Former President Donald Trump’s company was fined $1.6million for a decades-long scheme that helped its executives dodge taxes.
New York County Supreme Court Judge Juan Manuel Merchan ordered Donald Trump’s company to face the maximum punishment after it was convicted of 17 felonies, including tax evasion, conspiracy, and falsifying business records.
Prosecutors argued that Donald Trump’s company which is a real estate company funnelled additional payments to top executives through off-the-books benefits, including rent-free apartments in Trump buildings and tuition payments for their children’s private schools.
The seven-figure sum is equal to double the amount of taxes Trump Organization executives would have paid if their payments were accurately reported to the IRS
Judge Merchan ordered the company to pay the fine within 14 days.
Only one executive who benefited from these payments has faced legal consequences – the former Trump Organization CFO Allen Weisselberg.
Weisselberg, who pleaded guilty to 15 counts of tax fraud, was sentenced to five months in prison on January 10.
Lawyers for Donald Trump’s company tried to argue that Weisselberg arranged this tax scheme by himself. When he was called to the witness stand, he tearfully admitted that ‘it was my own personal greed that led to this.’
However, Weisselberg, 75, remained on paid leave at the Trump Organization until his conviction on Tuesday. He collected an annual salary of over $1,000,000 even while he was on trial.
Jurors did not seem to buy this argument. One anonymous juror told CNN they saw a ‘culture of fraud’ at the entire business.
In his closing arguments, Assistant District Attorney Joshua Steinglass reminded the jury that Trump signed the lease for Weisselberg’s off-the-books apartment himself.
‘Mr Trump is explicitly sanctioning tax fraud,’ Steinglass said.
The business will not be dismantled as a result of the prosecution, but the conviction could lead to future problems securing loans or contracts.
Meanwhile, another lawsuit against the business filed by New York Attorney General Letitia James threatens to permanently bar Trump and his children from operating a business in the state again.
In this lawsuit, James is arguing that the Trump Organization purposely inflated and deflated the values of their properties in order to secure more beneficial loan terms, defraud insurers, and pay less in taxes.
Last Friday, New York Supreme Court Judge Arthur Engoron refused a Trump Organization motion to dismiss the lawsuit as frivolous, paving the way for the company to go to trial again as soon as next Fall.