The deli guy said this morning: “It’ll stop right here. It won’t go to the top.”

Former Trump campaign manager Paul Manafort was indicted today on charges of laundering more than $18 million and tax fraud connected to properties he owns in New York, including his Carroll Gardens brownstone.

If Manafort is found guilty, the government could seize the Carroll Gardens property.

Most intriguing to Brownstoner are the loans made on that house, 377 Union Street, by the Federal Savings Bank, first uncovered by intrepid local blogger Katia Kelly of Pardon Me For Asking. They were unusual for several reasons: Banks don’t typically loan in excess of the value of a property or on properties in default. Also, the sum borrowed, $6.6 million, “appears to be a relatively large percentage of this bank’s total assets (2.2 percent) and total shareholder equity (10.9 percent),” according to a report published on Atavist in February.

paul manafort brooklyn carroll gardens
The stoop of the brownstone in February. Photo by Susan De Vries

The loans were made by the Federal Savings Bank, whose founder, chairman and ceo is Steve Calk, a Trump supporter and member of the Trump Economic Advisory Council.

Why would a bank loan millions on a house in default? Apparently not because Federal Savings Bank is a money laundering operation or because President Trump was helping anyone launder money.

The indictment portrays the suspicious loans as fraud against the lender (and ultimately the U.S.).

The indictment, which you can read on the New York Times website, says the loan was a construction loan, which explains why it was for more than the house is worth. It also says Manafort defrauded the lender by using the money not for renovation and to increase its value, as he had promised, but to pay off the mortgage on another house and buy an additional property in California.

No word though on why the lender was willing to loan on a property in default. We guess this means Manafort won’t be finishing the renovation.

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