Trump’s potential New York legal woes

Donald Trump
Donald Trump
Jacquelyn Martin/AP/Shutterstock
President Donald Trump.

Trump’s potential New York legal woes

The president is the subject of several investigations in the Empire State.
March 25, 2018

Special counsel Robert Mueller has finally published his findings after an extensive investigation into Russian interference in the 2016 presidential election. According to a summary sent to Congress by U.S. Attorney General William Barr, the report did not produce evidence of collusion between President Donald Trump's campaign and Russia, nor did it recommend further indictments beyond the ones that have already been issued against Trump associates such as Roger Stone and Paul Manafort. Mueller also chose not to indict Trump on obstruction of justice, but stopped short of exonerating the president.

Democrats in Congress have indicated that they will not stop their own hearings and investigations into Trump and his associates while they advocate for Barr to release the Mueller report in full. Whether or not any new investigations or indictments will come about in the aftermath of that report, Trump and his associates still have plenty of headaches in New York as independent investigations continue. Gov. Andrew Cuomo said in a recent radio interview that the end of the Mueller probe does not mean the president is “out of woods with legal trouble,” calling federal prosecutors in New York “as serious as a heart attack.” Here are the investigations and lawsuits they and other agencies have been pursuing.

Attorney general investigates Trump Organization projects

In March, The New York Times reported that the state attorney general’s office had subpoenaed Deutsche Bank and Investors Bank for information regarding the financing of several Trump Organization projects – the Trump International Hotel in Washington, D.C., the Trump National Doral golf resort outside Miami and the Trump International Hotel and Tower in Chicago – as well as Trump’s failed attempt to buy the Buffalo Bills. State Attorney General Letitia James issued the subpoena as a result of the congressional testimony of Michael Cohen, the president’s former personal lawyer and fixer, who said that Trump has inflated the worth of his assets in financial documents. Trump dismissed the subpoena on Twitter, saying it is “All part of the Witch Hunt Hoax. Started by little Eric Schneiderman & Cuomo.”

Unknown Southern District of New York investigation

While testifying before Congress, Michael Cohen said that the U.S. attorney for the Southern District of New York was investigating “illegal actions” taken by Trump as part of a non-public inquiry. He could not offer additional details, saying that prosecutors had asked him not to discuss it.

Southern District of New York investigation into Trump inaugural committee

The Wall Street Journal reported in December that federal prosecutors in New York had opened an investigation into Trump’s 2017 inaugural committee in order to determine if it misspent any of the record $107 million it raised. They will also look into whether donors gave money in exchange for access to the administration. Several months later, in February, prosecutors subpoenaed the inaugural committee for records relating to donors, vendors and franchises, as well as documents that may indicate donors received any “benefits” in exchange for their donations.

State tax department looks into fraud allegations

Following an explosive investigation by The New York Times into Trump and his family’s business dealings that included revelations of potential tax fraud and tax evasion, the state Department of Taxation and Finance said it would review the allegations to determine if Trump or members of his family broke any state laws. Trump’s lawyer called all the allegations “100% false and highly defamatory” in a statement. A few days later, New York City officials also announced they would investigate the allegations made in the Times story in cooperation with state efforts.

Manhattan district attorney indicts Paul Manafort

Immediately after a second federal court handed down its sentencing of former Trump campaign chairman Paul Manafort, Manhattan District Attorney Cyrus Vance Jr. announced a series of state indictments against Manafort. Vance implied the purpose of the charges is to ensure Manfort serves jail time even if Trump issues a pardon for Manafort's federal crimes. However, a case before the Supreme Court involving double jeopardy laws may hinder this and any other state case brought against Trump or his associates if the state-level charges are the same as the federal crimes.

Attorney general lawsuit against the Trump Foundation

After a two-year investigation, the state Attorney General’s office filed a lawsuit against the president’s charitable foundation, the Donald J. Trump Foundation. The office accused the foundation of campaign finance violations, self-dealing and illegal coordination with Trump’s presidential campaign. The investigation began soon after the 2016 presidential election and following an investigation conducted by The Washington Post that uncovered many of the questionable expenditures addressed in the lawsuit. These included using foundation money to pay for legal expenses incurred by Trump’s private businesses, paying for a new fountain outside of Trump Tower and purchasing a $10,000 portrait of Trump that used to hang in one of his golf clubs.

