Stephen Calk was appointed to a post as economic adviser to Donald Trump’s campaign in summer 2016, days after his bank approved a $9.5 million loan, federal prosecutors in New York said. Months later, after Trump was elected president, Calk was recommended for a position in the Trump administration while loans worth more than $6 million were awaiting approval at Calk’s bank, they said.

(Bloomberg) -- A Chicago banker who loaned millions of dollars to Trump campaign chairman Paul Manafort was charged by prosecutors with bribery for seeking a post in the Trump administration in return for $16 million in loans.


A former U.S. Army helicopter pilot, Calk, 54, faces a single count of financial institution bribery in an indictment unsealed Thursday. He is scheduled to appear later in the day in federal court in New York. Calk’s attorney didn’t immediately return a call for comment.

Manafort isn’t named in court papers, but the description of the high-ranking campaign official matches him. Calk’s name came up several times during Manafort’s criminal fraud trial last year as a lender seeking a post in the administration.

The indictment is the latest to target a Trump campaign associate and indicates that prosecutors are aggressively pursuing offshoots of Special Counsel Robert Mueller’s probe into Russian interference in the 2016 election. In addition to Manafort, former Trump aides Michael Cohen and Michael Flynn have been convicted of federal crimes.

Calk gave the borrower a list of positions he wanted, ranking them from secretary of the Treasury on down to 19 ambassador posts beginning with the U.K. and France, according to the indictment.

Prosecutors say that Calk abused his positions as head of his bank and holding company to provide loans to Manafort, who Calk understood needed the loans to avoid foreclosures on multiple properties owned by him and his family.


After Trump was elected, Manafort used his influence with the transition team to help Calk, recommending him for a position in the new White House. Calk was formally interviewed for the position of under secretary of the Army in January 2017 but wasn’t hired, prosecutors said.

Calk proceeded with the loans despite “significant red flags regarding the Borrower’s ability to repay the loans, such as his history of defaulting on prior loans,” according to the U.S. The Manafort loans became the single largest lending relationship at the bank.

In addition, in order to enable the bank to issue the loans without violating legal limits on lending to a single borrower, Calk authorized a maneuver never before done by the bank, using the holding company -- which Calk also controlled -- to acquire a portion of the loans from the bank, prosecutors said.

About July 2017, the bank’s primary regulator, the Office of the Comptroller of the Currency, downgraded the credit quality of the loans to “substandard,” after determining that the bank’s “satisfactory” classification was inappropriate, prosecutors said. Calk lied to regulators about the Manafort loans and falsely told them that he had never desired a position in the Trump administration, the U.S. said.

After Manafort was charged, he subsequently stopped making payments to Federal Savings Bank, and the bank has foreclosed on the cash collateral securing the loans and written off the remaining principal balance -- more than $12 million, prosecutors said.

In Manafort’s trial last August, a witness testified that Calk expedited approval of two loans to Manafort despite red flags raised by his staff about Manafort’s ability to repay. Calk wanted Manafort to help him land a job in Trump’s administration as Treasury secretary or housing secretary, according to testimony at the Manafort trial by Dennis Raico, a former senior vice president at Federal Savings Bank. Jurors were also told that Calk was also interested in becoming secretary of the Army.


Manafort’s request “didn’t go through the normal process because Mr. Calk was expediting the loan and pushing it through, notwithstanding the red flags,” prosecutor Greg Andres said during Manafort’s trial. “So there was agreement between Mr. Manafort and Mr. Calk to have the loans approved, they were approved, and in turn, Mr. Manafort proposed Mr. Calk for certain positions within the administration.” Calk didn’t receive a position in the administration.

But a defense attorney countered that there was no evidence that Calk knew that Manafort had submitted false financial documents and questioned whether Calk could defraud a bank that he controlled.

Manafort was convicted of tax and bank fraud in a trial in Alexandria, Virginia. Jurors deadlocked on some charges, including four relating to Federal Savings bank. A month later, Manafort pleaded guilty in Washington to two separate conspiracy counts, and he also admitted but didn’t plead guilty to an assortment of other crimes, including defrauding Federal Savings Bank.