A Russian Mega-Yacht Auction & Allegations of Mortgage Fraud 8/21/25

0:00Bring in show music please. Hi, I'm CNBC producer Katie Kramer. Today on Squawk Pod. Pressure on the U.S. Federal Reserve expands to include Fed Governor Lisa Cook and accusations of mortgage fraud. They're looking for obviously a reason. If a cop follows you for 500 miles, you're going to get a ticket. You know who said that? Warren Buffett. Our economics reporter Steve Leisman weighs in. Lisa Cook is a very accomplished economist. Lisa Cook should not be known for this thing. Speaking of the economics, Steve Leisman is at the Jackson Hole Symposium with the world's central bankers, including Kansas City Fed President Jeffrey Schmidt.

0:45Is an interest rate cut on the way? The inflation number is probably closer to three than it is two. And I think we've got some work to do. And how close is too close? President Trump's march toward more involvement in corporate America. Author Walter Isaacson says it is a risky road. That type of state capitalism, it often evolves into crony capitalism, where you have favored companies and industries, those that pay tribute. It's Thursday, August 21st. Squawk Pod begins right now. Stand Becky by in three, two, one. Cue, please. Good morning, everybody. Welcome to Squawk Box right here on CNBC.

1:29We're live from the Nasdaq market site in Times Square. I'm Becky Quick, along with Joe Kernan and Andrew Ross Sorkin. Talk of Jackson Hole, talk of the globe, talk of the weaponizing the housing regulator. I was doing some research on that great Soviet era quote. Actually, a lot of people have used the same quote. If you could show me a man, I'll find your crime. It was a Soviet jurist named Vyshynski. Anatoly Vyshynski came up with it, but also attributed to Stalin. It's a bad way to run... It's lawfare, and it's probably a bad way to run a... And I'm not saying that Trump doesn't have reason, because I think he thinks that the same thing was done to him during his...

2:10Well, and Adam Schiff. But it's not used to it. It's Adam Schiff, Letitia James, this person. This was four years ago. I did see a MAGA tweet that says, so the Fed won't lower rates, but they'll get better rates for themselves. which is that's the maggot take on but this is right in your wheelhouse uh i knew it yesterday tell everybody about what we're talking about well supposedly four years ago before she was a fed governor governor she claimed a principal residence of some house she was going to rent or something got a lower mortgage rate but this um pulte the fhfa guy i guess you you could say that this is part of his purview but this is the third i think it was uh adam shift too and leticia it's all coming from here.

2:52And then the president himself tweeted or whatever it's called on social media that she's got to resign. But it certainly looks like... It's for anybody who... It's... Federal Reserve Governor Lisa Cook says she... I don't know if this... She says she has no intention of being bullied to step down from her position following claims by a Trump administration official that she committed mortgage fraud. In a statement, Cook said she intends to take any questions about my financial history seriously as a member of the Federal Reserve. So I'm gathering the accurate information to answer any legitimate questions and provide the facts nominated to her position by Joe Biden in 2022.

3:30The fight kicked off when the head of the FHFA, Bill Pulte, sent a letter to Justice Department officials asking the DOJ to criminally investigate Cook. He alleges Cook claimed two different properties, as we just said, as her primary residence at the same time. President Trump. Two weeks apart, took out those mortgages, right. President Trump posted on True Social yesterday that Cook must resign now. But, you know, go back to the Fed building being remodeled. They're looking for, obviously, a reason to. There's nothing that, look, if she did this, this is a problem. You lie on federal documents for a mortgage application.

4:13It is a crime. The question comes in with how you're getting this information, how you're using it. I went and looked at the letter that Bill Pulte sent to Pam Bondi. He said, in the course of exercising U.S. federal housing authorities under the Federal Housing Enterprises Financial Safety and Soundness Act of 1992, U.S. federal housing has identified matters that are appropriate for referral to the U.S. Department of Justice for consideration of criminal prosecution. I guess the question is, were they looking through the list of people that they're trying to get booted out of jobs for cause and using this information that's collected at the U.S.?

