‘Forceful, blunt and undiplomatic’: the ambassador now at the center of the impeachment probe

When Gordon Sondland arrived in Brussels as the US ambassador to the European Union in July 2018, it didn’t take long before people were reminded of his American boss.

The hotel executive struck many of his European counterparts as something of a mini-Donald Trump. He started renovating the US embassy. He freely gave interviews and was a fixture on Twitter. He threw lavish parties and boasted of his growing relationship with Trump.

In the corridors of the European Parliament, Sondland worked to build personal relationships with heads of state and diplomats. Though he knew it was a breach of protocol, Sondland’s habit of calling officials by their first name was an attempt to build a personal rapport, but also struck some as off-putting in the rule-bound capital of the European Union. So did his penchant for speaking bluntly.

One veteran diplomat tells CNN that Sondland would ridicule the EU for being obsessed with regulations. “At the same time, he was open and candid — just not a believer in the traditional values that have kept Europe and the US so close in the last 70 years.”

In discussing trade, Sondland would complain that the EU was “ripping off” the US, said Jeremy Shapiro, a research director at the European Council on Foreign Relations, who interacted with Sondland. Shapiro says that Sondland would also threaten his European counterparts with a “Chinese-style stand-off” if they didn’t cooperate on trade.

“When he speaks he’s forceful, blunt and un-diplomatic and it aggravates people,” said Shapiro.

A key player

Sondland is now a key player in an impeachment inquiry examining whether the President tried to use US military aid as leverage in his effort to get a foreign country to investigate a political foe.

On Thursday, Sondland, who remains in his post as ambassador, will testify behind closed doors to the House Intelligence, Foreign Affairs and Oversight committees that are leading the Democratic impeachment inquiry into Trump and Ukraine. Their investigation was spurred by a whistleblower complaint alleging Trump sought help from Ukraine to investigate former Vice President Joe Biden and his son Hunter’s position on the board of a Ukrainian natural gas company, Burisma Holdings.

Sondland is a crucial witness for Democrats’ impeachment case. Lawmakers have already interviewed multiple current and former State Department officials, and Sondland has popped up in their testimony in several instances, including text messages turned over to Congress in which Sondland and a top US diplomat in Ukraine debate whether $400 million in military and security aid was being withheld in connection with Ukraine opening an investigation.

“I think it’s crazy to withhold security assistance for help with a political campaign,” acting US ambassador to Ukraine Bill Taylor texted to Sondland on September 9.

Taylor is expected to testify before the committees on Tuesday.

A self-made hotelier from Portland, Oregon, Sondland was for years the Republican Party’s go-to bundler in the Pacific Northwest. After donating to the presidential campaign of Mitt Romney in 2012, Sondland had initially supported Jeb Bush and then Marco Rubio in their 2016 presidential campaigns.

The irony of his current predicament is that he was not welcome in Trump World and had to force his way in, according to multiple former White House officials.

According to two Trump campaign advisers, Sondland angered Trump when he denied his campaign the use of his hotels as fundraiser venues after Trump’s negative remarks about the family of a slain Muslim-American soldier in the summer of 2016. One of Sondland’s business partners is Muslim.

But after Trump won, Sondland found himself on the outside looking in. “Gordon was desperate to win the approval of Trump,” said one of his long-time Republican friends who worked in the White House. To earn Trump’s favor, Sondland ended up donating $1 million to the inauguration.

Sondland’s change of heart did not surprise people who know him. David Nierenberg, a wealthy investor and friend of Sondland, told CNN that Sondland always aspired to connect himself to people of power.

“People like me collect books and wine and Gordon collects relationships with people in power,” said Nierenberg, adding that a glimpse of Sondland’s personal office offers a telling window into his ambition. Lining the room are photos of Sondland alongside well-known politicians, including Romney, and both Presidents Bush. What’s striking, says Nierenberg, is that pictures of Sondland with politicians outnumber those of his own family. “You can see his ambition in the photographs.”

Remarkably unremarkable

After his inauguration donation, Sondland’s name was suddenly on a list that former White House adviser responsible for personnel, Johnny DeStefano, regularly put in front of the President, says a person with knowledge. Still, it took Trump months to come around to the idea of nominating Sondland.

One Senate aide remembers that given all the other Trump nominees deemed unfit by many Democrats, Sonland seemed harmless. “He blended in the background,” the aide said.

“What is maybe most remarkable in retrospect is how unremarkable his nomination seemed at the time,” said another Congressional source familiar with Sondland’s confirmation. “He was very obviously a donor pick and not someone with much prior foreign policy experience, but other than that, our records and our staff’s recollections of it are that there wasn’t much else that stood out during his confirmation process. I definitely don’t think at that time that anyone guessed he would have ended up in the middle of a fiasco like this.”

Once confirmed, Sondland was viewed as a problem by the national security teams at the White House and at the State Department, two administration officials told CNN. Sondland did not feel bound by Secretary of State Mike Pompeo or national security adviser John Bolton. He could call the President whenever he wanted, and did, they said.

Bolton’s spokesperson declined to comment. A State Department spokesperson also declined to comment.

“Once he was an ambassador he was going to put himself in the middle of things, that’s who he is,” says a Republican political consultant.

Sondland would reach out to Bolton at times to try to set up meetings, but Bolton would often refuse to meet him, one of the administration officials explained.

That same official told CNN that Sondland would often confuse other countries that dealt with him, because he blurred the lines of who was in charge of administration policy. Sometimes the White House or State Department would ignore his initiatives because they were not always consistent with policy, the official said.

Ukraine is not usually in the portfolio of the EU embassy, but Sondland may claim it was always in his briefing book, according to a source familiar with what he is likely to testify.

In her testimony to Congress this week, Fiona Hill, Trump’s former top Russia adviser, said that she regarded Sondland as a security risk, a source familiar with her testimony tells CNN. Hill told Congress that Sondland frequently used his personal cell phone to conduct official diplomatic business, and that she worried his lack of experience could be exploited by foreign governments.

What will he say?

Sondland is still expecting to show up on Thursday and speak to impeachment investigators, according to a person familiar with the EU ambassador’s preparations. Sondland’s legal team has publicly pointed to the State Department regarding any document requests, saying State would be the entity to turn any discussions of official business over to the Hill.

Sondland hasn’t heard from the White House or State Department with requests to block all or parts of his testimony Thursday, the person said. Last week, the State Department stopped Sondland from speaking to Hill investigators, prompting them to subpoena him. Hill’s legal team had refused to honor a request from the White House to consider some of her communications privileged.

Sondland, the source said, is pushing back on the idea that the White House’s national security advisers expressed alarm about a possible quid pro quo with Ukraine, saying that Hill and Bolton never made it known to Sondland that they were concerned.

Even emails between Sondland and Hill, Trump’s former Russia specialist, were “cordial” and “collegial,” with the ambassador keeping her updated on his activities in Ukraine, the person said.

Sondland contends that he never understood that the President sought an investigation of Joe Biden, according to the source, even when Trump’s personal lawyer Rudy Giuliani was pushing for a Ukrainian investigation of the natural gas company Burisma and into foreign interference in the 2016 election. Sondland contends he did not understand that Trump sought political help from Ukraine at least until after the July 25 call transcript was released, where Trump had brought up Biden, according to the source.

The source also contends Sondland’s interactions with Giuliani were far less than others perceived, though necessary to achieve progress with Ukraine.

“If you wanted to get this meeting with (Ukrainian President Volodymyr) Zelensky, then you could either abandon that or you could work through Rudy (Giuliani),” the person said, again describing what Sondland may say on Thursday. “They came to understand that what Rudy wanted was a public statement by Zelensky to look at Burisma and the server in 2016.”

Some of Sondland’s friends worry about his potential exposure. “I hope that he did not cross any lines that he might now regret,” said Jordan Schnitzer a real estate developer in Portland, Oregon, and a longtime friend of Sondland.

