White House Senior Adviser Jared Kushner is tied to a real estate deal that has raised concerns about his family's business and is just the latest instance of the potential conflict of interest he poses as a top adviser to, and son-in-law of, the president.
The deal in question comes at a time when the White House has firmly found itself in a state of perpetual turmoil and also comes only a couple weeks after Kushner's financial entanglements had alarmed the U.S. intelligence community enough for them to believe he could be manipulated by foreign governments.
Only two months after he entered the White House, Kushner's family real estate firm, Kushner Companies, "sold a stake in a Brooklyn building to a unit of a company whose largest shareholder is the government of Japan," according to Bloomberg News. The deal, worth $103 million, was handled by Normandy Real Estate Partners, an investment firm based in New Jersey.
But Normandy Real Estate partners operated "on behalf of a subsidiary of Nippon Telegraph & Telephone Corp. By law, the Japanese government owns at least a third of NTT, in effect a controlling share," documents filed in Tokyo showed, according to Bloomberg.
There’s no evidence the NTT company made the investment with a political intent -- it denies that, as do all the others involved -- or that there has been any political gain. However, this is the kind of deal that conflict-of-interest rules seek to limit: not only inappropriate entanglements and their appearance but situations where potential favors might one day be paid back. Officials like Kushner are expected under U.S. law to recuse themselves from government decisions that would have a “direct and predictable effect” on their financial interests.
Kushner Cos. is now a co-owner with the NTT unit. The Japanese firm owns 23 percent of the building through limited liability companies plus more through a Normandy-controlled investment fund, a person familiar with the arrangement said. A day after the companies bought 175 Pearl St., the NTT company purchased a stake in Normandy itself. Kushner Cos. maintains a non-controlling share of less than five percent.
Kushner and his family real estate firm have already benefited from massive loans since he's been in the White House, as Salon has previously reported. His interim security clearance was also downgraded because he couldn't pass an FBI background check as a result of his complex financial dealings.
The Brooklyn deal also raises concerns, as it was sold at more than 60 percent, based on price-per-square-feet, of what his firm had paid for it when they originally bought the place at 175 Pearl St. just four years prior, according to data compiled by Bloomberg.
Since his father-in-law entered office, and even before that, Kushner has seemed to imagine he can live in a world where he can balance his responsibilities to his country with his business world. He’s tied financially to Israel, China and various countries in the Middle East. So it was only a matter of time before he asked Japan to join in the business venture he’s running in a side office off the West Wing.