When it comes to allegations of foreign governments meddling in the Trump Administration, Russia and Vladimir Putin are usually the prime suspects. But now one of the members of former President Donald Trump’s inner circle is in trouble for bending his ear on behalf of another country — the United Arab Emirates.
Tom Barrack, the 74-year-old former CEO of Colony Capital, was arrested on Tuesday on charges of acting as a secret agent for the UAE. The real estate and private equity investor, who served as chair of Trump’s inaugural committee, supposedly agreed to be a mole of sorts for the Middle Eastern country and promote its interests in U.S. policy. He used a dedicated cell phone loaded with an encrypted messaging app for that purpose, according to prosecutors.
He is being kept in jail, at least until a detention hearing Monday, on concerns that his wealth, power, ties to foreign countries, and possession of a private plane put him at high risk for fleeing the country. The indictment was filed in Brooklyn, New York. Barrack was taken into custody near his home in Los Angeles.
Curiously, Barrack traveled to New York for an interview on BloombergTV just a week before his arrest, appearing relaxed, speaking freely about his long relationships in the Middle East, and seemingly unaware of the pending criminal case. He described Sheikh Mohammed bin Zyed, the crown prince of Abu Dhabi, as “one of the best leaders anywhere in history.”
So who is this businessman, who advised Trump while purportedly acting as a booster and a spy for a foreign government? Here is a quick run-down.
Barrack is trained as a lawyer, and first worked with former President Richard Nixon’s personal lawyer Herbert W. Kalmbach. He later worked for an engineering firm in Saudi Arabia, and served as the deputy undersecretary of the U.S. Department of the Interior during the Reagan administration.
He came to have dealings with the Trumps when working in the 1980s as a principal for the Robert M. Bass Group, the personal investment company for an heir to an oil fortune. Barrack sold Trump a stake in the Alexander’s department stores and the Plaza Hotel, both later lost by Trump in bankruptcy.
The grandson of Lebanese immigrants and the son of a grocer, Barrack has described himself as a self-made business success story. His wealth peaked around 2008 at $2 billion, and now sits at about $425 million.
Colony Capital was founded by Barrack in 1991 and now manages a portfolio worth $34 billion. The private equity real estate investment firm initially focused on buying up bad loans during the savings and loan crisis, and has continued to take an interest in distressed assets, according to Forbes. Some of those have included $200 million in Middle Eastern properties, $534 million in non-performing German real estate loans, Michael Jackson’s Neverland Ranch, and a $24 million loan to photographer Annie Leibowitz.
Barrack and Colony Capital faced criticism following the Great Recession, which the company was accused of buying up houses, raising rents and allowing them to fall into disrepair. The investor stepped down as CEO of the real estate firm he founded in 2020, and stepped down as executive chairman in 2021.
Middle East connections
In the 1970s, when working in the Middle East, he befriended Saudi princes. He has negotiated oil drilling rights with officials in the UAE, and negotiated the sale of a $41 million stake in a luxury hotel to the Abu Dhabi Investment Authority. He sold an investment in a French football club to the Qatar Investment Authority and an Italian resort to a Qatari sovereign wealth fund.
He also partnered with the investment authority on a purchase of Harvey Weinstein’s Miramax. Barrack attempted to invest in The Weinstein Company amid the producer’s sexual misconduct allegations, but backed out when he was unable to structure the deal in a way to avoid enriching the now-convicted sex offender.
In an indictment unsealed Tuesday, Barrack was accused of acting as an agent for the UAE, without notifying the U.S. Attorney General as required, between April 2016 and April 2018. He was also charged with conspiracy and allegations of obstructing a grand jury investigation and lying to the FBI during its probe into his activities.
Among other things, he wrote an op-ed for Fortune, did a favorable television interview, back-channeled with the campaign, worked edits into speeches, and passed along information to the officials about meetings at the White House, according to the indictment. A 27-year-old former employee of Barrack’s, Matthew Grimes, was also charged in the case, along with a UAE official.
A representative for Barrack has said he is “not guilty and will be pleading not guilty” at a future hearing.