Mueller just stepped over Trump’s red line

Last July, President Donald Trump warned the special counsel Robert Mueller that it would be a “violation” for him and his group of Justice Department investigators to examine the Trump family’s finances. The president agreed with a New York Times reporter’s question about whether doing so would amount to crossing a “red line.”

Mueller apparently has decided to cross that line anyway. The New York Times reported on Thursday that Mueller’s team has subpoenaed Trump’s company, the Trump Organization, for records pertaining to a number of business deals - including some related to Russia.

Trump and his lawyers have thrown down all sorts of gauntlets around Mueller’s probe. They have argued for a tight deadline leading to its conclusion; negotiated for where, when and how the president might agree to an interview with investigators; and pointed to areas that they think are off-limits.

It would appear that Mueller, with the full force of the law and subpoena power behind him, intends to proceed as he sees fit.

Mueller has already made it clear that he wouldn’t hesitate to look at Trump’s business transactions. Bloomberg News reported last July - just a day after Trump conversed with the Times about that red line - that Mueller was expanding the scope of his investigation to Trump’s commercial dealings.

Mueller’s probe seems to be pursuing three primary questions. The first is whether Trump or his campaign worked with the Kremlin to tilt the 2016 election in Trump’s favor. The second is whether Trump or his advisers obstructed justice to derail the federal investigation. The third involves the possibility of financial quid pro quos that Trump and his family members (especially his son-in-law, Jared Kushner) may have sought in exchange for public policy favors (like, for example, possibly lifting economic sanctions on Russia or shifting U.S. Ukraine policy).

The quid pro quo stuff is likely to be all about money ultimately, and that’s why the Times’s scoop on Thursday is significant. Mueller is venturing into the Trump Organization itself, the nexus of all of the president’s business deals. He’s collecting records from a company that’s inseparable from the president himself. No major transactions have occurred at the Trump Organization without Trump’s blessing, and his unwillingness and failure to separate himself from his company since entering the White House make that reality even more apparent.

The president’s intersection with Russian money is also a potential powder keg. The Times said that Mueller is examining a 2015 proposal by a Trump business partner, Felix Sater, to Trump’s personal lawyer, Michael Cohen, to orchestrate a real estate deal in Moscow. Sater claimed that he could get Russia’s president, Vladimir Putin, to buy into the transaction and that doing so could help the president win the election.

Sater is, as they say in the trade, a character Cohen’s efforts to contact the Kremlin about that deal relied on using a publicly available email address in the Kremlin’s press office. That’s not exactly the work of sophisticates who have contacts in the highest reaches of Russia’s government.

Cohen has handled some of Trump’s most sensitive matters, including payoffs to a porn star, Stormy Daniels, in exchange for her silence about an alleged sexual encounter with Trump.

And Sater is a career criminal with organized crime ties. Trump and his children worked closely with him on the launch of the Trump SoHo Hotel and other real estate projects in the U.S. long before he set himself on course for the White House.

As I noted in a series of columns in 2016 and 2017, some of the murkiest financial dealings with possible Russian ties that Trump engaged in may have taken place in New York, not Moscow.

Trump has repeatedly called Mueller’s investigation a “witch hunt,” and his lawyers have said that the last decade of Trump’s tax returns (which the president has declined to release) would show that he had no income or loans from Russian sources. Last year, Trump told NBC that he had no property or investments in Russia.

“I am not involved in Russia,” he said.

But Trump’s description of his dealings doesn’t allow for the fact that national security problems and other quandaries might arise for the president if Russia is involved in him - either through potentially compromising business transactions and relationships in the U.S., or because of funds that might have flowed into his wallet years ago.

Sater’s company, the Bayrock Group, operated out of Trump Tower, just two floors beneath the Trump Organization’s headquarters. A former partner of Sater at Bayrock claimed that the company was run as a money-laundering operation. Bayrock also allegedly got some of its funding from Eastern Europe and from Iceland, and the company paid Trump to put his name on their projects.

Although Bayrock eventually went dormant, Sater never left the Trump team. He tried to engineer a diplomatic overture to Ukraine in early 2017, an effort he reportedly undertook with Cohen and which he tried to present to Trump’s former national security adviser, Michael Flynn. And, of course, there is the 2015 Moscow deal he pitched to Cohen that Mueller is now examining.

I have some history with Sater. Trump sued me in 2006, alleging that my biography, “TrumpNation,” had misrepresented his business record and his wealth. Trump lost the suit in 2011; my lawyers deposed him and Sater during the litigation.

Sater’s intersection with the Trump Organization - and the subpoena that landed on the company’s doorstep - probably should be reminders to the president, his family, and their lawyers that Mueller is content to draw his own lines in his investigation.

Timothy L. O’Brien is the executive editor of Bloomberg Gadfly and Bloomberg View. He has been an editor and writer for the New York Times, the Wall Street Journal, HuffPost and Talk magazine. His books include “TrumpNation: The Art of Being The Donald.” From Bloomberg View.