Dive Brief:
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The New York attorney general’s office, led by Letitia James, has been conducting a criminal tax inquiry into Trump Organization CFO Allen Weisselberg for months, and is now joining with the Manhattan district attorney's office in a criminal investigation of the company, CNN reported Tuesday. “We are now actively investigating the Trump Organization in a criminal capacity, along with the Manhattan D.A,” James’s office shared in a Tuesday statement.
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In January, James’s office notified the Trump Organization that it had opened an investigation “related” to Weisselberg, sources said Wednesday, examining whether he paid taxes on the perks Trump has given him and his family over the years, including luxury cars and private school tuition.
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Previously, the AG office’s investigation had been civil, meaning it could sue or fine Weisselberg and the Trump Organization, but could not press criminal charges. Weisselberg has not been accused of any wrongdoing.
Dive Insight:
James’s focus on Weisselberg overlaps with the monthslong investigation by Manhattan District Attorney Cyrus Vance, Jr., who has been probing former President Trump’s family business for possible tax evasion, among other criminal actions, and been angling to gain Weisselberg’s cooperation.
James’s and Vance’s offices have recently begun collaborating on their investigations, a source told the New York Times. Two assistant attorneys general from James’s office have joined Vance’s team since the investigation began, the source added.
In a Wednesday statement, former President Trump said the investigation is “in desperate search of a crime” and is politically motivated.
The Trump Organization probe has gradually narrowed its focus on Weisselberg, including subpoenaing his bank records, in an attempt to find whether the company falsely reported property values to secure loans and tax breaks, the New York Times said in March.
Scrutinizing Trump’s gifts to the Weisselbergs, including the private school tuition for his grandchildren, a New York apartment and several cars, “appears to be part of an effort to paint a picture of Weisselberg’s financial life, as is common when prosecutors seek cooperation from a potential witness,” the Times said at the time. “It is unclear whether prosecutors suspect any wrongdoing related to the gifts.”
At the core of the attorney general’s investigation is whether the Trump Organization lied about the value of its assets in order to secure loans and insurance and to reduce its tax liability, The Atlantic reported Wednesday. James is particularly focused on the company’s valuation of Seven Springs, a 213-acre estate in Westchester, New York, which, in 2015, it used to claim a $21.1 million tax deduction for a “conservation easement.”
James’s office is also investigating a $160 million loan on a Wall Street property Trump personally guaranteed for $20 million and “large portions of debt” the businesses owes related to the Trump International Hotel and Tower in Chicago and claimed as taxable income, as well as the valuation of Trump National Golf Club in Los Angeles, the Atlantic said.