Sondland’s friend David Nierenberg told CNN that he had emailed Sondland as the Ukraine scandal was breaking, reminding him that Richard Nixon did not lose the presidency because of the break-in at Democratic National Committee, but rather because of two years of lies and cover-ups. “I concluded my message, therefore, by saying whatever you do, tell the truth, if there’s anything that you regret doing or not doing on reflection that admitted, freely, apologize for it and make things right because you have the rest of your life ahead of you.”

“Thank you,” Sondland replied. “You’ve always given me good advice.”

Trump wanted to release his taxes in 2013 to show how smart he was for paying so little

President Donald Trump’s fight to keep his tax returns private is at odds with his own thinking in 2013 and 2014 that releasing them as part of a presidential bid would make him look like a smart businessman who had spent years lowering his taxable income, according to two people with firsthand knowledge of conversations at the time.

Trump ultimately changed his mind after an adviser says he convinced him not to release his taxes, and he has spent years claiming he can’t because he’s under audit by the IRS.

Sam Nunberg, Trump’s political adviser from 2011 to August 2015, tells CNN that during a meeting he had with Trump in the summer of 2013 at Trump Tower, the future president said he was comfortable releasing his tax returns and, even, that he thought it would be a good idea. Nunberg assumed this was because of how little Trump must pay in taxes.

“He thought he could defend the return,” says Nunberg, who did not himself view Trump’s returns. “I inferred from the conversation that he believed that it was a low number and he’d look savvy.”

A second person, a former senior adviser to Trump, who also joined them for lunch that day, recalls Trump being enthusiastic about releasing his returns for this reason.

Nunberg remembers that at the time Trump had recently returned from delivering a political speech in Iowa and that his motivation to look like a scrappy businessman was fueled by the failed presidential bid of Mitt Romney. “He felt that Romney had avoided looking successful,” says Nunberg. “Romney had posed beside a shopping cart in his jeans. Trump wanted to appear to be the opposite of that. He was proud of his business track record.”

In May 2014, Trump told an Irish television station that he would “absolutely” release his tax returns if he entered the race. “If I decide to run for office, I’ll produce my tax returns, absolutely,” he said. “And I would love to do that.”

It wasn’t until November 2014 that Trump abandoned the idea, according to Nunberg. At that point it was still eight months before Trump announced for president. At another one-on-one meeting at Trump Tower, Nunberg says he convinced Trump to change tack, and told him that federal election rules obliged him to release only a broad financial statement, rather than his full tax returns. Trump liked the idea because he could show how rich he was, says Nunberg.

“He wanted to look rich rather than smart,” Nunberg says.

Neither the White House, Trump’s lawyer Jay Sekulow, nor the Trump Organization responded to a request for comment.

A losing fight

That change of heart nearly five years ago has had massive repercussions. During the 2016 campaign, Trump became the first major party nominee not to release his taxes in more than 30 years.

As President, he has faced numerous legal challenges seeking the release of his tax returns, including from House Democrats and the New York district attorney.

In fighting to keep them private, Trump has deployed an assortment of arguments both legal and prosaic, ranging from claims he’s under audit by the IRS to simply stating his taxes are “none of your business.” Trump has also acknowledged that he has fought to “very hard to pay as little tax as possible.”

But after a string of court losses, Trump’s unprecedented struggle to block the release of his tax returns is looking legally tenuous and appears more likely to head to the Supreme Court.

On Friday, Trump lost his appeal to stop House Democrats from subpoenaing his taxes from his longtime accountant Mazars USA. In a 2-1 ruling, the US Court of Appeals for the DC Circuit upheld a lower court ruling saying the firm must turn over eight years of accounting records.

Trump can appeal to the Supreme Court to stop Mazars, but courts, including the Supreme Court, previously have refused to curtail Congress’ subpoena power.

A matter of vanity

Speculation has swirled around why Trump hasn’t released his taxes, including that they could reveal long-denied ties to foreign interests or that he has donated embarrassingly little to charitable organizations. Trump’s critics have also suggested that a full public airing of his tax records might prove that he has exaggerated his wealth and isn’t as rich as he claims to be.

It’s this last reason that is closest to the truth, according to Nunberg, who told CNN it’s his impression that Trump’s real motivation for not releasing his taxes was a simple matter of vanity.

A tax return of a New York real estate developer typically makes them look much less wealthy than they really are, on account of complex rules that include the ability for owners of profit-making buildings to write them off as losses.

Nunberg says the reason he suggested Trump not release his tax returns came down to three factors. First, by then Trump had told him that he was in fact under audit by the IRS. Secondly, he and Roger Stone, a mentor to Nunberg and himself a former Trump adviser, had started to realize that some of Trump’s business history — the bankruptcy of the Trump Organization in the 1990s in particular — would come under attack and the returns might highlight that.

Third, Nunberg assumed, given his knowledge of the common tax practice of New York real estate magnates, there would likely be a vast discrepancy between Trump’s net worth and what his tax returns showed — and that this might be difficult to explain to voters in Iowa, New Hampshire and South Carolina. Nunberg knew that tax laws for commercial real estate developers are notoriously riddled with loopholes peculiar to that industry.

“I wanted him to run. I wanted him to feel as comfortable as he could. I didn’t want any complications or hiccups. I tried so that this wouldn’t hurt the Trump brand in any way,” Nunberg said.

Changing his story

By early 2015, Trump was starting to slightly change the way he answered questions about his taxes. In February of that year, he told radio host Hugh Hewitt that he would “certainly show tax returns if it was necessary.”

By October, he was hedging even more, telling ABC’s George Stephanopoulos that he was considering releasing his tax returns. “I’m thinking about maybe when we find out the true story on Hillary’s emails,” he said of Democratic presidential candidate Hillary Clinton.

The financial statement Trump filed with the Federal Election Commission in July 2015 was 92 pages long and claimed $1.4 billion in assets and $265 million in liabilities.

Nunberg was fired from the campaign in August 2015, shortly after the financial statement was released.

During the presidential campaign Trump used the excuse of being under audit as the chief reason he could not release his taxes. He’s repeated that defense as President. It’s true that every president is audited every year, but there is no law that forbids them from releasing their returns while under audit.

“The President has fought releasing his tax returns since the early days of his campaign,” said the former senior Trump adviser who says they still regularly speak with the President. “He has no interest in showing them or he would have released them. As usual I expect the Democrats will be disappointed if they are released, as they might just show Trump is a savvy, successful wealthy businessman.”

But in May The New York Times reported that 10 years of Trump’s tax records the paper had viewed, starting in 1985, appeared to show the exact opposite, and that Trump had lost $1.17 billion during that period.

The paper reported that, according to the tax records, Trump would have “lost” more money than any individual taxpayer in the entire country. Trump’s attorney, Charles Harder, told the Times that statements about the records were “inaccurate” but pointed to no specific inaccuracies. He later added that IRS transcripts “are notoriously inaccurate.”

In a response to the Times, a senior White House official said, “The president got massive depreciation and tax shelter because of large-scale construction and subsidized developments. That is why the president has always scoffed at the tax system and said you need to change the tax laws. You can make a large income and not have to pay large amount of taxes.”

In other words, Nunberg’s assumptions about why Trump’s tax returns would be damaging to the Trump brand were spot on.

Former US special envoy for Ukraine plans to appear before House committees this week

Former US Special Envoy for Ukraine Kurt Volker is still planning to appear at his deposition Thursday in front of three congressional committees, according to two sources familiar with Volker’s latest thinking.

Volker’s plan to follow through with his deposition comes after Secretary of State Mike Pompeo accused House Democrats of intimidating and bullying State Department officials by calling for their depositions in the Ukraine inquiry starting this week, something he says is “not feasible.”

