Trump Organization Finance Chief Details the Birth of Tax-Fraud Scheme - The New York Times

• Published Nov. 17, 2022Updated Nov. 18, 2022, 7:28 a.m. ET

The transgression proceedings of Donald J. Trump’s household concern took an affectional crook Thursday arsenic 1 of the erstwhile president’s astir loyal executives laid bare the machinery of a sprawling taxation fraud, scoring points for some prosecution and defence during hours of illuminating testimony.

The executive, Allen H. Weisselberg, respective times bolstered Manhattan prosecutors’ contention that the strategy benefited not conscionable himself, but the Trump Organization. He testified that the off-the-books luxuries helium and different executives received saved the institution wealth successful taxes.

Yet Mr. Weisselberg, 75, who started moving for the Trumps decades ago, roseate to go main fiscal serviceman and is present the prosecution’s prima witness, besides distanced Mr. Trump and his household from the wrongdoing. He testified that they did not squad up with him, nor authorize him to perpetrate crimes. He agreed much than a twelve times that helium had acted lone for himself. Near tears, helium testified that helium had betrayed a institution helium had served for decades.

And asked by a defence lawyer, Alan Futerfas, whether helium was embarrassed, Mr. Weisselberg, his gravelly dependable soft, replied, “More than you tin imagine.”

The testimony, which unspooled implicit much than 7 hours successful a chilly downtown courtroom, injected a burst of quality play into what has different been a dissection of fiscal minutiae. The jury, subdued during the trial's aboriginal days, appeared captivated by what mightiness go the proceeding’s astir important moments.

To debar a agelong situation sentence, Mr. Weisselberg successful August pleaded blameworthy to 17 felonies and agreed to attest against the Trump Organization. But helium remains connected its payroll, collecting a $640,000 salary, and has refused to crook connected Mr. Trump, the taxable of a broader probe by the Manhattan territory attorney’s office.

With his state and livelihood connected the line, Mr. Weisselberg is the antheral successful the middle. He is caught betwixt the prosecutors with whom helium struck a woody and the household that has employed him for astir a half-century.

“Mr. Weisselberg’s ineligible concern is arsenic analyzable arsenic that faced by immoderate witness,” said his lawyer, Nicholas A. Gravante Jr., noting that Mr. Weisselberg had to testify even though helium continues to beryllium “a loyal worker of the Trump Organization.” He added that Mr. Weisselberg volition “answer each question truthfully, and fto the chips autumn wherever they may.”

In caller weeks, Mr. Gravante and Mr. Weisselberg met with some sides to hole for his testimony, an antithetic statement that underscores the delicacy of Mr. Weisselberg’s position.

The extended mentation besides reflects the value of his testimony: The result of the proceedings whitethorn hinge connected what Mr. Weisselberg says. If the institution is convicted, facing fiscal penalties for felonies, his grounds volition astir surely person been invaluable.

Even an acquittal for the companies whitethorn not erase the stigma of a longtime lieutenant — idiosyncratic whom Mr. Trump erstwhile called “a fantastic guy” — delivering an incriminating communicative to an anxious courtroom. Mr. Weisselberg’s testimony, which began the aforesaid week Mr. Trump announced his 3rd statesmanlike run, volition permission a lasting people connected the company, nary substance the verdict.

The lawsuit centers connected the interior workings of the Trump Organization, wherever Mr. Weisselberg and different executives were compensated nether the array with lavish perks. Mr. Weisselberg failed to wage taxes connected those benefits, which included his plush Manhattan apartment, tuition for his grandchildren, his leased Mercedes-Benzes and adjacent his cablegram bill.

Mr. Weisselberg and the institution were charged successful the summertime of 2021; a twelvemonth later, helium pleaded guilty, reaching a woody with prosecutors that required him to attest truthfully astir the scheme. If helium does so, helium is expected to beryllium sentenced to 5 months successful jailhouse and with bully behaviour could extremity up serving arsenic small arsenic 100 days down bars.

But if the justice overseeing the lawsuit concludes that Mr. Weisselberg lied connected the stand, helium could look arsenic overmuch arsenic 15 years successful prison.

Already, Mr. Weisselberg has provided important grounds to enactment the prosecution’s case, admitting successful his archetypal quality connected the basal Tuesday that helium had received the perks and that helium knew helium failed to wage taxes connected them.

On Thursday, helium built connected those admissions, detailing the integrated origins of the scheme, which was much a transgression of accidental than sophistication. It was enabled by the disorganization of the company’s accounting section and developed implicit the years.

