Manhattan prosecutors have told Donald J. Trump’s attorneys that they are considering filing criminal charges against his family business, the Trump Organization, in connection with fringe benefits the company has awarded a top executive, according to several knowledgeable people.
If the case progresses, prosecutor Cyrus R. Vance Jr. could bring charges against the Trump organization and executive director Allen H. Weisselberg as early as next week, people said.
The criminal charges would be the first to emerge from Mr. Vance’s longstanding investigation into Mr. Trump and his business relationships, which would raise the terrifying prospect of a former president defending the company he founded and ran for decades.
While prosecutors had spent months building a case against Mr. Weisselberg, the Trump Organization’s chief financial officer, to pressure him to cooperate in the investigation, it was previously unknown that the company could do so too Bring charges.
Prosecutors recently focused much of their investigation on the perks Mr. Trump and the company gave to Mr. Weisselberg and other executives, including tens of thousands of dollars in private schooling for one of Mr. Weisselberg’s grandchildren, as well as rents for apartments and car rentals.
The prosecution is verifying that these services have been properly recorded in the company’s books and that taxes have been paid on them, the New York Times reported.
Mr Trump’s attorneys met with senior prosecutors in the prosecutor’s office on Thursday in hopes of convincing them to abandon any plan to indict the company, according to several people familiar with the meeting. Such meetings are routine in a white collar crime investigation, and it is unclear whether prosecutors have made a final decision on whether to indict the Trump organization, which has long denied wrongdoing.
It would be highly unusual to sue a company for just failing to pay taxes on fringe benefits, said several tax law attorneys. None of them could cite a current example, as many companies offer their employees perks such as company cars.
Still, an indictment of Mr. Trump’s company could deal a severe blow to the former president, just as he flirted with a return to politics.
It is unclear whether Trump will ultimately be indicted himself. The investigation, which began three years ago, was far-reaching and looked into whether the Trump Organization manipulated the value of their homes to get cheap loans and tax breaks, knowledgeable people said.
The investigation also examines the organization’s statements to insurance companies about the value of various assets and any role its employees – including Mr. Weisselberg – may have played in the hush-money payments to two women during the 2016 presidential campaign.
Mr. Trump has derided the investigation of the Democrat Mr. Vance as a politically motivated “witch hunt”. He tried unsuccessfully to fight a subpoena from Mr. Vance’s office demanding his personal and corporate tax returns for eight years, a dispute that reached the United States Supreme Court twice.
A spokesman for the prosecutor did not want to comment on Friday. One of Mr. Weisselberg’s attorneys, Mary E. Mulligan, also declined to comment. A spokeswoman for the Trump organization was not immediately available for comment.
Thursday’s meeting between Mr Trump’s attorneys and prosecutors, held via video call and lasting more than an hour and a half, was arranged by Ronald P. Fischetti, a personal attorney for Mr Trump. Mr. Fischetti is a former legal partner of Mark F. Pomerantz, a former federal attorney and defense attorney whom the prosecution was responsible for leading the investigation against Mr. Trump and his Companies.
In the coming days, Mr Trump’s attorneys could still argue that any charges against the company could take a serious financial toll. Criminal charges, even against private companies like the Trump Organization, can jeopardize reputation and relationships with banks and business partners.
Corporations, like people, can be brought to justice for crimes, and if convicted or plead guilty, they can face fines and other penalties.
The charges could put pressure on Mr. Weisselberg to cooperate, who may attempt to strike a deal with prosecutors to testify against Mr. Trump in exchange for forbearance.
Mr Weisselberg’s in-depth knowledge of the Trump Organization – he worked for the company for decades and was a top executive when Mr Trump was in the White House – would make his collaboration a tremendous asset to investigators covering all aspects of the company. Because of this, he was the focus of the prosecutor’s investigation, with particular attention being paid to the benefits he and his family received.
In general, these types of benefits are taxable, although there are some exceptions and the rules can be unclear.
Mr Trump is heavily dependent on Mr Weisselberg, who continued to work for the Trump Organization during the investigation. In his book “Think Like a Billionaire”, the former president credits Mr. Weisselberg with “doing whatever it took to protect the bottom line”.
And few things excite Mr Trump as much as the prospect of disloyalty. Close allies have turned against him in the past, including his former personal attorney and fixer Michael D. Cohen, whom Trump has described as a “rat”.
Mr. Cohen, who pleaded guilty to federal charges related to hushing money payments to two women who reported having romantic affairs with Mr. Trump, is cooperating with the Manhattan District Attorney’s investigation. After pleading guilty, Mr Cohen said it was Mr Weisselberg who helped the Trump Organization disguise the refunds Mr Cohen received for paying out one of the women.
Mr Weißelberg has not been accused of any wrongdoing by the federal prosecutor, and Mr Trump did not pardon him in his final days in office, despite allegedly considering it. (A pardon would not have granted Mr. Weisselberg immunity from state charges.)
After Mr Cohen pleaded guilty in 2018, Mr Trump expressed confidence that Mr Weisselberg had not turned against him.
“He didn’t do that 100 percent,” Trump told Bloomberg reporters. “He’s a wonderful guy.”
In a way, Mr. Weißelberg is the exact opposite of his long-time boss. Discreetly and modestly, the CFO has avoided the attention even though he has put his family in the orbit of the former president. One of his sons, Barry, was a property manager for Trump Wollman Rink in Central Park. Another, Jack, works at Ladder Capital, one of Mr. Trump’s lenders.
But Mr. Weisselberg did his part to add to Trump’s aura of wealth and power. When the New York Times was trying to figure out how much money Mr Trump had in 2005, Mr Weisselberg provided a list of assets that he said would be worth $ 6 billion from Mr Trump.
When the list of assets appeared to be only $ 5 billion, Mr. Weisselberg apologized.
“I’ll go to my office and find the other billion,” he said.