It remains unclear whether the four current State Department officials will be deposed in the coming days by House committees, according to congressional sources.

CNN reported Saturday that Volker had planned to appear for the deposition.

In a letter to trustees of the McCain Institute on Saturday, Volker wrote that Congress requested his testimony and that he would “be complying with that request.”

Some background on Volker: His appearance before the Intelligence, Oversight and Reform and Foreign Affairs committees was announced just hours before the news broke Friday evening that he had resigned.

Lewandowski may lead White House impeachment team

Corey Lewandowski, the political operative who helped elect Donald Trump, has had conversations with White House officials in recent days about potentially taking a position inside the administration to help the President confront a looming impeachment fight.

The discussions, including a Thursday afternoon meeting at the White House, reflect the growing recognition among Trump’s allies and advisers that he is without a clear strategy for managing the crisis, which exploded in stunning fashion this week, according to multiple people familiar with the talks.

Trump’s 2016 campaign manager would be in a crisis management type role, and the idea as it currently stands would be for Lewandowski to assemble a team that mirrors the one that existed in Bill Clinton’s White House when he was facing his own impeachment.

The list of potential players on the team includes David Bossie, his former deputy campaign manager who angered the President earlier this year by soliciting funds using Trump’s name. Bossie served as the chief investigator of the Republican-led House Oversight Committee in 1997, helping scrutinize Clinton.

“As I have done for the last five years, I will continue to serve the President in any capacity he thinks I can be most helpful. However, I have not spoken directly to the President about leading an effort to push back on the fake impeachment narrative,” Lewandowski told CNN.

White House press secretary Stephanie Grisham denied that an impeachment response team is in the works.

“Despite what CNN clearly hopes to be true, there are no plans to form an impeachment response team. If your sourcing is so ‘strong,’ at least one of them would have the courage to say it on the record. You don’t have even one person on the record because it’s just not true,” Grisham said.

Lewandowski, who was fired midway through Trump’s campaign, remains close to the President and is a regularly guest aboard Air Force One and at the White House. His presence in Trump’s inner circle is controversial, however, given his loudly proclaimed view of letting “Trump be Trump” instead of attempting to apply discipline to the freewheeling president. Lewandowski has also chafed at times with some members of Trump’s family.

He also came under fire during a recent appearance in front of the House Judiciary Committee when he publicly admitted lying to the press, sparking an audible reaction in the room when he said: “I have no obligation to be honest with the media because they’re just as dishonest as anyone else.”

Lewandowski also teased a rumored New Hampshire US Senate bid, recently tweeting: “New website just launched to help a potential senate run. Sign up now!” he said, alongside a link to what appeared to be a super PAC.”

The response team would be to help spearhead strategy and messaging as the House of Representatives’ impeachment probe heats up. The role could also exist outside the White House, and many of the details of the arrangement are still unclear.

CNN reported earlier Thursday that some people close to Trump believe he is in denial about the gravity of his predicament, and it is still not clear whether the President is ready to acknowledge he needs such a team.

But several of his advisers have expressed concern that Trump’s team appears without a strategy as a long-anticipated impeachment proceeding becomes a reality.

Several allies have made the case for standing up a dedicated team to handle the matter — realizing how dire impeachment is and how hard it would be for a typical White House political and press shop to keep up. The White House legal team has expressed confidence in facing such a probe, but the rest of ranks of the White House are widely seen as depleted.

The White House is considering bringing other officials in as well, though some aides are pushing back on the need for such a team, claiming those who are already there are well-equipped to face off with Democrats.

During the last US impeachment proceedings, Clinton retained a personal legal team both to help combat perjury and obstruction of justice charges and to help mold public perceptions of the case.

A key difference, however, is Clinton had already been reelected when the charges were levied. Trump will face the impeachment process at the same time he is gearing up for another presidential campaign, lending the matter more political weight.

New details reveal acrimonious split between Epstein and Duke of York

On August 19, Buckingham Palace put out a statement signed by Prince Andrew, the Duke of York, that was emphatic in distancing the British Royal from the late disgraced financier, Jeffrey Epstein.

“His Royal Highness deplores the exploitation of any human being and the suggestion he would condone, participate in or encourage any such behavior is abhorrent,” it said in part.

The statement came days after The Mail On Sunday published grainy video footage that the British paper said showed the prince at the door of Epstein’s Manhattan townhouse in 2010.

By then Epstein was a registered sex offender who had avoided a federal trial at the time and served only 13 months in jail for state prostitution charges over his involvement with underage girls. He was accused of paying hundreds of dollars in cash to girls as young as 14 to have sex with him at his Upper East Side home and his estate in Palm Beach, Florida, and paid some of his victims to recruit other girls for him to abuse.

In 2015, one of Epstein’s accusers, Virginia Roberts Giuffre, said in a federal court filing that she was forced to have sex with the prince while underage. Prince Andrew has “emphatically denied” any sexual contact with Virginia Roberts.

While the statement was intended to clarify the details of a relationship that had plagued the British prince for almost a decade, the reality is that it had ended years earlier in a dramatic chain of events, some of which have never been told before.

The more than decade-long friendship between Prince Andrew and Epstein, who died by suicide in his jail cell on August 10, ended in the Spring of 2011, when Epstein threatened legal action against Prince Andrew’s ex-wife Sarah Ferguson, the Duchess of York.

According to interviews with three people with direct knowledge of the events, Epstein grew irate in late February 2011 after the New York Post published a photograph of the prince walking in Central Park with Epstein in late December 2010.

The accompanying article, headlined  ”Prince & Perv, generated a barrage of negative publicity about the prince’s years-long friendship with Epstein. On March 7, 2011, Sarah Ferguson admitted publicly that she had accepted GBP 15,000 ($9,305) from Epstein to help pay an employee to whom she owed money.

On the advice of her publicist, James Henderson, the Duchess gave an interview to London’s Evening Standard in which she expressed extreme contrition for her lack of judgment by accepting the funds from Epstein. With the interview, she put a clear divide between herself and Epstein. “I abhor pedophilia,” she said, adding that she’d had no knowledge of Epstein’s alleged relationships with under-age girls when she took the money.

According to Henderson, Epstein’s reaction to Ferguson’s statement was swift and dramatic. First Henderson received what he described as a “deeply unpleasant” phone call from Epstein, who threatened Henderson with a defamation lawsuit if a statement was not issued retracting the word “pedophile.”

“It was so unpleasant that I was left slightly rattled and I saved his number so I’d never have to take a call from him again,” Henderson told CNN.

Next, the Duchess received a letter threatening legal action from an Epstein lawyer and demanding a retraction, according to Henderson. The letter was sent to Ferguson’s lawyer at Schillings in London, according to Henderson, who says he advised the Duchess not to retract her statement.

Shortly after, Epstein, who had retained the services of Los Angeles publicity firm Sitrick & Company years earlier, now turned to Sitrick for help with the situation. The head and founder of the firm, Michael Sitrick, said he in turn recommended that Epstein hire a new lawyer, the UK defamation attorney Paul Tweed.

That solution didn’t work. Sitrick ended up suing Epstein for failing to pay his bills, and Tweed eventually stopped working for him as well. Tweed told CNN that he stopped working on the matter after “my advices were not acceptable to Epstein.”

According to court documents related to Sitrick’s lawsuit against Epstein and obtained by CNN, Sitrick’s employees, in consultation with Tweed, tried to construct language to propose to Fergie that would serve as some sort of retraction by the Duchess of York.

At one point, Henderson says he was shown a draft statement that asked for a retraction of every single one of the Duchess’s comments.

Ultimately, it was all for naught. On Henderson’s advice, the Duchess never retracted her statements. Records show that in 2014 Sitrick sued Epstein for payment of more than $71,000 in unpaid bills and received a default judgment in his favor.

