The Analyst Who Gambled And Took On Trump

Oct 10, 2016

The Trump Taj Mahal casino took its final bets on Monday, and it's been through bankruptcy more than once in its troubled history.

However, even before the Taj Mahal opened its doors in 1990, there were signs of trouble. One financial analyst predicted — correctly — that the casino would flop. He was promptly fired, under pressure from Donald Trump.

But Marvin Roffman didn't back down.

Roffman had been covering gambling in Atlantic City since legalized gambling in New Jersey began in 1978. And when he looked at the numbers for the Trump Taj Mahal, he was not impressed.

"It was such an expensive project, and it was so huge," Roffman says. "This was like two casinos opening at the same time. And there was enormous debt."

In order to buy the unfinished Taj Mahal casino and get it open, Donald Trump raised $675 million, mostly from junk bonds. Roffman was skeptical that any casino could make enough money to cover the interest payments on those bonds. So when reporters from The Wall Street Journal called, that's exactly what Roffman told them.

"I said that when the Taj opened, it would break every record in the book. And that strong business would continue during May, June and July," Roffman recalls, "but when the cold winds of October came, it wasn't going to make it."

A few weeks later, the story ran in the newspaper. Trump was not happy. He faxed a letter to Roffman's boss at Janney Montgomery Scott with an ultimatum: The firm had to dismiss Roffman immediately or issue a public apology. If not, Trump threatened "a major lawsuit against your firm," Roffman says.

Then Roffman's boss wrote a letter of his own. It was an apology to Trump, which Roffman signed. But Trump wasn't satisfied. He wanted changes to the letter, saying the Taj Mahal would be successful. Roffman said no. "And of course," he says, "they fired me on the spot."

The Trump Taj Mahal opened for business in April 1990. "We've broken every record," Trump told CNN's Larry King at the time. "You're seeing numbers that nobody's ever seen before. It's a great building."

The Taj Mahal brought in enormous piles of money that summer. But when the cold winds of October came, the casino missed its first debt payment. By 1991, the Taj Mahal was in bankruptcy court.

Roffman was in court, too. He won a $750,000 arbitration judgment against his former employer. And he sued Trump, as well. That case settled out of court. Roffman says he used the money to start his own business.

When he talks about Trump today, Roffman doesn't sound bitter.

"The man's a likable man. From the standpoint of running casinos, I don't put him in the Mozart category," Roffman jokes.

And does he plan to vote for Trump in November? Roffman says yes. While he still thinks Trump did a lousy job of running his casinos, "from the standpoint of marketing, he's a genius," Roffman says. "And when it comes to handling the media and the press, I don't think he takes a backseat to anybody."

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ARI SHAPIRO, HOST:

In Atlantic City, N.J., the Trump Taj Mahal Casino took its final bets this morning. It's been years since Donald Trump ran the casino, and decades since he hosted the lavish grand opening, reported on at the time by TV personality Robin Leach.

(SOUNDBITE OF TV SHOW, "LIFESTYLES OF THE RICH AND FAMOUS")

ROBIN LEACH: At the historic meeting of showbiz and big biz, music's magic man and the Midas mogul ran the media gauntlet to open the world's glitziest casino. That fan hysteria reminded me...

SHAPIRO: Even before the Taj Mahal opened, there were signs of trouble. One financial analyst predicted correctly that the casino would flop. That analyst was promptly fired, under pressure from Donald Trump. But that's not the end of the story, as NPR's Joel Rose reports.

JOEL ROSE, BYLINE: That financial analyst was Marvin Roffman. He'd been covering gambling in Atlantic City for more than a decade. And when he looked at the numbers for the Trump Taj Mahal, Roffman was not impressed.

MARVIN ROFFMAN: It was such an expensive project and it was so huge. This was like two casinos opening at the same time and there was enormous debt.

ROSE: In order to buy the unfinished Taj Mahal Casino and get it open, Donald Trump raised $675 million, mostly from junk bonds. Roffman was skeptical that any casino would make enough money to cover the interest payments on those bonds. So when reporters from The Wall Street Journal called, that's exactly what Roffman told them.

ROFFMAN: I said that when the Taj opened, it would break every record in the book. And that strong business would continue during May, June and July. But when the cold winds of October came, it wasn't going to make it.

ROSE: A few weeks later, the story ran in the newspaper. Donald Trump was not happy. He faxed a letter to Roffman's boss at the firm Janney Montgomery Scott with an ultimatum.

ROFFMAN: Either you dismiss Mr. Roffman immediately, or he publicly apologize, or I will institute a major lawsuit against your firm. That was the crux of the letter.

ROSE: Roffman's boss wrote a letter of his own. It was an apology to Donald Trump, which Roffman signed. But Trump wasn't satisfied. He wanted changes to the letter, saying the Taj Mahal would be successful. Roffman said no.

ROFFMAN: And of course, they fired me on the spot.

ROSE: The Trump Taj Mahal opened for business in April of 1990. Here's how Trump described it to CNN's Larry King at the time.

(SOUNDBITE OF TV SHOW, "LARRY KING LIVE")

DONALD TRUMP: We've broken every record. You're seeing numbers that nobody's ever seen before. It's a great building.

ROSE: The Taj Mahal was bringing in enormous piles of money that first summer. But when the cold winds of October came, the casino missed its first debt payment. By 1991, the Taj Mahal was in bankruptcy court. Marvin Roffman was in court, too. He won a $750,000 arbitration judgment against his former employer. And he sued Donald Trump as well. That case settled out of court. Roffman says he used the money to start his own business. When he talks about Donald Trump today, Roffman doesn't sound bitter. And he said something that surprised me.

ROFFMAN: The man's a likable man. You know, from the standpoint of running casinos, I don't put him in the Mozart category.

ROSE: (Laughter) What category do you put him in?

ROFFMAN: He's not one of the stars. I can tell you that.

ROSE: Would you vote for the guy? Are you going to vote for the guy?

ROFFMAN: Frankly, I'm going to vote for him.

ROSE: You are?

ROFFMAN: Yes, I am.

ROSE: Marvin Roffman still thinks Trump did a lousy job of running his casinos. But when it comes to marketing, he says, Trump takes a backseat to nobody. Joel Rose, NPR News. Transcript provided by NPR, Copyright NPR.