Trump Org Officials Testify No One Knew About Fraud Scheme They All Participated In

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(Photo by Evan Vucci-Pool/Getty Images)

Donald Trump was either the dumbest CEO in America, or he participated in a whole lot of crimes. His company’s lawyers are hoping to convince a jury of the first in the criminal prosecution of the Trump Organization underway in Manhattan.

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The goal here is to present former CFO Allen Weisselberg, who pleaded guilty to charges that he participated in a decades-long scheme to use pre-tax dollars to pay for his apartment, cars, and various other perks, as the lone criminal mastermind seeking to defraud the company. To that end, Weisselberg’s longtime right hand man, comptroller Jeff McConney, spent three days on the witness stand purporting to have thought it was very cool and very legal to keep a second set of secret books documenting the declining balance of top executives’ salaries.

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The problem with this strategy, as Daily Beast reporter Jose Pagliery, who has been livetweeting from the courtroom, points out is that everyone in the company appeared to be in on this supposedly secret scheme. In 2012, COO Matthew Calamari’s official compensation was reduced by $76,000, which the company used to pay for his apartment — meaning that the people of New York and the IRS chipped in for about $38,000 of his rent. And that was before the his and hers Mercedes Benzes the Trump Organization leased for Calamari and his wife.

Under questioning, McConney admitted that Trump’s initials on the paperwork documenting the rent for Calamari meant that he’d approved the pay scheme. And indeed only Trump could sign off on checks for more than $2,500 — hey, remember those $35,000 “retainer” checks Trump signed to reimburse Michael Cohen for the Stormy Daniels payoff? But McConney insisted that no one in the company but Weisselberg knew that the reason there was a separate ledger locked in McConney’s desk drawer was that they were all participating in rampant tax fraud.

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“Is there a reason you can’t issue a payroll check to somebody who didn’t work there?” McConney wondered, when asked about a scheme to divert $6,000 of Weisselberg’s salary to his wife Hillary so that she’d have spent enough time “employed” to qualify for social security.

“You have a college degree in accounting, correct?” demanded prosecutor Joshua Steinglass incredulously. “You worked at an accounting firm for 8 or 9 years before you joined the Trump Organization?”

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McConney admitted as he did, but still claimed to think it was perfectly fine to pay a salary to someone who was not, in fact, employed by the company.

This last exchange prompted a skeptical Justice Juan Merchan to send the jury out of the room for a little heart-to-heart with the witness who was having “a hard time giving very credible answers” to prosecutors while being “very helpful” to Trump’s lawyers. Later McConney revealed that he’d been huddled up with the same Trump Organization lawyers questioning him on the witness stand just days before.

Other revelations include accounts payable supervisor Deborah Tarasoff admitting that Weisselberg himself ordered her to go in and delete notations from the ledger documenting his approval of tuition payments to his grandchildren’s school in 2016.

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Holy forensic evidence, Batman! Sept. 26, 2016 was a busy day on Trump Tower's 26th floor.

Digital entries show that Jeff McConney joined Deborah Tarasoff in deleting a bunch of lines from the company's books.

They made sure there'd be no evidence the CFO got untaxed benefits.

— Jose Pagliery (@Jose_Pagliery) November 15, 2022

That would explain the previously documented discrepancy between the books handed over to Mazars, and then on to prosecutors, and the set of books the company handed over to the grand jury.

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Finally, prosecutors have put to bed any notion that Weisselberg “flipped” on Trump. On the witness stand, he testified that he continues to earn the same salary and bonus as before, just with a slightly different job title and in a different office.

Although now he probably pays taxes on the whole thing. Well … maybe.

The Trump Org’s ‘Fired’ Money Man Actually Still Has His Job [Daily Beast]
The Trump Org’s Courtroom Shenanigans Are Wearing Thin [Daily Beast]

Liz Dye lives in Baltimore where she writes about law and politics.

Topics

Allen Weisselberg, Crime, Donald Trump, Government