In a bit of irony, while the incident marked the end of the relationship between Epstein and Prince Andrew, it also led to a friendship between Tweed and the former royal couple. Tweed was photographed last week golfing with Prince Andrew.

The Duchess had been so impressed by his tenacity in 2011 she wound up hiring him a few years later, according to Henderson.

However, the Epstein issue has continued to plague the Duke of York, especially since the Giuffre allegations became public in 2015. (A photograph of the Duke with his arm around Giuffre’s waist allegedly taken in 2001 first surfaced in Britain’s Mail on Sunday in 2011.)

A federal judge has ruled that some documents related to the case could be unsealed.

Lawyers for Giuffre have asked for a meeting with the Duke to explore his relationship with Epstein. He did not answer their requests, according to Giuffre’s lawyers. Buckingham Palace reiterated its statement that Prince Andrew had never had any form of sexual contact with Giuffre.

On Friday, September 20, Giuffre reiterated her allegations about Prince Andrew on NBC’s Today Show, where she appeared with five other alleged Epstein victims. In the segment, Giuffre recounts an incident in which she went out to a club in London with Epstein, his close friend Ghislaine Maxwell, and Prince Andrew. In the car ride back from the club, Giuffre said that Maxwell told her the prince was coming back to her house and that she wanted her to “do for him what you do for Epstein.”

“I just couldn’t believe it,” Giuffre Roberts told NBC. “I couldn’t believe that even royalty were involved.”

In a statement to CNN, Buckingham Palace said that “It is emphatically denied that the Duke of York had any form of sexual contact or relationship with Virginia Roberts. Any claim to the contrary is false and without foundation.”

Trump campaign manager Brad Parscale remains on defense after scrutiny over financial ties

The Trump campaign is fending off questions about recent actions and comments from campaign manager Brad Parscale amid a torrent of criticism over the last few weeks from advisers inside the President’s expansive cutthroat network of confidants and aides.Parscale’s remarks about the Trump family, comparing the powerful real estate clan to a “dynasty,” revealed over the weekend, forced the President’s reelection aides to jump to the campaign manager’s defense once again.

“The Trumps will be a dynasty that lasts for decades,” Parscale said during a retreat for California Republicans, Politico first reported on Saturday. Asked if he thought the Trump children would eventually be on the ballot themselves, he said: “I just think they’re a dynasty. I think they’re all amazing people … with amazing capabilities. I think you see that from Don Jr. I think you see that from Ivanka. You see it from Jared. You see it from all.”

One Trump adviser, however, reacted with astonishment to the campaign manager’s comments, arguing Parscale had committed a serious unforced error.

“It’s was an incredibly stupid statement,” the adviser said, remarking that Trump’s victory over Hillary Clinton was partly a defeat of the notion of American political dynasties.

A Trump campaign spokesman explained Parscale only meant to compliment the first family in his comments.

“Brad meant what he said, which was praise for the Trump family’s intelligence and talents, which will have positive impacts on the party for decades to come,” campaign communications director Tim Murtaugh said in a statement.

But one of the President’s most vocal supporters in conservative media lambasted Parscale for the remark.

“This may be one of the dumbest things a campaign manager for a populist candidate ever said: Trump family building ‘dynasty’ for decades to come #MAGA #AmericaFirst #Dobbs,” tweeted Lou Dobbs, a Fox Business host and friend of Trump’s.

The controversy over Parscale’s tone-deaf comments comes as some Trump advisers have raised concerns about the campaign manager’s business activities and the perception Parscale has been profiting from his close ties to Trump.

“The President said he was going to drain the swamp. But, turns out, Parscale IS the swamp,” a long-time Trump adviser said.

Growing concern

Three sources inside and outside the campaign, including longtime Trump advisers, said there is growing concern about Parscale’s business activities, particularly news reports suggesting the campaign manager is profiting from his 2020 work.

Amid scrutiny of his business ties, Parscale has decided to disentangle his business interests from his work for the campaign, ending an ad-buying relationship with the Republican National Committee last month, according to a source close to the company.

There is nothing to indicate Parscale’s job might be in jeopardy, particularly because he still enjoys the confidence of Trump and his children. And like most places in Trump’s orbit, the campaign and his outside advisers are rife with factions, including those opposed to Parscale.

But advisers said his standing could be damaged if stories about his wealth and business ties continue. In the past, Trump has resented people who have brazenly tried to profit off their relationship with him. He personally ordered his campaign to put out a statement rebuking one of his earliest advisers, David Bossie, after he was accused of soliciting funds from Trump supporters and only spending a fraction on direct political activities. Trump has since softened his stance on Bossie.

Parscale’s longevity at the helm of Trump’s campaign is a subject of intense scrutiny in Trumpworld, after the 2016 campaign saw three iterations of leadership and amidst continued high turnover at the White House.

Murtaugh dismissed any concerns as “tired attacks”

“These are the same tired attacks against Brad Parscale from anonymous sources who have a personal stake in smearing him. Brad announced long ago that he was not placing ad buys for the Trump campaign, and in addition, his companies have transitioned out of all political ad-buying of any kind during this cycle to remove even the appearance of self-dealing,” he said.

“(Parscale) took the job of campaign manager because of his love for this country, President Trump, and the entire Trump family. Brad has been transparent with the President and the Trump family from the beginning. These anonymous sources are creating a distraction, which does nothing to further the reelection of the President they claim to support,” Murtaugh added.

Donor concern?

But some Trump campaign donors to the America First PAC have expressed concern to various advisers about the amount of money Parscale appears to be making off of his campaign role and his close ties to Trump.

“Of course they are,” one campaign official said about the donors’ concerns.

“He’s doing the work for everybody, man,” one major campaign donor to Trump’s 2016 effort said. “It’s just ridiculous, it’s outrageous.”

Parscale ingratiated himself with the Trump family as he played a critical role behind the scenes during the last campaign, when he served as the digital director and was in charge of online spending and voter targeting with the use of a highly sophisticated data bank built by the Republican National Committee. Republicans often give him credit for playing a part in the President’s success through his Facebook operation.

After the election, he co-founded America First Policies, the sister nonprofit closely related to the America First Action super PAC. He also helped raise millions of dollars in support of Trump’s reelection bid.

He’s also founded various companies that have received large sums of money from Trump-associated groups.

In 2017, he founded Parscale Strategy LLC, a marketing company that did work for America First Action, as well as others including the Republican National Committee. The America First Action super PAC made its last payment to Parscale Strategy on March 13, 2018, and its first payment to Red State Data and Digital — which Parscale also owns — eight days later, on March 21.

Federal Election Commission records show that Red State Data and Digital has received $910,000 from  America First Action, a large sum for a small company with one client.

The scrutiny over the amount of money he’s made off his political companies has bothered Parscale, particularly criticism among his Republican peers over a $13,500 fee he was paid for a speech to the Republican Party of Seminole County, Florida.

Parscale has returned the money to the campaign, according to a source close to the company. In the wake of the criticism, he has begun downsizing, according to the source, who said he had let three employees go from Parscale Strategy last month. A Trump campaign spokesman declined to comment about whether Parscale had returned the money to the campaign.

And as of August, Parscale Strategy is no longer making digital ad buys for the RNC, according to two sources. Parscale made the decision amid scrutiny of his finances by the Daily Mail.

“It’s not fair to him for him to take the heat on this and he made the decision to let us pay the ads ourselves and not through his firm,” an RNC official, speaking on background in order to speak freely, said.

The decision to cut ties had been discussed prior to the media scrutiny but the final decision came soon after the Daily Mail published, the RNC official said.

But the RNC official rebuked the Daily Mail reporting suggesting that Parscale was taking a percentage of online donations, calling it “insanity.”

Murtaugh refuted the allegations reported by the Daily Mail, telling them: “The suggestion that he is siphoning off a percentage of donations is a lie. Brad receives a monthly salary, and amounts paid to other entities are for staff salaries and services provided. There are no percentages involved anywhere.”

