McCarty further testified that defendants profited by paying a lower interest rate on the 40 Wall
Street Ladder Capital loan based on a fraudulent SFC than the interest rate with a non-recourse
loan, and he compared the terms of the then-existing Capital One non-recourse loan that 40 Wall
Street was subject to before refinancing, with the terms extended by Ladder Capital.
McCarty’s calculations determined that Donald Trump improperly saved the following amounts
on interest as a result of the banks relying on Donald Trump’s fraudulent SFCs and personal
guarantee: (1) $72,908,308 from 2014-2022 on the Doral loan; (2) $53,423,209 from 2015-2022
on the Old Post Office loan; (3) $17,443,359 from 2014-2022 on the Chicago loan; and (4)
$24,265,291 from 2015-2022 on the 40 Wall Street loan. PX 3302.
McCarty thoughtfully and logically explained why, contrary to defendants’ assertions, using the
default penalty rate would have been inappropriate, and, in any event, McCarty calculated the
differential using the default penalty rate and determined it would be larger than the numbers he
calculated in his report. PX 3077-3078. In fact, McCarty used conservative measures; by way
of example, even though interest rates were rising in 2017, 2018, and 2019, McCarty used a
standard flat 10% interest rate, resulting in significantly lower interest rate differentials than had
he calculated using the floating market interest rate. TT 3057-3058. He similarly conservatively
calculated his numbers using simple, not compound interest, which does not consider the time
value of money. TT 3082.
The method McCarty used to determine the amount of money defendants saved by borrowing
with full recourse, such as from Deutsche Bank’s Private Wealth Management Division, as
opposed to borrowing non-recourse, such as from Deutsche Bank’s Commercial Real Estate
Division, is simple in theory, although a little tricky in application. This Court reviewed
McCarty’s numbers and performed calculations to confirm his method and accuracy: four
examples should suffice:
(1) In 2020 the Doral loan was $125,000,000. Applying the non-recourse rate of
10% (or .01) results in an interest payment of $12,500,000. Applying the
recourse rate of 1.9348% (or .019348) results in an interest payment of
$2,418,500. Subtracting the latter from the former yields a saving of
$10,081,500, as seen on PX3302, page 4.
(2) Also in 2020, the Old Post Office loan was $170,000,000. Applying the non-
recourse rate of 8% (or .08) results in an interest payment of $13,600,000.
Applying the recourse rate of 1.9348% (or .019348) results in an interest
payment of $3,289,160. Subtracting the latter from the former yields a saving
of $10,310,840, as seen on PX3302, page 4.
(3) In 2019 the Trump Chicago loan was $45,000,000. Applying the non-
recourse rate of 7.5% (or .07500) results in an interest payment of $3,375,000.
Applying the recourse rate of 4.4116% (or .044116) results in an interest
payment of $1,985,220. Subtracting the latter from the former yields a saving
of $1,389,780, which is $13 more than the amount McCarty used, $1,389,767,
presumably because of a rounding differential, and in any event de minimis.
INDEX NO. 452564/2022
NYSCEF DOC. NO. 1688 RECEIVED NYSCEF: 02/16/2024