Why Trump Wasn’t Charged in New York Criminal Tax Probe

Patricia Hurtado and Greg Farrell
·5 min read
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(Bloomberg) -- Last week’s convictions of two Donald Trump companies for criminal tax fraud may help ensure Trump’s business remains under court-ordered supervision, former Manhattan district attorney Cyrus Vance Jr. said.

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Vance, whose office secured the indictment of the two companies last year, said the guilty verdict could help New York Attorney General Letitia James keep a court-appointed monitor in place on the Trump Organization in her civil lawsuit against Trump as he appeals the supervision.

In an interview, Vance called the convictions “a significant achievement for the current district attorney,” his successor, Alvin Bragg.

“I do think the implications of this case are far-reaching and present a serious threat to the defendants,” he said.

In her fraud suit against Trump, his business and three of his children, James alleges they lied to lenders and insurers by overvaluing assets by billions of dollars. She is seeking $250 million and to bar the Trumps from serving as officers or directors in any New York corporation.

Verdict Will ‘Resonate’

“That conviction in the tax case is helpful for the New York attorney general’s case,” Vance said. The jury’s swift verdict on all 17 counts, including scheme to defraud, conspiracy, criminal tax fraud and falsifying business records, “will presumably resonate with the Court of Appeals on whether or not there’s justification to have a monitor,” he said.

Read More: Trump Companies Are Convicted in NY Criminal Tax Fraud Trial

Alina Habba, a lawyer for Trump and his company, said in a statement that “we stand by our argument that a monitor is unnecessary, and that the case is part of an ongoing witch hunt against my client.”

Vance, 68, is now a partner at Baker McKenzie LLP, having left office last December. Bragg got a guilty plea in August from former Trump Organization chief financial officer Allen Weisselberg, who was indicted along with the two business units and agreed to testify truthfully at trial against them in hopes of a lighter sentence.

Risking Acquittal

While Trump himself wasn’t charged, prosecutors argued at trial that he “explicitly sanctioned tax fraud.” Nonetheless, Vance said he determined that proving Trump knew of the scheme would have been difficult without being “vulnerable at trial” and to an acquittal.

“We did not believe evidence supported fixing charges of those tax violations to him,” Vance said. “The extent of his knowledge would have been a vulnerability.”

Read More: Trump ‘Explicitly Sanctioned Tax Fraud,’ Prosecutor Tells Jury

Vance said that as his term in office drew to a close, he believed the Trump investigation would proceed under Carey Dunne, his general counsel, and Mark Pomerantz, a former federal prosecutor he had recruited for the matter.

“We were not stopping the investigation,” he said.

But the two quit in February after Bragg himself concluded there wasn’t enough evidence to charge Trump at the time.

“My views of the case may not have been shared by the new district attorney, and that’s just the way the world works,” Vance said of the pair’s departure.

A spokeswoman for Bragg declined to comment.

‘A Good Step’

Bragg has said his investigation is “ongoing” and recently announced the hire of a former senior Justice Department official to work on the office’s most important investigations. Vance commended the move, saying it was “maybe later than I would have wanted, but I think this is a good step.”

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Reflecting further on why he didn’t charge Trump, Vance said his investigation was hampered by the pandemic and an 18-month battle to secure Trump’s tax returns.

“To the question of were there regrets of leaving it to someone else, the answer is we did everything we could in the time we had,” he said. “The calendar won.”

He said his proudest achievement was the office’s victory at the Supreme Court in obtaining the tax records. The high court rejected Trump’s argument that he had broad immunity as president.

‘Fascinating Experience’

“The decision of the Supreme Court was in some sense to me the high-water mark of the work we did,” Vance said. “It was a very tricky area when you’re talking about, first, during a period when he was president, the limitations of investigating a sitting president, even for potential prior misconduct.”

He called it a “fascinating experience.”

Read More: Trump Knew of Alleged Tax Scam, Controller Says CFO Told Him

The two Trump companies now face fines totaling about $1.6 million, according to Bragg’s office. Vance said he has long advocated for fines for companies in New York state to be increased to as much as $1 million for each felony conviction.

His concern is related to a case he prosecuted of an Ecuadorian worker buried alive at a New York City construction site in 2015. After the construction company was convicted of manslaughter and other charges, it was fined $10,000.

“That’s just ridiculous,” Vance said.

The case is People v. Trump Organization, 01473-2021, New York State Supreme Court (Manhattan).

Read More

  • Trump Had Losses of $900 Million in Two Years, Jury Told

  • Trump Said Fight It When DA Charged His Firms With Tax Fraud

--With assistance from Erik Larson.

(Adds Trump lawyer’s comment in second section.)

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