Chicago bank denies loans traded for Army Secretary promise

CHICAGO (WLS) -- Claims of a quid pro quo, trading mega mortgage loans for the Secretary of Army post, were categorically denied Wednesday by Federal Savings Bank. In their first statement after months of allegations, Chicago bank officials told the ABC7 I-Team that the "reports are simply not true."

For months reports repeated by some members of Congress and others were that Federal Savings Bank founder and chairman Stephen Calk was under investigation for a loan scheme that included a promise he would become President Trump's Army Secretary.

In the statement to the I-Team Federal Savings Bank said it was "aware of recent press reports attributed to unnamed 'sources' implying that (former Donald Trump campaign chairman) Paul Manafort obtained loans in exchange for a promise of a position in the Trump Administration." Those reports, the bank officials contend, are false.

Special Counsel Robert Mueller said in court filings last month that Manafort accepted $16 million dollars in loans from Federal Savings Bank.

The loans came shortly after Trump was elected president, according to prosecutors.

Prior to the bank's statement on Wednesday, the House Oversight Committee's top Democrats, Rep. Elijah Cummings of Maryland and Rep. Stephen F. Lynch of Massachusetts, called for a subpoena of Department of Defense files concerning Calk. The committee chairman Rep. Trey Gowdy (R-SC) has not responded to questions about the case or whether he will authorize a subpoena.

In a letter on Wednesday the Democrats explained that DOD officials were asked one month ago to voluntarily turn over Calk/Manafort records but have not.

"To date, DOD has not produced any of the requested documents or information and has not provided a timeline for when it intends to produce the documents we requested," Reps. Cummings and Lynch wrote to Rep. Gowdy.

The Wednesday letter accused DOD officials of "withholding from Congress" the records of "extremely troubling reports that a banker named Stephen Calk may have made loans of up to $16 million to President Donald Trump's campaign chairman, Paul Manafort, in exchange for promises to name him Secretary of the Army."

If a subpoena is not issued, the Democrats ask that the request be placed "on the agenda for our next regularly scheduled business meeting so all Committee members will have the opportunity to vote on a motion for this subpoena."

Manafort, 68, has been indicted as a result of the Russian meddling probe underway by Special Counsel Robert Mueller. Manafort has pleaded not guilty to conspiracy, money laundering and tax and bank fraud charges related to his lobbying work for a Russian-friendly political party in Ukraine and former Ukrainian President Viktor Yanukovych.

On Wednesday newly filed court records revealed that Rick Gates, a business associate of Manafort, had ongoing ties to Russian intelligence. Gates and Manafort were in touch with Russian intelligence operatives during the 2016 campaign, according to the FBI cites in court filings. Prosecutors made the allegation without naming the Manafort associate but described his role with Manafort. The description matches the Russian manager of Manafort's lobbying office in Kiev.

As Mueller's investigations rolls on, Federal Savings Bank officials now say they are on board. "The Federal Savings Bank has been fully cooperating with the Special Counsel throughout his investigation and will continue to do so" bank officials said in the statement on Wednesday.

While the bank is said to be cooperating with Special Counsel Mueller, not stated or known is a possible role of bank founder and top executive Stephen Calk in the investigation.
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