Forensic News

Forensic News Roundup: Trump Org CFO under pressure to flip on Trump

Welcome to a special edition of Forensic News Roundup, focusing on the investigations and businesses of the former president.


Trump investigations

The Manhattan District Attorney’s office is scrutinizing the Trump Organization’s longtime chief financial officer, Allen Weisselberg, potentially indicating a strategy to pressure him into flipping on the Trump family. Investigators have reportedly questioned witnesses about Weisselberg’s two adult sons, one of whom works for the Trump Organization; the other works for a company that has extended over $270 million of loans to the Trump business.

In this case, prosecutors have scrutinized Weisselberg’s work in helping to assess the value of Trump buildings as the company sought to obtain loans or property-tax reductions, people familiar with the investigation said. They have also asked about a Trump-owned luxury apartment where Weisselberg’s son Barry lived for several years…if Barry Weisselberg, who manages Trump’s ice skating rinks, got the apartment rent-free, that might be considered a fringe benefit of his job and subject to income tax. (WaPo)

The Manhattan DA’s office is also examining Trump properties outside of the state, including the finances behind the Chicago Trump Tower. Late last year, prosecutors subpoenaed Fortress Investment Management for information on a $130 million loan the company made to the Trump Organization to construct the building; Fortress forgave more than $100 million of the loan – which amounted to about $150 million with interest and fees – by 2012. Investigators want to know if “Trump and the Trump Organization recorded the loan forgiveness as income, as required by the Internal Revenue Service, and paid the appropriate taxes,” according to CNN.

The loans behind Trump’s Chicago tower have been the source of much confusion among outside experts. Mother Jones reported:

Trump claims he bought a debt related to his Chicago venture, but neither of the two loans associated with this property appear to have been purchased. The Deutsche Bank loan was refinanced. The Fortress debt, according to sources with knowledge of the transaction, was canceled. And this raises a question: Did Trump create a bogus loan to evade a whopping tax bill on about $48 million of income?

A separate inquiry led by D.C Attorney General Karl Racine has now deposed two of Trump’s adult children, including most recently Don Jr. on February 11. Racine’s office filed a lawsuit last year alleging Trump’s 2017 inaugural committee abused nonprofit funds “to enrich the Trump family.” Don Jr. was asked specifically about a contract the Trump Organization signed with the Loews Madison hotel for roughly $50,000 for a block of rooms during the 2017 inauguration. The invoice was later forwarded to the Presidential Inaugural Committee, which then paid the bill.

Racine’s office says that three of the 10 witnesses deposed so far have given “inconsistent accounts about the purpose of the contract” on the Loews Madison invoice.

…the District has been met with repeated obstacles, including misleading testimony, a closed hotel, and new information revealed after the deadline for issuing discovery requests passed…

Donald Trump, Jr.’s testimony at his February 11, 2021 deposition raised further questions about the nature of the Loews Madison invoice and revealed evidence that Defendants had not yet produced to the District…When asked about the names associated with the rooms and the invoice, Mr. Trump was unable to testify if any of them donated to the [committee]. Instead, the names were associated with the campaign or with the Trump family.

The Fulton County District Attorney’s investigation into Trump’s election interference is picking up steam, with a grand jury reportedly seated last week. D.A. Fani Willis is conducting a criminal probe into the former president’s attempts to overturn his election loss in the state, which included a Jan. 2 phone call pressuring Secretary of State Brad Raffensperger to help him “find” the votes he needed to win Georgia.

A person familiar with the investigation said they are likely to rely heavily on subpoenas rather than voluntary requests for records and interviews, in part to establish a clear court record of their pursuit of evidence.

Willis has indicated she’s investigating several state crimes, including conspiracy, solicitation of election fraud, racketeering, and making false statements to state and local governmental bodies. Last week, we learned that her office hired an outside lawyer who is a national authority on racketeering. This avenue, if pursued, would require prosecutors to show numerous criminal acts took place to achieve the same goal – overturning the election results.

