DOJ: Trump’s Early Businesses Blocked Blacks

A 1973 suit against Trump and the Trump Organization claimed that superintendents at Trump properties would mark African American’s applications with a ‘C’ for ‘Colored’ and other racial codes.

12.15.15 6:00 AM ET

When an African American showed up to rent an apartment owned by a young real-estate scion named Donald Trump and his family, the building superintendent did what he claimed he’d been told to do. He allegedly attached a separate sheet of paper to the application, marked with the letter “C.”

“C” for “Colored.”

According to the Department of Justice, that was the crude code that ensured the rental would be denied.

Details of this secret system, as well as other practices that the Trump organization allegedly used to exclude black residents from its buildings in Brooklyn, Queens, and Norfolk, Virginia, in the 1970s, were recorded in a lawsuit brought by the DOJ against Trump and his father, Fred, in 1973 for alleged violations of the Fair Housing Act.

The Trumps responded to the Department of Justice with characteristic combativeness. They counter-sued the federal government for $100 million, while the family’s infamous lawyer—the Joe McCarthy aide turned mafia counsel Roy Cohn—attacked a prosecutor for being a “hot-tempered white female” while slamming the investigation as “Gestapo-like.” Extensive court documents, unearthed by The Daily Beast, provide a window not only into alleged discriminatory practices at the heart of Trump’s early real estate empire, but also into the family’s attack mode, which echoes Trump’s current slash-and-burn campaign for the White House.  

A Secret Racist Code

The lawsuit—which Trump Management settled in 1975 with a consent decree, and which they noted at the time did not constitute an admission of wrongdoing—detailed numerous instances of a racial code that Trump-owned buildings allegedly used to indicate if an applicant was black or otherwise “undesirable.”

A super who worked for the Trumps, Thomas Miranda, allegedly told the DOJ that Trump Management staffers had instructed him to “attach a separate sheet of paper to every application submitted by a prospective ‘colored’ renter.”

“Miranda was to write a ‘C’ in order to indicate to management that the prospective renter was ‘colored,’” the DOJ noted in court documents.

Elyse Goldweber, an attorney on the case, claimed Miranda had been reluctant to talk to her and have his name disclosed because “he was afraid that the Trumps would have him ‘knocked off.’” Miranda was also allegedly afraid to reveal to the Trumps that he was Puerto Rican and instead told them he was South American because he thought they “did not want Puerto Ricans living or working in the building,” according to Goldweber’s documentation.

Donald Trump, at City Hall announces 34th Street Convention Center

Frank Russo/NY Daily News Archive via Getty

Donald Trump, at City Hall announces 34th Street Convention Center.

In another instance, Goldweber said, Miranda told another tenant that Trump’s central office did not want him to rent to an Indian man—and that they only agreed to rent to the individual after they found out he had United Nations connections and that a rejection “might cause an unnecessary confrontation.”

Miranda later denied in sworn testimony that he’d said such things to the DOJ. He testified that he went to talk to the Trumps after prosecutors paid him a visit and told “Mr. Trump,” who was a “busy man,” that he wanted no part in the case.

But according to other court documents from the suit, Thomas Miranda was not the only staffer who claimed to know of a secret racial code.

According to the DOJ, a former super at Trump’s Highlander complex claimed that he would also attach a coded piece of paper to let the “central office” know that an applicant was black. He added that a number of supers in Queens used a “phony lease” to enable them to refuse apartments to people of color. The super’s assistant backed up his story about the code and said she was told, “Trump Management tries not to rent to black persons.”

The DOJ claimed that a former rental agent for the Trumps, Donald Herman, said he was told “that Trump Management believes that Jewish tenants are the best tenants” and while some black residents were allowed, it was not preferred. Herman also said he knew of the code to identify black applicants.

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The DOJ said that Allan Gross, another rental agent, claimed that he, too, was aware of a code used “to designate which applicants were black or otherwise ‘undesirable.’”

The DOJ alleged that former staffer Harry Schefflin, who worked at Trump’s Briarwick apartment complex in 1973, told government investigators that he was personally ordered to rent only to “Jews and executives” and to discourage blacks from renting. Schefflin said that Fred Trump and other agents of the company would use a racial code to indicate when a renter was black, marking the applications with a “No. 9.”

In addition to the alleged code, the lawsuit claimed other Trump employees had spoken of a host of nasty tactics to keep blacks from renting apartments—from supers telling prospective black applicants that the rental rates were substantially higher than they actually were, to keeping “a sham lease and check to be shown to black applicants.”

One rental agent at Trump’s Tysens Park Apartments said that he’d been told by Fred Trump himself not to rent to blacks.

Fred, he said, wished to “decrease the number of black tenants already residing at Tysens Park by encouraging black tenants to locate housing elsewhere.”

“No Vacancy” For Blacks

In its lawsuit, the DOJ listed more than half a dozen cases in which a black person would try to rent an apartment at a Trump-owned building and would be denied; but when a white person—often a “tester” from New York’s Urban League—would inquire about vacancies, they would allegedly get offered an apartment in the same building.

