Trump Organization, CFO indicted on tax fraud charges
Donald Trump’s company and its longtime finance chief were charged Thursday in what prosecutors called a “sweeping and audacious” tax fraud scheme in which the executive collected more than $1.7 million in off-the-books compensation, including apartment rent, car payments, and school tuition. Trump himself was not charged with any wrongdoing, but prosecutors noted he signed some of the checks at the center of the case. And one top prosecutor said the 15-year scheme was “orchestrated by the most senior executives” at the Trump Organization. It is the first criminal case to come out of New York authorities’ two-year investigation into the former president’s business dealings. According to the indictment, from 2005 through this year, the Trump Organization and Chief Financial Officer Allen Weisselberg cheated tax authorities by conspiring to pay senior executives off the books by way of lucrative fringe benefits and other means. Weisselberg alone was accused of defrauding the federal government, state, and city out of more than $900,000 in unpaid taxes and undeserved tax refunds. The most serious charge against Weisselberg, grand larceny, carries five to 15 years in prison. The tax fraud charges against the company are punishable by a fine of double the amount of unpaid taxes, or $250,000, whichever is larger. The 73-year-old Weisselberg has intimate knowledge of the Trump Organization’s financial dealings from nearly five decades at the company. The charges against him could enable prosecutors to pressure him to cooperate with the investigation and tell them what he knows. Both Weisselberg and lawyers for the Trump Organization pleaded not guilty. Weisselberg was ordered to surrender his passport and was released without bail, leaving the courthouse without comment. In a statement, Trump condemned the case as a “political Witch Hunt by the Radical Left Democrats.” Weisselberg’s lawyers said he will “fight these charges.” The case is being led by Manhattan District Attorney Cyrus Vance Jr. and New York Attorney General Letitia James, both Democrats. Vance has been investigating a wide range of matters involving Trump and the Trump Organization, such as hush-money payments made to women on Trump’s behalf and whether the company falsified the value of its properties to obtain loans or reduce its tax bills. The news comes as Trump has been more seriously discussing a possible comeback run for president in 2024. He has ramped up his public appearances, including holding his first rallies since leaving the White House. In announcing the grand jury indictment, Carey Dunne, the top prosecutor in the district attorney’s office, said: “Politics has no role in the jury chamber, and I can assure you it had no role here.” The Trump Organization is the entity through which the former president manages his many ventures, including his investments in office towers, hotels and golf courses, his many marketing deals and his TV pursuits. Trump’s sons Donald Trump Jr. and Eric Trump have been in charge of day-to-day operations since he became president. In addition to exposing the Trump Organizations to fines, the criminal case could make it more difficult for the business to secure bank loans or strike deals — a hit that comes at a particularly bad time, with the company already reeling from lost business because of the coronavirus and the backlash over the Jan. 6 attack on the Capitol. “Companies that are being indicted, whether they are private or public, big or small, face serious collateral consequences,” said Daniel Horwitz, a white-collar defense attorney. “Companies in the financial services industry are reluctant to do business with them. Their access to capital is limited or cut off.” Weisselberg came under scrutiny in part because of questions about his son’s use of a Trump apartment at little or no cost. Weisselberg’s son Barry Weisselberg — who managed a Trump-operated ice rink in Central Park — paid no reported rent while living in a Trump-owned apartment in 2018, and he was charged just $1,000 per month — far below typical Manhattan prices — while living in a Trump apartment from 2005 to 2012, the indictment said. Allen Weisselberg himself, an intensely private man who lived for years in a modest home on Long Island, continued to claim residency there despite living in a company-paid Manhattan apartment, prosecutors said. By doing so, Weisselberg concealed that he was a New York City resident, and he avoided paying hundreds of thousands in federal, state, and city income taxes while collecting about $133,000 in refunds to which he was not entitled, prosecutors said. According to the indictment, Weisselberg paid rent on his Manhattan apartment with company checks and directed the company to pay for his utility bills and parking, too. The company also paid for private school tuition for Weisselberg’s grandchildren with checks bearing Trump’s signature, as well as for Mercedes cars driven by Weisselberg and his wife, and gave him cash to hand out tips around Christmas. Such perks were listed on internal Trump company documents as being part of Weisselberg’s compensation but were not included on his W-2 forms or otherwise reported, and the company did not withhold taxes on their value, prosecutors said. Trump’s company also issued checks, at Weisselberg’s request, to pay for personal expenses and upgrades to his homes and an apartment used by one of his sons, such as new beds, flat-screen TVs, carpeting, and furniture prosecutors said. Barry Weisselberg’s ex-wife has been cooperating with investigators and given them reams of tax records and other documents. Two other Trump executives who were not identified by name also received substantial under-the-table compensation, including lodging and the payment of automobile leases, the indictment said. Weisselberg has a reputation as a workaholic utterly devoted to Trump’s interests. So far, there is no sign that he is about to turn on the former president. “I think it’s possible that Weisselberg would reconsider. Seeing the charges spelled out in this much detail, and seeing that the alleged federal tax loss is included, could, in theory, change his mind,” said Daniel R. Alonso, former chief assistant district attorney. “On the other hand, he is a loyal Trump soldier, which obviously argues
