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Trump’s deals sometimes rely on creativity with the truth

There was the time Donald Trump told Larry King that he had been paid more than $1 million to give a speech about his business acumen when in fact he was paid $400,000. Or the time he sought a bank loan claiming a net worth of $3.5 billion in 2004, four times as much as what the bank found when it checked his math. Or the time he boasted that membership to Trump National Golf Club in Westchester County, New York, cost $300,000 when the actual initiation fee was $200,000. Or the time he bragged on CNBC about his new Trump International Hotel and Tower in Las Vegas, claiming, “We have 1,282 units, and they sold out in less than a week.” As Trump knew, more than 300 units had not been sold.

Confronted in a court case about this last untruth, Trump was anything but chagrined. “I’m talking to a television station,” he said. “We do want to put the best spin on the property.”

As Trump prepares to claim the Republican nomination for president this week, he and his supporters are sure to laud his main calling card — his long, operatic record as a swaggering business tycoon. And without question, there will be successes aplenty to highlight, from his gleaming golden high-rises to his well-regarded golf resorts, hit TV shows and best-selling books.

But a survey of Trump’s four decades of wheeling and dealing also reveals an equally operatic record of dissembling and deception, some of it unabashedly confirmed by Trump himself, who nearly 30 years ago first extolled the business advantages of “truthful hyperbole.” Indeed, based on the mountain of court records churned out over the span of Trump’s career, it is hard to find a project he touched that did not produce allegations of broken promises, blatant lies or outright fraud.

Under the intense scrutiny of a presidential election, many of those allegations have already become familiar campaign fodder: the Trump University students and Trump condo buyers who say they were fleeced; the public servants from New Jersey to Scotland who now say they rue the zoning approvals, licenses or tax breaks they gave based on Trump’s promises; the small-time contractors who say Trump concocted complaints about their work to avoid paying them; the infuriated business partners who say Trump concealed profits or ignored contractual obligations; the business journalists and stock analysts who say Trump smeared them for critical coverage.

Taken as a whole, though, an examination of Trump’s business career reveals persistent patterns in the way Trump bends or breaks the truth — patterns that may already feel familiar to those watching his campaign.

First and foremost is Trump’s tendency toward the self-aggrandizing fib — as if it were not impressive enough to be paid $400,000 for a speech. What also emerges is a nearly reflexive habit of telling his target audience precisely what he thinks it wants to hear — such as promising Trump University students they will learn all his real estate secrets from his “handpicked” instructors. And finally, there is the pattern already deeply familiar to his political opponents — making spurious claims against adversaries under Trump’s oft-stated theory that the best defense is a scorched-earth offense.

Equally striking is his Houdiniesque ability to wiggle away from all but the most skilled and determined efforts to corner him in an apparent lie. In interviews, lawyers who have tangled with Trump in court cases are sometimes reduced to sputtering, astonished rage, calling him “borderline pathological” and “the Michelangelo of deception” as they attempt to describe the ease with which Trump weaves his own versions of reality.

“He’s a bully, and bullies aren’t known for their veracity,” said Richard C. Seltzer, a retired senior partner at the law firm Kaye Scholer who confronted Trump in three real estate lawsuits.

In a telephone interview on Friday, Trump defended his integrity as a businessman — “I shoot very straight” — and argued that those who accuse him of acting in bad faith are often the same people he has outmaneuvered in deals.

“What, you’re going to quote people that I’ve beat? Are you going to quote people that I out-dealt?” he asked, adding, “I’ll give you hundreds of names of people that have dealt with me that say I’m very honest.”

The taxonomy of Trump’s business deceptions has been the subject of legal and journalistic scrutiny for decades. A Fortune magazine article from 2000 memorably described Trump’s “astonishing ability to prevaricate” this way: “But when Trump says he owns 10 percent of the Plaza Hotel, understand that what he actually means is that he has the right to 10 percent of the profit if it’s ever sold. When he says he’s building a ‘90-story building’ next to the United Nations, he means a 72-story building that has extra-high ceilings. And when he says his casino company is the ‘largest employer in the state of New Jersey,’ he actually means to say it is the eighth largest.”

Casino magnate Steve Wynn, a sometimes friend and sometimes foe of Trump, took up the subject of Trump’s honesty in an interview with New York magazine. “His statements to people like you, whether they concern us and our projects or our motivations or his own reality or his own future or his own present you have seen over the years have no relation to truth or fact,” Wynn said.

