Jared Kushner’s investment fund is not especially large by global finance standards. But as he gets it fully up and running, each step is bringing with it ethical issues that would only grow if his father-in-law, Donald Trump, should win another term as president.
His $3 billion fund is financed almost entirely from overseas investors with whom he worked when he served as a senior adviser in the Trump White House. He has taken money from government wealth funds in Saudi Arabia, Qatar and the United Arab Emirates, as well as from Terry Gou, a founder of Foxconn, the Taiwan-based electronics manufacturer, whose role in Kushner’s firm has not been previously disclosed.
In total, 99% of the money placed with him by investors has come from foreign sources, according to a filing with the Securities and Exchange Commission in late March.
Kushner’s firm, Affinity Partners, is collecting approximately $40 million a year in management fees from those investors even before any share of profits earned on investments. He has made 10 investments to date, totaling $1.2 billion, many of them in companies based abroad.
The investments include stakes in the Shlomo Group, an Israeli car-leasing and financing company; Dubizzle Group, a Dubai, UAE-based online real estate site; EGYM, a Munich-based electronic fitness company; Mosaic, a California-based solar lending site; and Zamp, an Abu Dhabi, UAE-backed fast food company that operates more than 1,000 restaurants in Brazil.
Other investments include two insurance businesses and a software company.
The foreign transactions — previously unseen in scale and speed for a former White House adviser — are bringing fresh scrutiny as Kushner’s father-in-law again seeks the White House and control over U.S. foreign policy.
Kushner’s business partner in the car-leasing firm is part owner of Israel’s only domestic builder of warships, putting him in business with executives who are also major shareholders in an Israeli military contractor whose vessels have been used in the war in the Gaza Strip, armed with American-made weapons.
Last month, Kushner announced plans for his biggest deals yet, including a $500 million hotel and condominium complex in Serbia and two other luxury developments planned on the Mediterranean coast of Albania. These projects benefited from relationships built in part during the Trump administration and directly involved the president of Serbia and the prime minister of Albania, with whom Kushner has met.
In a series of interviews, Kushner, 43, laid out new details of his effort to ramp up his firm. He also defended himself against the conflict-of-interest questions that have swirled around him since he left the White House and began soliciting investors.
“Following the laws and the rules is something we always do,” he said. “Perception, I’ve learned that from my time in politics, is important. But I can’t control what everyone is going to write or say about me.”
Kushner, the sole owner of the company, said he hoped to generate billions of dollars in additional returns for his investors and himself after helping to expand the companies he is investing in.
He has set up shop on the ninth floor of an office tower north of Miami. Its walls are filled with mementos from his time at the White House, including at least a dozen items signed by Trump, often with the words “Jared, Great Job. Thanks.”
Kushner said he understood that he could not avoid scrutiny. But he said repeatedly that he was confident he was acting ethically and legally and did not worry too much about what have become regular attacks from Democrats in Congress and ethics watchdogs.
It is not just liberal groups raising questions about Kushner’s activities.
Rep. James Comer, R-Ky., the chair of the House Oversight Committee, said in an interview on CNN last year that “what Kushner did crossed the line of ethics,” regarding the Saudi funding for Kushner’s investment firm.
Relationships with foreign officials
Kushner had come to the White House after serving nearly a decade as CEO of a real estate investment company built by his father and grandfather.
Kushner developed a relationship with the Chinese ambassador and a friendship with Saudi Crown Prince Mohammed bin Salman, with whom he exchanged messages over WhatsApp. He also worked with Mexican officials to revise a trade deal with the United States.
Former Trump administration officials who worked closely with Kushner said he grasped immediately that as the son-in-law of the president he held an advantage over his more seasoned colleagues across the government.
He played a substantial role in the diplomatic breakthroughs between Israel and several Arab nations that were labeled the Abraham Accords, perhaps Kushner’s most significant White House achievement.
But the Jan. 6, 2021, storming of the Capitol by a mob of Trump’s supporters made the Trump family at least temporarily toxic to many corporate players in the United States. Major banks, real estate brokers and law firms dropped the family as clients.
Kushner said he saw the investment fund as his first opportunity to start a large-scale business entirely on his own. “I get to work with people I want to work with, make the decisions I want to make,” he said.
