Trump Companies Fined $1.6 Million for Tax Fraud Scheme

The largest criminal case against former President Donald Trump’s corporate empire—and the one that has come closest to implicating him directly in illegal behavior—has come to an end, with a New York judge forcing two of his companies to pay $1.6 million in fines for routinely cooking the books and cheating on taxes for more than a decade.

The monetary punishment, the corporate equivalent of a criminal sentence, was ordered by Justice Juan Merchan on Friday morning.

“You’re given 14 days from today to make payment,” the state judge said, refusing the companies’ request to delay paying the fine until next month.

But even at the very end, the company remained defiant. Trump Corporation defense lawyer Susan Necheles insisted that rogue executives acted on their own—continuing the losing argument she made at trial.

“The DA, again, does not understand the tax law,” she said.

Inside the Jury Room for the Trump Org Criminal Trial

The Manhattan District Attorney’s Office had requested the maximum punishment of $1.6 million against both companies.

Joshua Steinglass, the lead prosecutor at trial, acknowledged that the fines “constitute a tiny portion of the overall revenue of the corporation,” but he said the “pervasive culture of fraud” and “sheer magnitude” of lies “merit the maximum.”

Merchan presided over a six-week jury trial at the Manhattan criminal courthouse that laid out how the Trump Corporation and Trump Payroll Corporation showered their executives with untaxed benefits, paid them huge parts of their salaries as if they were independent contractors taxed at a lower rate, and created fake business records. At one point, they even made up a no-show job for the chief financial officer’s wife so she could fraudulently qualify for taxpayer funded retirement benefits. The New York jury convicted the companies of tax fraud and related charges after deliberating for three days.

“This conduct can only be described as egregious,” Steinglass said on Friday.

That accounting executive, Allen Weisselberg, was sentenced to five months at the dreaded Rikers Island jail earlier this week.

The companies tried pinning the entire scheme on Weisselberg, but it didn’t work.

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After the corporate trial, The Daily Beast scored an exclusive interview with a juror who revealed that jurors were furious at the corporate greed on display. The New Yorkers on the panel did their best to avoid letting their personal feelings toward Trump cloud their judgment, going so far as to give him the nickname “Joe Smith.”

But jurors still sided squarely against him and his eponymous real estate business, unconvinced by the lame excuses. According to this juror, they were annoyed at the way corporate defense lawyer Michael van der Veen insulted their intelligence by adopting his own version of the famous O.J. Simpson defense catchphrase, repeatedly uttering “Weisselberg did it for Weisselberg.”

During their secret deliberations behind closed doors, the jury foreperson initially asked her fellow jurors to raise their hands if they thought the companies were guilty. But the jurors were so overwhelmingly convinced that the companies had broken the law that the jury foreperson found it more practical to ask the opposite. In the end, no one thought the company was innocent.

The trial lasted from mid-October until early December, although much of that was due to constant interruptions because of the fall holidays and COVID outbreak that sickened a witness and the judge too.

The Manhattan DA’s case against the companies is part of that office’s concerted law enforcement effort to make up for the way federal prosecutors went easy on Trump and his associates during his time at the White House and afterward. The previous DA, Cyrus Vance Jr., opened criminal investigations when the Trump-appointed U.S. Attorney for the Southern District of New York, Geoffrey Berman, would not pursue tips.

After the sentencing, District Attorney Alvin Bragg congratulated his prosecution team outside his office doors on the courthouse’s 15th floor—noting that he wished he could punish the company even harder.

“I want to be very clear, we don’t think that is enough. Our laws in this state need to change in order to capture this type of decade-plus, systemic and egregious fraud,” Bragg said.

Bragg also hinted at an oncoming prosecution of Trump himself—a long-awaited law enforcement action that’s been in the works for years but has yet to actually happen. His predecessor, Vance, opened the investigation with Trump as the ultimate target but that probe fell apart once Bragg took over the office last year.

Bragg’s reluctance to indict Trump with the evidence his office had already collected prompted the team’s top two prosecutors to quit. But on Friday, Bragg cited the successful convictions of Weisselberg and the two Trump Organization affiliates when affirming that the investigation will continue.

“The sentencing today along with the sentencing earlier this week closes this important chapter of our ongoing investigation into the former president and his businesses. We now move on to the next chapter,” Bragg said.

Read more at The Daily Beast.

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