Trump Organization Is Charged in 15-Year Tax Scheme - The New York Times

  

Category:  News & Politics

Via:  jbb  •  one month ago  •  37 comments

By:   Ben Protess, William K. Rashbaum and Jonah E. Bromwich (nytimes)

Trump Organization Is Charged in 15-Year Tax Scheme - The New York Times
The company was accused of a "sweeping and audacious illegal payments scheme" in compensating executives to help them avoid paying taxes.

S E E D E D   C O N T E N T



The company was accused of a "sweeping and audacious illegal payments scheme" in compensating executives to help them avoid paying taxes.

01nytrump-indictment01-articleLarge-v2.jpg?quality=75&auto=webp&disable=upscale Allen Weisselberg, center, surrendered Thursday morning at the Lower Manhattan building that houses the criminal courts and the district attorney's office.Credit...Jefferson Siegel for The New York Times

By Ben Protess, William K. Rashbaum and Jonah E. Bromwich

July 1, 2021Updated 3:46 p.m. ET

The Trump Organization, the real estate business that catapulted Donald J. Trump to tabloid fame, television riches and ultimately the White House, was charged Thursday with running a 15-year scheme to help executives avoid paying taxes by compensating them off the books.

The Manhattan district attorney's office, which has been conducting the investigation, also accused a top executive, Allen H. Weisselberg, of dodging taxes on $1.7 million in perks that should have been reported as income. Mr. Weisselberg, Mr. Trump's long-serving and trusted chief financial officer, faced grand larceny, tax fraud and other charges.

"To put it bluntly, this was a sweeping and audacious illegal payments scheme," Carey Dunne, general counsel for the Manhattan district attorney, said when the defendants appeared for their arraignment in State Supreme Court in Manhattan.

The charges against the Trump Organization and Mr. Weisselberg — whom Mr. Trump once praised for doing "whatever was necessary to protect the bottom line" — ushered in a new phase of the district attorney's sweeping inquiry into the business practices of Mr. Trump and his company.

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Read the Indictment


The Trump Organization and a top executive were charged by the Manhattan district attorney's office on Thursday with fraud and tax crimes.

Read Document 25 pages

Mr. Weisselberg pleaded not guilty. "He will fight these charges in court," his lawyers, Mary E. Mulligan and Bryan C. Skarlatos, said in a statement.

In a statement issued after the arraignment, lawyers for the Trump Organization called the case inappropriate and unjustified, saying the case should be resolved by civil tax authorities.

"In our view, this case was brought because the companies' name is Trump," read the statement from the lawyers, Alan S. Futerfas, Bettina Schein and Susan R. Necheles. "This case signals that it is now open season for local prosecutors to target federal political opponents and adversaries."

The 15-count indictment, which charged the Trump Organization with committing a scheme to defraud, criminal tax fraud and falsifying business records, accused the company of a long-running conspiracy to help executives, including Mr. Weisselberg, evade taxes on perks and bonuses while at the same time decreasing the company's own tax obligations.

It also charged Mr. Weisselberg with failing to pay taxes on leased Mercedes-Benzes, bonuses and a rent-free apartment paid for by the company. The indictment also charged him with grand larceny, accusing him of essentially cheating the I.R.S. out of tax revenue.

And while the indictment is narrowly focused on the scheme to evade taxes based on the provision of the benefits, the charges could lay the groundwork for the next steps in the investigation, which will focus on Mr. Trump.

The broader investigation into Mr. Trump and his company's business practices is continuing. The prosecutors in the office of the Manhattan district attorney, Cyrus R. Vance Jr., have been investigating whether Mr. Trump and the Trump Organization manipulated property values to obtain loans and tax benefits, among other potential financial crimes, The New York Times has reported.

The indictment on Thursday follows months of an increasing pressure campaign on Mr. Weisselberg to offer information that could help that inquiry. Prosecutors had subpoenaed Mr. Weisselberg's personal tax returns and bank records, reviewed a raft of his financial dealings and questioned his ex-daughter-in-law — all part of an effort to gain his cooperation.

Mr. Trump was not charged. But an indictment of the company that carries his name strikes a blow to the former president just as he has resumed holding rallies. Even if Mr. Trump parlays the charges into some immediate good will from his supporters — he has denounced the investigation as political persecution — he could face the costly distraction of a trial if he attempts to mount another presidential campaign.

