Drive for Show, Putt for Dough: Trump’s Accountant’s Putting Method Revealed [UPDATE-3]

[NB: Check the byline, thanks. This is a work in progress, subject to updates which will be added at the bottom of this post. /~Rayne]

Trump’s numbers guy, Allen Weisselberg, was indicted yesterday. The indictment was unsealed today and it’s revealing — not because there’s any big surprise but because the fifteen counts with which Weisselberg is charged point to the next hole(s) on this course to be played.

You can read the indictment here (thanks to Adam Klasfeld at Law & Crime News).

There are a lot of folks complaining this is puny stuff, whining that the Trump Organization and its CFO Weisselberg are getting away with a lot. Au contraire, mes amis, it’s too soon for such complaints.

Just Security’s Ryan Goodman notes right off the BIG FAT RED BLINKING LIGHTS embedded in the indictment which point to potential federal charges in the offing:

Sure would like to know how those IRS audits are coming along, hmm?

Here’s the thing: Trump, like his father before him, didn’t do something just once. If it worked — and it always has, never resulting in a criminal prosecution until now — Trump did it again. And again. What we see in this indictment is what will be found for every single business under the Trump Organization umbrella.

I will bet good money there will be other individuals who domiciled in New York whose compensation including living expenses were reported fraudulently to city, state, and federal authorities. The implication is right there in the repeated use of the word “defendants,” references to “Unindicted Co-conspirator #1,” and the conspiracy.

Which of the Trump kindred lived in New York and were also employed by a Trump Organization entity? Does this include ex-wives and their children while they lived at home?

As I noted above, this post is subject to updates; I am only through page 12 of the indictment so far. I’ll share a couple disjointed observations here.

— Jesus Christ, they kept goddamned spreadsheets documenting their criming. I feel like I’m watching The Untouchables with Elliott Ness wielding Capone’s bookkeeper’s black book.

— Trump Org paid tuition for Weisselberg’s family members (which was unreported compensation). This smells hinky; I wondered at first if an actual education facility received payment, but it’s likely. And yet this points to another possibility, that “tuition payments” may appear in the Trump Org’s books and not actually have been tuition payments.

— This is just the State of New York; where else did Weisselberg work for Trump beside NYS? Are there other states where Trump Org employees have failed to report their income? We know Florida doesn’t have personal income tax and can’t expect to see similar charges based on income tax evasion. But what about California, New Jersey, North Carolina, Pennsylvania, Washington D.C. where other Trump Org golf courses and resorts are located?

I have to say I’m surprised that Weisselberg never moved as much of the Trump Org’s business as possible to Florida because of the lack of personal income tax. There must be some other reason behind retaining a (unreported) domicile in New York instead of “moving” to Florida or any of the other six eight states which don’t have personal income tax.

Ditto the use of an entity, Trump Payroll Corp. — was this created as another opportunity to skim cash off payroll?

— The indictment spells out a period, “during the period from on or about March 31, 2005, to on or about June 30, 2021” in which the offenses occurred. This is only months after Trump’s tenure on NBC’s The Apprentice began. Is there a correlation between offenses delineated in this indictment and the reality TV series?

Is there something in any of the records related to The Apprentice which is an MGM property, and now possibly owned by Jeff Bezos’ Amazon? ~dark laugh~

I hope you stocked up on popcorn because this is going to be entertaining. We haven’t even gotten to property tax and insurance fraud suggested by Michael Cohen’s appearance before the House Oversight Committee when he testified that Trump understated asset values.

UPDATE-1 — 11:00 AM ET 02-JUL-2021 —

Before I continue I have a couple of asks, thanks for any help you can offer:

— Does anyone have access to Dun & Bradstreet? If you do can you pull up a copy of the profile on Trump Organization? I’ve not pulled a D&B in a while, not certain if it will have history of the enterprise available, but it would be VERY helpful at this point to known who the “executives” were at Trump Org according to D&B. These are likely the same individuals legitimate lending organizations understand to be the policy and decision makers for the holding company structure.

— Does anyone have a copy of proceedings mentioned last night on Maddow? (Shut it, bmaz, we know how you feel about that show.) There was a key nugget in an excerpt last night and I can’t find it because MSNBC no longer uploads their evening programs in full. It may have been a transcript related to the grand jury but I couldn’t give it my full attention at the time; it was important enough that it caught my ear, though. What caught my ear was a throwaway remark that Weisselberg had other sources of income besides Trump Org. [See UPDATE-3 below.]

By now you’ve seen Marcy’s post this morning about Weisselberg’s stagnant income requiring tax evasion. My personal suspicion is that any changes to income levels were being hidden out of sight of local, state, and federal regulators as well as banks just about the point when Trump was beginning to think seriously about a run for POTUS, Trump Org was beginning to experience liquidity problems, AND they were pursuing what I might call euphemistically “alternative financing.” Trump Org purchased 4-5 golf courses in the period 2010-2011 (I need to confirm this number and which courses) which may have required filing of documents related to operating expenses for loans. Weisselberg’s income could have been suppressed on the Trump Org’s books but augmented by income not formally reported as Trump Org payroll.

Which brings me to another observation: the indictment mentions an unindicted co-conspirator. It’s not Trump because in the section Overt Acts under item 2 the indictment reads,

2) On or before April 5, 2010, the Trump Corporation, acting through its agent, Unindicted Coconspirator #1, underreported Allen Weisselberg’s taxable income for the tax year 2009.

The term agent makes it likely it’s Mazars, the accounting firm which did the bookkeeping for Trump Org.

What’s interesting to me looking at the timeline of events: Mazars, an international firm, acquired Weiser, an accounting firm in northeast U.S., in early 2010. It may be something, it may be nothing, but the acquisition happened ahead of the stagnation in Weisselberg’s income. Of course the acquisition didn’t change a history of sketchy financial reporting by Trump Org’s previous accountants, Weiser, and Spahr, Lacher & Berk before Weiser.