4:46I can't imagine that they were just happened to be, they happened upon these applications, you know. Well, you don't want to see the IRS. Four years later. That's why I started with Vyshynski. And there's another old Russian expression that show me a neck and I'll show you a collar. Mm-hmm. So, um... But at the same time... I'll give you a CNBC version. I don't think you... What's the CNBC version? The CNBC version, if a cop follows you for 500 miles, you're going to get a ticket. Right. You know who said that? Jim Carrey? Warren Buffett. Oh, Warren Buffett. Remember the Jim Carrey movie? How long have you been following me?

5:20The cop pulls him over. Do you know why I pulled you over? It depends on how long you've been following me. Yeah, um... But the... I don't like... I think the IRS can do this. That's why a weaponized IRS is really scary, too. Right, right. The thing is, is you don't want to see these agencies politicized to this extent where they are going after enemies. I also don't want to sound like I'm saying this is no big deal if she actually did this. If you lie on this stuff, it is a federal crime. Did she get both mortgages or would she just apply for both mortgages? She got both mortgages for two houses, two weeks apart, one in Michigan, one in Georgia.

5:58claimed on both of them that they would be her primary residence. And we've all gotten mortgages. So I want to know a lot more about that. This is three's of charm, though. I mean, Letitia James, Adam Schiff. And Bill Pulte was very actively kind of pushing this agenda. He's a hard ass. And, you know, I like him. And I think there's certain, just like everything else, I like certain things, but then there are certain times when it's like, whoa. You can't use things that way, right? When I saw this, you know, yesterday, and we were going to talk about it, But I was there's something for everyone.

6:31I mean, I can go back and say, look, you know, you harass. How many trials were there against Trump? How many lawfare trials were there against Trump? He feels totally justified. He's like, this is what they did to me. I'm going back and getting this. The reason I was going back to Letitia James is it's very similar to what they accused Trump and the Trump organization of on a grand scale of lying about how valuable his businesses were when he was going out for loans with some of those things. That was totally. But the difference was, and that was, that was politicizing that office, but she had to go and get the information from other places.

7:02It wasn't taking the information that you had and using it. But you're right. It was politicization of the agent's office. Alvin Bragg twisted himself into a pretzel to get around the statues of limitation to juice something up into a felony that wasn't a felony to get the 32 felony accounts against Trump. Two wrongs don't make a right. Nobody should be. No, I know that. I know that. Two wrongs don't make a right. I think it's the distinction which Becky's making, which is, and by the way, I totally now accept, and you and I. Lawfare, we have. No, no. We've had conversations about what Letitia James was doing and about the case.

7:33Right. And all of those folks. But the idea that when you have people inside the departments that are actively doing this, that's different, I think, than even prosecutors, arguably even weaponizing their own business. Prosecutors are politicians, too. I mean, but anytime you're using the arm of the law for a political reason, it's not a great thing. But I immediately took it to the IRS. And you do not want to see the IRS weaponized in a way like the FHPA. I don't even like talking about the IRS on TV. I haven't done anything. But they can, you know, like I said, they can ask you for every receipt.

8:08I got a bill for$19 yesterday from the state of New Jersey. Like, I thought I'd done everything right, but I've got$19 that I owe and it's racking up. With interest. Right. We're talking about industrial policy all day long today, too. I was also looking through that. Public-private partnerships sound great, don't they? There's a lot of historical precedent for that. Do you know where you can find the most historical precedent? A lot of Latin Americans. Or China. Or Spain. The only one we really have here that kind of worked was Fannie and Freddie. Most of the time. But it didn't really work. It worked because we took them over.

8:45And fully took them over. Before they took him over. And it will probably, by the way, it'll work even less, though, if the investors can get their money back. So think about that. Think about when Trump decides to actually, you know, decide that he's going to spin Fannie and Freddie off and turn it private again, which is what folks like John Paulson and Bill Ackman and others want to happen. And Bill Pulte. And Bill Pulte. And who will be the beneficiary of that and the largest of the taxpayers. So this is where it gets super complicated, super complicated. And it goes to the Sarah Fryer question, which is, sure, OpenAI may not be taking money from the government right now.

