Trump signed checks at stake in tax fraud, ex-CFO testifies

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By Luc Cohen and Karen Freifeld

NEW YORK (Reuters) – Former US President Donald Trump signed checks for Christmas bonuses for executives of his namesake company as if they were independent contractors, longtime chief financial officer Allen Weisselberg testified Thursday.

But Weisselberg said Trump was not conspiring with him over the tax fraud scheme the Trump Organization is on trial for.

Paying employees as independent contractors is one way. Prosecutors in the Manhattan district attorney’s office say Trump’s real estate company deceived tax authorities over a 15-year period. The scheme also included paying employees’ personal expenses, prosecutors said.

Trump has not been charged with wrongdoing. Weisselberg pleaded guilty in August and agreed to testify as part of a plea deal.

Weisselberg said Thursday that between about 2005 and 2017, he, controller Jeffrey McConney, and a handful of other executives at Trump’s real estate company received bonuses from Trump Organization companies as non-employee compensation that saved them and corporate taxes.

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“For years, Donald Trump has always wanted to sign the bonus checks,” Weisselberg said. “I would usually bring them in.”

Asked by District Attorney Susan Hoffinger if Trump understood they were for employees, Weisselberg said, “Correct.”

But under cross-examination by Trump Organization attorney Alan Futerfas, Weisselberg said he conspired with McConney, but not with any member of the Trump family.

“It was my own personal greed that led to this,” says Weisselberg, who is on paid leave from the company. He testified that he is still receiving his $640,000 a year salary and hopes to receive another $500,000 bonus in January.

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Weisselberg, 75, admitted to evading taxes on $1.76 million in income when he pleaded guilty. McConney is immune from prosecution for tax fraud because he testified before the grand jury that indicted both Weisselberg and the Trump Organization.

The company has pleaded not guilty and argued that Weisselberg acted for its own benefit.

Weisselberg also said Thursday that Trump withheld checks for his grandchildren’s private school fees. He said Trump himself offered to make the payments after Weisselberg saw him do so for his own grandchildren’s school fees.

“I said, ‘Remember, I’m going to pay you back for this,'” Weisselberg said. But he said he and Trump never discussed how.

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Weisselberg said he ultimately cut his salary and bonus by the amount of tuition Trump covered, as well as the rent for a luxury Manhattan apartment paid by the company. That lowered his taxable income.

The questionable practices finally came to an end in 2017 when Trump became president, Weisselberg said.

“We went through a whole corporate cleanup process to make sure that since Mr. Trump is now president, everything was done right,” Weisselberg said.

Under questioning by Futerfas, Weisselberg said he had betrayed the trust the company placed in him.

When asked if he was ashamed of what he did, he choked and replied, “More than you can imagine.”

(Reporting by Luc Cohen and Karen Freifeld in New York; editing by Matthew Lewis)

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