The official said the RNC used Parscale’s firm for ad-buying because he would get “a great rate” from Facebook, Google and other companies because of his track record with those companies.

Family ties

The speculation over Parscale’s finances has not stalled the campaign’s pace, which includes a Monday fundraiser in North Carolina and at multiple fundraisers in California and New York.

And despite the questions about his financial ties, Parscale still finds himself in good standing with the President’s family and those close to him said questions about his money amount to sour grapes. Because the campaign was filled with fractious relationships the last time around, Parscale has made an effort to fill the operation with his own people to minimize the infighting, according to sources familiar with the situation.

This has irked people who consider themselves the President’s earliest advisers but now find themselves on the outside, despite a desire from several of the President’s family members to streamline and professionalize the operation now that Trump is running as an incumbent, not an underdog.

Parscale has also made one strategic move that could help him stay in the job longer than most — deeply embedding himself in the President’s family. Parscale Strategy employs both Lara Trump, the President’s daughter-in-law, and Kimberly Guilfoyle, a former Fox News personality who is dating Donald Trump Jr.

Parscale also has a close relationship with Jared Kushner, and has empowered him to make decisions about the campaign more than most campaign managers would.

Kushner has not raised concerns about Parscale’s business ventures but has asked the campaign manager about the reporting, according to one person familiar with the conversation.

“I think that Brad’s fate probably lies with the donor reaction and then how the media covers it,” one Trump adviser said. “If the donors say we’re not giving any more, we’re not doing any more fundraising … until you do something about Brad or get rid of Brad, if that’s the message from multiple donors, then that’s going to be really problematic for Brad.”

Right now, Parscale still wields power in the Republican Party, too.

He has built strong ties with the chair of the Republican National Committee, Ronna Romney McDaniel. Parscale and McDaniel often phone the President together to discuss fundraising, polling and what’s next for their reelection effort, according to a source familiar with the practice. The campaign and RNC raised a combined $105 million during the second quarter of the year.

Pro-Trump super PAC paid thousands to firm owned by Trump’s campaign manager

A company that President Donald Trump’s campaign manager, Brad Parscale, says he owns has received hundreds of thousands of dollars from the President’s flagship political action committee, which is barred from coordinating with the campaign.

Federal Election Commission records indicate that Red State Data and Digital has received  $910,000 from  America First Action,  the super PAC formed in 2017 to support the Trump-Pence agenda and  fellow Republican  candidates.

After CNN initially published a story about Parscale’s wife, Candice, being an owner of Red State, her husband contacted CNN and acknowledged he owns the company even though she is listed on legal paperwork. “I am the owner of Red State,” Parscale told CNN.

Parscale said he hadn’t originally wanted to disclose his ownership publicly because there are no available records connecting him to the company.

Delaware incorporation documents name only Candice Parscale as a “member” of Red State Data and Digital. A “member” of an LLC is usually an owner. The company was founded on March 2, 2018, just days after it was announced that Brad Parscale would become Trump’s campaign manager. His name does not appear on the documents.

In a series of texts with CNN, after initial publication, Parscale said that “so, legally we both own it,” and “she is on the paperwork yes.” He also said that “she is my wife and I allow her to file and be on my companies because I trust her. It depends on how you look at it. But no. It is all my company.” Then later he said, “I own the company solely,” and that his wife “listed it incorrectly” on the incorporation document, speaking of her being named as a “member.” “She just checked the box of what she was. I’m the owner.”

He also tweeted around the same time, “I own all my companies. My wife is member on some of them to do filings and bookkeeping. This is a disgusting trick to make a very simple thing look nefarious. Her last name is Parscale, what would that hide?”

Super PACs can raise and spend unlimited amounts of money on behalf of federal candidates, but they are barred from coordinating spending decisions with those campaigns, among other limitations.

Brad Parscale and his wife both insist their arrangement is legitimate and that there is no coordination.

“This is a perfectly legal and appropriate arrangement, which is firewalled, with zero chance for coordination,” he said in a statement. “There could not possibly be coordination because the ads placed were for other candidates in the 2018 midterms. Everything is in FEC compliance.”

Still, experts in federal election law consulted by CNN said earlier that the appearance of a connection between the President’s main super PAC and a firm set up by his campaign  manager’s  spouse that handles political ads walks right up to the line.

“It calls into question the independence of the super PAC,” said Larry  Noble, the former general counsel to the Federal Election Commission and a CNN contributor. “One would hope a watchdog agency would investigate allegations of coordination.”

Noble said the FEC has been “lax” about enforcing coordination rules.  The FEC was further weakened by the resignation of one of its commissioners this week, reducing the number of sitting commissioners to three and thereby stripping it of its power to enforce campaign finance laws. Federal law requires four or more commissioners to approve new rules or take actions to punish those who violate election law.

Leading the campaign

Brad  Parscale  served as Trump’s digital media director during the 2016 campaign. After the election, in January 2017 he co-founded America First Policies, the sister nonprofit closely related to the America First Action super PAC. He also helped raise  millions of dollars in support of Trump’s reelection bid.

In 2017, he founded Parscale Strategy LLC, a marketing company that did work for America First Action, as well as others including the Republican National Committee.

As Trump’s campaign manager, Parscale has come under scrutiny over the amount of money he’s made off his political companies. According to a source close to the company, Parscale was rattled by recent negative press, particularly criticism among his Republican peers over a $13,500 fee he was paid for a speech to the Republican Party of Seminole County, Florida.

Parscale has returned the money to the campaign, according to a source close to the company. In the wake of the criticism, he has begun downsizing, according to the source, who said he had let three employees go from Parscale Strategy in the past week. A Trump campaign spokesman declined to comment about whether Parscale had returned the money to the campaign.

Payments from the PAC

The America First Action super PAC made its last payment to Parscale Strategy on March 13, 2018, and its first payment to Red State eight days later, on March 21.

In 2018, America First paid Red State a total of $837,000, according to FEC records. That makes it the fifth biggest recipient of money from the group last year, according to Open Secrets.

Since then, the company has received payments totaling approximately $70,000 for fundraising consulting and website design and development, according to FEC filings. The last payment of $10,000 was made in June 2019.

The same source close to the company says it stopped involvement with ads or media spends, typically the biggest expenditures of political groups, after the midterms.

In an interview with CNN this week, Candice Parscale said she is simply the bookkeeper for Red State, which she described  as a small web-services company. The super PAC, however, remains Red State’s only client, according to FEC filings.

Candice Parscale also denied having any involvement in Red State’s strategy or work for campaigns.

“I do payroll and invoicing,” she said.

According to its incorporation documents, Red State’s listed street address is the same as a UPS Store near Capitol Hill in Washington. It’s not uncommon for LLC’s to list mailboxes as their addresses.

The company has no website. The Parscales live in Fort Lauderdale, Florida, where Candice Parscale says Red State employs at least a couple of people. They also said the company had one employee in Washington.

Once  Brad  Parscale moved over to run the Trump campaign last year, according to his wife, the couple took legal advice as to how to retain a few of his employees. The staff, she says, mostly did not want to leave Florida and had no long-term interest in working for a political action committee.

“These are web designers, not policy people,” she explained. Hence, according to  her,  the  formation of Red State, which could keep the web designers separate from the super PAC.

According to Candice Parscale, Red State does not have a CEO. Instead a woman whom she declined to name runs the company and reports directly to the president of America First Action, Brian Walsh. Candice Parscale said she does not have work-related discussions herself with Walsh, though she does know him socially.

Walsh did not answer specific questions about how he works with Red State or about his relationship with Candice Parscale when asked by CNN.

