Trump Organization Fined $1.6 Million After Tax Fraud Conviction
Former President’s Real Estate Firm Was Convicted on 17 Charges in December
The Trump Organization’s properties include the Trump International Hotel & Tower at 401 N. Wabash Ave. in Chicago. (Justin Schmidt/CoStar)
Former President Donald Trump’s family real estate business was ordered Friday to pay more than $1.6 million in penalties, the maximum allowed, following last month’s conviction of the Trump Organization on tax fraud charges in a New York court.
Trump Organization affiliates were hit with the maximum $1.61 million fine after a December jury conviction on all 17 charges in a fraud case brought by Manhattan District Attorney Alvin Bragg.
The fines were handed down by a judge in State Supreme Court in Manhattan. They include $810,000 in fines against the Trump Corp. and $800,000 against another Trump Organization affiliate, the Trump Payroll Corp., according to a statement from Bragg’s office.
Trump and family members were not charged in the case, in which the real estate development firm was convicted of evading taxes by concealing about $1.7 million in taxable income. Reacting to the fines Friday, the Trump Organization issued a statement to CoStar News that echoed previous descriptions of legal actions against the former president as political witch hunts.
Prosecutors said the company provided off-the-books benefits such as cars, private school tuition and houses since 2005 to employees including longtime Chief Financial Officer Allen Weisselberg, who pleaded guilty in August and testified in the trial under oath. Weisselberg already had been sentenced to five months in prison.
“Allen Weisselberg is a victim,” the Trump Organization statement said. “He was threatened, intimidated and terrorized. He was given a choice of pleading guilty and serving 90 days in prison or serving the rest of his life in jail — all of this over a corporate car and standard employee benefits.
“President Trump and The Trump Organization are also both victims," according to the statement. "These politically motivated prosecutors will stop at nothing to get President Trump and continue the never ending witch-hunt which began the day he announced his presidency. We did nothing wrong and we will appeal this verdict.”
Bragg, a Democrat who took office last year, successfully argued that by providing off-the-books perks, the company reduced its payroll tax bill and allowed employees such as Weisselberg to pay less in income taxes.
The all-counts conviction came on the second day of jury deliberations.
The penalties are relatively small compared to the total amount of revenue involved with a real estate development venture with properties throughout the world, but they tarnish the firm’s reputation, potentially complicate its ability to do business in New York and add to the former president’s legal woes as he said he will seek the Republican nomination to attempt another presidential run next year.
The lawsuit is separate from a civil suit brought in September against the company, Trump and other executives by New York Attorney General Letitia James. Separately, Trump faces U.S. Department of Justice investigations regarding attempts to overturn the 2020 presidential election and over his handling of classified and highly sensitive documents after leaving office.
“Today, former President Trump’s companies were sentenced to the maximum fines allowed by law following historic convictions for a total of 17 felony crimes,” Bragg said in the statement, which said Trump executives conducted "sweeping fraud for well over a decade.”
The statement added that “while corporations can’t serve jail time, this consequential conviction and sentencing serves as a reminder to corporations and executives that you cannot defraud tax authorities and get away with it. It is also an important reminder that our state law must change so that we can impose more significant penalties and sanctions on corporations that commit crimes in New York. Today’s sentencing of The Trump Corporation and The Trump Payroll Corp. represents a significant chapter of our ongoing investigation into the former President and his businesses.”