9:25But at some point, the government may say to OpenAI, fork over the money. Well, because you've been the beneficiary of what we've spent. You've been the beneficiary of all the money that we're subsidizing the infrastructure. That's why this all, talk about the slippery slope. The slippery slope is real. Well, I'm even more worried about the ability of the government to pick the right companies to do things. And then to prop them up when they shouldn't be propped up. And then it's not capitalism. You're not able to fail. It's another too big to fail. Intel might not be the right company to be backing here.

10:01Well, the question is, which is the right company? Well, that's why the market sorts things out. The free market sorts that out. Yeah, but the problem is we don't. Well, the problem with the free market in this context is we don't have, forget about national champion, we don't have somebody currently that's both either capable, interested, or economically incented to do it because the economics of it, at least historically, maybe with the tariffs, it changes. This is what I was going to say. Maybe the tariffs work in this situation where you economically incentivize people to do it back here. It's a stick, but it's the stick.

10:33But look, you're not going to get a free ride if you're not building things here in the United States. We're going to settle this by nine, all these things. We're going to settle the lawfare and the industrial posse. We'll have it all. Let me throw one more onto it. And that is what Wesley Clark talked to us about this week, the former NATO commander and general. He said basically any agreement that you get from peacetime, any agreement you cut with Putin or anybody else is only going to be as good as the commander in chief standing behind it. We started the Cold War with strategic nuclear superiority.

11:07And President Trump is exactly right to be concerned now about our strategic defense in the United States. because in a multipolar world, mutual assured destruction does not provide the level of deterrence for the United States that we thought it did during the Cold War. You choose what to enforce and what not to enforce. So it kind of goes back into all of these. You can set up laws and rules and regulations, but bad guys can get around good laws. And the best you're going to have to do is you can't make it. It goes back to what Charlie Munger once told me. You can't make a good deal with a bad person, no matter how much legalese you put into it.

11:50Harkening back to the worst things about the Soviet era, we saw from Lavrov also yesterday. And nothing short of really tough sanctions are going to get them to do it. That was unbelievable, the way the developments yesterday and the things that they're saying at this point, this backing out. We're back to 2022, and they're lying about Ukraine accepting the terms of that deal back then. And the biggest number of drone attacks that they've done came yesterday. You can't make a good deal with a bad person. That's what it comes all down to.

12:26It's a$300 million mega yacht that once belonged to a Russian oligarch going up for auction, but potential buyers may be more than they bargained for here on the high seas. It may cost him, really, is really the issue, I think. Robert Frank is going to join us right now. The only one who knows all about the yachts. Tell us. Tell us. Good morning, Andrew. Well, the U.S. government is, in fact, auctioning off that$300 million yacht that it seized as part of its crackdown on Russian oligarchs. The yacht is called Amadeya, and it was seized by the Justice Department off the coast of Fiji shortly after Russia's invasion of Ukraine back in 2022.

13:01And it was all part of that global capture of dozens of yachts, villas, art, and private jets that were taken by governments to pressure President Putin and his money machine at the time. But now most of these assets are sitting in legal limbo and costing taxpayers millions of dollars. The U.S. government says Amadei is owned by Suleiman Karamov. He is, of course, the sanctioned Russian billionaire. The holding company for the yacht, however, says it's owned by another non-sanctioned Russian. So therefore, the seizure was illegal. Now, the government has spent over $30 million of taxpayer money to maintain this yacht and its crew.

13:38It's now docked in San Diego. A judge approved a sale finally in March. It's now being sold at auction that ends on September 10th. Bidders, if you're interested, have to put up a$10 million deposit. Yacht brokers tell me that potential buyers are leery of buying a yacht that could be subject to a legal claim by a wealthy Russian. But for those with deep pockets, good lawyers, maybe guns, lawyers, and money. Amadea is 348 feet long, sleeps 16 guests and 36 crews. Got a glass elevator serving six decks, a chromotherapy pool. I don't even know what that is. 36 foot infinity pool, a nightclub, Marvel fireplaces, helipad, and a winter patio dining room inspired by an Alpine conservatory.