Charges expected Thursday for Donald Trump’s company, top executive
Donald Trump’s company and his longtime finance chief are expected to be charged Thursday with tax-related crimes stemming from a New York investigation into the former president’s business dealings, people familiar with the matter told The Associated Press. The charges against the Trump Organization and the company’s chief financial officer, Allen Weisselberg, appear to involve non-monetary benefits the company gave to top executives, possibly including the use of apartments, cars, and school tuition. The people were not authorized to speak about an ongoing investigation and did so on condition of anonymity. The Wall Street Journal was first to report that charges were expected Thursday. The charges against Weisselberg and the Trump Organization would be the first criminal cases to arise from the two-year probe led by Manhattan District Attorney Cyrus Vance Jr., a Democrat who leaves office at the end of the year. Prosecutors have been scrutinizing Trump’s tax records, subpoenaing documents, and interviewing witnesses, including Trump insiders and company executives. A grand jury was recently empaneled to weigh evidence and New York Attorney General Letitia James said she was assigning two of her lawyers to work with Vance on the criminal probe while she continues a civil investigation of Trump. Messages seeking comment were left with a spokesperson and lawyers for the Trump Organization. Weisselberg’s lawyer, Mary Mulligan, declined to comment. The Manhattan district attorney’s office declined to comment. Trump’s spokesperson did not immediately respond to a request for comment, but Jason Miller, a longtime former senior adviser to the Republican, spun the looming charges as “politically terrible for the Democrats.” “They told their crazies and their supplicants in the mainstream media this was about President Trump. Instead, their Witch Hunt is persecuting an innocent 80-year-old man for maybe taking free parking!” Miller tweeted, apparently referring to Weisselberg, who is 73. Trump, who’s been critical of President Joe Biden’s immigration policies, was in Texas visiting the U.S.-Mexico border on Wednesday. He did not respond to shouted questions about the charges as he participated in a briefing with state officials. Trump had blasted the investigation in a statement Monday, deriding Vance’s office as “rude, nasty, and totally biased” in their treatment of Trump company lawyers, representatives, and long-term employees. Trump, in the statement, said the company’s actions were “things that are standard practice throughout the U.S. business community, and in no way a crime” and that Vance’s probe was an investigation was “in search of a crime.” Trump Organization lawyers met virtually with Manhattan prosecutors last week in a last-ditch attempt to dissuade them from charging the company. Prosecutors gave the lawyers a Monday deadline to make the case that criminal charges shouldn’t be filed. Ron Fischetti, a lawyer for the Trump Organization, told the AP this week that there was no indication Trump himself was included in the first batch of charges. “There is no indictment coming down this week against the former president,” Fischetti said. “I can’t say he’s out of the woods yet completely.” Weisselberg, a loyal lieutenant to Trump and his real estate-developer father, Fred, came under scrutiny, in part, because of questions about his son’s use of a Trump apartment at little or no cost. Barry Weisselberg managed a Trump-operated ice rink in Central Park. Barry’s ex-wife, Jen Weisselberg, has been cooperating with the investigation and turned over reams of tax records and other documents to investigators. “We have been working with prosecutors for many months now as part of this tax and financial investigation and have provided a large volume of evidence that allowed them to bring these charges,” Jen Weisselberg’s lawyer, Duncan Levin, said Wednesday. “We are gratified to hear that the DA’s office is moving forward with a criminal case.” Allen Weisselberg has worked for the Trump Organization since 1973. The case against him could give prosecutors the means to pressure the executive into cooperating and telling them what he knows about Trump’s business dealings. Prosecutors subpoenaed another long-time Trump finance executive, senior vice president and controller Jeffrey McConney, to testify in front of the grand jury in the spring. Under New York law, grand jury witnesses are granted immunity and can not be charged for conduct they testify about. Prosecutors probing untaxed benefits to Trump executives have also been looking at Matthew Calamari, a former Trump bodyguard turned chief operating officer, and his son, the company’s corporate director of security. However, a lawyer for the Calamaris said Wednesday that he didn’t expect them to be charged. “Although the DA’s investigation obviously is ongoing, I do not expect charges to be filed against either of my clients at this time,” said the lawyer, Nicholas Gravante. Republished with the permission of the Associated Press.