Advisers to the Saudi sovereign wealth fund recommended rejecting a request from Kushner for an investment. “Why aren’t there any significant institutional investors from the U.S.?” the board of the investment committee of the Saudi Public Investment Fund asked about Kushner’s firm in late June 2021, just days before Affinity opened its doors, The New York Times first reported two years ago.
But Crown Prince Mohammed, the Saudi leader, overrode the recommendations and backed his American friend to the tune of $2 billion. Kushner said in an interview that he had been told by an associate of Crown Prince Mohammed, whom he still visits several times a year, that the Saudi leader had confidence in him because of his successful work on the Abraham Accords.
Qatar and the UAE each invested more than $200 million in Kushner’s fund, the Times reported last year.
Slow start avoids economic turbulence
Kushner’s firm started slowly, as he recruited a staff of seasoned investment advisers, including Asad Naqvi, a former senior partner at a London-based global equity fund, and Bret Pearlman, a former Blackstone Group managing director.
The slow start turned out to be fortuitous. It meant that Kushner avoided some of the financial turbulence that accompanied a flood of investments by venture capital and private equity firms that subsequently came under pressure when interest rates surged and startups struggled to secure more funding.
Kushner said his firm had vetted at least 1,430 investment opportunities since opening in July 2021, closely evaluating about 300 potential deals and then making the 10 investments so far, in amounts ranging from $100 million to $500 million.
By the end of March, he said, $1.45 billion had been committed to firms it is investing in, and $1.2 billion had been distributed.
It will be several years still before the firm’s profitability can be evaluated beyond the fees it receives for managing its investors’ money.
His first investment in Israel went into the Shlomo Group, a family-owned conglomerate that has a diverse array of assets, including divisions that handle construction, real estate, rental cars and shipbuilding.
The car-leasing group controls about 30% of the Israeli market and is looking to expand to new locations, including perhaps Saudi Arabia. Kushner took a 15% stake in the Shlomo Group’s car and credit business unit for a $150 million commitment.
Shmeltzer Holdings, the parent company of the Shlomo Group, is also a part owner of Israel Shipyards, the country’s only domestic shipbuilder for the Israeli navy. Israel Shipyards built Israel’s fast-attack boats, named SA’AR 4.5, which are equipped with American-made missiles, along with several other ships for the Israeli navy.
Because the United States provides Israel with billions of dollars in military aid each year, Kushner’s father-in-law could once again soon be in a position to help out Kushner’s business partner.
Kushner also recently teamed up with Mubadala Investment Co., the $280 billion Abu Dhabi-based sovereign wealth fund, as it moved to buy a larger stake in Zamp, the Brazil-based operator of Burger King.
This move is part of an effort by Mubadala to assume a controlling share in Zamp. It effectively turns Kushner’s firm and Mubadala Capital into business partners in Brazil as they join to bring more fast-food restaurants to the nation, and underscores the close nature of Kushner’s financial ties to Arab governments. This investment has not previously been disclosed.
In Serbia, Kushner is working to complete a government-backed deal to take control of the former Yugoslav military headquarters building in the center of Belgrade to transform it into a luxury development.
The transaction involves some of the same Serbian officials that Kushner’s business partner and former Trump administration colleague, Richard Grenell, dealt with in 2020, when negotiating a regional agreement that ultimately brought Serbia hundreds of millions of dollars in promised financial assistance from the United States.
And in Albania, where Kushner has negotiated the possible lease of a government-owned island to build another luxury hotel, the government has been moving to modify federal laws that will make it easier to build five-star tourist compounds in sensitive marine areas and wildlife preserves. Those changes could benefit Kushner’s proposed projects there.
A spokesperson for Prime Minister Edi Rama of Albania said the legal changes were not written specifically to benefit Kushner. And Kushner, in the interviews, said he had played no role in lobbying for the changes.
The problem, said Steven L. Schooner, a law professor at George Washington University and a former White House lawyer, is that even if Kushner is not intentionally seeking favors from foreign governments, he might be getting them.
“There are plenty of foreign governments that would like to be viewed favorably by the president of the United States,” Schooner said. “Entering into business deals with the future president’s son-in-law is one way to accomplish that.”
Kushner said he remained confident that if Trump was reelected, all decisions his father-in-law made would be based on what was best for the country, not any family business interests. He added that no favors to him from any foreign government would be accepted.
“If they think they’re going to get special treatment from Trump because they’re doing a deal with me, they’re wrong,” he said. “That would be stupid.”
c.2024 The New York Times Company. This article originally appeared in The New York Times.