The term “executives” — plural — appears throughout the indictment nine times, hence my ask for the D&B profile. D&B’s freebie profile indicates the current executives are:

Eric Trump, Chief Executive Officer
Donald J. Trump Junior, Director
Ivanka Trump, Executive Vice President
A Aamiyahh, Accountant

I wonder if Aamiyahh also qualifies as controller, which may be relevant if more decision making power comes with that title. We don’t know the history of Trump Org’s executives that I’m aware of prior to Trump’s election. Were there any other persons who may also be under scrutiny as one of the “executives,” plural?

As I understand it, the indictment’s first count of grand larceny is based on theft of tax dollars owed not one victim but two — New York State and the IRS. The charge is not in lieu of a federal charge of tax fraud, though.

The multiple counts of falsifying business records have likely set any legitimate financing entities holding Trump Org debt scurrying to check documents on which they predicated lending decisions. One might imagine a liquidity crisis at Trump Org if loans are called in.

Last bit which has been niggling at me which the New York State investigation likely couldn’t encompass: what the hell was the ~$50 million “springing loan” related to Trump’s Chicago Unit Acquisition LLC? How does it fit into the Trump Org’s financial ecosystem?

I’m sure there will be plenty more to come, it’s just a matter of time.

UPDATE-2 — 11:30 AM ET 02-JUL-2021 —

Just had two three thoughts:

— Trump’s revocable trust which was last modified on February 10, 2017 after he assumed office as president doesn’t specify how the trust is revoked. The simplicity and spareness of the document is a massive loophole of sorts; at any given time Trump could give a verbal order and the trust could have been revoked and/or restored; the inclusion of an “ethics advisor” (ha!) is a mere gesture without any real brake on transactions. The two named trustees, Donnie Jr. and Weisselberg, also provide zero checks on this trust given their weaknesses. Ditto Eric Trump’s role as Chairman of the Advisory Board of the Trust; we don’t even know who that board is (could be just Eric).

In short, the trust is like the $50 million “springing loan,” the exact terms of which are unknown to the public. Is it possible the revocable trust and the springing loan are mirror images of each other, an asset in the trust and a debt in the loan, canceling each other out to avoid/evade taxes?

— The word “employees” plural appears 19 times in the indictment of Weisselberg, of which only one use is “executives and employees.” There are some employees who are not executives who must be very itchy right now, besides Weisselberg’s son Barry, the manager of the all-cash operation Wollman Rink.

— If I were a naïve and legitimate paid member of Trump Golf Courses, I’d be panicking. What happens to the tens of thousands of dollars, even hundreds of thousands of dollars paid to become a member (not to be confused with dues or fees related to monthly/annual consumption of services) should the entire Trump holding company structure go bankrupt?

UPDATE-3 — 10:50 PM ET 02-JUL-2021 —

Community member Justlp provided a link to the full transcript for last night’s Maddow show. It contains the snippet I heard which I couldn’t pick apart at the time.

Looking at the transcript I didn’t hear exactly what I thought I heard, but it does raise questions:

The prosecutor says to the judge: While these charges are eligible for bail, we believe there is a flight risk associated with this defendant. So surrender of the passport is necessary to reasonably assure his return to court. This defendant has been and apparently will remain the CFO of a company with international tentacles, and the evidence on this would demonstrate an ample record of travel by private jet and defendant has significant means and connections to support himself outside the jurisdiction, including in places beyond our powers of extradition.

The surrender of the passport is the least restrictive alternative condition that would reasonably assure defendant`s return to court. It`s our understanding that defendant Weisselberg consents to this condition and is prepared to surrender the passport to our investigators.

Emphasis mine — it was this bit in the transcript from the indictment hearing which caught my attention. It wasn’t that he had other income streams but assets and a network outside New York State and the U.S. such that prosecutors think he’s a flight risk.

Was Weisselberg paid enough during his tenure in spite of what reported expenses he had residing in New York, or are we supposed to believe he’s a talented asset manager after hours?

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110 replies
    • earlofhuntingdon says:

      Per your series of earlier threads, I’d especially like to hear about the books for the offshore golf courses, especially the ones in Scotland and Ireland. Trump, like many real estate moguls, has no history of being flush with cash, but he poured cash into those. It came from somewhere.

      • Rugger9 says:

        This indictment might spur the Scottish Parliament to get on the Unexplained Wealth Order investigation that the Greens have been pushing for for a while now, for exactly the reason you mentioned. For a guy to be a self-proclaimed “king of debt” the pivot to cash-only transactions (plus huge reported losses) makes me wondering if someone is laundering something.

    • Richard Kohal says:

      “If I had my way, any man guilty of golf would be ineligible for any public office of trust in the United States.”
      H. L. Mencken

      • Wajim says:

        “Golf? God, no. Hate the game. Hate the people who play it even more”

        —Dave Foley, Kids in the Hall, Season 3, #4, 1991

      • Rayne says:

        Ah, I missed the one in Indonesia. I will have to check that one out, stat. Thanks much!

        ADDER: Heh. I see these three courses are still in development, which can mean all manner of things. I know the Dubai course was supposed to be a licensing arrangement, not ownership; uncertain whether the Indonesian courses are similar.

        Trump World Dubai, Dubai
        Trump International Resort & Golf Club, Lido City, Indonesia
        Trump International Resort & Golf Club Bali, Bali, Indonesia

        And I’m not even asking about the other Trump real estate developments. Just the golf courses which I think are more likely to rake in undocumented cash.

