The Trump Organization and its CFO Allen Weisselberg have been indicted on tax fraud charges for a tax scheme that has been operating since 2005. Authorities claim Weisselberg pocketed more than $1.7 million dollars in undocumented income, including school tuition, rent payments, and car payments. The scheme had been running for fifteen years and involved the most senior executives of Donald Trump’s company.
New York prosecutors charged the Trump Organization and the Trump Payroll Corporation with 10 counts and Weisselberg with 15 counts, including conspiracy, grand larceny, a scheme to defraud, and falsifying business records.
Weisselberg, the Trump Organization and the Trump Payroll Corporation all pleaded not guilty to the charges. New York Attorney General Letitia James spoke to the press on Thursday after the charges were announced, saying that “Today is an important marker in the ongoing criminal investigation of the Trump Organization and its CFO, Allen Weisselberg. In the indictment, we allege, among other things, financial wrongdoing whereby the Trump Organization engaged in a scheme with Mr. Weisselberg to avoid paying taxes on certain compensation. This investigation will continue, and we will follow the facts and the law wherever they may lead.”
Trump Organization had been running tax scheme since 2005
The Trump Organization and its senior executives had been running this tax scheme since 2005, over 15 years ago. Trump himself has not been charged, but there is indication that he was aware of aspects of the scheme and lent his authority to its maneuvers, as his signature is present on many checks that are being used as evidence in the case.
This is the first charge against the Trump Organization and its associates.
The indictment states that the company paid for nearly all of Weisselberg’s living expenses, including his New York City apartment. The company kept internal records to track its spending on Weisselberg’s life, and took the amount it was paying towards his lifestyle out of the direct compensation he received as an executive. The company did not take income tax out of the money it was spending towards Weisselberg’s expenses. The company had been paying for Weisselberg’s apartment since 2005, and Weisselberg did not state he was a New York City resident on his taxes until 2013, when he sold his house in upstate New York, thus avoiding city income tax.
Prosecutors found that Weisselberg has received roughly $1.7 million dollars in indirect income for the past 16 years from the company.
The indictment claims that Weisselberg was assisted in the scheme by an unnammed, unindicted co-conspirator: “the named defendants and others, including Unindicted Co-conspirator #1, agreed to and implemented a compensation scheme with the object of enabling Weisselberg to underreport his income to federal authorities, and thereby evade taxes and falsely claim federal tax refunds to which he was not entitled.”