One of the charges filed this week against the Trump Organization
and its chief financial officer involves a type of pay strategy that is allegedly also connected to Ivanka Trump
Among the 15 felony charges detailed in the indictment
against the Trump Organization and CFO Allen Weisselberg
is a scheme to pay Weisselberg as both an employee of the company and as a nonemployee contractor or consultant to other businesses in the Trump Organization, ostensibly to avoid taxes
for both the company and Weisselberg.
On Thursday, the Trump Organization and Weisselberg pleaded not guilty to all charges, including conspiracy
, grand larceny, criminal tax fraud
, and falsifying business records.
The New York Times
reported last year that a consultant payment strategy was part of Manhattan
's district attorney
's and New York State Attorney General
's investigations into the Trump Organization.
The investigation focused on Trump Organization tax write-offs for “millions of dollars in consulting fees, some of which appear to have gone to Ivanka Trump,” according to sources, though there was no indication at the time that the former president
’s daughter was a target of the investigation.
According to the Associated Press
, the attorney general also issued a subpoena to the Trump Organization last year for records relating to consulting fees paid to Ivanka Trump while she was also a senior executive at the Trump Organization.
According to the New York Times, both city and state investigators issued subpoenas last year for information on tax write-offs for “millions of dollars of consulting fees” paid to TTT consulting, a limited liability company set up for Trump’s eldest three children
. However, only fees paid to Ivanka Trump in the last few years are publicly known, because she was required to reveal fees owed to TTT consulting.
Ivanka Trump could not be reached for comment at the time of publication.
In light of the indictment against the Trump Organization and Weisselberg, MSNBC
's Rachel Maddow
referenced the Times' revelation about Ivanka Trump's consultant fees on her show Thursday night.
Weisselberg allegedly received both a salary from the Trump Organization and “non-employee compensation” as a “self-employed” contractor for other Trump businesses, such as Wollman Rink in New York’s Central Park
, allowing him to shelter more of his income
in a retirement
account as a “self-employed” worker, despite the fact that he wasn’t self-employed.
It was "exactly the kind of scheme" described by The New York Times in relation to Ivanka Trump, according to Maddow.
Maddow explained that the newspaper “described in detail financial records they discovered that showed Ivanka Trump being paid both as an employee of the Trump Organization and as a consultant to the Trump Organization in a way that seemed custom-designed to try to evade taxes both for the company and for her.”
The indictment does not name Ivanka Trump or “other executives” other than Weisselberg who are accused of receiving “non-employee compensation.”
The perp walk of Trump Organization CFO Allen Weisselberg https://t.co/Sm037o4q44
— Zach Everson (@Z_Everson) July 1, 2021
According to the New York Times, Donald Trump
reduced his taxable income between 2010 and 2018 by deducting approximately $26 million in fees to “unidentified consultants as a business expense on numerous projects.”
According to the newspaper, “some of those fees appear to have been paid” to Ivanka Trump, who reported receiving payments from a consulting company she co-owned totaling $747,622 on a 2017 disclosure she filed when joining the White House
as a presidential adviser, which “exactly matched consulting fees claimed as tax deductions by the Trump Organization for hotel projects in Hawaii
and Vancouver, Britannia.”
Ivanka Trump was an executive officer of the Trump companies that made the payments at the time of the payments, according to the Times, which means she “appears to have been treated as a consultant while also working for the company” as a senior executive.
Susanne Craig, a Times investigative reporter, told Maddow on Thursday that Ivanka Trump's role as an officer of the Trump Organization while also receiving consulting fees from the company is a "red flag."
In response to the Times' story last year, Alan Garten, general counsel for the Trump Organization, told the paper, "this is just the latest fishing
expedition in an ongoing effort to harass the company."
Trump has denied all wrongdoing, claiming that the indictments against his company and Weisselberg were politically motivated.
In the indictment, federal prosecutors
accuse Weisselberg and the company of committing tax evasion.
“The purpose of the scheme was to compensate Weisselberg and other Trump Organization executives in an ‘off the books
’ manner: the scheme’s beneficiaries received substantial portions of their income through indirect and disguised means, with compensation that was unreported or misreported by [the Trump Organization] to the tax authorities,” the indictment stated.
“The scheme was intended to allow certain employees to substantially understate their compensation from the Trump Organization, so that they could and did pay federal, state, and local taxes in amounts that were significantly less than the amounts that should have been paid,” the statement continued.