      • Rayne says:

        Thank you, thank you, that’s an enormous help. I didn’t hear exactly what I thought I heard, but it does raise questions:

        The prosecutor says to the judge: While these charges are eligible for bail, we believe there is a flight risk associated with this defendant. So surrender of the passport is necessary to reasonably assure his return to court. This defendant has been and apparently will remain the CFO of a company with international tentacles, and the evidence on this would demonstrate an ample record of travel by private jet and defendant has significant means and connections to support himself outside the jurisdiction, including in places beyond our powers of extradition.

        The surrender of the passport is the least restrictive alternative condition that would reasonably assure defendant`s return to court. It`s our understanding that defendant Weisselberg consents to this condition and is prepared to surrender the passport to our investigators.

        It was this bit in the transcript from the indictment hearing. It wasn’t that he had other income streams but assets and a network outside New York State and the U.S. such that prosecutors think he’s a flight risk.

        Was Weisselberg paid enough during his tenure in spite of what reported expenses he had residing in New York, or are we supposed to believe he’s a talented asset manager after hours?

        Thanks again — I’m going to add this as an update to the post.

        • bmaz says:

          Meh, seizing Weisselberg’s passport and giving him OR is fine. These are not huge crimes in the least. Even if he went to trial and lost on all, he would still be probation eligible. People lose track of the concept of presumption of innocence and presumption of pre-trial release as a right, not something to be dangled because a particular defendant is unpopular. This is fine.

          There are people that need to be remanded without bail, Weisselberg is not one of them. Even if there was a bail amount set, then what? What was done was fine.

          • Rayne says:

            It wasn’t the passport seizure that caught my attention; it was the assumption he had plenty of resources *outside the reach of NYS and federal law enforcement*.

            • bmaz says:

              Oh the passport taking was not really attention grabbing, is actually quite standard. But I see no reason OR was not appropriate, he is not going anywhere.

  1. Alan says:

    I think there was something in the indictment about some of the checks used to pay Weisselberg being drawn on Trump’s personal bank account and signed by Trump. Not sure what more connections need to be made to indict Trump…

    • Rayne says:

      That was related to the tuition:

      Beginning in 2012, one of Weisselberg’s family members began attending a private school in Manhattan. Beginning in 2014, second Weisselberg family member began attending the same private school. From 2012 through 2017, and as part of the scheme to defraud, Trump Corporation personnel, including Weisselberg, arranged for tuition expenses for Weisselberg’s family members to be paid by personal checks drawn on the account of and signed by Donald J. Trump, and later drawn on the account of the Donald J. Trump Revocable Trust dated April 7, 2014.

      Emphasis mine.

      • earlofhuntingdon says:

        That suggests that any number of paying agents might exist between the alleged beneficiary of the gift/compensation and the party bearing its cost. Presumably, the latter party needed a tax deduction; but it might not have had the requisite personal or business relationship with the beneficiary. That normally means it’s another pass through, or has a non-deductible expense.

        It has been a truism for decades that Trump uses his entire organization as his personal piggy bank. It seems unlikely that Trump stopped using that model just because he started moonlighting as president. So, yea, WTF is happening with that IRS audit?

  2. earlofhuntingdon says:

    If I remember correctly, the Trump Org has 500 plus subsidiary and affiliated companies, partnerships, and what have you. Perusing their books will keep forensic accountants busy, not to mention a few lawyers, attempting to verify that any of them have adequately maintained their corporate records and, hence, their legal existence.

    If the records are inadequate to maintain corporate existence – or if Trump’s decision-making ignored their existence – the subsidiaries would legally collapse. Their actions would then be deemed to be the actions of their parent organization(s). That would require restating the parents’ financial statements, which might affect its tax position. (All without considering the legality of any transaction.) Ultimately, that might involve many subsidiaries, given that the investigation into Trump’s family foundation – run by the same folks – indicated no records were maintained for years on end. Plus, Trump’s accountants are on record saying they did not perform “audits,” but accepted the numbers Weisselberg gave them at face value. That’s its own can of worms.

    Excuse me while I run out for more popcorn – and something cool to go with it. There’s a long weekend coming up.

  3. P J Evans says:

    They really weren’t very good at this, were they? Shouldn’t this stuff have been noticed like 10 or 15 years ago?

    • earlofhuntingdon says:

      Defunding the IRS and its having to live with Republican appointees has had the intended effect of gutting IRS enforcement.

      • P J Evans says:

        Even at the state level – they should have noticed sooner. And not been bought by skeevy “donations”.

    • Kenster42 says:

      This is one of few good things about Trump having been arrogant and stupid enough to run for President. New York State officials would have never done this had he not become President.

  4. MattyG says:

    Simple question. DT is president of the Trump Foundation. How’s he handled in these papers? Is this round just prep work?

    • Rayne says:

      That’s a good question given the current Dun & Bradstreet listing online says:

      Eric Trump, Chief Executive Officer
      Donald J. Trump Junior, Director
      Ivanka Trump, Executive Vice President
      A Aamiyahh, Accountant

      Wonder if a director still counts as an executive? Probably doesn’t matter if the payroll and bonus checks are made out to Junior.

      • jc says:

        It’s utterly unimaginable that Weaselberg would be assisted in cheating on his taxes and others, named trump, wouldn’t be.

        trump org gets loans called and financing dries up in 3,2,1.

        trump org needs to purge all suspected leakers and keep the business operational

        NYS has a mountain of incriminating documents, weasels lawyers and forensic auditors need to sift thru them at their billable rates. If Rudy had a hard time paying his defense lawyers whats weasel going to do? UFO shows on Youtube sponsored by MyPillow guy?

      • subtropolis says:

        Humpty Dumpty’s former bodyguard, Mathew Calamari, was the COO at one time. If you can dig up the clip of AOC asking all the right questions of Michael Cohen, there’s at least one other name he mentions. This was in response to her question about who else knew of the bank/tax fraud. Cohen replies Weisselberg, Calamari, and another name.

