Congress can see Trump banking files, court rules

President Donald Trump speaks during a meeting with Canadian Prime Minister Justin Trudeau at Winfield House during the NATO summit, Tuesday, Dec. 3, 2019, in London. (AP Photo/ Evan Vucci)
President Donald Trump speaks during a meeting with Canadian Prime Minister Justin Trudeau at Winfield House during the NATO summit, Tuesday, Dec. 3, 2019, in London. (AP Photo/ Evan Vucci)

NEW YORK -- A federal appeals court in New York ruled Tuesday that Congress can see President Donald Trump's banking records for investigations into possible foreign influence in U.S. politics.

A panel of 2nd U.S. Circuit Court of Appeals judges said two banks, Deutsche Bank and Capital One, should comply with subpoenas from the House Financial Services and Intelligence committees seeking records related to Trump's business ventures.

The court said Congress was acting within its constitutional authority to investigate a series of significant issues, including whether Trump was "vulnerable to foreign exploitation."

It rejected arguments that the subpoenas were meant merely to embarrass the president, though the court said Trump did deserve some privacy protections and outlined procedures for protecting some sensitive personal information in the documents from public disclosure. It also gave Trump a limited chance to object to disclosure of certain documents.

Judge Debra Ann Livingston said in a partial dissent that the lower court should take a longer look at the "serious questions" raised by the case and give the parties time to negotiate.

Jay Sekulow, Trump's personal lawyer, said in a statement that an appeal to the Supreme Court was under consideration.

"We believe the subpoena is invalid as issued. In light of the 2nd Circuit decision, we are evaluating our next options," he said.

Trump has seven days to seek a further delay from the high court before the banks must comply.

In a statement, Deutsche Bank said, "we remain committed to providing appropriate information to all authorized investigations and will abide by a court order regarding such investigations."

Capital One declined to comment.

The ruling by the appeals court upheld a May ruling by U.S. District Judge Edgardo Ramos, who had said Trump and his company were unlikely to succeed in proving that the subpoenas were unlawful and unconstitutional. The 2nd Circuit panel said three of Trump's children had not shown a likelihood of success on any of their claims and had not identified a single factual issue to take to trial or a single witness or document that might add substance to their claims at trial.

Lawyers for the House committees, both of which are controlled by Democrats, say they need access to documents from the banks to investigate possible "foreign influence in the U.S. political process" and possible money laundering from abroad.

In a decision written by Circuit Judge Jon Newman, the appeals court said that while Trump and his children might suffer a loss of privacy if the documents were disclosed to Congress, the records had to do with their business ventures, not intimate personal details.

"The Committees' interests in pursuing their constitutional legislative function is a far more significant public interest than whatever public interest inheres in avoiding the risk of a Chief Executive's distraction arising from disclosure of documents reflecting his private financial transactions," the decision said.

The ruling contained one caveat: The lower court must consider whether and how the banks disclose a limited set of sensitive personal information that would have no bearing on the government investigations. Such information could include checks that were written by Trump or his companies to cover employees' medical expenses.

But, the court ruled, the presumption should be in favor of handing over more documents, not fewer.

"Many documents facially appearing to reflect normal business dealings will therefore warrant disclosure for examination and analysis by skilled investigators assisting the committees to determine the effectiveness of current regulation and the possible need for improved legislation," the court wrote.

Deutsche Bank became Trump's main lender after a string of bankruptcies and loan defaults cost other banks hundreds of millions of dollars. Over the past two decades, the German bank lent him and his companies more than $2 billion. The bank's files would most likely contain a trove of documents, including details about how he made his money, who his partners have been, the terms of his extensive borrowings and other transactions.

The court noted that the president had not disputed that the bank lent him money when no other bank would do so.

"That unusual circumstance adequately supports requests for information to determine whether proper banking procedures have been followed," the decision said.

The ruling from the 2nd Circuit is the third time a federal appeals court has upheld subpoenas for Trump's business records. Last month, the federal appeals court in Washington let stand an earlier ruling against the president, affirming that Congress can seek eight years of Trump's tax records. The U.S. Court of Appeals for the District of Columbia Circuit previously ruled that Trump's claims that a congressional subpoena was invalid because lawmakers lacked a "legitimate legislative purpose" were incorrect. A majority of the court's 11 active judges voted against revisiting the case.

In that case, the president is fighting a House Oversight Committee subpoena to his longtime accounting firm, Mazars USA, and audits that it prepared for Trump and several of his companies. The Supreme Court agreed to Trump's request to temporarily put the order on hold. Trump's lawyers have until Thursday to file a petition seeking review by the high court.

A separate three-judge panel of the 2nd Circuit also unanimously rejected Trump's effort to block New York grand jury subpoenas for his eight years of Trump's tax returns from his accounting firm. The panel ruled that "any presidential immunity from a state criminal process does not bar the enforcement of such subpoena," according to the opinion written by Chief Judge Robert Katzmann.

This case centers on a subpoena from Manhattan District Attorney Cyrus Vance Jr., whose office is investigating hush-money payments made before the 2016 election to silence two women who said they had affairs years earlier with Trump. The president has denied the affairs.

Trump has also asked the Supreme Court to step in to stop disclosure of his financial records to New York prosecutors. The justices are scheduled to discuss whether to take the case at their private conference on Dec. 13.

Information for this article was contributed by Eric Tucker and Larry Neumeister of The Associated Press; by Ann E. Marimow and Renae Merle of The Washington Post; and by David Enrich of The New York Times.

A Section on 12/04/2019

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