After a 15-year plot to mislead tax authorities by failing to register and pay taxes on compensation for senior executives, a Manhattan jury has found two firms affiliated with the Trump Organization guilty of multiple counts of criminal tax fraud and falsifying business documents. The Trump Organization was responsible for the plan.
There was guilt assigned to Trump Corporation and Trump Payroll Corporation on all allegations.
President Trump and his family were not charged in this case. Still, during the trial, prosecutors often referenced Trump’s ties to the company’s lavish perks for top employees as evidence that Trump must have known about them. The firm paid for housing, vehicle leases, and other perks.
When sentenced in mid-January, the Trump Organization faces potential fines of up to $1.61 million. Since no provision in New York law could lead to the dissolution of the company, there is no danger of its dissolution. However, it may have trouble getting loans or contracts if it has a criminal record.
Trump is currently under investigation by federal and state prosecutors for his handling of classified documents, his effort to overturn the results of the 2020 election, and the accuracy of the business records and financial statements maintained by the Trump Organization, all of which were brought to light by the guilty verdict.
On top of that, New York State has launched a civil suit against him for $250 million, saying that he and his adult children were involved in a decade-long fraudulent conspiracy. The New York attorney general is seeking additional punishments, including a lifetime ban on serving as a company officer or director in New York.
There will be an appeal, according to lawyers for the Trump Organization.
This was a case about greed and cheating,” said Manhattan District Attorney Alvin Bragg. “The Trump Corporation and the Trump Payroll Corporation got away with a scheme that awarded high-level executives with lavish perks and compensation while intentionally concealing the benefits from the taxing authorities to avoid paying taxes. Today’s verdict hold these Trump companies accountable for their long-running criminal scheme.”
A former federal prosecutor and TCNN senior legal expert Elie Honig agree that Bragg’s strategy was correct.
“Obviously, this is a setback for Trump Org. – a major setback for the Trump Org. They’ve now been found guilty of criminal conduct, criminal tax fraud,” Honig told CNN’s Victor Blackwell on “Newsroom.”
“It’s also a victory of sorts for the Manhattan district attorney,” Honig said.
“Their theory, now, that part of the income for the employees, including Allen Weisselberg, was paid through fringe benefits in order to avoid tax liability- that theory has been vindicated.”
The jury was told that Trump signed a contract for a Manhattan condominium to reduce the executive’s commute time and that he agreed to pay the private school tuition for Weisselberg’s offspring on a whim. Both of these events were brought to their attention by the prosecution.
Because he signed the Christmas bonus checks for his staff and initiated a memo lowering the income of another top executive, the prosecutors argue that Trump knew about the criminal scheme and that he participated in it.
The prosecution has maintained for years that high-ranking executives evaded taxes by reporting lower incomes than they earned. They did this by failing to include the value of company-provided perks in their claimed earnings, which caused their reported incomes to be significantly lower than their actual earnings.
Weisselberg, now on paid leave from the company, provided testimony over three consecutive days. He pleaded guilty to 15 charges of evading taxes on his earnings of 1.76 million dollars and admitted to doing so. If the judge agrees to accept his guilty plea and finds that he was truthful during his testimony, he will only have to serve five months behind bars.
Trump Organization attorney Susan Necheles has stated her intention to appeal, placing all blame for the scandal on Weisselberg.
“Why would a corporation whose owner knew nothing about Weisselberg’s personal tax returns be criminally prosecuted for Allen Weissekberg’s personal conduct, for which they had no visibility or oversight? This case was unprecedented and legally incorrect,” Nechless said. “We will appeal this verdict.”