A banker accused of trying to buy himself a post in President Donald Trump’s administration by making large, risky loans to former Trump campaign manager Paul Manafort was arrested Thursday.
Stephen M. Calk, 54, was charged with one count of financial institution bribery. Authorities said he committed the crime while serving as CEO of The Federal Savings Bank, a small bank headquartered in Chicago with an office in New York.
Manafort took the loans, but never paid the money back to Calk's bank pic.twitter.com/ElsT7C9Clb— Jamie Dupree (@jamiedupree) May 23, 2019
Calk pleaded not guilty in an appearance Thursday afternoon in a federal courthouse in Manhattan. He was released on $5 million bail.
If convicted, Calk could face up to 30 years in prison.
In an indictment released Thursday, authorities said Calk abused his authority when he approved $16 million in high-risk loans to Manafort during and shortly after the 2016 presidential election. The loans were ultimately downgraded by the bank’s primary regulator.
Calk approved of the loans with the expectation that Manafort would “in return, assist Calk in obtaining a senior position with an incoming presidential administration,” prosecutors alleged.
Neither Trump nor Manafort were identified by name in the indictment unsealed Thursday, although details shared in the record made their identities clear.
Prosecutors said Calk asked for and got Manafort’s help in trying to secure a position in the Trump administration, with the secretary of treasury, secretary of defense and secretary of the Army posts at the top of his list. After he approved of Manafort’s initial loan request, Manafort was able to get him appointed to Trump’s National Economic Advisory Committee. Later, after Trump was elected to the White House, Manafort lobbied Trump’s son-in-law, Jared Kushner, to get Calk an interview for the secretary of the Army post. Ultimately, he did not get the job.
William F. Sweeney Jr., head of New York’s FBI office, said Calk “went to great lengths to avoid banking violations in an attempt to secure a senior position in a presidential administration.”
“His attempt at petitioning for political favors was unsuccessful in more ways than one — he didn’t get the job he wanted, and he compromised the one he had,” Sweeney said.
Manafort was sentenced in March to serve 7 1/2 years in prison after he was convicted of conspiring against the United States, conspiring to launder money and bank and tax fraud charges connected to lobbying work he did for pro-Russia forces in Ukraine. He is serving out his sentence at the U.S. Penitentiary, Canaan, a high-security federal prison in Wayne County, Pennsylvania that also has and adjacent minimum-security satellite camp.
Manafort also faces fraud charges leveled at him by state prosecutors in New York.
The Associated Press contributed to this report.
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