- Trump affiliate and real-estate titan Tom Barrack was charged with seven felony counts on Tuesday.
- The charges stem from his relationship with agents of the UAE during his time advising Trump.
- One of the big names in private equity real estate, Barrack often partnered with Gulf State allies.
Tom Barrack, former executive chairman and founder of real-estate giant Colony Capital and chairman of Donald Trump’s inaugural fund, was arrested Tuesday and charged with seven felony counts including acting as an unregistered agent for the United Arab Emirates, obstruction of justice, and false statements.
Federal prosecutors accuse Barrack, and others, with attempting to help the UAE exert influence within the Trump administration to aid its geopolitical goals. He is the eighth Trump campaign and administration official to be indicted on federal criminal charges.
Barrack, 74, is a prominent name in the commercial real estate industry, known for founding and leading Colony, a company that solicited billions of dollars from investors for an array of real-estate investment funds, or REITs. His rise to wealth and fame includes hit-or-miss investments, a close relationship with the former president, and deep ties with the Middle East.
“Mr. Barrack has made himself voluntarily available to investigators from the outset,” a spokesperson for Barrack told Insider reporters. “He is not guilty and will be pleading not guilty.”
A Department of Justice press release stated that Barrack, along with another executive who worked at Colony, were in routine contact with a UAE agent and attempted to use Barrack’s access to the Trump campaign “to advance the interests of and provide intelligence to the UAE.” Barrack did not notify the DOJ about his status as an agent of a foreign government.
The defendants “sought and received direction and feedback” from UAE officials throughout 2016 and 2017, according to the criminal complaint.
The release also says that Barrack referred to a UAE agent as a “‘secret weapon” whose goal was to influence US foreign policy. After a press appearance during which he praised the UAE, Barrack is accused of emailing the agent, “I nailed it … for the home team.”
Barrack was also indicted for “knowingly, intentionally, and corruptly” obstructing justice in June 2019 by making “materially false, fictitious, and fraudulent statements” to the FBI during an interview. He is accused of lying to US agents.
Here are three key things to know about Barrack.
1. Barrack got rich off real estate, then bowed out of the firm he founded last year.
Like other successful real-estate investors of his generation, Tom Barrack rose to prominence in the wake of the
of the early 1990s, buying up commercial real estate on the cheap and profiting as the nation’s economy and the real estate market rebounded as the decade progressed.
Barrack’s company, Colony Capital, invested billions of dollars across real estate assets through investment funds it raised and managed, buying various properties as varied as warehouses, offices, retail spaces, and single-family homes. One of his major hotel purchases was the Raffles and Fairmont brands.
Barrack himself was briefly considered a billionaire in net worth but has since lost that status. Indeed, the public company’s balance sheet, along with Barrack’s reputation, sustained a blow when the pandemic hit and Colony defaulted on more than $3 billion of debt last year that was tied to a large portfolio of hotels it held.
The debacle accelerated a leadership succession at Colony. A year ago, Barrack stepped down as chief executive of the company. Marc Ganzi, an executive who joined the firm in 2019, took over. Ganzi transitioned its focus to real-estate assets tied to digital infrastructure, such as data centers and cellular communications towers.
2. Barrack and Trump were close friends who first met through work.
Barrack and Trump have been friends since 1986, when Trump purchased the Plaza Hotel along Central Park in Manhattan from Barrack’s employer at the time, the Robert M. Bass Group, according to an interview Barrack gave to Bloomberg.
The two developed a deep friendship, with Politico reporting that Barrack consoled Trump during the funeral of his father, Fred, in 1999. “Fire and Fury” author Michael Wolff reported that Barrack, Trump, and Jeffrey Epstein were a “set of nightlife musketeers” in the 1980s and 1990s. Both Barrack and Trump appear in Epstein’s notorious black book.
Barrack eventually became a key fundraiser for Trump during the 2016 campaign, and gave a speech supporting him at the 2016 Republican National Convention.
After Trump won the election, Barrack was appointed chairman of the president’s 2017 inauguration fund, raising a record $107 million. Barrack remained a close advisor in the early years of Trump’s presidency, sometimes speaking to Trump multiple times a day, often late at night, Politico reported.
The two were no longer speaking by 2019, according to Politico, because of early reports that Barrack may have been investigated for potentially violating lobbying laws.
Barrack also recommended that Trump hire an old friend, Paul Manafort, as campaign chairman. Manafort was eventually sentenced in 2019 to seven and a half years in prison for tax fraud and working as a foreign agent for Ukraine. He was pardoned by Trump in 2020.
3. Barrack’s many ties to the Middle East run deep.
Barrack, who is the grandson of Lebanese Christians who emigrated to the US in 1900, has a long history of doing business with investors from the Middle East. An Arabic speaker, Barrack began his business career working with Nixon’s personal lawyer, Herbert Kalmbach, before being dispatched to Saudi Arabia. While there, he became a squash partner of the son of the Saudi king, according to the New York Times.
Barrack continued to build relationships with prominent businessmen in the Middle East throughout his career, working with Saudi princes in a deal to bring Saudi oil to Haiti and attempting to buy a controlling stake in a Libyan oil refiner in 2007.
While he was a young man, he negotiated drilling rights with the father of UAE Ambassador to the US Yousef Al Otaiba. Otaiba later became a close business partner, helping Barrack sell his firm’s Beverly Hills hotel, L’Ermitage Raffles, for $41 million in a joint venture half-owned by a UAE-based investment fund.
Otaiba himself later invested $1 million into a single-family rental fund that helped Colony create an early single-family rental company by buying foreclosed homes during the Great Financial Crisis. In 2017, the company merged with Invitation Homes, creating the largest single-family rental company.
The UAE has continued to be a close business partner, with the New York Times reporting in June of 2018 that Colony had raised $7 billion since Trump won the 2016 election, 24% of which came from the UAE and Saudi Arabia. A UAE state investment company, controlled by the crown prince of Abu Dhabi, was also allegedly a silent investor in Barrack’s 2017 $400 million deal to purchase an LA office tower, contributing $70 million.
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