‘Foot In The Door’: Prosecutors Penetrate Trump Org With Subpoena To CFO

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This week brought an unwelcome turn in the spotlight for a notoriously under-the-radar fixture in President Trump’s inner circle: Trump Organization Chief Financial Officer Allen Weisselberg.

Weisselberg’s name first cropped up in a now-public audio recording of Trump and his former fixer Michael Cohen discussing a payment related to Trump’s alleged  affair with a former Playboy playmate.

Then, on Thursday, the Wall Street Journal broke the news that Weisselberg has been subpoenaed to testify before a federal grand jury as part of the Manhattan U.S. attorney’s criminal investigation into Cohen’s finances.

The revelation draws the President’s family real estate business even further into that federal probe, providing prosecutors with access to an individual intimately familiar with the Trump Organization’s operations and deals.

“Weisselberg’s involvement in this gives the prosecutors a foot in the door to the Trump Organization, if they didn’t already have one,” Mimi Rocah, a former federal prosecutor in the Southern District of New York, told TPM. “It doesn’t open the door all the way, but it gives them a foot in the door.”

Weisselberg and the Trump Organization did not return TPM’s requests for comment.

Professional Trump chroniclers have for months suggested that Weisselberg, rather than Cohen, presented the secret to the Trump Organization’s finances. The trusted 70-year-old executive vice president and CFO got his start working for the president’s father, Fred, and has been with the firm since the 1970s. Currently, Weisselberg oversees operations of the firm alongside Trump’s two adult sons.

Save for a one-time turn as a judge on “The Apprentice,” Weisselberg has shied away from publicity, eschewing the bright lights of the campaign trial and the White House for a family-centered, quiet life in the Long Island suburbs. But several currently unfolding legal matters suggest that Weisselberg, like Cohen, played a hybrid role, handling all sorts of personal and business-related financial matters for Trump.

“While Cohen certainly helped Trump with a lot of sticky situations, money is always at the root of any issue,” former federal prosecutor Jeff Cramer told TPM. “Sooner or later, it all flows through the CFO.”

One matter involving all three men is a payment related to former Playboy model Karen McDougal’s alleged 2006 affair with Trump.

In a recording Cohen’s attorneys released this week, Cohen tells Trump that he spoke to Weisselberg about how best to structure a deal to buy the rights to McDougal’s story.

“I’ve spoken to Allen Weisselberg about how to set the whole thing up,” Cohen said.

Trump, nonplussed, asks what the financial damage will be. A few moments later, Cohen reiterates that he “spoke to Allen about” the financing.

As the Wall Street Journal has reported, Cohen set up a Delaware limited liability company to buy the rights to McDougal’s account from tabloid giant American Media Inc. The National Enquirer, an AMI publication, had purchased McDougal’s story for $150,000 during the campaign but never released it in an alleged effort to help Trump.

Cohen ended up dissolving the LLC without ever making any payment to AMI, according to the Journal. Trump Organization attorney Alan Futerfas denied to the Washington Post that Cohen actually discussed the matter with Weisselberg, calling the CFO “a bookkeeper who simply carries out directions from others about monetary payments and transfers.”

The three men were involved in another unusual financial situation that did go through, however. In 2017, Weisselberg arranged for the Trump Organization to reimburse Cohen for the $130,000 payment he made to adult film star Stormy Daniels to keep her quiet about her own alleged affair with Trump. A source close to Weisselberg told the Journal that he was unaware of the payment to Daniels when he approved the $35,000 monthly retainer for Cohen.

Former prosecutors told TPM that attorneys in the Cohen case will want to know how much Weisselberg actually knew about these arrangements and whether these kind of payouts were standard practice for the Trump Organization.

“He’s going to be able to explain the financial records; he may be able to explain the thinking of Trump, Cohen, and other central individuals when the payments were made,” former Manhattan federal prosecutor Harry Sandick said. “He may know of records that exist that would also shed light on when and how they were made.”

Sandick noted that from the casual way Trump and Cohen discuss the AMI payment, “It doesn’t sound like a novel thing that’s never happened before. It sounds like something that happens all the time.”

Weisselberg has three options, prosecutors say. He can go in for what’s called a proffer session with the U.S. attorney’s office where he’ll take questions alongside his counsel and hand over any documents requested. He can agree to sit through grand jury testimony. Or he can plead the Fifth.

What route he goes will likely depend on the value of the information Weisselberg has to provide and how much liability he sees himself having. If he was, as Trump Organization attorney Futerfas put it, simply a “bookkeeper” with no intimate knowledge of the company’s more unorthodox dealings, he likely faces little legal exposure.

Rocah, the former Manhattan prosecutor, finds that line of defense unpersuasive: “It’s not like they called up 1-800-accountant. This is someone with a longstanding relationship that the [President] seem[s] to trust. So it’s gonna be hard for him to make that, ‘I had no idea’ defense.”

Complicating matters further is Weisselberg’s role as treasurer for the Donald J. Trump Foundation, the President’s beleaguered charity. In June, New York Attorney General Barbara Underwood sued the foundation and its board—Trump and his three eldest children—for engaging in “a pattern of persistent illegal conduct.”

Though Weisselberg is not named as a defendant, his name is all over the complaint. In a quoted deposition, he admitted to not knowing he served as the foundation’s treasurer. He also copped to being intimately involved in improperly providing the charity’s funds to activities related to Trump’s 2016 campaign. Included in the complaint is a handwritten note from Trump directing “Allen W” to funnel $100,000 from the foundation to settle a personal legal matter—a violation of charitable tax law.

Seth Perlman, a New York-based non-profit attorney, said that as treasurer Weisselberg is ultimately “responsible for the finances of the organization.”

“He should be questioning what expenditures are being made,” Perlman continued. “That’s part of his job. Since there were no paid employees at this organization, he was also acting essentially as chief financial officer. So he’s really the primary person that should’ve been aware of what was happening and should have taken steps to stop it.”

Manhattan prosecutors will likely soon find out just how tuned in Weisselberg was to what was going on at the Trump Organization’s midtown headquarters.

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