        There was also another money guy, who reported to Weisselberg, mentioned recently as also paying a visit to the grand jury. I’m wondering whether he’s the source of that spreadsheet. Weisselberg sure didn’t provide it.

        I’ve been rolling my eyes, btw, at all the people freaking out thinking that this indictment is all there is. LOL, no. They gave W the opportunity to cooperate and this is the harsh response to his rebuff, is all. It looks as though they have plenty with which to go after the family. W’s cooperation would have made things easier but they can work around him, establishing that Trump Org is a criminal enterprise in the process. This is but a fine introduction for what’s coming. Save some popcorn for later, because we’re just getting started, eh?

        • Rayne says:

          My problem with the way this is playing out: it telegraphs everything coming for the co-conspirators and defendants if they were too stupid to grasp it months ago, or high on their own supply and hubris.

          If only the hammer of justice would drop like a poorly-built and poorly-maintained oceanfront tower.

          • Duke says:

            “ If only the hammer of justice would drop like a poorly-built and poorly-maintained oceanfront tower.”

            Rayne, powerful use of words.

            8.0 on the Richter scale.

        • posaune says:

          One thing I recall from AOC’s questions to Michael Cohen: has Trump Co ever misstated the value of properties for insurance policy applications? Answer: yes. I’m waiting for an insurance fraud charge to come down the line– when it does, the C of O can be pulled — which for DJT would be worse than a building collapse.

    • earlofhuntingdon says:

      The Trump Foundation was would up in 2019, though its conduct remains subject to investigation. Do you mean the Trump Corporation?

      • earlofhuntingdon says:

        No problemo, that’s what I thought. Playing fast and loose with legal entities is one of Trump’s – and Weisselberg’s – defining characteristics. So it’s worth paying attention to which entity is in play.

        The Trump Organization, for example, is not a legal entity: it’s only a trading name used by the Trump Corp. and its various subsidiary and affiliated companies, partnerships, etc. Weisselberg could only have been employed as CFO of a legal entity (or many of them).

  5. BobCon says:

    I agree that the bit about the spreadsheets for parallel financials jumped out at me, and if they were dumb enough to do it once, are there other examples that are now sitting with investigators?

    They were stupid enough to leave all of the records around that led to Mary Trump’s tip to the NY Times. They seem to have relied far too much on simple smokescreens to keep investigators away, which is good for the rest of us.

    • Commander Ogg says:

      Or not move assets to Florida to avoid state taxes?

      I guess the electric light with a wire filament was not at full illumination inside the storage facility.

      Shows that money does not always equal smarts.

    • d4v1d says:

      I’m not sure it’s dumb to keep a separate (accurate) set of books if – while pedaling a unicycle – your goal is to somehow keep the plates spinning without dropping the flaming chainsaws you’re juggling. The temptation to say it’s dumb to get *caught* is high, but hiding the fact that you have actual records would be extremely difficult as such records need to be consulted regularly.

      It’s likely they relied on the same old techniques working because Cy Vance was on the job (or maybe the take). Note he doesn’t have the guts to see this through. Trump is peering out of bunker-a-lago at new forces arrayed at him…and they are probing his defenses, and sapping his weakening curtain wall of bullshit

      • P J Evans says:

        The former guy is trying to blame it all on Biden. Which isn’t flying well with people who have actually paid attention to where the suit is: it’s not the feds, and Biden wouldn’t be involved with state and city (and likely not with federal: he’s much more hands-off).

      • ernesto1581 says:

        “…because Cy Vance was on the job (or maybe the take). Note he doesn’t have the guts to see this through.”

        Are you perhaps referring to the nonsense in 2012 involving Manhattan DA building a case against Ivanka & Don Jr for misleading prospective buyers of Trump SoHo, represented in the matter by Kasowitz who was able to convince Vance to overrule his prosecutors and drop the case shortly after steering a $25,000 contribution to Vance’s re-election effort? Which Vance grandly and publicly returned only to have Kasowitz head up a another contribution effort that netted about $50,000, barely six months later, under the rubric “Republicans for Vance.”
        Vance noted that while he was allowed to accept the second contribution under NYS law he would nevertheless return it as well. No sure whether or not that ever happened.
        Look forward to Alvin Bragg coming in as new Manhattan DA in January…

  6. PieIsDamnGood says:

    Trump org obviously never watched The Wire, they literally took notes on a criminal conspiracy.

    • TooLoose LeTruck says:

      In its better moments, The Wire was some of the best writing I have ever seen on television.

  7. Marinela says:

    Based on the 15 charges so far, what penalty in prison time for Allen W.?
    May explain the reason Allen W. is willing to go to jail or take a chance with the jury if the penalty is just few years.
    Assuming this is all the prosecutors have on Trump organization.

    • subtropolis says:

      One figure that I’ve seen is up to eighty years, if convicted on all counts, and sentenced consecutively. But that’s unrealistic.

    • Leoghann says:

      All? I’m sure they have a good deal more on the Organization, as well as several other people involved in it. But AW is 73 years old. Even a couple of years in a minimum-security prison would be on him.

  8. Fran of the North says:

    The juicy bits for me are in ‘The Scheme’ pp4:

    “The purpose of the scheme was to compensate Weisselberg and OTHER TRUMP ORGANIZATION EXECUTIVES in a manner that was off the books.”

    If they’ve figured out that Weisselberg received indirect payments, can’t that also be determined for others?

    IANAL and so would like input from brighter bulbs than mine. Doesn’t this appear that they are keeping other indictments under wraps so that in the event the Weisselberg flips, they will have stronger cases agains the other TO Execs?