An America First spokesperson told CNN,  “Red State is a valued vendor that provides us with digital consulting services at a competitive rate,”  and when asked about the propriety of the campaign manager’s wife working for a firm directed by the super PAC, said, “America First strictly complies with FEC rules and regulations and any suggestion otherwise is patently false.”

Campaign experts weigh in

Campaign finance experts say it is difficult to know if the required distance between the entities is being adhered to.

“If  Parscale  wanted to sever himself completely from the super PAC, then I don’t know why he would create a company involving his wife,” said Fred Wertheimer, president of Democracy 21,  a nonprofit organization  committed to reducing the amount of dark money in politics.  “It’s hard to know if there’s a legal issue or not, because of the lack of transparency.”

Wertheimer said it would  be  difficult  to determine whether the Parscales were having  conversations  about work that was being done for the super PAC by Red State.  “That’s why dark money is so dangerous,” he said. “No one knows what’s going on.”

Noble agreed that the setup is “concerning” because it poses the question of  whether  Brad and Candice Parscale  talked strategy together. “It looks terrible because it’s hard to believe they would not share information,” Noble said. “Maybe they won’t,” he added wryly.

This story and the headline have been updated to include additional information given to CNN by Brad Parscale after publication.

House committee subpoenaing former White House staffer Rob Porter

The House Judiciary Committee is subpoenaing former White House staff secretary Rob Porter, according to a source familiar with the matter.

The committee is expected to announce the move as soon as today.

Porter’s subpoena is the sixth issued to officials close to the President in the wake of the release of the Mueller report by Chairman Jerry Nadler, a New York Democrat, and his committee as part of its investigation into President Donald Trump and possible obstruction of justice. The committee has been authorized to issue subpoenas to 17 individuals in total. The committee is expected to announce the subpoena Monday which asks for Porter to testify in a public hearing in September.

So far, former White House counsel Donald F. McGahn has refused to comply with his Congressional subpoena, because the White House asserted that he has absolute immunity from testifying before Congress. The committee has filed a lawsuit to force him to testify.

Two other officials have testified but did not answer nearly any questions about events after the 2016 election at the direction of the White House.

McGahn’s assistant Annie Donaldson, whose notes made for some of the more interesting reading in the Mueller report, answered written questions and is expected to testify in November.

Former White House communications director Hope Hicks testified behind closed doors in June. According to the transcripts, Hicks would not discuss conversations she had with the President while at the White House. Former Trump campaign manager Corey Lewandowski and former deputy chief of staff Rick Dearborn were both subpoenaed earlier this month.

Lewandoski, the first non-White House employee to be subpoenaed by Nadler, said he would be willing to testify about his campaign role but not about conversations with the President since he took office.

Porter’s testimony could be critical in trying to establish the mindset of the President as he strategized what to do about the Mueller investigation while it was underway.

Who is Rob Porter?

Porter, who was known to take contemporaneous notes, is among the most cited sources after McGahn in the second volume of the Mueller report, the part that covers obstruction as opposed to possible collusion.

A former chief of staff of Utah Republican and former Sen. Orrin Hatch, Porter is a former Rhodes scholar and a lawyer who clerked on the DC circuit of appeals, The 41-year-old was the only Trump White House senior staff member who can lay claim to having worked in all three branches of the government, and he is also the only person so far subpoenaed by Nadler who was not a member of the Trump campaign.

He supported Jeb Bush in the 2016 Republican primary. When Jared Kushner, the President’s son-in-law and a White House senior adviser, asked Porter during the transition if he could be loyal to Trump given his track record, Porter replied he could be loyal to the office of the Presidency, according to a source with knowledge.

Footnotes in the Mueller Report indicate that Porter sat for two days of interviews with the special counsel’s team. As staff secretary, his job was to vet any document the President signed. But it soon morphed into much more than that, it has been widely reported. Porter’s glittering academic resume impressed the President who, according to three sources, increasingly relied on Porter for advice on a broad range of issues.

For example, when former Attorney General Jeff Sessions refused to un-recuse himself from the Mueller investigation, the Mueller report states that the President asked Porter about associate Attorney General Rachel Brand, whom Porter knew personally.

Porter in the Mueller report

According to the report, the President asked Porter to find out if Brand was “on the team” and would be interested in becoming Attorney General one day, or taking on the investigation herself.According to the report, Porter did not do as the President asked and seek out Brand, because, according to the report, he understood that what he was being asked to do, thought it was not stated explicitly by the President, was to find someone to fire the special counsel or end the Russia investigation.Porter was also sandwiched between an angry President and McGahn, according to the report, after McGahn refused to refute an article published by the New York Times that alleged the President had asked McGahn to fire the special counsel. McGahn had not only refused, but threatened to resign, according to the report. Trump had told Porter that the article was “bullsh**” and insisted to Porter that he tell McGahn to write a letter for the public file stating he had never asked McGahn to fire the special counsel. He told Porter that if McGahn did not do as directed “then maybe I will get rid of him.”

According to the Mueller report, Porter told the President that he thought the matter would be best handled by the White House communications office. But after being pressed by the President, he went to McGahn and conveyed the message, which McGahn “shrugged off.”

According to the Mueller report, Porter also talked with then-White House chief of staff John Kelly, who set up a meeting between the President and McGahn, during which McGahn told the President that the optics of firing him would be terrible. McGahn was not fired. He left the White House in October 2018.

Porter resigned from the White House in February 2018 amid allegations from two former wives of domestic abuse. Porter denied the allegations.

But for the next couple of months, the President continued to talk with Porter frequently and wanted him to return to the White House, according to a report in the New York Times. According to the book “Fear: Trump in the White House” by veteran Washington Post journalist Bob Woodward, Porter had acted as something of a guardrail against the President’s more extremist positions, especially on a trade war with China and on immigration.

Since then, it’s not clear how often the President and Porter have talked or what the nature of their relationship is now. That could be one reason House Democrats want his testimony come September.

CNN Exclusive: New documents reveal behind-the-scenes clash over spending inside Trump inaugural committee

(CNN) — The former adviser to first lady Melania Trump, who has come under fire for the cost of President Donald Trump’s inauguration, was among the event planners who raised concerns about excessive spending in the weeks before the events, according to documents obtained by CNN.

Stephanie Winston Wolkoff, a former friend of Melania Trump, has emerged as a witness for investigators and received a subpoena last month by Washington DC’s attorney general.

The 10-page subpoena, which has been seen by CNN, asks Wolkoff to hand over a variety of information, including any evidence of inaugural-related expenditures that were “wasteful, mismanaged, and/or improperly provided private benefit.”

It asks for communications between the inaugural committee and several business entities connected to President Trump or his family, as well as communications between Wolkoff and a number of Trump family members, including Donald Trump Jr., Eric Trump, Ivanka Trump and Jared Kushner.

Multiple agencies are investigating Trump’s inauguration, including federal prosecutors in New York who are scrutinizing tens of thousands of documents handed over by the Presidential Inaugural Committee, according to people familiar with the inquiry. Authorities are investigating whether any of the donation money was misspent, used to improperly benefit certain individuals or came from foreign donors. Vanity Fair first reported the DC subpoena.

The DC subpoena is the third Wolkoff has received about the inaugural’s finances. The other two were from the US Attorney’s office in New York’s Southern District and from the House Oversight Committee, according to a source familiar with the matter.

Reached by CNN, Wolkoff said she could not comment, citing a nondisclosure agreement she signed with the 58th Presidential Inaugural Committee, the nonprofit group that oversaw Trump’s inauguration.

In a one-page statement released in April 2019, Wolkoff said, “If the PIC were to release me from this obligation, I would be able to speak freely without the fear of legal or financial repercussions. Otherwise I am regrettably unable to provide any substantive comment.”

But two people close to Wolkoff tell CNN that she has responded to the latest subpoena. That could be worrisome for people connected to the inauguration.