“It’s not a stretch to see where she’s taking this,” said Cathy Cox, the dean of Mercer University’s law school in Macon, Georgia and a former Georgia secretary of state. “If Donald Trump engaged in two or more acts that involve false statements – that were made knowingly and willfully in an attempt to falsify material fact, like the election results – then you can piece together a violation of the racketeering act.”

Yet another recording of yet another phone call Trump made to a Georgia official seeking to overturn the election surfaced yesterday. Days before calling Secretary of State Raffensperger, Trump called the chief investigator at Raffensperger’s office, Francis Watson, telling her repeatedly that he won Georgia but “something bad happened” and she needed to focus on Fulton County to find “the dishonesty.”

Trump told Watson that if he wasn’t declared the winner in Georgia, the two Republicans who were up for a run-off the next month were likely to lose their seats in the U.S. Senate. “When the right answer comes out, you’ll be praised,” Trump told Watson, while claiming that she had the “most important job in the country right now.”

The House Oversight Committee issued a new subpoena to Trump’s accounting firm, Mazars USA, seeking seven years of the former president’s financial data – hours after the Supreme Court struck down Trump’s challenge of a similar subpoena issued by D.A. Vance. With Trump no longer in office, the separation of powers issue is not in play, perhaps simplifying the process that has already stretched for more than 22 months. D.C. District Court Judge Amit Mehta – who has previously ruled in favor of Congress – will oversee the case. It is likely to take a slow pace, however, as both sides have agreed to a schedule setting oral arguments this summer.


Trump money

Former president Trump sent cease-and-desist letters to at least three GOP committees demanding they stop using his name and likeness for fundraising. The letters were directed to the Republican National Committee (RNC), National Republican Senatorial Committee (NRSC), and the National Republican Congressional Committee (NRCC) – the latter two are leading Republican efforts to retake Congress next year. According to Politico, Trump is “furious” that these committees are benefiting lawmakers who voted to impeach him.

On Monday, the RNC refused to stop using Trump’s name to fundraise, saying that the Republican party “has every right to refer to public figures as it engages in core, First Amendment-protected political speech, and it will continue to do so in pursuit of these common goals.”

Trump kickstarted his fundraising machine following his CPAC address, moving into the territory already occupied by national Republican committees and worrying some that he’ll take a big chunk of their donations. The former president ended his Conservative Political Action Conference speech with a plea for small-dollar donors, saying: “There’s only one way to contribute to our efforts, to elect ‘America first’ Republican conservatives. And in turn, to make America great again. And that’s through Save America PAC and Donald J Trump dot com.” (clip)

One Trump adviser said that single request resulted in “millions of dollars” coming into Trump’s new political committee and predicted it would eat into the Republican National Committee’s efforts to raise money from those donors. “It’ll kill it,” the adviser said on condition of anonymity. “They’re not going to have a small-donor program anymore.”

His televised plea was accompanied by emails and texts urging fans to “donate” to “SAVE AMERICA!” Days later, Trump released a more explicitly anti-GOP statement, declaring: “No more money for RINOS… Send your donation to Save America PAC at DonaldJTrump.com.” The money is going into his newly-formed PAC and joint fundraising committee, with fewer restrictions on donation amounts and more freedom to use the funds for personal interests (like fighting lawsuits).

“Trump has stockpiled tens of millions of dollars for his leadership PAC that he can use to maintain his political influence,” Fischer said. “It is notable that Trump’s recent public statements threatening to throw his weight behind primary challengers were released on Save America letterhead: Trump has the resources to back up those threats with millions of dollars.”

The RNC moved one night of its spring donor retreat to Mar-a-Lago for a dinner speech headlined by former president Trump. According to the Washington Post, “[t]he national party will sign a contract with Mar-a-Lago to host the event and will be paying Trump’s club for the use of the facilities and the meal”. At least 350 people may attend Trump’s speech.

