Trump's ex-CFO, at tax fraud trial, says company reaped big savings with perks (updated)

Crown Equity Holdings

15/11/2022 20:10

(Recasts to lead on Weisselberg's testimony about payments)
    By Karen Freifeld and Luc Cohen
       NEW YORK, Nov 15 (Reuters) - Former U.S. President
Donald Trump's namesake company saved hundreds of thousands of
dollars by paying longtime executive Allen Weisselberg's rent
and other personal expenses instead of increasing his salary,
Weisselberg testified on Tuesday at the company's tax fraud
trial. 
    Weisselberg, the Trump Organization's former chief financial
officer, spoke about the savings during testimony as the
prosecution's star witness.
    The Trump Organization has pleaded not guilty to charges in
2021 by the Manhattan district attorney that it hid executive
perks from tax authorities for over 15 years, and falsely
reported bonuses as non-employee compensation.
    Weisselberg pleaded guilty in August to avoiding taxes on
$1.76 million in income and helping engineer tax fraud. His plea
agreement requires him to testify in exchange for a five-month
jail sentence.
    Trump, a Republican, has not been charged, and has called
the prosecution politically motivated. Alvin Bragg, the
Manhattan district attorney, is a Democrat.
    During questioning by prosecutor Susan Hoffinger on Tuesday
in a New York state court, Weisselberg testified that starting
around 2005, the Trump Organization paid the $7,000 to $8,000
monthly rent on his Manhattan apartment, as well as his
utilities, phone and parking garage bills. 
    Weisselberg, 75, testified the arrangement began after Trump
suggested he live closer to the company's Fifth Avenue
headquarters, rather than commute from his home in suburban Long
Island. 
    "He said, 'Allen I think it's time you should consider
moving into the city,'" Weisselberg said, adding that Trump also
said it would "help you, help the company." 
    Weisselberg said rent and accompanying expenses grew to
about $200,000 a year. He said if the Trump Organization gave
him a raise to cover those expenses, it would have cost the
company twice as much to account for his resulting taxes.
    "The Trump Corporation would have had to give me double the
amount," Weisselberg said, referring to one of the two Trump
Organization units charged in the case. 
    Weisselberg said he did not report the payments on his tax
returns and purposefully withheld them from Mazars, an
accounting firm that prepared his taxes, because it might have
balked at signing his returns.
    The company's lawyers have argued that Weisselberg, who has
worked for Trump for half a century, orchestrated the scheme to
benefit himself. They have also sought to blame Mazars, which
for many years prepared Trump Organization tax returns. 
    Weisselberg said he received a $640,000 salary and $500,000
bonus before being charged in 2021.
    He said his salary has remained unchanged, including after
going on paid leave last month, and that he got a bonus this
year despite stepping down as CFO and executive vice president. 
    Hoffinger asked if he expected to receive another $500,000
bonus in January. 
    "Hopefully, yes," Weisselberg said.  
    The trial's first witness, Trump Organization controller
Jeffrey McConney, testified that he did not know whether
executives' rent payments were taxable income.
    McConney had been granted immunity to testify before the
grand jury that indicted Weisselberg and the company. 
    Weisselberg said McConney knew the payments should have been
reported, citing his experience in accounting. 
    "I believe he knew the law," Weisselberg said.
    Weisselberg is expected to continue testifying when trial
resumes on Thursday.
    The case is one of several legal troubles facing the
76-year-old Trump as he prepares to announce another bid for the
presidency after losing in 2020.
 (Reporting by Karen Freifeld and Luc Cohen in New York; Editing
by Josie Kao and Noeleen Walder)
 ((luc.cohen@thomsonreuters.com; +1 646 361 1622; Reuters
Messaging: Twitter: @cohenluc))