    • subtropolis says:

      Yes. They’re clearly waiting to go after the family. This indictment appears to me to be a swift response to Weisselberg’s refusal to cooperate. They dropped the hammer on him without delay to send a message, imho. And, the (successful) prosecution of the indictment conveniently sets up Trump Org as a criminal enterprise. Much more fun to come.

      Also, in the big NYT bombshell reporting based on Mary Trump’s files, there was something about the hinky way that Ivanka had been paid — both as employee and contractor.

      • Leoghann says:

        Jeff McConney, senior vice president and controller of the Organization, testified at length last month. And apparently he was very cooperative. Michael Cohen said, if one were to think of the Organization as a small bank, Trump would be the CEO, Weisselberg would be the loan officer, and McConney would be the teller. All disbursements went through him.

  9. earlofhuntingdon says:

    The indictment understates this, but much of the corporate conduct it describes was determined by Weisselberg (and/or Donald Trump), so he’s on both sides of some of these transactions.

    Fair bit of accounting and tax fraud described there, documented nicely by Weisselberg or people that reported to him. Those internal spreadsheets, for example, keep track of corporate payments to him that Trump considered personal compensation, but which were accounted for differently in order to cheat the tax man. Good example of how Trump micro-managed so much.

    • Peterr says:

      The double set of books is quite a scheme, demonstrating that Trump was sure he wouldn’t get caught by the feds and also wanted to make sure Weisselberg didn’t try to pull one over on him. Sez Trump to himself: “Sure, I’m gonna defraud the government and want the books to reflect that, but I also want to make damn sure Weisselberg doesn’t get more than he should from me, so I’ll just keep a little spreadsheet on the side.”

      Donnie Two-Books is being hoist with his own petard. [Side note: That phrase from Shakespeare refers to a bomb-maker being hoist — blown into the air — by his own bomb. Seems like an appropriate image here.]

    • subtropolis says:

      “or people that reported to him”

      There was another guy, who reported to Weisselberg, who’d testified before the grand jury. That’s my guess for the source of the spreadsheet.

  10. earlofhuntingdon says:

    The Trump Org (a dba for the Trump Corp, and its various entities) is a purportedly multi-billion corporation. But it operates in the manner of a private family corporation – of the kind that manages the wealth of the mega-wealthy. It was supposedly doing complex transactions in several countries. Yet, it paid its CFO a fixed compensation of $940,000/year: $540k salary, $400k “bonus.” (His bonus was, apparently, adjusted for other cash and non-cash comp, so as to keep his total comp fixed.)

    By standards of NYC-based CFOs, that’s not a lot of money. But it was allegedly inflated, at a minimum, by being structured to allow Weisselberg allegedly to cheat on his taxes. i wonder how else he inflated his income.

    • TooLoose LeTruck says:

      What’s that old saying?

      “Keep three sets of books… one for the government… one for the owner… and one for yourself…”

  11. Peterr says:

    The tuition payments *were* actually made, to Columbia Grammar and Preparatory School on the Upper East Side in NYC. According to the NYT :

    Prosecutors have also questioned Mr. Weisselberg’s former daughter-in-law, Jennifer Weisselberg, who is in the midst of a contentious court battle with her ex-husband, Mr. Weisselberg’s son Barry, over custody of their children. Barry Weisselberg manages the Trump Wollman Rink in Central Park.

    Ms. Weisselberg has said that prosecutors had asked her about the tuition payments as well as gifts Barry Weisselberg received from Mr. Trump, including an apartment on Central Park South and several cars that were leased for them.

    If the Weisselbergs lived rent-free for several years, the apartment, like the tuition payments, could be considered taxable income.

    Tuition at Columbia Grammar currently costs about $55,000 a year. . . .

    Ms. Weisselberg said in an interview that either Mr. Trump or her former father-in-law had paid her children’s tuition since 2012. She said that the tuition payment had been part of her ex-husband’s compensation and that he would pick it up directly from the Trump Organization.

    They also subpoenaed the records from the school, which presumably confirms Ms. Weisselberg’s account.

    • Peterr says:

      And given that last paragraph, she and Barry should have declared that tuition as income for tax purposes. If they didn’t, and she pointed the prosecutors to these payments, that may be enough to keep her out of jail. Barry, not so much.

      • jc says:

        Don Jr’s EX hired a criminal defense atty for her divorce a few years ago, the trump westchester estate is rife with tax cheating, it will be a much bigger deal than Weaselberg’s free NYC apt.

        At some point IRS will piggyback on NYS legwork

        IMO trump org fraudulent activity was all that kept the business viable

    • earlofhuntingdon says:

      Given how miserly Donald is, it’s a good bet these various payments are not “gifts,” but compensation. (Ignoring, for now, the limits on gift giving that apply to for-profit business corporations.) So they should have been booked as income to some employee.

      This sort of compensation isn’t often paid domestically by traditional business corporations. Private family concerns perhaps more so. (Expats employed offshore often receive them.) When they are made, real corporations gross them up, because the full expense is meant to be paid from the after-tax amount.

      If not grossed up, the employee only has the benefit of the after-tax amount, which leaves a deficiency the employee has to pay from other income. Trump seems to get around that added cost by cheating the tax man – allegedly. Works until it doesn’t.

      • Peterr says:

        “Works until it doesn’t.”

        That could be the motto on the Trump family crest. “Donec illud operatur, non agit”

        See also Trump Airline, Trump Wine, Trump Steaks, Trump’s casino businesses . . .

      • P J Evans says:

        How it normally works with things like bonuses is that either the company withholds the various taxes and deductions, or you’re responsible for all of that. If the company will do it, let them.

        • earlofhuntingdon says:

          If you’re an employee, the company should withhold – and pay over to tax agencies – all relevant taxes, whether on a bonus or any other compensation. Gross payments are for those unrelated to the company, such as legitimately independent contractors, whether traditional vendors or individuals performing special or outsourced services.