Wolkoff was deeply involved in minute details of the inauguration planning and was included in emails viewed by CNN that included costs, schedules and vendors, among other information.

One of the sources close to Wolkoff told CNN that she is meticulous about record-keeping, and has maintained extensive records of her work surrounding the inauguration, including detailed ledgers and spreadsheets of budget expenses.

Welcome to Washington

This is a story, essentially, of a clash of wills and culture. Wolkoff came to Washington unversed in politics but expert in staging large-scale productions for high-end, notoriously detail-oriented cultural institutions, such as the Lincoln Center and Vogue magazine. She was used to working with people she knew and trusted and expected that her role would include checking the price of every line item, according to the sources. She was told she would be given carte blanche, they say. That turned out not to be case.

Stephanie Winston Wolkoff and Melania Trump in 2008.

Wolkoff left the White House in February 2018 amid controversy, when it was revealed that her firm, WIS Media Partners, was paid close to $26 million to plan events for the inauguration.

That month, senior administration officials said the President and first lady were not pleased to have learned about the money paid to Wolkoff’s firm by the Inaugural Committee, according to The New York Times.

The first lady’s former spokesperson Stephanie Grisham, now the White House press secretary, released a statement at the time saying the White House had “severed the gratuitous services contract with Ms. Wolkoff.”

In her April 2019 statement, Wolkoff disputed that she had been fired, and wrote that Grisham’s words were “not fair or accurate,” and that she had been “thrown under the bus.”

All but $1.6 million of the $26 million payment to Wolkoff’s company went to vendors and subcontractors for broadcast production services of events, according to a document prepared by the company and viewed by CNN.

The Inaugural Committee was chaired by President Trump’s longtime friend, the California-based financier Tom Barrack. The committee’s deputy chairman, Rick Gates, became an employee of Colony Capital, Barrack’s investment firm, after the inauguration.

In February 2018, Gates pleaded guilty to conspiracy and for lying to investigators, on charges unrelated to the inauguration. Gates is currently cooperating with various investigations, as part of his plea agreement.

Barrack has come under scrutiny recently over his dealings with Saudi Arabia.

Asked about the recent subpoena to Wolkoff, spokespeople for Kushner, Gates, Barrack, Donald Trump Jr. and Eric Trump all declined to comment.

The White House would not comment but has previously said the President and first lady were not involved in inauguration planning.

Double the cost

The Trump Inaugural was different in many ways, most notably in what it cost. The event’s record $107 million price tag was more than twice as expensive as President Barack Obama’s 2009 inauguration, as well as the 2001 swearing-in of President George W. Bush.

Wolkoff, a longtime friend of the first lady, was asked by Ivanka Trump to run the inauguration after the election, according to one of the sources close to Wolkoff. Wolkoff had a reputation as a strong event planner, having run the Metropolitan Museum of Art’s Costume Institute Gala, known as the Met Gala, in New York City.

Once she landed in Washington, Wolkoff realized that the scope of the inauguration was far beyond what had been outlined to by her Barrack and Gates, according to one of the sources. She’d have to trust the “Washington way,” which included, so she was told, working with long-held partnerships.

Thomas Barrack

Four sources familiar with the situation tell CNN that Wolkoff clashed repeatedly with Barrack and Gates over the Inaugural Committee’s spending. A particular point of contention was a vendor called Hargrove Inc., a special events company that Wolkoff felt was charging prices beyond what she thought was reasonable. Hargrove has been involved in producing events for every presidential inauguration since 1949 and was paid at least $25 million for Trump’s inauguration.

Emails obtained by CNN show the concern Wolkoff and other event planners had about Hargrove’s budget. In late December, Gates was copied on an email exchange between Wolkoff and Hargrove managers that said, “I am expressing my concerns because I have no options at this point.” Wolkoff cited “many line items that were not reflected, rentals that were not sourced, budgets that were not accurate and décor elements that were not feasible.”

Hargrove’s then-president replied that “our only goal here is to make this the most successful inauguration ever,” and offered to provide 10 bars free of charge.

An email among inaugural event planners also questioned Hargrove’s prices, with one saying a bid to decorate two halls of the convention center was “literally 5 times anywhere else would be. We’ve accounted for some premium increase, but this is exceptionally high.”

Another email from another partner in the event planning asked Hargrove why the price was so high for scenic elements, writing that the “cost … is not justified with how it has been explained or shown.” CNN did not see Hargrove’s response to this email.

Despite the concerns, Gates approved the hiring of Hargrove for Barrack’s Chairman’s Global Dinner held at Andrew W. Mellon Auditorium, one of multiple events the company was involved in, and the Presidential Inaugural Committee signed off on Hargrove’s budget, according to documents viewed by CNN.

Hargrove declined to comment for this story, but a source familiar with the company’s work on the inaugural events said Hargrove submitted a detailed scope of work documents and invoices and because the scope of work changes with each inauguration, any comparison with other events would be unfair. Hargrove produces many other major events, including the Democratic National Convention, and CNN has, along with other media outlets, worked with Hargrove in its convention coverage.

A spokesperson for Gates told CNN he had no knowledge of Wolkoff’s concerns over Hargrove. Barrack’s spokesperson refused to comment, though it is unclear whether he knew about the cost concerns.

Rick Gates

Wolkoff soon felt excluded from meetings convened by Barrack and Gates that she thought she should have been included in, according to one of the sources close to her.

Things got so bad that Wolkoff voiced her distress in a phone call to Trump’s then-personal attorney, Michael Cohen, who recorded the call. According to a source with knowledge of the recording, Wolkoff told Cohen that she was concerned about the inaugural spending.

The recorded conversation was acquired by federal agents last year during their investigation into Cohen.

Wolkoff, according to the two sources close to her, had gone to work for the Inaugural Committee against the wishes of the majority of her New York friends, many of whom supported Hillary Clinton.

Wolkoff has told one of those sources, a close friend, that she took the job because she felt she had no choice due to her close relationship with the first lady, as well as a sense of patriotic duty

Despite the friction surrounding the inauguration, Wolkoff agreed to work for Melania Trump as an unpaid adviser. Classified as a special government employee, Wolkoff spent a lot of time working from New York City. She was tasked with crafting certain messaging points, as well as cultivating the first lady’s official children’s initiative, though to what extent remains unclear. Wolkoff departed the first lady’s staff in February 2018 — Be Best was launched in April.

Privately, Wolkoff has told multiple people that it’s her belief she was deliberately set up as a scapegoat to deflect attention from other people involved with the inaugural who, to her mind, were guilty of misspending and with whom she grew to have a difficult relationship.

“Stephanie was underestimated,” says a person close to Wolkoff. “They were hoping for a New York socialite who would not look at the details.”

CNN Exclusive: The rise of the Jeffrey Epstein mystique

New York (CNN)—In the days before Jeffrey Epstein died in an apparent suicide early Saturday morning, one of his closest associates, billionaire retail magnate Leslie Wexner, the founder and chairman of L Brands, Inc. went public with a shocking allegation.

In a letter to his charitable foundation, Wexner wrote that Epstein, who’d been his right hand and had power of attorney over his finances, had “misappropriated vast sums” of money from Wexner and his family more than a decade ago—more than $46 million according to The Wall Street Journal.

In his letter, Wexner claimed to be “embarrassed” to have been duped.

The admission raised more questions than it answered: Did Wexner go to the authorities with these claims? And if not, why not? What was the nature of the two men’s relationship? And why had he given Epstein so much control over his finances in the first place?

So much about Epstein’s life (and now his death as well) remains shrouded in mystery. Here was a man of enormous means, with no college degree, no brokers’ license, whose reputation as a financial savant seemed grounded not in any concrete evidence but in the extensive network of powerful people he had cultivated over the years. It remains striking that for someone of such wealth (his fortune was reportedly estimated at half a billion dollars) no one could ever truly say (including Epstein himself) how he actually made his money.