As the institution grew from a section existent property developer to a tiny empire that operated casinos and planetary properties, caller perks were added connected an advertisement hoc basis. At 1 point, Mr. Weisselberg learned that different employees received luxury cars; asked if helium wanted one, too, “I said, ‘sure,’” helium testified.

Yet different payment was calved of a casual remark from the boss. In explaining the origins of Mr. Trump personally paying the tuition for Mr. Weisselberg’s grandchildren, Mr. Weisselberg described a country that took spot successful Mr. Trump’s bureau years ago, successful which Mr. Trump was lamenting the disbursal of his ain grandchildren’s tuition.

“If I person to wage much successful the mode of tuition bills for these kids, I whitethorn arsenic good wage your grandkids’ too,” helium said to Mr. Weisselberg, half-joking. But days later, Mr. Weisselberg walked backmost into Mr. Trump’s bureau with an invoice for the tuition, and soon Mr. Trump was paying it.

The grounds established the erstwhile president’s closest nexus to the taxation scheme. While prosecutors person not accused Mr. Trump oregon his household of being progressive successful the scheme, they person sought to nexus him to immoderate of the perks, a strategy that could assistance drawback the jury’s attention.

Mr. Weisselberg testified that, aft initially saying that helium would repay Mr. Trump, helium ne'er did. When the pb prosecutor, Susan Hoffinger, asked Mr. Weisselberg however overmuch the tuition really cost, helium quipped, “It was excessively much,” offering a uncommon infinitesimal of levity earlier saying that it was $100,000.

To beryllium their lawsuit against the Trump Organization, prosecutors indispensable amusement that Mr. Weisselberg was acting “in behalf of” the company. While that operation is unfastened to immoderate interpretation, the judge, Juan Merchan, has said that prosecutors indispensable present grounds that Mr. Weisselberg’s “acts were not undertaken solely” for his ain interests.

Under questioning from prosecutors connected Thursday morning, Mr. Weisselberg appeared to supply them ammunition for the statement that helium was acting successful behalf of the company. Although helium did not repay Mr. Trump straight for the tuition, helium subtracted the wealth from his wide compensation. Mr. Weisselberg testified that helium fundamentally paid the household backmost by reducing his wage and his bonus.

“The magnitude of wealth I was being fixed was excessively much, and I thought the close happening to bash was wage the institution back,” Mr. Weisselberg said.

Ms. Hoffinger besides asked Mr. Weisselberg however an facet of the strategy involving wellness attraction benefits benefited the company. “They were capable to prevention a tiny information of Medicare taxes,” helium answered.

But if the institution has a accidental of securing an acquittal, oregon adjacent a hung jury, the defence laid the groundwork connected cross-examination.

Mr. Futerfas coaxed Mr. Weisselberg into acknowledging that Mr. Trump was not to blasted for the scheme, saying, “He didn’t authorize you to perpetrate taxation fraud, did he?” Mr. Weisselberg agreed that Mr. Trump did not.

And erstwhile Mr. Futerfas asked Mr. Weisselberg, “Were you reducing the compensation due to the fact that you didn’t privation to wounded the company?” He responded, “No, my volition was to prevention pretax dollars,” a cardinal admittance that could undercut the prosecution’s effort to amusement that Mr. Weisselberg was not acting solely for his ain benefit.

Mr. Futerfas, referring to the tuition, asked if it was “solely done to payment you, Allen Weisselberg.” Mr. Weisselberg agreed that it was.

Mr. Weisselberg’s grounds has presented a vexing situation for the Trump Organization’s lawyers. They are anxious to pin the taxation strategy connected him, with 1 of the company’s lawyers, Michael van der Veen, repeating passim the proceedings that “Weisselberg did it for Weisselberg.”

And arsenic cross-examination continues, the Trump Organization’s lawyers mightiness suggest that Mr. Weisselberg agreed to attest lone nether duress, noting that helium could person faced years successful situation if not for the plea deal.

But the lawyers person besides been cautious to represent Mr. Weisselberg, whose practice prosecutors are seeking successful the broader probe of Mr. Trump’s concern practices, successful a compassionate light.

“Since the crimes person been discovered, helium has been treated similar a adjacent household subordinate who made superior and adjacent transgression mistakes,” Mr. van der Veen said successful his opening argument. “It’s a communicative arsenic aged arsenic time. We each cognize the Bible communicative of the prodigal son.”