          • P J Evans says:

            Ours were “incentive compensation pay” – they were considered compensation, and could be a big chunk of income above the base pay. (Taxes etc took about 50% of my ICP. But it was excellent while it lasted.)

    • posaune says:

      [email protected] 7:11

      Some school that is! For the 1-percenters. 1,150 kids, faculty of 300. All the ancillary services (OT, SLP, reading specialists, learning specialists), library for each division, pool, 100 clubs. Kids arrive at 7:00, eat breakfast in the dining room, can stay until 6:30 in the evening. After school teacher availability for extra help, study hall and athletics, dinner at school, too. All the things parents too busy to take care of their own kids need. The educational nanny. (Of course, they probably all have live-in nannies, too).

  12. Peterr says:

    This mess reminds me of a jury I sat on years ago.

    The case involved a used car dealer and (IIRC) and someone else involved in the used car business (maybe a buyer for a car auction house?). The details are hazy, but there was some dispute about the ownership of several vehicles that both claimed to own, which the car dealer had sold to third parties and pocketed the proceeds. On the last day of arguments, the used car dealer was on the stand and made a passing reference to some routine monthly reports made to the state, about the vehicles you owned that were sitting on your lot and certain related tax payments.

    In this particular court, after the direct examination, cross examination, and re-direct examination of witnesses by the lawyers, the judge allowed the jury to submit written questions that he would ask the witness assuming they were pertinent and properly posed. Smelling a rat, I put together a list of four questions to be asked in succession (depending on the answers) about those routine reports. The judge looked at the questions, smiled, then looked at the lawyers, then looked at me.

    The first asked whether the used car dealer had included the cars in question on the appropriate monthly reports (indicating that he owned the cars). When that question was asked, the used car dealer got very pale. “I don’t recall. I’d have to check . . .”

    Shortly thereafter, the judge called the day to a close, and told us to prepare for closing statements the next day. We came back, gathered in the jury room, and waited to be called into court. And waited. And waited. Finally the judge came in, say down, and told us that the case had been settled. He didn’t come right out and say it, but I’m guessing that the used car dealer claiming to own these cars told the state of Missouri that he didn’t own them at all.

    Funny how telling one person something and telling the state — in writing — the opposite can rear up and bite you in the ass.

    • AndTheSlithyToves says:

      “Funny how telling one person something and telling the state — in writing — the opposite can rear up and bite you in the ass.” lolol
      This was the extremely frustrating technique Giuliani and Crew were deploying with all their faux election challenges.

  13. earlofhuntingdon says:

    CFOs are not the most highly-compensated employee of most for-profit businesses. CEOs typically are, along with the COO and a handful of EVPs (which might include the CFO). That description exactly fits Donald Trump and his children. What are the odds that a tax-cheating structure allegedly used by Allen Weisselberg – in a Trump company, operated by and for the benefit of Donald Trump – was not also used by them, and to a greater extent?

    • BobCon says:

      Part of the state and city investigations were reported in the NY Times to deal with compensation for Ivanka via consulting fees, but it wasn’t clear whether this implied wrongdoing by her or just the Trump Org.

      (Non paywalled summary by CBS https://www.cbsnews.com/news/new-york-investigating-trump-tax-write-offs-ivanka/)

      The Times article noted that Fred Trump used a similar arrangement as a tax dodge using payments for no work arrangements with his family. I assume they are looking into whether Ivanka did any actual work for that money, and whether she paid appropriate taxes.

      • posaune says:

        IIRC, seems like Ivanka’s “consultant contract” amount was around $774K — something like that. It was referenced in the NYT Trump Tax article (I think). The striking thing was that Ivanka’s FS86 financial disclosure listed the exact amount as her consulting income. I’ll go look for this.

        • P J Evans says:

          ISTR the same thing. It was very hinky-looking. And there were questions, including here, about how you can be a consultant for a company you officially work for.

          • Kenster42 says:

            As long as Ivanka paid the proper taxes on the income, there’s no there there with this one. It’s crappy but pretty typical and not a crime. This has already been discussed in the press.

  14. Leslie Ehrlich says:

    Do we think Trump paid his kids the same way — have the business pay personal expenses and not report it as income? Might we look forward to indictments for them?

    And how does this relate to that payment to Ivanka, while she was an employee, for consulting services? This always seemed fishy.

    • Peterr says:

      The indictment of Weisselberg and the Trump Organization made it clear that he was not the only one who was compensated in these kinds of irregular ways. He is merely the only one charged so far.

  15. jc says:

    the legal defense costs of going thru 15 years of business records will cost millions I guesstimate, will trump pay for them? If this was just a civil case Weaselberg would agree to almost anything to avoid onerous legal costs, but cutting a deal for only 5-7 years of prison is different

    Does anyone think wesael was tax cheating more than any of the trumps or that his son Barry was running those cash only central park skate rinks without cheating on taxes? Impossible!

    • Dutch Louis says:

      I suppose ‘cash only’ not taxes is the main point of interest here. The skate rink as entrance for black money.

    • Kenster42 says:

      Many experts, including Preet Bharara and Joyce Vance have commented on this. They are “optimistic” that Weisselberg will be convicted, although the general expectation is that he’ll see no more than 1-2 years in prison.

      • bmaz says:

        They are overly optimistic. This case is more difficult than that. Even if given a two year sentence, Weisellberg would probably not serve that much with credits and early release. But that assumes only what is charged and known now. That said, the facts, charges and circumstances may change. We will see.

  16. Marc in Denver says:

    Minor correction: IIRC, there are nine, not six, states without personal income tax: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming.

    • Rayne says:

      Thank you, I’ll tweak the post, just double checked AARP:

      Nine states — Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington and Wyoming — have no income taxes. New Hampshire, however, taxes interest and dividends, according to the Tax Foundation. (Tennessee eliminated its tax on investment income in 2021.)

