The Trump Files: The Shady Way Fred Trump Tried to Save His Son’s Casino

It involved several million dollars in casino chips.

Ivylise Simones

For indispensable reporting on the coronavirus crisis, the election, and more, subscribe to the Mother Jones Daily newsletter.


Until the election, we’re bringing you “The Trump Files,” a daily dose of telling episodes, strange but true stories, or curious scenes from the life of GOP nominee Donald Trump.

Donald Trump’s career was built on help from his father, Fred, whether it was the years Trump spent managing his dad’s apartment building or the political connections and multimillion-dollar loan guarantee that made cash-strapped Donald’s first deals possible. So it’s no surprise that Fred tried to bail his son out of trouble when Donald’s Trump Castle casino in Atlantic City, New Jersey, was about to miss an interest payment in December 1990.

By then, Trump had already defaulted on the debt from his Taj Mahal casino. If Fred simply wrote Donald a check, the money would be used to pay off that debt. So, as the Washington Post‘s Michael Kranish and Marc Fisher describe in their new book, Trump Revealed, the elder Trump sent a lawyer to the Trump Castle to sneak money straight into the ailing casino’s coffers.

The lawyer, Howard Snyder, approached the casino cage and handed over a certified check for $3.35 million, drawn on Fred’s account. Snyder then walked over to a blackjack table, where a dealer paid out the entire amount in 670 gray $5,000 chips. The next day, the bank wired another $150,000 into Fred’s account at the Castle. Once again, Snyder arrived at the casino and collected the full amount in 30 more chips.

That let Trump use the de facto loan in whatever way he needed. “Sure enough, the Castle made its bond payment the day Fred’s lawyer bought the first batch of chips,” Kranish and Fisher wrote. The tactic also had a nice financial benefit. “Not only did he avoid default on the bonds—and the risk of losing control of Trump Castle as a result—but patrons who hold gaming chips normally are not paid interest,” wrote the Philadelphia Inquirer at the time.

New Jersey’s Casino Control Commission investigated the chip purchase the following year and said it was an illegal loan that broke the state’s rules about casinos receiving cash from approved financial sources. The Inquirer wrote that a casino lawyer told the paper that “Fred Trump is ineligible for licensing, and Trump Castle should be required to return the money, a move that would almost certainly force it into bankruptcy court.” In the end, the casino kept the money and the commission fined the casino the relatively small amount of $65,000. But it didn’t save Trump. A year later, the Trump Castle went into bankruptcy, and Donald gave up half the casino to his creditors.

Read the rest of “The Trump Files”:

DOES IT FEEL LIKE POLITICS IS AT A BREAKING POINT?

Headshot of Editor in Chief of Mother Jones, Clara Jeffery

It sure feels that way to me, and here at Mother Jones, we’ve been thinking a lot about what journalism needs to do differently, and how we can have the biggest impact.

We kept coming back to one word: corruption. Democracy and the rule of law being undermined by those with wealth and power for their own gain. So we're launching an ambitious Mother Jones Corruption Project to do deep, time-intensive reporting on systemic corruption, and asking the MoJo community to help crowdfund it.

We aim to hire, build a team, and give them the time and space needed to understand how we got here and how we might get out. We want to dig into the forces and decisions that have allowed massive conflicts of interest, influence peddling, and win-at-all-costs politics to flourish.

It's unlike anything we've done, and we have seed funding to get started, but we're looking to raise $500,000 from readers by July when we'll be making key budgeting decisions—and the more resources we have by then, the deeper we can dig. If our plan sounds good to you, please help kickstart it with a tax-deductible donation today.

Thanks for reading—whether or not you can pitch in today, or ever, I'm glad you're with us.

Signed by Clara Jeffery

Clara Jeffery, Editor-in-Chief

payment methods

We Recommend

Latest