABC News, banks were lining up to lend him money.
Trump went on a spending spree, buying everything from a $US32 million yacht to a $US365 million airline, to the $US407 million Plaza Hotel.
The casino he hailed as a "tremendous success" was built on borrowed money with a whopping 14 per cent interest rate. But it wasn't enough.
The casino was unable to generate enough gambling revenue to cover the enormous costs of building and maintaining the facility, particularly given there was a recession going on at the time.
By 1991, the casino was in $US3 billion of debt, while Trump owed around $US900 million in personal liabilities.
"He was destined to fail," said real estate businessman Steve Wynn, a rival of Trump's. "In a town where for the last 10 years, no 60,000 square foot casino had ever been utilised, on what basis would someone build one with 120,000 feet?" Now, everything he had worked to build was in jeopardy. Bankers who had been throwing money at him just months before were now at his door, demanding answers.
The company ended up seeking Chapter 11 bankruptcy protection — referring to a chapter of the United States Bankruptcy Code filed by corporations that require time to restructure their debts.
Trump struck a deal with the lenders, giving up half his stake in the casino, and being forced to sell his yacht and airline to pay back loans, according to the Washington Post.
In 2016, the Trump Taj Mahal closed for the last time.
Trump Taj Mahal casino and resort was put into liquidation. Photo/Getty Images.
1992: TRUMP PLAZA HOTEL
In 1988, Trump acquired the iconic Plaza Hotel in New York for $US390 million, a lavish hotel on New York's famous Fifth Avenue overlooking Central Park. His then-wife Ivana Trump was installed as the hotel's president, and he was optimistic about the purchase.
"I haven't purchased a building, I have purchased a masterpiece — the Mona Lisa," he was quoted by The New York Times as saying.
"For the first time in my life, I have knowingly made a deal that was not economic — for I can never justify the price I paid, no matter how successful the Plaza becomes."
But by 1992, the hotel had built up $US550 million in debt, forcing Trump to relinquish a 49 per cent stake in the venue in exchange for easier terms on which to pay off the debts.
The agreement was submitted as a prepackaged bankruptcy in November 1992.
Trump also filed for Chapter 11 protection over two more Atlantic City hotel-casinos — the Trump Plaza and Trump's Castle, because they couldn't make principal and interest payments on bonds.
The Trump Plaza was one of a number of Atlantic City casinos to fall onto hard times. Photo/Getty Images.
2004: TRUMP HOTELS & CASINO RESORTS
In 1995, Trump established Trump Hotels and Casino Resorts as a publicly traded company.
By 2004, the company was nearly $US1.8 billion in debt.
Once again, his ownership in the business was reduced from 56 per cent to 27 per cent, in order to receive better terms from lenders.
In November that year, the company filed for bankruptcy. Trump said the filing was "really just a technical thing" as the best way to begin restructuring.
The company was subsequently renamed Trump Entertainment Resorts (TER).
It hasn't always been smooth sailing for current US President Donald Trump. Photo/Getty Images.
2009: TRUMP ENTERTAINMENT RESORTS
In 2009, TER declared Chapter 11 after missing a $US53.1 million bond interest payment.
At first, Trump made an agreement with Beal Bank owner Andrew Beal to take over the resorts.
But he could not reach an agreement with the board of directors over whether or not to file for bankruptcy, which, according to Reuters, saw him resigning as head of the board.
He ended up reducing his ownership share of the business yet again, but the company retained his name. In 2011, TER sold the Trump Marina to Landry's Restaurants for $US38 million — less than 10 per cent of what the company paid Trump for it in 1996.
