Trump Organization. fined $1.6 million after conviction for 17 crimes, including tax fraud

210630100528 02 trump tower 2019 file


New York
CNN

The Trump Organization was fined $1.6 million – the maximum possible penalty – by a New York judge on Friday for running a decade-old tax fraud scheme, a symbolic moment because it is the only trial for a conviction. criminal who got close to former President Donald Trump.

Two Trump entities, The Trump Corp. and Trump Payroll Corp., were convicted last month of 17 crimes, including tax fraud and falsifying business records.

Under New York law, the most companies can be fined is about $1.6 million, a penalty the Trump Organization can easily pay.

The real estate business does not run the risk of being dismantled because there is no mechanism provided for by law to dissolve the company. No individual will go to jail based on the jury’s verdict. However, a criminal conviction could affect the Trump Organization’s reputation and ability to do business or obtain loans or contracts.

Trump and his family were not charged in this case, but the former president was mentioned repeatedly during the trial by prosecutors about his connection to untaxed benefits granted to certain executives, including company-financed apartments, car rentals and personal expenses. . One prosecutor said Trump had “explicitly sanctioned” the tax fraud.

One of the jurors told CNN that the jury saw a “culture of fraud” in the Trump Organization, but referred to Trump as an undefined “Bob Smith” at times when speaking about the company owner’s knowledge of crimes in relation to the charges. . .

Earlier this week, Allen Weisselberg, the longtime chief financial officer of the Trump Organization, was sentenced to five months in prison as part of a deal he struck with prosecutors. Weisselberg pleaded guilty to 15 counts related to the tax fraud scheme and agreed to testify honestly against the company at trial.

He remained on paid leave with the Trump Organization, where he was compensated just over $1 million a year, until Tuesday, when he was sentenced. Weisselberg received a severance package that one person familiar with the deal called “generous”.

Judge Juan Merchan said at the time that, had it not been for the settlement, he would have given Weisselberg more time in prison after hearing the evidence at trial.

Merchan said he found most “offensive” a payroll check for $6,000 that Weisselberg wrote to his wife, who never worked for Trump, so that she could qualify for Social Security benefits.

The Manhattan District Attorney’s office continues to investigate the company’s business practices.

Prosecutors are conducting a comprehensive investigation, and in recent months their focus has returned to the company’s involvement in clandestine payments made to prevent adult film star Stormy Daniels from going public with an affair with Trump shortly before the 2016 election, people familiar with said the subject. Trump denied the affair.

Prosecutors are also looking into potential insurance fraud after new material surfaced in the New York attorney general’s civil investigation into the accuracy of the Trump Organization’s financial statements, the people said.

The biggest threat currently facing the company could be the $250 million civil suit from New York Attorney General Letitia James, which alleged that Trump, his three oldest children, Weisselberg and others defrauded creditors, insurers and tax authorities by inflating the value of several Trump Org. real estate for over a decade.

In addition to money, James, a Democrat, is seeking to permanently bar Trump and the sons named in the suit from serving as directors of a company registered in New York state. It is also trying to cancel the Trump Organization’s corporate certificate, which, if granted by a judge, could effectively force the company to cease operations in New York state.

The judge overseeing the process has placed an independent monitor to review the Trump Organization’s financial statements and business decisions. He recently denied motions to dismiss the case and said he has considered sanctioning Trump’s lawyers. The trial is scheduled for October.

Trump has denied wrongdoing and said the lawsuit is politically motivated.

This story has been updated with additional details.

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