Former President Donald Trump arrives at a rally on Saturday, March 12, 2022, in Florence, S.C. Trump has endorsed two Republicans mounting primary challenges to sitting House members who have been critical of him. (AP Photo/Meg Kinnard)
Former Manhattan District Attorney Cy Vance pursued Donald Trump for years—methodically wading through ultimately fruitless legal challenges by Trump’s attorneys to block him from accessing the inner workings of the Trump Organization. Analysts assumed that Trump was fighting a defense not so much based on his innocence but on running out the clock on the statute of limitations. But as it turned out, the real clock expired in January, along with Vance’s term in office. His successor, Alvin Bragg, quickly shut down the office’s investigation into whether Trump had personally committed criminal fraud—by potentially lying to banks, insurance companies or tax authorities—during his years running the Trump Organization. On Wednesday, the New York Times published a letter of resignation from Mark Pomerantz, a prominent white collar prosecutor who Vance had hired to handle the Trump case, in which Pomerantz expresses his bitter disappointment at Bragg for not pursuing the matter.
“The team that has been investigating Mr. Trump harbors no doubt about whether he committed crimes—he did,” Pomerantz wrote.
Through an attorney, Trump was quick to declare victory, saying Pomerantz “had the opportunity to present the fruits of his investigation to the D.A. and his senior staff on several occasions and failed.”
It’s not as clear cut as that. Quite a bit is known about things that happened at the Trump Organization. Last summer, Vance’s office charged the company and its then-CFO, Allen Weisselberg, with criminal fraud. The question Bragg inherited was whether he could prove to 12 jurors that Trump himself was complicit in any wrongdoing at his company. Even in deep-blue New York, that’s no small feat. Just 1-in-8 Manhattanites voted for Trump in 2020, but it only takes a single juror to block a conviction. The DA’s office would have had to present bulletproof evidence that Trump committed a crime—and to prove a crime, intent must be shown.
That’s likely the hangup for Bragg, and it’s probably the disconnect between what Pomerantz says he knows—that a crime was committed—and the likelihood of winning a conviction.
Trump does not use email, and he often reportedly destroys the pieces of paper on which he writes down notes or instructions. Unlike the investigation into his meddling in the 2020 vote-counting in Georgia, there are, as far as we know, no audio recordings of him discussing his role in the events the New York prosecutors were investigating. With little or no physical evidence to show Trump’s intent and involvement—unless Weisselberg or another close associate is willing to testify about what they saw Trump say or do—it could be hard for any prosecutor to prove Trump knowingly participated in an effort to break the law. Still, Pomerantz claimed in his letter that those were hurdles that could be overcome.
“To the extent you have raised issues as to the legal and factual sufficiency of our case and the likelihood that a prosecution would succeed, I and others have advised you that we have evidence sufficient to establish Mr. Trump’s guilt beyond a reasonable doubt, and we believe that the prosecution would prevail if charges were brought and the matter were tried to an impartial jury,” Pomerantz wrote.
But, even if Bragg is right that such a case could not be won in court, it doesn’t mean there wasn’t wrongdoing at the Trump Organization. And it doesn’t mean Trump himself didn’t do anything wrong—or that he didn’t commit any crimes.
“I believe that Donald Trump is guilty of numerous felony violations of the Penal Law in connection with the preparation and use of his annual Statements of Financial Condition,” Pomerantz wrote in his resignation letter. “His financial statements were false, and he has a long history of fabricating information relating to his personal finances and lying about his assets to banks, the national media, counterparties, and many others, including the American people.”
Based on the evidence already presented in the cases against the Trump Organization and Weisselberg, and the simultaneous civil investigation into Trump’s business affairs that is being conducted by New York State Attorney General Letitia James, Pomerantz might be right.
In fact, in January, James filed 268 exhibits worth of material making essentially the same case that Bragg would have had to make in the criminal case. In James’ case, she was arguing that she was not, as Trump’s lawyers have claimed, on a politically motivated fishing expedition. James was trying to convince a judge that she had uncovered sufficient evidence to continue her investigation. The judge quickly ruled in her favor and even stated that she had uncovered “copious evidence of possible financial fraud.”
The exhibits James filed are sealed. But portions of them are discussed in her various briefs so, we know quite a bit about their contents. Among the things James says she has proof of:
- The Trump Organization created statements of financial condition that showed that the Trump Tower triplex that was Trump’s main residence before becoming president was worth as much as $327 million and based that figure on the fact that the apartment was 30,000 square feet. But the apartment is allegedly nowhere near that size—James says that Trump Organization CFO Allen Weisselberg testified that it was only about 10,000 square feet and that the $327 million evaluation was inflated by “give or take” $200 million
- The Trump Organization claimed in 2011 that Trump’s Abderdeen golf course in northeastern Scotland was worth $161 million, a claim that, according to the New York attorney general, appears to have been based not on any actual legitimate property appraisal, but rather on information compiled to send to a reporter for an article in Forbes.
- The company claimed in 2016 that the Abderdeen golf course was at that point worth $435.6 million, citing plans to build as many as 2,500 luxury homes, even though local zoning and planning officials had made it clear they would allow no more than 1,500 to be built. (None have been built so far.)
- The Trump Organization tacked on an additional 15 to 30 percent to the estimated value of seven golf courses based on their affiliation with the Trump brand, even though financial institutions that were sent the valuations specifically requested numbers that did not include estimates of “brand value.”
- The Trump Organization gave the Internal Revenue Service incorrect information about the value of land donated or put into conservation at his Upstate New York and Los Angeles properties.
