- The Trump Taj Mahal, 1991. He funded the construction with one billion dollars, primarily with junk bonds at a 14% interest rate. A year later the Casino was nearly three billion dollars in debt, while Trump racked up nearly $900 million in personal liabilities. As a result, he gave up half of his personal stake in the Casino and sold his yacht and airline.
- Trump Castle, 1992. Trump Castle, which opened in 1985, filed for bankruptcy within one year after his first bankruptcy.
- Trump Plaza and Casino, 1992. Trump Plaza Hotel and Casino in Atlantic City, which opened in 1984, declared bankruptcy at the same time as the Castle.
- Plaza Hotel, 1992. Trump purchased the Plaza Hotel in Midtown Manhattan for $390 million in 1988, but accumulated more than $550 million in debt by 1992.
- Trump Hotel and Casino Resorts, 2004. Trump Hotels and Casinos filed for bankruptcy again in 2004, when his Casinos, Tash Mahal, Trump Marina, and Trump Casino Plazas in Atlantic City, and Riverboat Casino in Indiana had accrued an estimated $1.8 billion dollars in debt.
- Trump Entertainment Resorts, 2009. After debating with the company’s Board of Directors, Trump resigned as the company’s Chairman and had his corporate stake in the company reduced to 10%. The company continued to use Trump’s name and licensing.
It is very important to understand the background relating to the bankruptcy of the Taj Mahal and how Trump misrepresented his financing plan to the Casino Commission. When Trump took over the Casino he had to convince the Casino Commission that he could raise enough money to complete the project at a low enough interest rate in order for the ambitious project to be feasible. According to the transcript of one of the Casino Commission’s hearings, Trump stated that:
“I do not have to use junk bonds. I can use my own funds or I can use regular bank borrowing, so I can build at the prime rate. I mean, the banks call me all the time. Can we lend you money?, Can we do this?, Can we do that? And he always says it’s easier to finance it if Donald Trump owns it. With me, they know that there is certainty that they would get interest. I get it down, and everybody is happy.”
Just months after Trump obtained the approval from the Casino Commission, he did not obtain prime rate loans and went ahead and got junk bonds (14% interest rate) and paid roughly 50% more in interest than he told the Commission.