14:22It also has a ton of gold inside. So much gold that gold furniture, no, gold furniture, gold lining. So much gold that I thought maybe, you know, somebody could gift this to the president. We could get a presidential yacht back. Who put that much gold into a yacht? Don't they know that gold is heavy and sinks? Are you stupid? The Russians particularly put not just gold, but a lot of masterpiece paintings on their yacht. And so part of the issue is climate control. The reason it's so expensive for these yachts to maintain. And$600 ,000 a month it's cost U.S. taxpayers to maintain this yacht. Are they taking the art off the yachts?

14:59No. They're leaving the art on the yachts. Why do they do that? Why wouldn't you just take it and store it? Because a banker and split them up here. Yeah. I think it gets complicated in terms of confiscating property and where it is. So you're keeping it all together. I'm just thinking I could save money on the air conditioning if I move the art. It's docking fees, insurance. I mean, these boats are incredibly expensive. This sounds like a flipping opportunity because I don't know if I'd want to keep one of these things and then have somebody really mad at me. And that's probably the only thing you're going to be.

15:32They'll probably buy it. They charter it, keep it close to the U.S., and then eventually sell it at some point when there's a resolution around the ownership. But it's going to sell for a lot less than$300 million. That's for sure. Okay. Robert, thank you, sir. Thank you, guys. Nice to see you. Cheese will be next. Coming up on Squawk Pod, Walter Isaacson issues a warning about the slippery slope from state capitalism to crony capitalism. To have the government decide it's going to take a stake in Intel and not take a stake in NVIDIA, but tell NVIDIA to give it 15 percent or whatever, that's just sort of a scattershot method of crony capitalism that's not necessarily going to bring chip manufacturing back to America, which is the goal.

16:16We'll be right back.

16:26Welcome back to Squawk Pod from CNBC. Here's Joe Kernan. Bill Pulte, Director Pulte, is watching. And he agrees. Becky nailed it on at least one thing that she said, and that is that it is a serious allegation. I guess here's Becky Quick is right. This came out at 6-11 after our discussion. lying on mortgage applications is a major federal crime with up to 30 years. Much more will come out about all these loans. I can also say that the agency says that they were tipped about this. And that's an important point, because if, in fact, somebody, either they were tipped from outside the agency, or even if they were tipped by somebody who would be an employee apolitically, down lower, I think a lot of people would feel better about that than if, in fact, it felt like somebody at the top.

17:14if Bill, and we've got to talk to him, and I know we'd love to get him on and broadcast. Well, we want him to be able to respond to whether, I mean, we talked all about, not only did you say that, but you also said a lot of other things about weaponizing. You don't want to weaponize agencies. We don't know what happened here. But if you think of that from the perspective of the IRS. And you also hear, you know, how do we get Al Capone? So none of these things are minor, and you do what you, I guess, but that's the thing. I mean, are they after people on the Fed now? Right. I mean, does it come from tips or does it come from here's a list of people we'd like to look at?

17:50And then there's a slightly different question, but I don't know how you feel about this one. If you knew, for example, that Bill was, you know, against this Fed and wanted to oust, you know, because he's been out there about his own views. Right. He's a housing guy. He'd like to see lower rates. Of course. But I'm just saying if that's the case and then you have either employees or others who say, oh, I'm going to have a favorable ear to this, meaning I'm going to go. I'm going to tip this person because I know that then they'll actually do something with it, which may be fine. I don't know. It's just it's we're in a very weird gray zone.

18:23Well, but it's terrible to be lying on these things. So let's just put that stipulate straight up. Will anyone ever do this again? Probably not. So maybe, by the way, maybe that's a good outcome. Deterrence. We need deterrence. Exactly. Well, we hope we hear. I'm saying I have multiple mortgages, and I would never say that it was not my primary. So you're on the record that you haven't done this? No. Because I've gotten a tip. I have not. I've gotten a tip about it. No, I would never. And by the way, it is a big difference. I have like a 3 % mortgage on one or just under 3%, and I pay close to 6 % on another because it's not your primary residence.

18:57Honesty is the best policy, someone once said. In addition to show me a man and I'll show you a crime. But call in. Call me. Remember that one? Director Poulter, we'd love to hear from you. And we're waiting. We're leaving the line open.

