NEW YORK: Donald Trump’s family company is set to face a criminal trial on tax fraud charges in New York starting next week that could trigger fines and further complicate the real estate firm’s ability to do business as the former US president’s legal woes mount.
The Manhattan district attorney’s office in July 2021 charged the Trump Organisation and its then-chief financial officer Allen Weisselberg with defrauding tax authorities by awarding “off the books” benefits to company executives since 2005, allowing certain employees to understate their taxable compensation and enabling the company to evade payroll taxes.
Weisselberg, who has worked for Trump for half a century, pleaded guilty in August to charges that he concealed $1.76 million in income. His plea agreement requires him to testify at the trial against the Trump Organisation, which operates hotels, golf courses and other real estate around the world. Jury selection is scheduled to begin on Monday in Manhattan state court.
Trump has not been charged in the case. But the trial of his namesake company now run by two of his adult children — Donald Trump Jr. and Eric Trump — comes as the Republican former president considers running again in 2024. Trump faces other investigations by federal and state prosecutors including ones into attempts to overturn his 2020 election loss and the removal of government documents from the White House when he left office.
The Trump Organisation could face up to $1.6 million in fines for the three tax fraud counts and six other counts that were brought. Two of its subsidiaries — the Trump Corporation and Trump Payroll Corp — are the entities charged in the case.
Lawyers for the Trump Organisation have claimed the case is a “selective prosecution” based on animosity by the prosecution toward Trump for his political views, though the judge overseeing it has rejected that argument. Manhattan District Attorney Alvin Bragg and his predecessor who began the investigation, Cyrus Vance, are Democrats.
The company’s lawyers also said prosecutors presented no evidence to the grand jury that returned the indictment that the Trump Organisation evaded payroll taxes. They also said that prosecutors were seeking to punish the company because “a handful of its officers allegedly failed to report fringe benefits on their personal tax returns.”
The fact that the Trump Organisation kept making off-the-books payments for so many years could help prosecutors show it intended to violate tax laws, a key element of proving its guilt to the jury, said Bridget Crawford, a law professor at Pace University in New York focusing on income tax and corporations.
“Failure to report once might be a mistake. Failure to report over a period of time is fraud,” Crawford added. “If you know of your tax obligations — which all experienced and savvy people do — and consciously disregard them, that is intent to defraud the government.”
Published in Dawn, October 21st, 2022
