The allegations against Commerce Secretary Wilbur Ross sure sound familiar ...
Remember Mini-Me, the modestly-sized version of Dr. Evil from Austin Powers? It turns out President Trump has his own identical-but-more-compact minion: Commerce Secretary Wilbur Ross.
In a bombshell report on Tuesday, Forbes spoke with 21 of the one-time Wall Street titan's former colleagues, who accused Ross of bilking them out of a combined $120 million over his career. "If even half of the accusations are legitimate," Forbes wrote, "the current United States secretary of commerce could rank among the biggest grifters in American history."
Admittedly, this would hardly make Ross unique in Trump world. Former EPA Administrator Scott Pruitt recently resigned under a veritable avalanche of ethics scandals. Former Health and Human Services Secretary Tom Price also resigned after taking advantage of taxpayers. But compared to Ross' scandals, theirs are of the penny-ante variety: chartered aircraft and expensive pens and weird, soundproof phone-booths. With Ross, we're talking about $120 million.
Beyond the sheer size of the alleged malfeasance, the other thing that sets Ross apart from previously disgraced Trump toadies is style. The particular low cunning of Ross' investment antics is almost a mirror image of Trump's own.
Take how both billionaire claimants allegedly relieved their bankrollers of their money.
Invesco, the parent company of WL Ross & Co., the private equity company Ross founded and ran, reportedly had to pay out $43 million to settle various issues that former employees laid at Ross' doorstep. Similarly, investors got left holding the bag when the Taj Mahal and Trump's other casinos and projects went belly up. Trump even reportedly used corporate sleight of hand — creating new companies, selling assets between them — to protect his own personal finances as much as possible while offloading his debts onto other financiers.
But at least the victims in these cases are what the president would describe as Wall Street "killers." Much worse is how Ross and Trump treated their customers.
Just before joining the White House, WL Ross actually paid the Securities and Exchange Commission (SEC) a $2.3 million fine, and refunded its investors $11.9 million, after reportedly charging management fees in excess of what was promised. On top of that, three major executives at the firm — including Ross' former number two, David Storper — are now suing Ross over at least $48 million in improper fees they say were charged over years and years.
"There are all sorts of fee issues," one investor told Forbes. "But it was just the most egregious that I've seen." Ross himself said the lawsuit from Stroper and the others is "without merit."
Trump bilked his customers, too: Thousands of former students of Trump University recently finalized a $25 million settlement, aimed at getting their money back from the bygone real estate seminar. The "university" (it was never actually a licensed university) apparently used false advertising to sell its students pre-baked self-help material put together by third parties, and consistently tried to up-sell them on the most expensive "classes" available.
Ross and Trump also got in more personal, bare knuckle brawls.
In 2007, Ross settled for $10 million with WL Ross' former vice chairman, Peter Lusk, after the latter sued him for $20 million. Lusk claimed Ross had tried to cut him out of his interests. Another former WL Ross official, Joseph Mullin, sued Ross for $3.6 million in 2016, alleging Ross "looted" him and then tried to cover it up. The case was dismissed on a technicality — Mullins waited too long to file — but now it's in appeal. Storper even launched a separate $4 million lawsuit against Ross, alleging his former boss swindled him personally by transferring Storper's equity fund interests to himself through falsified paperwork. The suit was settled and the terms remain secret.
"[Ross will] push the edge of truthfulness and use whatever power he has to grab assets," New York financier Asher Edelman told Forbes. The most obvious parallel to all this is Trump's alleged dealings with private contractors. Trump allegedly underpaid his personal driver for years, allegedly refused to pay his full bill to an Atlantic City cabinet maker, and allegedly denied full payment to a paint company and to a drapery business. And that's just the tip of the iceberg.
Ross himself left a string of disgruntled employees, who claimed they weren't properly paid for the work at Ross' home in the Hamptons. And like Ross, Trump has left a string of court cases and settlements in his wake.
This isn't where the similarities end, either. Trump and Ross share one more trait: profound vanity.
Ross was on Forbes' radar to begin with largely because he'd been lying to them for years about his net worth, in a bid to get higher on the magazine's billionaire rankings. Meanwhile, a former Forbes reporter says Trump once pretended to be an aide who doesn't exist to claim wealth he doesn't have in an effort to get on the Forbes 400 list. "What I don't want," Ross once said, "is for people to suddenly think that I've lost a lot of money when it's not true."
"Money was never a big motivation for me, except as a way to keep score," Trump wrote in The Art of the Deal. "The real excitement is playing the game." But that also raises a few follow up questions: Did the game have any rules? Did Trump follow them? Did the other participants even know what game they were playing?
Now it looks like Commerce Secretary Wilbur Ross needs to answer those questions as well.