      Save for Florida, none of them have Trump golf courses. Only Nevada has a Trump hotel and I hope to heavens the co-owners are scrutinizing the hell out of it already.

      • P J Evans says:

        Las Vegas is one place where a hotel would make money-laundering easy. I suspect Nevada does keep an eye on those, because of it.

        • Rayne says:

          The co-owners are Phil Ruffin and Hilton Grand Vacations; you’d think they’d be on top of this because it’s Nevada. But Trump Org is the management company; Ruffin and Hilton may only see what Trump Org reports if their management agreement doesn’t provide complete transparency, and turning a blind eye to “reasonable” skimming may have been an unreported political campaign contribution.

      • d4v1d says:

        Income taxes are only one tax consideration for where one would site a business. For example, there are a lot of businesses in ‘Taxachusetts’ when bordering New Hampshire is but an hour from Boston. When I began researching whether to establish my small office there, I encountered New Hampshire’s ‘business profits tax,’ and I understood why the major firms I worked with didn’t move hq’s there. (They sometimes put production plants and remote service offices there – places with cadres of W-2 employees.)

  17. Ginevra diBenci says:

    Rayne, thank you for pointing out the Apprentice connection with the criming chronology. I have been wavering as to how much I should cover that show in a book about true crime TV, but this kind of tipped the balance. The crime was the point; brazenly getting away with it? NBC sure helped with that.

    Couldn’t that McKesson guy who talked to the grand jury a few weeks ago be the unindicted co-conspirator?

    • Rayne says:

      Yeah, Mark Burnett and MGM along with NBC all owe us answers; they’ve been playing a kind of licensing/rights shell game about who owns what related to The Apprentice. It’s not clear at what point Trump’s infamous NDAs play into this but with California having fairly strong anti-SLAPP laws, Hollywood doesn’t have a lot of excuses. I don’t think Burnett’s background has been deeply examined, either.

      I’m drawing a blank about the “McKesson guy,” not certain who this is. Whomever the “agent” is, they were responsible for underreporting Weisselberg’s income. To me this sounds less like a single person than an entity like an accounting firm.

      • Peterr says:

        I would look for someone that Trump lured away from McKessen to become a wholly owned Trump Org person.

      • subtropolis says:

        McConney (not McKesson) reported to Weisselberg. He’s the person I was referring to in another comment, who I believe may have supplied the spreadsheet.

        I agree with your supposition, that UC-C#1 is Mazars.

        • Ginevra diBenci says:

          Thanks for the correction. I meant McConney. But I agree that Mazars is a strong possibility too.

      • Ginevra diBenci says:

        Mark Burnett has been hiding behind his born-again image since Trump went full MAGA. The Apprentice’s Hollywood legacy was its long, steady ratings decline; but the damage from a DJT persona-falsifying perspective had already been done. I think he ran for president to rescue his failing entertainment career. He was looking forward to taking shots at President Crooked HRC for four years–what fun that would have been. But we got the end of democracy as we knew it instead.

        • Rayne says:

          I have wondered if Burnett and his reality TV show was the hook; Trump wasn’t fully on until he became addicted to the narcissistic supply only obtained from prime time TV. Once he was fully on and his image completely air brushed for public consumption, the next best narcissistic supply was running for POTUS.

          Jeff Zucker is just as big a problem in this respect as Burnett and NBC management as Zucker was at NBC then went to CNN where he continued off offer narcissistic supply through constant candidate-coverage-as-unreported-donation-in-kind.

      • gmoke says:

        Yes, please, don’t forget Jeff Zucker who was the exec at NBC who greenlit “The Apprentice.” I’ve met Mr Zucker and immediately had the impression that he was slimy from the get-go. Rumor is that he wants to get into politics once he leaves CNN.

        PS: Jeff Zucker is a Harvard graduate and a beneficiary of a fellowship there every time he’s kicked to the curb by a corporation like NBC.

        • Ginevra diBenci says:

          Oh, Jeff Zucker absolutely has dirty hands. At least when he was at NBC his profit motive was clear; at CNN many mistook his goal as producing news.

  18. Ginevra diBenci says:

    Trump was just mounting his invasion of the golf world when I was finishing my golf book eight years ago. Two years of talking to PGA pros and the old-money sultans whose names are deliberately obscure while they hobnob with current and former presidents taught me that golf is one more of those worlds that Trump will never gain entry into, no matter how much cash he pours into it. Like the approval of the Times and the Philadelphia Main Line . . . they will always send the message that class can’t be bought.

    In my observation it can be, but not by Donald Trump.

  19. greenbird says:

    first time – but not last – reading one of YOUR posts, Rayne.
    no typos in this indictment, no fat or fluff. i’m ready for whatever comes next.
    your thoughts here are a nice way to end my day: knowing more about your thought processes, appreciating your clear writing and citations … i even took time today to use the link marcy tweeted to the NYT 40-min video, which loaded and played fine. so all in all, a very good day for me. i don’t comment a lot, but i needed to say ‘thank you’ and let you know i was – and will be – one of your regular readers.

  20. Eureka says:

    Rayne — that unindicted co-conspirator you’re looking for might be Controller Jeff McConney:

    https://www.emptywheel.net/2021/06/04/barbara-jones-special-mastery-of-releasing-donald-trumps-lawyers-crime-fraud-excepted-communications/#comment-893627

    Or COO Matthew Calamari?

    I haven’t had time to read/ for context to form an opinion of which is likelier (if at all) but McConney was called before the GJ last month and I’ve heard news snippets suggesting Calamari might be charged.

    Also your request for Maddow info came *just* in time for me to have deleted it off DVR (of course!).