“Nothing about Jeffrey Epstein makes sense, including his death,” said Steven Hoffenberg, Epstein’s former friend and business partner and a convicted fraudster who served 18 years in prison for bilking investors out of $460 million in a ponzi scheme. Since getting out of prison in 2013 Hoffenberg has widely claimed, including to CNN, that it was Epstein who masterminded the whole thing.

Last year, victims of Hoffenberg’s firm, Towers Financial, sued Epstein for restitution of alleged misappropriated funds.

Before his death, it was widely believed that the criminal case brought against Epstein on sex-trafficking charges might finally shed light on the many unanswered questions that surrounded him. That included not just getting to the bottom of the extensive sexual abuse allegations that dogged him, but also examining the darker corners of his rarefied social network that encompassed some of the world’s most powerful people in business, finance, politics and academia.

It was this network after all that gave Epstein his ultimate power and prestige and, until recently, seemed to have made him almost untouchable.

While there are certainly secrets that died with Jeffrey Epstein, some answers may yet come to light.

On Saturday afternoon, Geoffrey Berman, the US Attorney for the Southern District of New York who brought the criminal sex trafficking charges against Epstein in July, indicated that while the criminal case against Epstein is over, federal prosecutors still intend to investigate charges that are part of the indictment, including conspiracy.

“Our investigation of the conduct charged in the indictment — which included a conspiracy count — remains ongoing,” Berman said in a statement.

In the weeks following Epstein’s July 6 arrest, and in the hours after his death, people in his social circle in the Hamptons, Epstein’s target audience, focused in on the word “conspiracy,” and what that might mean for a handful of his most exclusive connections.

Within those rarefied orbits, the mystery behind Epstein’s relationship with Wexner is considered to be among the most important to unravel; so too is that of Ghislaine Maxwell, the British socialite and Epstein’s alleged madam, who was not given immunity in Epstein’s non-prosecution-deal of 2007. Maxwell was named in a 2015 civil suit by Virginia Giuffre, an alleged Epstein victim, as the person who introduced Giuffre to Epstein.

The defamation case was settled in 2017, after the judge had ruled against a motion for summary judgment filed by Maxwell.

The rise of Epstein’s mystique

The irony of Epstein’s influence is that he was a deliberately enigmatic figure, who thrived on telling stories about himself that were hard to believe by people who, regardless, kept him close, including Wexner.

“Everything, the money, the girls — it was all a game to him,” an Epstein friend who received almost daily financial advice from him told CNN. “It was like a chain. He took money from the rich people he cultivated, charmed, bribed; and in turn he paid women to do what he asked them. In the end it was all about the money, the power that money gave him.”

In under a decade, Epstein went from tutoring the daughter of Bear Stearns chairman Alan “Ace” Greenberg to rising to become a limited partner with the firm while still in his twenties, advising their wealthiest clients and forming a close alliance with both Greenberg and then CEO James Cayne.

Though he was asked to leave Bear Stearns in the early 1980s, his rise to achieve the vast trappings of wealth was as rapid as it was unconventional. Epstein sold himself as a money manager exclusively to billionaires– but it was unclear who his clients were — other than Wexner — and Hoffenberg, about whom he was much less public.

Part of Epstein’s schtick was to be low key in his dress and showy in his home, where he displayed photographs of the important people he associated with. A recent visitor to Epstein’s house saw “numerous” photographs of Epstein with former President Bill Clinton, as well as photographs of himself with his arm around the Saudi Crown Prince Mohammed Bin Salman.

Within the last two years, Epstein separately told four confidants that he was advising the Saudi Crown Prince on financial matters. A close adviser to the Crown Prince denied this, as did a Saudi official who spoke to CNN on condition of anonymity. “The claim that Mr. Epstein was advising HRH Crown Prince Mohammed bin Salman on financial matters is without foundation,” the official said.

Epstein would also tell people he was making money for various African dictators, according to two Epstein confidants, who said that people who heard this were skeptical. “I wondered if he photo-shopped the pictures,” one of those confidants told CNN.

Other people’s money

For many, Epstein played fast and loose with other people’s money.

Two former Sotheby’s executives confirmed an instance to CNN where Wexner claimed that Epstein made money for him in highly questionable circumstances. In 1994, Sotheby’s, where Wexner was a board director, was in negotiations to buy the site of the former Alexander’s department store in Manhattan, now the site of Bloomberg LP’s headquarters.

Since the talks were non-public, Sotheby’s directors were warned to make no transactions with their stock to avoid suggestions of insider trading, the two executives said.

Yet public financial records show that that same year Wexner sold more than a million shares. A. Alfred Taubman, Sotheby’s then-chairman who died in 2015, told one of the former Sotheby’s executives, that he was furious with Wexner for trading while the real estate deal was pending.

Records show that Wexner left the board the next year, after, according to the Sotheby’s source, Taubman asked him to. According to this source, when Taubman questioned Wexner about the sale, Wexner professed ignorance and blamed Epstein for the transactions.

A spokesperson for Wexner declined to comment. Wexner has not been charged with any crimes. CNN reported Monday that he has hired one of the most prominent criminal defense attorneys in New York, Mary Jo White, who is a partner at law firm Debevoise & Plimpton LLP and is the former US attorney in Manhattan.

The Social network

Epstein’s financial success was dependent on the vast, eclectic social network which enabled him to throw dinners at his house where he could introduce academics to politicians and financiers and royalty — and of course, women. In this regard Epstein appears to have received considerable assistance from the British socialite Ghislaine Maxwell, the daughter of the late Robert Maxwell, a British tycoon who died in mysterious circumstances in 1991, disappearing off his yacht. It was posthumously discovered that Maxwell committed a massive pension fraud.

In an interview with CNN, a former nanny for Ghislaine Maxwell’s sister, Christine, recalled that in the 1990’s Ghislaine showed up at Christine’s home in Oakland Hills, California, to “lick her wounds” over a break-up with Epstein.

Ghislaine stayed in her sister’s house for just over 24 hours, according to the nanny, Sydney Proctor. After Ghislaine’s departure, Proctor recalled that Christine was livid on behalf of her sister, because “to add insult to injury Jeffrey made Ghislaine find his girlfriends.”

In an interview from 2002, one alleged Epstein victim, Annie Farmer, said she would never have stayed under Epstein’s roof had it not been for the fact Maxwell assured her mother she would act as chaperone.

In an email to CNN, Christine Maxwell said she has “no recollection of ever having had any such conversation with Sydney Proctor in relation either to my sister or Epstein.”

Even after they split, Maxwell stayed close to Epstein. Her name is mentioned frequently in a cache of documents that were unsealed last week in which it’s alleged she was a procurer for Epstein and other high-profile people.

According to multiple people in affluent Manhattan circles, including two of her girlfriends, Maxwell introduced Epstein to many of the social figures in his life. She herself socialized in exclusive circles that included people connected to politics.

Chelsea Clinton invited Maxwell to her wedding and even brought Maxwell backstage at the Clinton Global Initiative summit in 2009, according to eyewitness accounts.

Bari Lurie, a spokesperson for Chelsea Clinton, says the only reason Clinton was acquainted with Maxwell was because Maxwell was dating a friend of hers, Ted Waitt, the billionaire co-founder of Gateway Inc.

In recent days, Maxwell has not been spotted. Maxwell was not among the four women who received immunity in Epstein’s 2007 non-prosecution agreement, which has left the people in Epstein world wondering if, in the wake of Epstein’s death, she now becomes the number one target of many of the alleged victims.

Multiple attempts to contact Maxwell have been unsuccessful.

A source close to Maxwell told CNN recently that she sat with Maxwell on a flight from Miami to New York around December of last year. When asked where she was living, Maxwell did not want to be pinned down. “I live all over the place,” she replied.