Image00trumporgweisselberg-indicted-articleLarge.jpg?quality=75&auto=webp&disable=upscale Mr. Weisselberg has worked for the Trump family since the 1970s and has been under increasing pressure to cooperate with an investigation into their business dealings.Credit...Evan Vucci/Associated Press

The charges also could strain his company's finances and jeopardize its relationship with business partners who had stood by the Trump Organization even after the Jan. 6 Capitol riot, which prompted a backlash against the former president.

Mr. Trump won the presidency by portraying himself as a political outsider with the business acumen to shake up Washington. But the company whose name he made famous on his reality television show, "The Apprentice," might eventually be associated as much with criminal charges as it is with the hotels and golf courses that bear his name. If the company is found guilty, it could face fines or other penalties.

Mr. Trump mentioned the investigation only in passing during a Fox ​News town hall appearance Wednesday. As he listed his history of legal battles, he said, "New York radical left prosecutors come after me."

"You got to always fight," he said. "You got to keep fighting."

An accountant who began his career working for Mr. Trump's father nearly a half-century ago, Mr. Weisselberg has served as the Trump Organization's financial gatekeeper for more than two decades and recently ran the business with Mr. Trump's adult sons while Mr. Trump was in the White House.

Famously hard-working — he once said he took "no vacations" — Mr. Weisselberg gained an unparalleled view into the inner workings of the company and its bare-knuckled brawls with business partners. Mr. Weisselberg "knows of every dime that leaves the building," Corey Lewandowski, a former Trump campaign official, wrote in the book he co-authored, "Let Trump Be Trump."

Now that he faces charges, Mr. Weisselberg, who is 73 years old, still could cooperate with the prosecutors. If he ultimately pleads guilty and strikes a deal, he could do considerable damage to Mr. Trump, who for decades has depended on his unflinching loyalty, once declaring with "100 percent" certainty that Mr. Weisselberg had not betrayed him.

The two started working together closely in the late 1970s, with Mr. Weisselberg putting in time on nights and weekends to handle projects for Mr. Trump, the ambitious son of his boss, Fred Trump. Mr. Weisselberg said in a 2015 deposition that he had been helping with Mr. Trump's tax returns since at least the 1990s, when Mr. Trump made him the organization's chief financial officer.

Mr. Weisselberg has remained steadfastly loyal to the company even as his own name surfaced during congressional and federal investigations into Mr. Trump. While Mr. Weisselberg was never a target of those investigations, he has long been a central focus of the district attorney's inquiry, which began in August 2018.

As the prosecutors have zeroed in on the benefits he and his family received from Mr. Trump, they have examined tens of thousands of dollars in private school tuition for one of Mr. Weisselberg's grandchildren, a rent-free apartment on the Upper West Side of Manhattan and leased Mercedes-Benz vehicles.

Mr. Weisselberg was not the only senior company executive to receive similar perks. Until 2018, when the company reined in the benefits, it provided a number of employees with Mercedes-Benzes.

Those types of benefits are generally taxable, though there are exceptions, and the tax rules can be murky.

ImageCyrus R. Vance Jr., the Manhattan district attorney and a Democrat, has been investigating Mr. Trump and his business practices since August 2018.Credit...Jefferson Siegel for The New York Times

Even if Mr. Weisselberg declines to cooperate, the charges represent a major milestone for Mr. Vance, a Democrat who twice beat Mr. Trump at the U.S. Supreme Court in a battle to obtain the former president's tax records. That victory reinvigorated the investigation, touching off months of grand jury subpoenas and witness testimony.

Of all the investigations that have loomed over Mr. Trump and his inner circle in the past few years — two impeachments, one special counsel inquiry into ties with Russia and criminal charges against a half dozen former aides — only Mr. Vance's case has reached into the top rungs of the Trump Organization and taken aim at the company itself.

Still, the stakes remain high for Mr. Vance. Although he is not seeking re-election after three terms, the district attorney has faced criticism in the past for treading lightly with other powerful defendants. The Trump investigation will arguably be the most enduring part of his legacy.

When Mr. Vance's office opened its broader investigation, it began with an examination of hush-money payments made during the 2016 presidential campaign to two women who said they had affairs with Mr. Trump. In particular, the prosecutors scrutinized how the company accounted for $420,000 it gave Michael D. Cohen, Mr. Trump's former personal lawyer, partly as reimbursement for money he paid to buy the silence of one of the women, Stormy Daniels, a pornographic film actress who said she had an affair with Mr. Trump.

Mr. Cohen is cooperating with Mr. Vance's investigation, which grew out of 2018 federal charges against him.