‘Truthful Hyperbole’

Some of the earliest documented examples of Trump’s deceptive business tactics come from none other than Trump, who in books and interviews sometimes seems to delight in describing the brazen bluffs and well-timed trickery he used to claw his way to the upper echelons of New York City’s cutthroat real estate world.

“You have to understand where I was coming from,” Trump wrote in his 1987 best-seller, “The Art of the Deal.” “While there are certainly honorable people in the real estate business, I was more accustomed to the sort of people with whom you don’t want to waste the effort of a handshake because you know it’s meaningless.”

In court cases against Trump — USA Today counted 3,500 lawsuits involving Trump, and Trump estimates he has testified more than 100 times — plaintiffs’ lawyers frequently return to the same two paragraphs from “The Art of the Deal.”

“I call it truthful hyperbole. It’s an innocent form of exaggeration — and a very effective form of promotion.”

In depositions, lawyers have repeatedly probed for the limits of Trump’s “truthful hyperbole,” or, as one lawyer framed it, the distinction Trump makes between “innocent exaggeration” and “guilty exaggeration.”

Trump has been repeatedly accused of bringing false legal claims to avoid paying debts and evade contractual obligations. As far back as 1983, a New York City housing court judge ruled that Trump filed a “spurious” lawsuit to harass a tenant into vacating a Trump building.

In Friday’s interview, Trump denied filing frivolous court cases, insisting, “I’ve won a massive majority of the litigation I’ve been involved in.” He pointed to the USA Today survey of his 3,500 legal cases. Although the newspaper could not determine who had prevailed in the vast majority of the cases, it did find Trump the clear winner in 450 suits and the clear loser in 38.

And, indeed, for all ofthe litigation Trump has attracted or spawned, for all of the times he has been accused of ruinous dishonesty, the legal and regulatory record is surprisingly bare of official findings by judges, juries or regulators that Trump engaged in perjury or improper deception or actual fraud.

But in case after case, Trump has displayed a special talent for turning what should be cold hard facts into semantic mush. Perhaps the most famous example of this skill came when Trump was asked under oath a seemingly straightforward question: Had he ever lied about his net worth? Trump responded, “My net worth fluctuates, and it goes up and down with markets and with attitudes and with feelings, even my own feelings.”

So, he explained in a deposition, when he said membership costs $300,000 to his Westchester golf club, that included the $200,000 initiation fee plus every cent he guessed that a member might spend on annual dues over the next 20 or 30 years. In other words, “The way I say it is more accurate.” And when he told Larry King he was paid more than $1 million for a speech, it was not his fault if viewers failed to realize he was including not just his $400,000 speaking fee but also the hundreds of thousands of dollars he assumed must have been spent promoting his appearance.

Part of what makes Trump such an elusive target is that his paper trail is often minimal. Trump has repeatedly testified that he does not use computers. He says he also throws away his day planner each month, and just last year he testified that he did not own a smartphone. “Unlike Hillary Clinton, I’m not a big email fan,” he said, leaving open the question of how he posts to Twitter.

Trump is also adept at deflecting blame to his staff. In two of his books, Trump made the startling and, as it turned out, bogus claim that he had once performed the remarkable feat of climbing out from under more than $9 billion in debt. Trump blamed his ghostwriter for the mistake. Asked if he reads his books before publication, Trump said, “I read it as quickly as I can because of time constraints.”

Trump is also the beneficiary of miraculously well-timed memory lapses. In suit after suit, the man who claims to possess one of world’s best memories suddenly seems to have chronic memory loss when asked about critical facts or events.

Such was the case when Trump filed a libel lawsuit against Timothy L. O’Brien, the author of “TrumpNation: The Art of Being the Donald.” Among other things, Trump asserted that “TrumpNation” cost him a “deal made in heaven” with a group of Italian investors, men he had met and who were on the brink of signing a business partnership that would have made him hundreds of millions of dollars. Their names? He could not recall. “TrumpNation” also cost him a hotel deal with Russian investors, he said. He could not remember their names, either. He was certain the book also ruined a deal with Turkish investors. Again, he could not recall any names. Polish investors also got cold feet after they read O’Brien’s book. Their names escaped him, too. The book also scared off investors from Ukraine. Alas, he could not think of their names either.

Trump’s lawsuit was dismissed.

© 2016 The New York Times Company

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