- After a lender valued Trump’s 40 Wall Street office building as being worth no more than $220 million, Trump refinanced the property with another lender where the building was then given a valuation of $550 million, a figure James’ filing says was not a “good-faith” assessment. Trump’s next statement of financial condition allegedly listed the property as being worth $730 million.
All of the evidence that is available to James was also available to Pomerantz and Bragg—the two offices were working in tandem. But civil cases are far easier to prove, and James, who openly campaigned on her willingness to take the heat that comes with fighting Trump in court, is continuing her case.
If James is correct—and the judge in her case certainly seems to think so—the remaining two questions in the criminal case could have been fairly simple: 1) Did Trump know these things were happening? 2) Could it be proven beyond a reasonable doubt to a jury? Without emails, handwritten notes, or testimony from someone like Weisselberg, it might be difficult for Bragg. But if Trump wasn’t aware that these massive errors were being made, it would seem to be very hard to call him the person in charge of the company that his name is plastered all over. And Trump designed his business empire so that all roads always led directly back to him. As I wrote last year when the Trump Organization was indicted by Vance, it’s hard to separate the Trump Organization from Trump personally:
The Trump Organization is something of a one-note brand—nearly every aspect of the company’s identity is tied to the former president. The company’s entire strategy is to appeal to consumers by evoking the ethos of wealth, status, and luxury that Trump has tried to equate with himself. But the company is also, legally speaking, his alter ego. With the exception of a few ventures, Trump owns 100 percent of every corporate entity and asset that falls under the Trump Organization umbrella. According to personal financial disclosure statements filed when he was president, the Trump Organization itself—the entity that was officially indicted on Thursday—is 100 percent owned by a company called DJT Holdings Managing Member LLC, which is, in turn, 100 percent owned by the Donald J. Trump Revocable Trust. According to the trust’s paperwork, its sole purpose is to hold assets for the benefit of the man himself. Its three trustees are Trump, his son Donald Jr., and Weisselberg.
The pattern repeats itself at nearly every property owned by the former president. A few more companies may stand between the asset and the Trump trust, but the ownership almost always ends up in Trump’s hands. The exceptions are mainly properties that are used mostly by the Trump family, as well as the Trump Hotel in Washington, DC, in which Don Jr., Eric, and Ivanka Trump own minor stakes.
In fact, in 2017, when Trump took office and continued to refuse to release copies of his tax returns, one of the main rationales his lawyers employed for withholding this information from the public was that Trump and the Trump Organization are inextricably linked. “You hold interests as the sole or principal owner in approximately 500 separate entities. These entities are collectively referred to and do business as The Trump Organization,” his attorney Sherri Dillon then wrote Trump in a letter that was made public. “These entities engage in hundreds of transactions, deals and new enterprises every year. Because you operate these businesses almost exclusively through sole proprietorships and/or closely held partnerships, your personal federal income tax returns are inordinately large and complex for an individual.”
In other words, Trump is at the center of everything at the Trump Organization. It’s difficult to square that well documented truth with the notion that he was completely uninvolved with the numerous, repeated, and massive misstatements of financial condition that James alleges.
In the Manhattan DA’s case against Weisselberg and the Trump Organization, a similar disconnect in logic is at play.
Bragg’s office says that Weisselberg didn’t pay taxes on the many significant financial perks that the Trump Organization paid him outside of his listed taxable salary. The existence of these benefits is not in question—attorneys for Weisselberg and the Trump Organization have not argued that he didn’t receive an estimated $1.7 million in perks from his employer, including an apartment, luxury cars, at least $27,000 in cash, vacations, and tuition for his grandchildren’s elite private school education. The tuition checks were actually signed by Trump himself. In the indictment of Weisselberg, prosecutors say that the Trump Organization kept two separate sets of books—one set, which was shown to the IRS, listed Weisselberg’s employee salary at one level. The second set, which allegedly included all of the extra perks, was not disclosed to the IRS.
“As spelled out in the indictment, this was a 15-year long tax fraud scheme involving off the books payments,” assistant district attorney Carey Dunne said in court last summer when Weisselberg was arraigned. “This is not a ‘standard practice in the business community,’ nor was it the act of a rogue or isolated employee. Instead, it was orchestrated by the most senior executives, who were financially benefitting themselves and the company, by getting secret pay raises at the expense of state and federal taxpayers.”
“To put it bluntly, this was a sweeping and audacious illegal payments scheme,” Dunne added.
Weisselberg, not Trump, is the target of that case. But it once again seems hard to square the idea that Trump is the businessman he says he is with the competing idea that he somehow did not know or intend to give $1.7 million to Weisselberg outside of his taxable salary. Just as it seems to stretch plausibility that Trump did not participate in the alleged $200 million over-valuation of his penthouse apartment, it also seems illogical to argue Trump is both the ultimate corporate CEO—a billionaire who made his money by his wits, tireless ambition, and tenacity—and also that he had no idea that the personal checks he wrote and signed, made out to the private school Weisselberg’s grandchildren attended, drawing on his own personal account, were a form of compensation for his employee.
But Bragg seems to want more than the logic. He needs cooperating witnesses willing to testify or hard written evidence. In his resignation letter, Pomerantz said the evidence is there, if only Bragg were brave enough to try the case. The fact that it wouldn’t be the easiest of cases shouldn’t be a deterrent, he argued, because it’s an important case to try.
“No case is perfect,” Pomerantz wrote. “Whatever the risks of bringing the case may be, I am convinced that a failure to prosecute will pose much greater risks in terms of public confidence in the fair administration of justice. As I have suggested to you, respect for the rule of law, and the need to reinforce the bedrock proposition that ‘no man is above the law,’ require that this prosecution be brought even if a conviction is not certain.”