The lawsuit alleges that the Trump Foundation effectively became an illegal arm of the Trump campaign, with emails showing that then-campaign manager Corey Lewandowski directed the foundation’s spending, even though that is illegal. The attorney general’s office is seeking over $2.8 million in restitution, stating that is the sum that the foundation raised in illegal in-kind campaign contributions.

In addition to that and other potential fines the foundation faces, Attorney General Barbara Underwood is also looking to dissolve the foundation completely and bar Trump from serving as the director of a non-profit for 10 years and his children Ivanka, Eric and Donald Jr. from serving on the board of a non-profit for one year.

When the lawsuit was announced, Trump responded to it on Twitter by calling is attempt by “sleazy New York Democrats” to smear him and that he has no plans to settle.

Tax department investigation into the Trump Foundation

About a month after the attorney general’s office announced its lawsuit, The New York Times reported that the state Department of Taxation and Finance opened an investigation to examine whether the Donald J. Trump Foundation violated state tax law. While it is expected to cover some of the same ground as the lawsuit, this criminal investigation could uncover further information, such as Trump’s tax returns. The agency can refer its findings to law enforcement, such as the attorney general’s office, at the close of the investigation if it reveals criminal activity, or it could present the findings to a grand jury.

A day after Cohen’s guilty plea in federal court, the department subpoenaed Cohen for this investigation, requesting documents relating to the Trump Foundation. The night of that plea, Cohen’s lawyer Lanny Davis made appearances on cable news, telling CNN that his client “has information about Mr. Trump that would be of interest both in Washington as well as New York state,” and telling MSNBC off-air that Cohen has information about the Trump Foundation that would be of interest to the New York attorney general.

SDNY prosecuting Cohen

After a referral from special counsel Robert Mueller, the FBI executed a search warrant and raided Cohen’s office a year ago. Although Mueller uncovered information that led to the raid, it did not fit into his line of inquiry into Russian meddling in the 2016 presidential election. So he handed it off to the U.S. attorney’s office for the Southern District of New York, which began its own case. (U.S. Attorney Geoffrey Berman, who was appointed by Trump, recused himself. The investigation is being overseen by his subordinates.) In the raid, the FBI searched for documents related to, most notably, the payment Cohen made to Stormy Daniels before the 2016 election.

In addition to investigating the pay off to Daniels and whether or not it violated campaign finance laws, reports emerged that Cohen was under investigation for over $20 million in loans related to his taxi business. Cohen pleaded guilty to eight counts, including tax evasion, bank fraud and campaign finance violations. As part of his plea, Cohen admitted to paying Daniels and one other woman in exchange for their silence regarding alleged affairs with Trump. He implicated the president as well, saying that he arranged those payments at then-candidate Trump’s behest.

The plea reignited an ongoing debate about whether or not a sitting president can be indicted, since one has now been directly implicated in a crime. Following Cohen’s plea, Trump said he knew about the payment after the fact, but said that since the money did not come from his campaign account, it was not illegal. This is not true.

Attorney general investigation of Cohen’s finances

Following the completion of the federal investigation, then-state Attorney General Barbara Underwood decided take a crack at Cohen as well. She was looking to begin a criminal tax investigation into Cohen, which would be separate from the federal tax evasion he has already pleaded guilty to, thus avoiding New York’s strict double jeopardy laws. Underwood had been seeking a referral from the state Department of Taxation and Finances, which is necessary before the state attorney general’s office can begin its inquiry. The current status of that potential investigation remains unknown.

Hot on the heels of the Michael Cohen’s guilty plea where he admitted to paying porn star Stormy Daniels to stay quiet about her alleged affair with President Donald Trump, Manhattan District Attorney Cy Vance is reportedly thinking about opening an investigation into the Trump Organization. The company reimbursed Cohen, Trump’s former attorney and fixer, for the $280,000 he paid to Daniels and another woman, writing it off as a “legal expense.” But federal prosecutors argued this is not an accurate description of how the money was used. Vance’s office has not made a final decision about whether to bring criminal charges, but New York state has been far from inactive when it comes to Trump’s dealings. Here are the other lawsuits and investigations currently or soon to be underway by the state.

Rebecca C. Lewis
is a staff reporter at City & State.
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