In congressional testimony two years ago, Mr. Cohen pinned blame on Mr. Weisselberg, saying that he had helped devise a strategy to mask the Trump Organization's reimbursements to Mr. Cohen.

In his final days in office, Mr. Trump was said to have considered pardoning Mr. Weisselberg, but ultimately did not do so. Federal prosecutors never accused Mr. Weisselberg of wrongdoing.

For years, Mr. Weisselberg kept a low profile at the Trump Organization, often eclipsed by his bombastic boss. One of Mr. Weisselberg's rare moments in the spotlight came during a cameo as a judge on "The Apprentice," in which he discussed dog grooming.

Mr. Weisselberg's family has also long been entwined with Mr. Trump. One of Mr. Weisselberg's sons, Barry, has been the manager of Trump Wollman Rink in Central Park, and another son, Jack, works at Ladder Capital, one of Mr. Trump's biggest lenders.

Mr. Vance's office has subpoenaed Ladder Capital and spoken to some of its employees about the lending process, according to people with knowledge of the matter. There has been no indication that prosecutors suspect either of Mr. Weisselberg's sons of wrongdoing.

Prosecutors have also questioned Mr. Weisselberg's former daughter-in-law, Jennifer Weisselberg, who is in the midst of a contentious court battle with her ex-husband, Barry, over custody of their children.

Ms. Weisselberg has said that prosecutors had asked her about the tuition payments as well as gifts Barry Weisselberg received from Mr. Trump, including an apartment on Central Park South and several cars that were leased for him.

Kate Christobek and Sean Piccoli contributed reporting.

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JBB
Professor Principal
1  seeder  JBB    one month ago

BOOM!

 
 
 
JohnRussell
Professor Principal
2  JohnRussell    one month ago

I'm afraid we are about to learn how little Americans care about white collar crime. 

We often hear that Americans dont care about income inequality because they dream of being rich themselves one day. 

The same applies to white collar crime like the Trumps have perfected over the years. People dont care about it because they would engage in it themselves if they had the chance. 

Donald Trump is the most personally corrupt national leader this country has ever seen. The trouble is not enough people care about ending corruption. 

 
 
 
Hallux
Freshman Principal
3  Hallux    one month ago

Liz is smiling, letting out the occasional guffaw ... laughing hysterically. 

 
 
 
JBB
Professor Principal
4  seeder  JBB    one month ago

Do no rightwingers want to discuss this article?

 
 
 
Dismayed Patriot
Professor Participates
4.1  Dismayed Patriot  replied to  JBB @4    one month ago
Do no rightwingers want to discuss this article?

Perhaps they're too busy taking their "Q's" from right wing conservative Media who hasn't come up with a response any more coherent than "They're targeting Trump because of politics! It's all the 'deep state'! It's all a conspiracy! The lizard people did it! Trump is innocent!"....

 
 
 
Sunshine
Masters Guide
5  Sunshine    one month ago

This is the best use they could find to use taxpayers money?

So it was about a million in fringe benefits not declared and the tax on that would be even less. 

No much bigger fish to fry?  Sounds nothing but targeting political opponents to me.

 
 
 
JBB
Professor Principal
5.1  seeder  JBB  replied to  Sunshine @5    one month ago

I would say it is just the beginning and is merely the tip of an iceberg which shmmm ows a clear pattern of corrupt and illegal business practices...

 
 
 
Sunshine
Masters Guide
5.1.1  Sunshine  replied to  JBB @5.1    one month ago

Yeah ok

 
 
 
sandy-2021492
Professor Principal
5.2  sandy-2021492  replied to  Sunshine @5    one month ago

That seems like a gross misrepresentation of what was actually going on.  Care to tell us where you came up with your numbers?  Because according to the indictment, Weisselberg avoided paying $1,034,236 in taxes on those unreported "fringe benefits", when you add in the tax refunds he improperly applied for and received.

The unreported compensation amounted to $1,174,018 just in rent and utilities for the apartment provided to him.  Those were not the only fringe benefits.  The Trump Corporation paid for his family members' private school tuition to the tune of $359,358.  There was also $196,245 for leases on "his and hers" Mercedes Benzes.  There were $29,400 in cash payments for "Holiday Entertainment".  There were purchases of furniture and electronics for Weisselberg and his family's personal homes.

And that's just Weisselberg.  Other employees were involved in the scheme.

Why are you downplaying the amounts?

