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Trump's accounting firm must hand over 8 years of tax returns, court rules

By Brendan Pierson

NEW YORK, Nov 4 (Reuters) - President Donald Trump's
longtime accounting firm must hand over eight years of his tax
returns to New York prosecutors, a U.S. appeals court ruled
Monday in the latest setback for Trump in his tenacious efforts
to keep his finances secret.

The ruling by a unanimous three-judge panel of the New
York-based 2nd U.S. Circuit Court of Appeals backed the ability
of prosecutors to enforce a subpoena for the returns against
accounting firm Mazars LLP. Jay Sekulow, a lawyer for Trump,
said the Republican president will appeal the ruling to the U.S.
Supreme Court, whose 5-4 conservative majority includes two
justices appointed by Trump.

The office of Manhattan District Attorney Cyrus Vance, a
Democrat, is seeking the returns as part of a criminal
investigation into Trump and his family real estate business.
The scope of that probe is not publicly known.

The 2nd Circuit did not decide whether Trump is immune from
being charged with a state crime while in office, as the
president has argued. However, it found that even if he is, the
immunity could not stop Vance from getting the returns from a
third party, or from prosecuting him once he leaves office.

It would "exact a heavy toll on our criminal justice system
to prohibit a state from even investigating potential crimes
committed by him for potential later prosecution," 2nd Circuit
Chief Judge Robert Katzmann wrote in the ruling.

Vance's office has agreed not to enforce the subpoena while
Trump petitions the Supreme Court. Under the agreement, Trump
has 10 calendar days to file the petition.

Trump, who built a real estate empire with his New
York-based business before becoming president, separately faces
an impeachment inquiry in the Democratic-led U.S. House of
Representatives.

BREAKING TRADITION

Trump has refused to make his tax returns public, breaking
with a decades-old tradition of U.S. presidential candidates
releasing their returns during campaigns and presidents
disclosing them while in office. More broadly, Trump has fought
efforts by Democrats in Congress and others to obtain
information about his finances and a range of other matters.

In a similar dispute, Treasury Secretary Steven Mnuchin in
May refused to release Trump's tax returns to a House committee,
saying the request was not based on "a legitimate legislative
purpose." The House then sued the Treasury Department and the
Internal Revenue Service in July to try to get access to the tax
records. The U.S. Court of Appeals for the District of Columbia
Circuit on Oct. 11 ruled in favor of the House bid to obtain
Trump's financial records from Mazars.

In August, Vance subpoenaed Trump's personal and corporate
tax returns from 2011 to 2018, and other records from Mazars
USA, the president's longtime accounting firm. Trump sued
Vance's office in Manhattan federal court to try to block the
subpoena, arguing that as a sitting president, he cannot be
subject to criminal investigation.

On Oct. 7, U.S. District Judge Victor Marrero threw out
Trump's lawsuit, calling his claim of immunity "repugnant to the
nation's governmental structure and constitutional values." The
ruling prompted Trump's appeal to the 2nd Circuit.

Arguing before the appeals court on Oct. 23, a lawyer for
Trump made the claim of immunity more explicit, saying state
authorities would be powerless to act against the president even
if he shot someone on the street unless he were removed from
office first.

Katzmann wrote in Monday's order that the extent of the
president's immunity was irrelevant to the case.

"The subpoena at issue is directed not to the President, but
to his accountants; compliance does not require the President to
do anything at all," Katzmann wrote.

Katzmann was appointed to the court by former President Bill
Clinton, a Democrat. The other two judges on the panel,
Christopher Droney and Denny Chin, both appointed by former
President Barack Obama, Trump's predecessor and also a Democrat.

A spokesman for Vance declined to comment on the ruling.

Trump filed his own lawsuit in July seeking to block the
House Ways and Means Committee from invoking a New York law that
allows it to request his state tax returns. That case remains
pending.

The House impeachment inquiry focuses on the president's
request in a July phone call for Ukrainian President Volodymyr
Zelenskiy to investigate a domestic political rival, Joe Biden,
the former vice president and a top contender for the 2020
Democratic presidential nomination to face Trump.

(Reporting by Brendan Pierson in New York
Editing by Will Dunham and Chizu Nomiyama)

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