19:14Joining us now to talk about the proposed U.S. government stake in intel and the future of industrial policy, if that's what this is, CNBC contributor Walter Isaacson. He's a professor at Tulane University and a Perella Weinberg advisory partner. Historically, Walter, and welcome. If you look up public-private partnerships, there's a long history of things like that, most of which it's either Latin America, China, or somewhere else where it's been done and usually not very successfully. There are some emergency situations. Another PPP with the payroll protection and things like that. We have done things under emergency circumstances, but this is not.

19:59Or is it? No, no. This is really kind of odd. When you see everybody from the Fortune magazine piece that Jeffrey Sonnenfeld and the former CEO's of Xerox and Procter & Gamble wrote or the Wall Street Journal editorial board, you're seeing what is really state capitalism here, where the government is interfering in all sorts of ways in corporate decisions, whether it be pricing, whether it be Coca-Cola, whether it be Intel and maybe taking a stake in it. And that type of state capitalism, it often evolves into crony capitalism, where you have favored companies and industries, those that pay tribute to the leader.

20:41And that is a recipe for not only disaster, but just sort of a corrupt sense of messiness. Well, I'll tell you the not in defense necessarily of it, but I'll tell you my take. The actual way that that those chip grants were doled out in terms of industrial policy in the last administration with child care and DEI and ESG and Davis Bacon union wages and not even getting a stake in the company. That starts it. I would almost say this is this is improving upon something that was even worse. and less bad than the deal we had as a government with Intel in the first place. Still not great, but actually preferable to what we were doing.

21:31Or maybe not. When you talk about all the things they requested and, you know, what do you call the DEI or whatever, this is the problem with state capitals and this is the problem with too much government intervention. And you can argue that that was worse than what Trump is trying to do with taking a stake in it. But no, this is just going further and further down the path. And if you believe what you just said about all the government intervention, then you've got to feel that way now. I mean, I do. I'm even more disturbed that the government go back, go back and look at what we back. You know, how many charging stations did we build?

22:08How did Solyndra work out? We're not good at this. And no matter how smart you no matter how smart you think you are. And usually, I don't know, Democrats think they're a lot smarter. There's 100 of them that could run the entire country, and we'd be, oh, my God, it'd be the greatest thing that ever happened. And we know what happened. We saw that presidency, and it didn't happen, Walter. So I don't, what gets me, I don't want to pick Intel. I don't want to own Intel. I'd rather let somebody else, the free market, decide who's going to win there. You want to buy NVIDIA? For now. Yeah. That's what I mean.

22:44It's the question. Here's the question, though. If we if we don't go down the road, I'm not suggesting we should. How do you do it? I mean, as you know so well, we did not make chips in this country for a reason, because the economics of making these chips didn't make sense. In fact, I don't think if you had gone to these companies a couple of years ago and said, we're going to give you money and you're going to give us equity, they would have said yes. I think they would have said no, because it didn't make economic sense. That's why they weren't in the business to begin with. Now, maybe you could argue the field has changed insofar as the tariffs change things, and that may make the economics to do this here more attractive, if you will.

23:18That's obviously a shift. But if we don't somehow shift the balance, how do you actually, in a free market world, make this happen? Well, as you know, and I talked to Joe about it a week ago on this show, I really believe we've got to bring manufacturing back, and especially if we want to stand up to China in certain instances, We got to bring chip manufacturing back. Just a question of the way to do it. I think that to some extent using tariffs on especially things that are defense related or national security related is important. But to have the government decide it's going to take a stake in Intel and not take a stake in NVIDIA, but tell NVIDIA to give it 15 percent or whatever, that's just sort of a scattershot method of crony capitalism that's not necessarily going to bring chip manufacturing back to America, which is the goal.

24:12We got to keep our eye on the fact that the main thing is the main thing here, which is bringing manufacturing back to America. Yeah. And from the defense perspective, the national security perspective, you can think of it with this. You can think of it with pharmaceuticals. I mean, we all got caught during the pandemic by not realizing how much of the supply chain was out of our control and how many things we didn't make here. You can see it even more recently with the rare earth minerals. China kind of is holding us up over that, too. I guess, how do you go about it? Is there is there a room for private public partnerships or public private partnerships on some of these things?