The Real Deal New York

Meet Trump attorney Michael Cohen’s nemesis: Uber

Chunk of his net worth is invested in taxi medallions, which have taken a big hit
By Kathryn Brenzel | February 27, 2018 12:30PM

Caption: Michael Cohen (Credit: Getty Images, Pixabay)

Michael Cohen is President Trump’s premier fixer. The personal attorney to the president is also a successful real estate investor in his own right, with a property portfolio of several luxury condos and a tony rental building on the Upper East Side. But much of his wealth is tied up in New York City taxi medallions, and those have plummeted in value since the rise of Uber and Lyft, likely wiping out a chunk of his net worth.

Cohen owns at least 34 medallions through 17 LLCs, according to an analysis by The Real Deal of the latest available city data from 2017. In 2013, when medallion values were at their peak, those metal plates could sell for $1 million a pop. In recent months, medallions have struggled to command even $200,000.

At an auction in January, a package of five medallions was purchased for $875,000 — or about $175,000 each. In an auction earlier that month, a set of six sold for $1.1 million, or roughly $186,000 each, Crain’s reported. Even at the higher average price, Cohen’s medallions would be worth $6.3 million — an 81.5 percent decrease from the $34 million they could’ve secured just five years ago.

Cohen disputed TRD’s figures, but declined to specify how many medallions he owned.

“While my finances are personal to me and my family, at the risk of being trashed with ‘fake news,’ I am fortunate to have created a portfolio of assets and investments that are well diversified,” he said. “While medallion values have suffered negatively and impacted so many individuals and lenders, I sincerely hope that evenhanded regulation and legislation by the Mayor and TLC will assist this iconic NYC service in making an economic comeback.” De Blasio told state legislators this month that customers of Uber and other for-hire vehicles should pay a fee toward the transit system, as taxis do.

It’s not clear exactly how much the decrease in medallion values will impact Cohen’s overall net worth. Fifteen years ago — before Uber and Lyft walloped the industry — he was more involved in the taxi business and several reports have mused that this was a major source of his initial wealth.

When he ran an unsuccessful campaign for a City Council seat in 2003, his biography on the city’s Campaign Finance Board website described him as the co-owner of a fleet of 200 taxis. That was likely connected to his partnership with Simon Garber, who owns hundreds of medallions, and with whom Cohen co-owned a taxi business up until the early 2000s, according to Talking Points Memo.

Up until last April, Evgeny Freidman , the so-called “taxi king,” managed Cohen’s remaining medallions. Freidman is barred from managing medallions in the city, after the Taxi and Limousine Commission declined to renew his licenses in April amid his litany of ongoing legal troubles, including allegedly failing to pay the state $5 million in taxes. In August, the New York Daily News reported that Cohen owed nearly $40,000 in unpaid taxi taxes. The tax warrants filed with the state’s Department of Taxation appear to remain active.

Freidman didn’t return calls or emails seeking comment. Cohen said he has not yet found someone else to manage his medallions. But finding a replacement could be tricky, experts said.

“Overwhelmingly, the management companies have refused to take on new medallions for passive owners,” said Jay Hickman, an investor and analyst who covers the taxicab industry. “And if that’s the case, then the medallions aren’t worth anything. In my opinion, I wouldn’t pay $100,000 for a medallion right now, given all the uncertainties.”

Hickman said that while there are some signs that medallion values will soon level out, he expects them to creep below $100,000. He said investors also shouldn’t hitch their hopes on local and state legislators to level the playing field between taxis and ride-hailing services like Uber and Lyft.

Cohen made headlines this month for his involvement in the Stormy Daniels case. Daniels, a porn star, had claimed to have had an affair with Trump, and Cohen said that in 2016, he made a $130,000 payment to Daniels out of his own pocket.

The Stormy Daniels payout was once equivalent to about 13 percent of the value of one of Cohen’s medallions. Now, it’s roughly 70 percent.