 
 
 
Ender
Professor Principal
5.2.1  Ender  replied to  sandy-2021492 @5.2    one month ago

I learned to never get my hopes up. donald seems to be able to weasel his way out of everything.

That was actually meant as a general comment. I hit the wrong button...

 
 
 
Sunshine
Masters Guide
5.2.2  Sunshine  replied to  sandy-2021492 @5.2    one month ago
The Manhattan district attorney's office, which has been conducting the investigation, also accused a top executive, Allen H. Weisselberg, of dodging taxes on $1.7 million in perks that should have been reported as income. Mr. Weisselberg, Mr. Trump's long-serving and trusted chief financial officer, faced grand larceny, tax fraud and other charges.

Your beef is with the article.

It says income. 

 

 
 
 
sandy-2021492
Professor Principal
5.2.3  sandy-2021492  replied to  Sunshine @5.2.2    one month ago

So, 1.7 million is "about a million"?  That's pretty fuzzy math.  And the taxes, as I've shown, were not all that much less.  The article, BTW, contains a link to the indictment.

 
 
 
Sunshine
Masters Guide
5.2.4  Sunshine  replied to  sandy-2021492 @5.2.3    one month ago

Not really fuzzy.  In the large corporate world that is very little in fringe benefits.  I have done audits myself involving large corporations and about a million is not that much or 1.7M. Making a big to do over that doesn’t change it much.

You should complain to the author about what was written not me.

 
 
 
JBB
Professor Principal
5.2.5  seeder  JBB  replied to  Sunshine @5.2.4    one month ago

If you could have proven that Hillary Clinton took a Bic Pen from the Clinton Foundation you would be hollering, "LOCK HER UP!"

 
 
 
sandy-2021492
Professor Principal
5.2.6  sandy-2021492  replied to  Sunshine @5.2.4    one month ago

Of course it's fuzzy.  It's intentionally inaccurate rounding to minimize wrongdoing.  Lies, damned lies, and statistics.

And also, as I mentioned before, those numbers include only unreported income for Weisselberg.  Other employees were also paid "under the table".

 
 
 
Sunshine
Masters Guide
5.2.7  Sunshine  replied to  JBB @5.2.5    one month ago

No I wouldn’t.  That’s just silly.

 
 
 
Sunshine
Masters Guide
5.2.8  Sunshine  replied to  sandy-2021492 @5.2.6    one month ago

No it isn’t fuzzy.  Like I said the difference is minimal for the bottom line.  But you can think it is a big deal if you want.

 
 
 
JohnRussell
Professor Principal
5.3  JohnRussell  replied to  Sunshine @5    one month ago

The unpaid taxes are about 900,000 dollars. You would think someone would go to jail for that . Try stealing 900,000 dollars from Ft Knox and see what happens. 

Like I said though, Americans dont care about white collar crime. 

 
 
 
JBB
Professor Principal
5.3.1  seeder  JBB  replied to  JohnRussell @5.3    one month ago

I think people are sick and tired of this bullshit!

 
 
 
JohnRussell
Professor Principal
5.3.2  JohnRussell  replied to  JohnRussell @5.3    one month ago

In Oct of 2018, the New York Times PROVED that Trump, his parents, and his sister and brother defrauded the government out of millions of dollars in inheritance taxes. Most of the money went to Donald because he was his parents favorite. 

Even though the newspaper had evidence that PROVED the Trumps were guilty the story got very little coverage.

It is very hard to get Americans interested in stopping this type of fraud. 

 
 
 
Ender
Professor Principal
6  Ender    one month ago

What I read about this was kinda weird.

It said that government can go after companies for things like this yet usually they don't. Their point being that if a company is under indictment/charges/ whatever, banks and lenders will stop with any new loans and can recall outstanding ones. Their logic is it would bankrupt a lot of business. So they usually turn a blind eye.

That was from Politico I think.

 
 
 
JohnRussell
Professor Principal
6.1  JohnRussell  replied to  Ender @6    one month ago

If you steal a six pack of beer from a 7-11 you might go to jail. Steal a million with a pen or a computer and it is just one of those things. It is the fault of all of us for tolerating this. 

 
 
 
Ender
Professor Principal
6.1.1  Ender  replied to  JohnRussell @6.1    one month ago

Agreed. Yet point being, let this be the tip of the iceberg in the action of them going after all of them.

Not just pick and choose. I hate to say it but I can kinda see the right wings point here a little.

