The latest Trump Organization filings reporting a $4.6 million annual loss at the president’s two Scottish golf resorts boost the total red ink for the courses over eight years to an eye-popping $75 million.
The filings covering 2019 don’t reflect the tumult of 2020. Eric Trump, the director of the Scottish courses, warned that the COVID-19 pandemic and Brexit — which the president has always supported — may take a further bite out of revenues.
The unprofitable properties have been hemorrhaging money for years. Trump International Golf Club Scotland Ltd., which operates Donald Trump’s course in Aberdeenshire, reported a net loss of $1.5 million for 2019 after losing $1.4 million the previous year, according to a filing with Britain’s Companies House registry. The total debt for the club, which opened in 2012, is more than $16 million, the London Times has reported.
Trump Turnberry in Ayrshire reported a $3.1 million loss in 2019 — despite hundreds of thousands of dollars paid by the U.S. government for lodging Secret Service agents and other costs, the Scotsman noted. Turnberry owes debt of more than $61 million.
Despite the losses, the Trump Organization has reported massive outlays at the properties over the years. It also has won approval to build a 500-unit housing development at a cost of $185 million next to the club in Aberdeenshire, which it intends to pursue, according to the latest filing.
Accounting for the president’s Scottish resorts is unusual because Trump is the creditor for his own businesses, which means payment for many of the resorts’ costs flow to the Trump Organization.
The resort losses are so astronomical that some Scottish officials are suspicious about financing and taxes. Trump hasn’t paid a penny in tax on the properties.
Trump bought the Scotland properties with huge amounts of cash at a time when he was heavily indebted and having a difficult time finding a bank to loan him funds. Scottish Green Party co-leader and member of Parliament Patrick Harvie called on the government in November to file an “Unexplained Wealth Order” against Trump to compel him to reveal the source of that cash.
The circular flow of money in the Trump companies provides an opportunity for money laundering, The New Yorker business writer Adam Davidson has suggested. He called the resorts “money disappearing” operations.
Trump “owns the asset, lends the money, owes the money, is owed the money,” Davidson explained. “The overall picture is crystal clear: Every year, Trump lends millions to himself, spends all that money on something, and claims the asset is worth all the money he spent.”
But Trump couldn’t possibly have spent all the outlays he claims on his properties, Davidson said. “We have the planning docs. We know how much he spent — it’s far less than what he claims. The money truly disappears. It goes from one pocket to another pocket and then the pocket is opened to reveal nothing is there.”