Trump Group faces prison tax fraud trial over perks

Michael R. Sisak, The Related Press


Revealed Monday, October 31, 2022 9:23PM EDT

NEW YORK (AP) — For years, as Donald Trump was hovering from actuality TV star to the White Home, his actual property empire was bankrolling massive perks for a few of his high executives, together with residences and luxurious automobiles.

Now Trump’s firm, the Trump Group, is on trial for prison tax fraud — on the hook for what prosecutors say was a 15-year scheme by his most trusted lieutenant to keep away from paying taxes on these fringe advantages.

In opening statements Monday, prosecutors and protection legal professionals sparred over the corporate’s culpability for the actions of Allen Weisselberg, who has pleaded responsible and agreed to testify as a star prosecution witness in change for a five-month jail sentence.

Later, one other Trump Group government, senior vp and controller Jeffrey McConney, walked a prosecutor by monetary data, together with Weisselberg’s payroll varieties and ledger entries displaying that the corporate paid for Weisselberg’s automotive leases. He’ll resume testifying Tuesday.

McConney, whom prosecutors say helped Weisselberg by misreporting his revenue to tax authorities, was granted immunity to testify final 12 months earlier than a grand jury and to testify once more on the prison trial. He stated he appeared earlier than the grand jury eight occasions on a wide range of Trump-related issues.

The tax fraud case is the one prison trial to come up from the Manhattan district legal professional’s three-year investigation of the previous president and is one in every of three energetic instances involving Trump or the corporate in New York courts.

Prosecutor Susan Hoffinger argued in her opening assertion that the Trump Group — by its subsidiaries Trump Corp. and Trump Payroll Corp. — is liable as a result of Weisselberg, the longtime finance chief, was a “excessive managerial agent” entrusted to behave on behalf of the corporate and its numerous entities.

The corporate, she stated, benefited as a result of it did not must pay Weisselberg and at the least two different executives who acquired perks as a lot in wage and bonus pay — which for Weisselberg totaled near $1 million a 12 months.

The corporate additionally saved cash when giving out Christmas bonuses by paying high executives as unbiased contractors by subsidiary firms, comparable to its golf programs and the ice rink it managed in Central Park, Hoffinger stated.

“This case is about greed and dishonest — dishonest on taxes,” Hoffinger informed jurors. “(The Trump Group) paid their already extremely paid executives much more by serving to them cheat on taxes.”

A Trump Group lawyer, Michael van der Veen, countered that the Weisselberg had gone rogue and betrayed the corporate’s belief. Weisselberg concocted the scheme with out Trump or the Trump household’s data, cheated on his private revenue taxes and lied to the corporate about what he’d performed, van der Veen stated.

“This case is about particular person, private greed and the abuse of belief essential to feed that greed. Allen Weisselberg is a person who has fallen to that greed,” van der Veen stated.

“Weisselberg did it for Weisselberg,” he stated.

Weisselberg has pleaded responsible to taking $1.7 million in off-the-books compensation. His Manhattan residence, Mercedes-Benz automobiles for him and his spouse, and his grandchildren’s faculty tuition had been all paid for by the corporate. His son and one other Trump Group government additionally acquired off-the-books compensation, prosecutors stated.

After they say the Trump firm, “what they actually imply is Allen Weisselberg did one thing unlawful with the intent to profit Allen Weisselberg, his buddy or his son,” one other firm lawyer, Susan Necheles, informed jurors.

If convicted, the Trump Group might be fined greater than $1 million and will face issue in securing new loans and offers. Some companions and authorities entities might search to chop ties with the corporate. It might additionally hamper its means to do enterprise with the U.S. Secret Service, which typically pays the corporate for lodging and providers whereas defending Trump as a former president.

Neither Trump nor any of his kids who’ve labored as Trump Group executives are charged or accused of wrongdoing. Trump signed a number of the checks on the heart of the case, however Necheles stated proof will present he knew nothing concerning the scheme.

The Trump Group is the entity by which Trump manages his many ventures, together with investments in golf programs, luxurious towers and different actual property, his many advertising and marketing offers and his TV pursuits.

Prosecutors have stated they count on to name 15 witnesses, together with Weisselberg, McConney and different Trump Group officers. Choose Juan Manuel Merchan stated he expects the trial to take at the least 4 weeks.

Except for the prison case, Trump and the Trump Group are defendants in a lawsuit introduced by New York Legal professional Normal Letitia James, who alleges that Trump and the corporate inflated his internet price by billions of {dollars} and misled banks and others for years concerning the worth of assorted belongings.

A listening to in that case is scheduled for Thursday.

In the meantime, within the Bronx, jury choice was scheduled to start Monday in a lawsuit introduced by protesters who say they had been roughed up by safety guards outdoors Trump Tower. The previous president gave a deposition in that case final 12 months.

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