Among the claims:

  • According to the DOJ, Alfred Hoyt, a black man, was told there were no two-bedroom apartments at Trump’s Westminster apartment complex in Brooklyn. His white wife, Sheila, was offered a two-bedroom apartment the very next day. They were admitted to the building after filing a complaint with the New York City Human Rights Commission.
  • The DOJ claimed that Henrietta Davis, a black woman, tried to rent an apartment at the Fontainebleau in Brooklyn in 1972. She said she was told by the super that he had no authority to accept rental applications. And yet when Muriel Salzman, a white Urban League tester, went to the Fontainebleau directly after Davis, she was told that two apartments were free and she could rent either of them.
  • According to the DOJ, just a week later, in 1972, Godfrey Jacobs—a black tester for the Urban League—was told there were no vacancies at the Beachaven Apartments in Sheepshead Bay. Yet George Sim Johnston, a white tester, was offered a rental at that building on the very same day.
  • The DOJ alleged that Muriel Silberberg, a black employee of the New York Human Rights Commission, says she was told by a man named Paul Ziselman on March 10, 1973, that there were no one-bedroom apartments available in Trump’s Beachaven complex. Ziselman, who identified himself to Silberberg as a rental agent, allegedly later told Phyllis Spiro, a white employee of the Urban League, that he “followed a racially discriminatory rental policy at the direction of his superiors” and that very few “colored” people lived there.
  • According to government investigators, Beverly Best, a black woman, tried to rent at the Beachaven complex in December of 1972. She says she was told by phone that an apartment was available but when she showed up in person the next day to fill out an application, she was told there were no vacancies. She was only admitted to the building after she, too, filed a complaint with the New York City Human Rights Commission.

By the summer of 1974, after a new lead attorney, Donna Goldstein, had taken over the case, the government detailed a series of tests conducted by the New York Urban League in which a black employee would try to rent an apartment at a Trump property and would often be denied, while a white employee was often allegedly granted the same apartment.

In court documents, Goldstein alleged that she had talked to a super named Peter Connan at the Trumps’ Westminster apartment complex. Connan said he was advised that the Trump office staff wanted to know the race of applicants, and that he’d overheard a Trump staffer tell another super that he should have told a black applicant there were no vacancies.

Goldstein also noted that a couple, Mr. and Mrs. Kenneth Laitman, were allegedly denied the opportunity to sublet their apartment in 1973 because the subleasee was black.

The Laitmans had written a letter to the Trumps in August 1973—which was later introduced in court—claiming that a neighbor had complained that “if the apartment were rented to a Negro she would break her lease and encourage others in the building to do likewise” and stating their belief that the building’s manager “refused to rent the apt to [the potential subleasee] because he is Negro.”

“Racial prejudice,” they exhorted the Trumps, “should not be tolerated in your organization.”

The Trumps Hit Back

When the DOJ filed the lawsuit on Oct. 15, 1973—which included explicit reference to Donald Trump, the president of Trump Management—the Trumps immediately cried foul.

On Oct. 16, Donald Trump denied all of the accusations to the press, saying to The New York Times that the charges were flatly “ridiculous.”

“We have never discriminated and we never would,” he said.

“There have been a number of local actions against us and we’ve won them all.”

On Dec. 12, 1973, after the court had given the Trumps no fewer than three extensions (beyond the initially allotted 20 days), the Trumps’ lawyer, Roy Cohn, filed a motion to dismiss the case. Cohn also launched a counterclaim against the U.S. seeking $100 million in damages.

On the same day, Donald Trump was quoted in the New York Post saying that the prosecution was trying to force the Trumps to rent to welfare recipients “who do not otherwise qualify for our apartments in our buildings.”

This now familiar Trump-style incendiary hyperbole had already surfaced inside the courtroom. In an earlier affidavit, Cohn had claimed that the real purpose of the DOJ’s lawsuit was to serve as a press release “announcing the capitulation of the defendants and the substitution of the Welfare Department for the management corporation.”

Meanwhile, Donald Trump claimed in an affidavit that the government had only informed him of the lawsuit via the press, and that he’d first heard about the allegations against him on his car radio on the morning of Oct. 15. Later that day, Trump claimed, he heard the same news of the lawsuit on television and in The New York Times, where he was quoted.

“We have always maintained the respect and admiration of not only our tenants but the community as a whole,” Trump wrote in his affidavit at the time. “Our organization has never discriminated and does not now discriminate.”

The DOJ lawyers sought to dismiss the Trumps’ counterclaim on Jan. 8, 1974, with information indicating that Donald Trump had, in fact, been specifically informed of the case before it was reported in the press.

In its court documents, the DOJ noted that the suit had been filed at 10 a.m. on Oct. 15. Shortly thereafter, they said, departmental attorney Judith Wolf called “defendant Donald Trump and advised that the suit had been filed. This was accomplished no later than 10:30, well in advance of dissemination of the news by the media.”