 
 
 
JBB
Professor Principal
6.1.2  seeder  JBB  replied to  JohnRussell @6.1    one month ago

And yet, some of the exact same people who are defending Trump now thought it was just fine for a policeman to kneel on George Floyd's neck till he was dead for passing a fake twenty dollar bill. Because? Floyd was a "Criminal"...

 
 
 
JohnRussell
Professor Principal
6.1.3  JohnRussell  replied to  JBB @6.1.2    one month ago

Good point. 

 
 
 
JohnRussell
Professor Principal
6.1.4  JohnRussell  replied to  Ender @6.1.1    one month ago

What is the point? We dont prosecute and convict white collar crime? 

 
 
 
Ender
Professor Principal
6.1.5  Ender  replied to  JohnRussell @6.1.4    one month ago

Government turns a blind eye to a lot of white color crime. Under the guise that the health of the business itself is more important.

We need to change thinking and start prosecuting all the companies that engage in this.

Sadly I doubt it will happen as I am sure it would sweep up a few politicians in its wake.

 
 
 
Sunshine
Masters Guide
6.2  Sunshine  replied to  Ender @6    one month ago
The indictment on Thursday follows months of an increasing pressure campaign on Mr. Weisselberg to offer information that could help that inquiry. Prosecutors had subpoenaed Mr. Weisselberg's personal tax returns and bank records, reviewed a raft of his financial dealings and questioned his ex-daughter-in-law — all part of an effort to gain his cooperation.

yeah, sounds like they didn’t give a crap about Weisselberg’s taxes.  They where strong arming him to get to a political opponent.

 
 
 
JBB
Professor Principal
6.2.1  seeder  JBB  replied to  Sunshine @6.2    one month ago

The basis of a good RICO Case is to establish a pattern of corruption and illegal practices, a conspiracy to commit fraud. Compromising the main players is a proven method of insuring silence and loyalty.

 
 
 
Sunshine
Masters Guide
6.2.2  Sunshine  replied to  JBB @6.2.1    one month ago

Oh I didn’t know it was just specifics targets for wanting to crack down on white collar crime. 

 
 
 
Ender
Professor Principal
6.2.3  Ender  replied to  Sunshine @6.2    one month ago

Believe me I am in no way defending donald. I think he is a crook. I think he is more than likely guilty of what they are indicting for. I think he should be held accountable.

Do I think it was political? Maybe, but I think that is a stretch. Vengeance more likely.

My point is, do it to all the companies that engage in this. Do not give credence to political fodder. Which right now I am leaning to the side that says a court might find what you all are saying accurate. Then he will get away with any crimes committed, as well as will future/existing companies.

I am looking at a larger picture than donald.

 
 
 
Sunshine
Masters Guide
6.2.4  Sunshine  replied to  Ender @6.2.3    one month ago

Many middle class earners can be guilty of the same if someone wants to look hard enough for the fringe benefits.

It wouldn’t be just the wealthy and politicians swept up in an increased scrutiny.

 
 
 
JBB
Professor Principal
6.2.5  seeder  JBB  replied to  Sunshine @6.2.2    one month ago

I suppose Al Capone's conviction on tax evasion charges was just, "White Collar Crime"...

 
 
 
Ender
Professor Principal
6.2.6  Ender  replied to  Sunshine @6.2.4    one month ago

Owners have always had perks.

Then it would be, who is to say what perks are allowed.

 
 
 
Ender
Professor Principal
6.2.7  Ender  replied to  JBB @6.2.5    one month ago

The only thing they could get him on.  Haha

 
 
 
Sunshine
Masters Guide
6.2.8  Sunshine  replied to  Ender @6.2.6    one month ago
Owners have always had perks.

Employees have too and they would have to claim that income and pay taxes on them.

Then it would be, who is to say what perks are allowed.

IRS code would say, but hey that trip to Disneyland somehow turned into a business meeting.  jrSmiley_7_smiley_image.png

 
 
 
JohnRussell
Professor Principal
7  JohnRussell    one month ago

Donald trump was twice involved in lending his name and image to multi-level marketing schemes, sometimes known as ponzi schemes. 

President Trump made over $11 million endorsing two multi-level marketing companies in the 2000s for which he and his children would later be sued for fraud, according to the New York Times , which revealed for the first time how much money the future president received for hawking the MLMs, and that those two endorsements were his most lucrative side deals during his height of fame from The Apprentice .

What legitimate businessman gives his name over for use in advertising for ponzi schemes? 

He has been a crook all his life. 

 
 
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