An analysis by Open Secrets shines light on a big reason for the Republican party’s continued devotion to Trump: Republican state committees are exploiting a loophole to funnel massive amounts of money from Trump’s campaign to the RNC. GOP state committees raised $478 million in the 2020 cycle with the assistance of huge transfers from Trump and the RNC. States without competitive elections sent Trump’s money right back to the RNC, “effectively allowing six-figure donors to bypass contribution limits.”

State parties and the national party may transfer unlimited amounts of money between their accounts. These rules, coupled with joint fundraising committees, allow a single donor to effectively contribute hundreds of thousands of dollars more to the national party than they are allowed to under current contribution limits… The party transfer loophole didn’t exist until the 2014 McCutcheon v. FEC Supreme Court decision, which shot down limits on how much an individual donor can give to candidates, PACs and parties in a single cycle. Conservative justices were skeptical of warnings that removing the aggregate limit would effectively kneecap contribution limits.

Don Jr. and Eric Trump are trying to sell a beachfront home in Florida for $49 million after buying it from their aunt in 2018 for only $18 million. The property is right next to Trump’s Mar-a-Lago club in Palm Beach. It’s possible the family is selling the house in an effort to come up with a portion of the $1 billion they owe in debt.

Documents newly released by the Secret Service show that the Trump Organization began raking in money almost immediately after he started his term by charging agents for rooms on Trump properties. During the former president’s first stay at his Bedminster resort, his company charged the Secret Service $5,343 for four nights at a cottage near Trump. Then, the Trump Organization began charging taxpayers $566.64 every night of the week to have the cottage on hold, in case Trump should visit, leading to over $392,000 for one cottage over his presidency.

Further reading:


Trump era investigations

Manhattan D.A. Cyrus Vance is advancing the investigation into Steve Bannon’s “We Build the Wall” funding, having recently subpoenaed related financial records from Wells Fargo and GoFundMe. Before leaving office, former President Trump pardoned Bannon to protect him from federal conspiracy to commit wire fraud and conspiracy to commit money laundering charges. Because Bannon was never convicted of the federal crimes, he can be prosecuted for similar state-level charges (unlike Paul Manafort, who was convicted and, thus, could not be prosecuted at the state-level).

The FBI is reportedly investigating the pro-Trump group that conducted cash giveaways in black communities in 2019 after reporting revealed foreign ties and IRS violations. The now-defunct Urban Revitalization Coalition, run by Cleveland-area pastor Kareem Lanier and former Trump campaign official Darrell Scott, lost its tax-exempt charity in August after failing to file the required forms for three years in a row. The two founders allegedly solicited donations from foreign nationals while at the same time lobbying the Trump administration for policies that would benefit said foreigners.

The Transportation Department Inspector General released a report identifying several areas where former Secretary Elaine Chao misused the power of her office for personal gain. Among other violations of federal ethics laws, Chao – wife to Mitch McConnell – used department resources to benefit her family’s shipping business, directed staff to assist her father in marketing his personal biography, and used Transportation staff for personal errands. The IG referred the case to the Justice Department for prosecution, but both the U.S. Attorney’s Office in DC and the Public Integrity Section declined to open an investigation.

Two whistleblowers have accused former Justice Department official Jeffrey Clark, acting head of the Civil Division, of corrupting the hiring process to elevate a Trump loyalist in the administration’s final days. According to a letter sent to Congress and the DOJ IG, Clark “abused his authority by injecting himself into the career staff promotion process” to hire “the one and only candidate who volunteered to defend one of the Trump administration’s most controversial policies” (that was later deemed unconstitutional by a federal judge).

Further reading:

Trump Ally Erik Prince Supplied Arms, Mercenaries For Planned Libya Coup: Report

Inspector General Reviews Trump Admin’s Last-Minute Decision To Relocate Space Command

The Trump administration quietly spent billions in hospital funds on Operation Warp Speed

Trump Appointee At VOA Parent Paid Law Firm Millions To Investigate His Own Staff

Trump Administration Referred A Record Number Of Leaks For Criminal Investigation

Former President Donald Trump requested a mail-in ballot ahead of a local municipal election in Florida, according to Palm Beach County records, despite his frequent attacks on voting by mail.

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