The lawyers wrote that the press release was not issued until after the case was filed. “Mr. Trump expressed no awareness of the suit when Miss Wolf spoke to him.”

Cohn’s counterclaim and motion to dismiss the case were formally denied on Feb. 5, 1974. But he wasn’t done contesting the legitimacy of the suit.

In May 1974, DOJ attorney Donna Goldstein was assigned to the case, taking over from Elyse Goldweber. In July, Cohn tried to have Goldstein held in contempt of court, claiming her work had turned the case “into a Gestapo-like investigation.”

It was classic Roy Cohn, living to infuriate. He called the Urban League testers “undercover agents,” and compared the FBI to storm troopers. Even before he took issue with Goldstein, Cohn had written a letter (which was later submitted in court) to her predecessor, Elyse Goldweber, in April of 1974, saying, “I never knew you were such a hot-tempered white female.” It’s hard not to read the lawsuit and think of such statements coming from the mouth of modern-day Donald Trump.

In his attempt to take down Goldstein, Cohn presented at least four former employees whom he said had been harassed by the DOJ. They included Paul Ziselman, a clerk for the Trumps named Carol Falcone, and Thomas Miranda, the superintendent who had initially claimed he’d been instructed to mark the rental applications of African Americans with a “C” for “Colored.” The employees claimed that Goldstein and the FBI had visited them at odd hours and scared them with talk of “higher authorities” and jail time for perjury. (Goldstein denied all the allegations against her.)

On July 26, Cohn filed the motion to have Goldstein held in contempt. On Aug. 5, the United States denied any improper conduct from Goldstein.

The magistrate who heard the case, Vincent Catoggio, dismissed Cohn’s allegations against Goldstein and slammed Cohn for trying to smear the FBI. (In one of the lawsuit’s most choice quotes, Cohn responded, “As far as the FBI is concerned, nobody has been a better friend of the FBI than I have.”)

In a hearing on Oct. 24, 1974, Catoggio said he “found no evidence in the record to sustain such a charge.”

“I think the charge is utterly without foundation,” he added. Brushed back, Cohn abandoned this line of attack.

Ongoing Discrimination?

At the time of the lawsuit, Donald Trump tried to distance himself from the alleged discriminatory practices.

Under oath in court during a March 1974 deposition, he was asked: “Do you ever have anything to do with rental decisions in individual cases?”

“No, I really don’t,” Trump responded.

But afterwards, Trump said in an interview with a field investigator for the New York secretary of state—involving an unrelated matter having to do with his brokerage license—that he “supervise[d] and control[led] the renting of all apartments owned by the Trump organization.”

“During my interview with applicant he showed me hundreds of files,” the investigator noted. “Each contained numerous leases both for commercial and residential tenants... and rental records, all of which contained applicant’s signature and handwriting.”

According to Wayne Barrett’s 1991 book, Trump: The Deals and The Downfall, Trump was asked during his March 1974 deposition when the first black resident moved in to one of his properties. He replied, “I don’t care and I don’t know.”

Trump also disclosed that his company had “a practice of destroying company records to save space” and that he wasn’t sure if this practice had been discontinued since the litigation began.

When given the opportunity to respond about the allegations of a secret code for black applicants, Cohn claimed in a February 1974 deposition, “We would have no way in the world of knowing” about the race or religion of applicants.

In 1975, Trump Management settled the case with a consent decree. The Trumps agreed to take a list of vacancies to the Urban League every week for two years. They also agreed to let the League present one qualified candidate for every five vacancies in buildings where less than 10 percent of residents were black.

But less than three years later, the DOJ and the Trumps were back in court again, with the government charging that the real estate company wasn’t complying with the agreed terms in the consent decree. In 1978, the DOJ charged that “racially discriminatory conduct by Trump agents has occurred with such frequency that it has created a substantial impediment to the full enjoyment of equal opportunity.”

The DOJ filed a motion for supplemental relief which entailed a “substantial extension” of the consent decree, additional affirmative action, and a requirement that Trump continue to report to the court and the United States.

It is unclear if the Trump organization’s practices were significantly altered. But in 1983, the Metropolitan Action Institute, a nonprofit fair-housing group, released a report in which two Trump properties were specifically named as being at least 95 percent majority white.

The Fair Housing Act requires that employers be responsible for the actions of their subordinates. In its 1973 suit, the DOJ charged that, “stripped to its essentials, the claim of the United States is that the defendants have failed and neglected to exercise their affirmative and non-delegable duty under the Fair Housing Act to assure compliance by their subordinates.”

The Trump campaign did not respond to a request for comment on this article. But the ugly details of this early clash with the Department of Justice shed light on alleged systemic discrimination at the heart of the Trump real estate empire. If there is any truth to these allegations, these court documents may provide insight into the early business practices of the candidate who is now committed to blocking all Muslims entry into our nation, and who claims to be “the least racist person on Earth.”

with additional reporting by Michael Daly