Trump Organization found guilty of tax fraud scheme

NEW YORK, Dec 6 (Reuters) – Donald Trump’s real estate firm was convicted on Tuesday of a 15-year criminal scheme to defraud tax authorities, intensifying the ex-U.S. The legal woes of running for president return in 2024.

The Trump Organization — which operates hotels, golf courses and other real estate around the world — was ruled to pay top executives, including former CFO Alan Weisselberg, for personal expenses and act as if they were independent Contractors hand out bonus checks to them as well.

The company faces a fine of up to $1.6 million following its conviction on all counts, including conspiracy to defraud tax authorities, conspiracy and falsification of business records. Trump has not been charged in the case.

Judge Juan Merchan, presiding in New York state court, set a sentencing date of Jan. 13.

While the fine is not expected to be significant for a company the size of the Trump Organization, a conviction could complicate its ability to conduct business.

Weisselberg, 75, testified as the government’s star witness as part of a plea deal that called for a five-month prison sentence.

Manhattan District Attorney Alvin Bragg, whose office is prosecuting the case, called the verdict “very fair.”

“The former president’s company is now convicted of a crime,” Bragg said in a New York court after the sentencing, referring to the two convicted arms of the Trump Organization and Trump Payroll.

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Bragg did not respond when asked if he regretted not prosecuting Trump in the case.

He has said the office’s investigation of Trump continues.


Alan Futerfas, a lawyer for the Trump Organization, said the company would appeal and that the criminal law governing corporate liability is vague.

“This is the heart of the case,” he told reporters after the verdict.

The jury deliberated for approximately 12 hours over two days.

The case focuses on the fact that the company paid executives, including Weisselberg, for personal expenses such as free rent and car rentals without reporting income, and provided them with information from other Trump entities such as the Mar-a-lago Club. Bonuses are considered non-employee compensation but are not tax deductible.

According to testimony during the four-week trial, Trump himself signed bonus checks every year, paid for private school tuition for Weisselberg’s grandchildren, approved the lease on his luxury Manhattan apartment and approved another salary deduction for senior executives.

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“The entire narrative about Donald Trump being blissfully ignorant is untrue,” prosecutor Joshua Stanglass told jurors in closing arguments on Friday.

The “hodgepodge of benefits” was designed to keep top management “happy and loyal,” he said.

Trump, a Republican who announced his third run for president on Nov. 15, said in a statement he was “disappointed” with the verdict but called the case a “Manhattan witch hunt.” Bragg and his predecessor, Cyrus Vance, who made the accusations, are both Democrats.

Separate lawsuit

The Trump Organization is separately facing a fraud lawsuit brought by New York Attorney General Letitia James.

Trump himself is under investigation by the U.S. Justice Department for his handling of sensitive government documents after leaving office in January 2021 and his attempt to overturn the November 2020 election in which he lost to Democrat Joe Biden.

Lawyers for the Trump Organization argued that Weisselberg implemented the scheme to benefit himself, not the company. They tried to paint him as a rogue employee. Weisselberg is currently on paid leave and testified that he expects to receive another $500,000 bonus in January

On Nov. 19, Trump wrote on his Truth Social platform that his family “receives no financial benefit from the actions of the executive.”

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Weisselberg, who pleaded guilty in August to concealing $1.76 million in income from tax authorities, testified that he did not conspire with Trump even though he signed the checks involved.

He said the company saved money by paying his and his wife’s rent, utilities, Mercedes-Benz car rental and other personal expenses, rather than raising his wages, which must be accounted for in taxes.

He said Trump’s two sons — who took over running the company in 2017 — gave him a raise when they learned of his tax-evasion scheme.

By then, Trump was president and the company was bracing for greater scrutiny.

“We’re going through the entire cleanup process of the company to make sure that since Mr. Trump became president, everything has been going well,” Weisselberg testified.

Reporting by Luc Cohen and Karen Freifeld in New York; Additional reporting by Andrew Hofstetter in New York; Editing by Noeleen Walder and Grant McCool

Our Standards: The Thomson Reuters Trust Principles.

Luc Cohen

Thomson Reuters

Report on the New York Federal Court. Worked as a journalist in Venezuela and Argentina.


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