NEW YORK — A Chicago bank chairman has been indicted in Manhattan on a charge that he issued millions of dollars in high-risk loans to President Donald Trump’s former campaign chairman, Paul Manafort, in an effort to obtain a senior position in the administration, federal authorities said Thursday.
Prosecutors said Stephen M. Calk of Federal Savings Bank pushed the bank to give Manafort $16 million in loans in 2016 in exchange for help in procuring an appointment for Calk. Just after the election, Calk, 54, sent Manafort a list of 10 positions ranked in order of preference, including Treasury secretary, according to the indictment unsealed in U.S. District Court.
At the time, Manafort was trying to stave off foreclosure on several properties and desperately needed capital, the indictment said.
Manafort, who had left the campaign in August, made two calls on Calk’s behalf in late 2016 to officials on Trump’s transition team, urging them to appoint Calk secretary of the Army, the indictment said. Calk was interviewed in 2017 for a job as undersecretary of the Army but was not hired.
The indictment charges Calk with one count of financial institution bribery. If convicted, Calk could face up to 30 years in prison, although he would likely receive a lesser sentence.
He curried favor with an influential borrower,” William F. Sweeney Jr., head of the FBI’s New York office, said in a statement, “intentionally turning his back on the many red flags posted along the way.”
Calk pleaded not guilty before a federal magistrate judge Thursday afternoon. He was ordered released on a $5 million bond. He had no comment afterward.
His lawyers, Daniel L. Stein and Jeremy Margolis, said Calk was not guilty and would be exonerated at trial.
Federal Savings Banks said in a statement that Calk has been on a “complete leave of absence” and no longer has a role at the institution. “There is no suggestion of any wrongdoing on the part of the bank,” the statement said.
Manafort, 70, is serving a 7 1/2-year sentence at a minimum security prison in Pennsylvania. He was convicted of 10 felonies, including conspiracy to obstruct justice, bank fraud and tax fraud in two cases brought by the special counsel, Robert Mueller.
This article originally appeared in The New York Times.