THREAD: What should we make of today's indictment of the Trump Organization and its CFO, Allen Weisselberg?
1/ Today the Manhattan DA charged Allen Weisselberg and two entities that are commonly referred to as the "Trump Organization" with a tax fraud scheme spanning from 2005 to the present.
Read the indictment below: nytimes.com/interactive/20…
Read the indictment below: nytimes.com/interactive/20…
2/ The scheme at issue here is very simple. The Trump Organization paid money (in the form of rent, tuition, cars, and other items) to executives under the table and hid those payments from tax authorities.
This is a common tax scheme that any jury could get its head around.
This is a common tax scheme that any jury could get its head around.
3/ The indictment contains details demonstrating that the scheme was orchestrated and deliberate. It will be very hard for Weisselberg or the Trump Org to claim they didn't know what they were doing.
Perhaps that's why the Trump Org's statement today did not deny wrongdoing.
Perhaps that's why the Trump Org's statement today did not deny wrongdoing.
4/ The amount of money at issue is also larger than previously reported.
The scheme involved $1.76 million in compensation and resulted in avoiding payment of $556,385 in federal taxes, $106,568 in state taxes, and $238,159 in NYC taxes.
The scheme involved $1.76 million in compensation and resulted in avoiding payment of $556,385 in federal taxes, $106,568 in state taxes, and $238,159 in NYC taxes.
5/ On top of that, Weisselberg received $94,902 in federal tax refunds and $38,222 in state tax refunds. A jury won't like Weisselberg receiving taxpayer money that he wasn't entitled to.
It is true this isn't a large case, as tax cases go, to a jury this is a lot of money.
It is true this isn't a large case, as tax cases go, to a jury this is a lot of money.
6/ It is also substantial enough of a case that a prison sentence for Weisselberg is likely.
So for Weisselberg, the calculus will be whether it's worth challenging the evidence at trial.
Usually the answer is "yes," but the evidence against him is strong. Trial won't be easy.
So for Weisselberg, the calculus will be whether it's worth challenging the evidence at trial.
Usually the answer is "yes," but the evidence against him is strong. Trial won't be easy.
7/ For example, the Trump Organization paid rent on a lease on a Manhattan apartment for Weisselberg and his wife and didn't withhold income taxes on this extra income.
Weisselberg himself signed the checks to pay for the lease! It will be hard for him to claim he didn't know.
Weisselberg himself signed the checks to pay for the lease! It will be hard for him to claim he didn't know.
8/ The Trump Org reduced Weisselberg's direct income to account for this additional indirect income, which demonstrates that the company knew it was income.
The only reason for Weisselberg or the company to pay him indirectly was to do it "off the books" and avoid paying taxes.
The only reason for Weisselberg or the company to pay him indirectly was to do it "off the books" and avoid paying taxes.
9/ The indictment also alleges that Weisselberg concealed his status as a NYC resident until 2013 with the help of the Trump Organization to avoid NYC taxes.
The scheme also involved Donald Trump writing personal checks to pay for private school for Weisselberg's relatives.
The scheme also involved Donald Trump writing personal checks to pay for private school for Weisselberg's relatives.
10/ Weisselberg and his wife also allegedly received leases for Mercedes-Benz automobiles for him and his wife.
It goes without saying that this will be a challenging case to try before a jury.
It goes without saying that this will be a challenging case to try before a jury.
11/ Weisselberg is a wealthy man who lived a lavish lifestyle, but hid that he was a NYC resident and structured his income to hide it from the tax authorities.
A very difficult case to try for a defense lawyer.
So Weisselberg is in a tough spot. Eat a year in prison, or flip?
A very difficult case to try for a defense lawyer.
So Weisselberg is in a tough spot. Eat a year in prison, or flip?
12/ Certainly an indictment is just the government's allegations, and doesn't tell the full story. But on some of these points, the documents and numbers are what they are.
The issue in tax cases is typically proving the defendant's state of mind.
The issue in tax cases is typically proving the defendant's state of mind.
13/ Given that Weisselberg signed the checks, and that the scheme was structured deliberately to hide income from tax authorities, it's not hard to see why the Manhattan DA brought charges.
Regardless of whether there is more to come, a conviction here would be significant.
Regardless of whether there is more to come, a conviction here would be significant.
14/ The indictment states that two other employees benefited from this scheme. The ongoing investigation is likely focused in part on them.
So will the investigation bear more fruit? It's hard to say, although the pressure to flip is higher than it looked yesterday. /end
So will the investigation bear more fruit? It's hard to say, although the pressure to flip is higher than it looked yesterday. /end
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