OP-ED: Trump’s accountant confronts a loyalty test

Timothy L. O'Brien
Bloomberg Opinion (TNS)
Trump Organization finance chief Allen Weisselberg appears in a New York court after turning himself in to authorities on July 1, 2021 in New York City. (Seth Wenig-Pool/Getty Images/TNS)

Donald Trump and his accountant, Allen Weisselberg, have spent decades crunching the Trump Organization’s numbers together. During a 2007 deposition stemming from an unsuccessful libel suit Trump filed against me, the former president testified under oath that he and Weisselberg routinely worked jointly to prepare summaries they shared with banks that were trying to assess Trump’s financial wherewithal.

“He shows me. We’ll talk about it. He’ll do it,” Trump noted. “And he’ll show me, before we go to the final drafts and put down everything.”

“Do you review the asset values and liabilities in the statement of financial condition prior to providing this financial statement to any other party?” my lawyer asked.

“Yes, I review them,” Trump responded.

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Manhattan District Attorney Cyrus Vance Jr. has spent almost three years investigating whether such tag-teaming by Trump and his accountant involved misrepresentations meant to defraud banks, tax authorities and others. On Thursday, in an attempt to resolve these questions, Vance’s office unsealed an indictment of Weisselberg and the Trump Organization on charges of tax fraud.

The indictment is more sweeping than anticipated. It alleges that a 15-year tax-fraud scheme enabled Weisselberg to pay no taxes on cars, apartments and private-school tuition that the Trump Organization gave him. Such benefits are supposed to be accounted for as compensation, and to intentionally avoid paying taxes on them is a crime. The indictment cited about $1.76 million worth of perks that Weisselberg received, and the charges include falsification of business records and grand larceny.

The indictment is meant to squeeze Weisselberg and thus convince him to testify against Trump. While Trump and his supporters have painted the charges as part of a partisan witch hunt, Vance is following a classic prosecutorial strategy. It may appear brutal, and these initial charges might seem underwhelming, but this is how prosecutors build cases. Vance also convened a special grand jury to decide whether the criminal indictment was warranted, a move meant to insulate the process from partisan politics by taking that decision out of his hands.

The immediate consequences are serious. A criminal indictment will imperil the Trump Organization’s business and banking relationships, possibly derailing the company regardless of where the litigation leads. Weisselberg and the Trump Organization pleaded not guilty and will fight the charges. But Weisselberg’s trial is probably months away, and during that time, as he ponders the possibility of a 15-year prison sentence, his loyalty to Trump will be tested.

Weisselberg is one of the few people in the Trump Organization to have regularly dealt directly with Trump on pivotal financial matters. Others include Trump’s three eldest children, who worked there; his controller, Jeffrey McConney; and his former in-house legal counsel, Jason Greenblatt. All of them are certainly aware that, with Trump, loyalty has typically been a one-way street, and that he has rarely supported others when his own livelihood or personal prospects have been threatened. That may inform how Weisselberg and others ultimately weigh their own loyalty if their legal perils escalate.

Trump is mired in two investigations — Vance’s and a related criminal probe overseen by New York State Attorney General Letitia James — that have delved more deeply into his personal and corporate finances than any other outside examination he’s encountered. He and his company have never before faced the prospect of criminal charges. Given those stakes, Trump will surely be tempted to try distancing himself from any evidence of fraud and from those found guilty of engineering crimes.

To secure a criminal conviction, prosecutors have to prove that defendants knew their actions were illegal. Trump will undoubtedly claim he never intended to do anything wrong — and that, if crimes occurred, he relied on the advice of others. Weisselberg, the most enduring and knowledgeable steward of the Trump family’s financial secrets, was usually the adviser Trump sought out first when money was on the table. If more criminal charges find their way to Trump, it’s hard to imagine he wouldn’t point his finger at Weisselberg.

Trump is likely to suggest that Weisselberg, not him, was the architect. But as that deposition from 2007 shows, Trump and his accountant navigated financial waters jointly, and he may have a lot more explaining to do.

— Timothy L. O'Brien is a senior columnist for Bloomberg Opinion. This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.