    • Rayne says:

      I’m burning out this evening but the Trump Org controller is what I remember being key, which likely means McConney and not Calamari if the former had that title. It certainly makes sense to me.

      I hope I have enough time tomorrow to dig into this a bit more. Thanks for the link, very helpful.

      • Eureka says:

        You’re welcome, and yes — the controller

        Subsequent to that ABC report, DB did a profile you’ll find interesting when you’re refreshed. McConney was around for pivotal transactions over the decades (and so may play a role in cases to follow), but is a hardcore GOPer and Trump loyalist. There are indications they used McConney like a “cleaner“, if not “clean” — to borrow from the ever-eloquent Eric’s rantings — man. And one story on procedures wraps back around to Donald Bender at Mazars, where you were going initially.

        This is chuck full o nuts, linking older pieces on Trump Org inner workings — with some additional names [such as a (then-) asst. controller]:

        Jeff McConney, Trump’s Loyal, ‘Low Profile’ Money Man Who Could Bring Him Down
        Longtime Trump Organization executive Jeff McConney oversaw all the transactions and financial documents at the company—and he’s already testified.
        https://www.thedailybeast.com/jeff-mcconney-trumps-loyal-low-profile-money-man-who-could-bring-him-down
        Asawin Suebsaeng Senior Political Reporter
        Jose Pagliery Political Investigations Reporter
        Updated Jun. 11, 2021 1:12PM ET / Published Jun. 10, 2021 8:17PM ET

        When leaders of The Trump Organization would prepare important documents like asset evaluations or taxes, there were usually only two people in the room: Donald Trump and chief financial officer Allen Weisselberg.

        To this point, prosecutors are still searching for ways to flip Weisselberg against his boss. And Trump is Trump. But according to a source with direct knowledge of the company’s inner workings, the man who brought the original documents and tranches of raw data to Trump and Weisselberg—the man who might know how those documents changed in those rooms over the course of more than three decades—is Jeffrey S. McConney.

        Footnote terrible: We also have McConney’s son to thank for getting Trump on Twitter:

        His son, Justin McConney, was dubbed by Politico in late 2015 as “Trump’s 29-year-old social media whiz.” The younger McConney is even credited with convincing Trump to adopt social media—particularly Twitter—as a primary tool for political messaging and sniping at celebrities and bitter rivals.

        In a 2018 interview, also with Politico, Justin McConney said the moment he found out Trump could tweet himself, it was “comparable to the moment in Jurassic Park when Dr. Grant realized that velociraptors could open doors. I was like, ‘Oh, no.’”

        Internal links removed.

        • Eureka says:

          I forgot to add explicitly here that after reading I do think UCC-1 is McConney — certainly consistent with his role, at least, and as controller he would be an agent of Trump Org.

          • Rayne says:

            I’m still leaning toward Mazars myself though the indictment’s description of Weisselberg as a “high managerial agent” of Trump Org supports your theory. The indictment’s wording, “acting through its agent, Unindicted Co-conspirator #1, underreported Allen Weisselberg’s taxable income,” suggests to me the accounting firm though Trump Org’s controller could prepare and file taxes.

            Of course somebody *signed* the tax filings for Trump Org…can’t imagine the narcissist-in-chief not doing this.

      • Leoghann says:

        Rayne, there’s a third aggrieved entity–City of New York. According to a couple of articles I’ve read, Weisselberg actually owes more city income taxes than state.

        • Rayne says:

          Ah, thanks. It’s funny how easy it is to overlook the obvious, was right there on page one of the indictment that the injured parties in the scheme were the “United Sates Internal Revenue Service, the New York State Department of Taxation and Finance, and the New York City Department of Finance.”

    • Eureka says:

      To avoid confusion, I put a note on Marcy’s post about the Trump Org having a *controller* (as opposed to a “Comptroller”, the title used in the indictment/text cited in post). i.e. we are not looking for two droids, but the one.

      https://www.emptywheel.net/2021/07/02/why-would-allen-weisselberg-tolerate-having-to-cheat-on-his-taxes-rather-than-getting-a-raise/#comment-896260

      While some people use the terms as interchangeable (they’re not, but for similar roles between different types of organizations) and would take one word for the other, some less familiar with the business world might instead not know they’re meant to refer to the same person at Trump Org: formerly Weisselberg, currently McConney.

  21. earlofhuntingdon says:

    It’s hard to imagine that Allen Weisselberg has any off hours when he’s not working for Donald Trump. For comparison, think about when and how often Trump tweets. It’s a good placeholder for how frequently and at what odd hours the obsessive micro-manager Trump is probably demanding financial information from Weisselberg. Given the likelihood that much of what they do is questionable or illegal, it probably takes longer than normal to obtain that info and deliver it to Trump in a way that attempts not to create an evidence trail. Weisselberg is probably not moonlighting or acting for himself, so much as he is doing more off-the-books stuff for Trump and his businesses. By the same token, the alleged tax cheating was not done for Weisselberg’s benefit as much at was for Trump’s.

    Given the interest in tracking the officers and other employees of the Trump “Organization,” it’s useful to remember that it does not exist – other than as a label. It’s not even a holding company, although the handle is often used for one. Rather, it is shorthand for one or more of the 500 plus companies Trump uses – euphemistically – to do business.

    The largest and most prominent Trump legal entity is the Trump Corporation. But Trump plays fast and loose with process, including company formation, maintenance and naming. He, more likely Weisselberg, uses whatever vehicle is convenient – or most obfuscates what’s really taking place – and then labels it as something done by the Trump “Organization.” It’s a little like emphasizing “collusion” – not really a thing or a crime – in order to imply rhetorically that you haven’t broken any laws. It’s a requirement that prosecutors, tax departments, and credit reporting agencies use the correct name of a legal entity, then separately mention that it may do business using one or more trade or business names. As with cruelty, confusion is the point.

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