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By Elie Honig
I’ll answer your first question first: no, Donald J. Trump will not and cannot go to prison for this (or, at least, for this without more).
New York state prosecutors — the combined forces of Manhattan District Attorney Cy Vance and New York Attorney General Letitia James — have indicted the Trump Organization (as a corporation) and its longtime Chief Financial Officer Allen Weisselberg (as an individual). That matters, and it could soon matter more. However, if you’re hoping to see Donald Trump handcuffed and behind bars — this won’t do the trick. And if you’re hoping the investigation falls flat and Trump avoids incarceration, you can breathe a sigh of relief, certainly for now and probably for good.
Prosecutors can and sometimes do indict corporations. I never did it when I was a federal prosecutor — mobsters don’t tend to officially incorporate as, say, “Gambino Shakedowns LLC” — but I supervised some corporate prosecutions at the New Jersey AG’s Office. In one case, for example, we indicted a crooked engineering firm that violated the state’s “pay to play” laws by making undisclosed (hence, illegal) campaign contributions to well-connected politicians who then funnelled lucrative contracts back to the firm. Importantly, we also indicted the firm’s officers and employees who were involved in the scheme, in their individual capacities.
Corporate charges can be a potent means to hold to account not only the people who concocted a crooked scheme, but also the corporate entity that facilitated it. But the Trump Org indictment, as it currently stands, is thin gruel. The crux of the allegation is that the Org gave its employees some of their income in the form of cash bonuses and perks — tuition, car payments, rent — to avoid paying income taxes due on those benefits. Trump’s attorneys have a legitimate point when they note that conduct of this relatively mild nature wouldn’t typically result in a criminal charge against a corporation. I’ve never heard of corporate criminal charges based on tax evasion conduct similar to that alleged against the Trump Org, without more.
Indeed, the Trump Org’s charged conduct pales in comparison to prototypical corporate criminal cases. For more typical corporate indictments, think BP (indicted and convicted for manslaughter, environmental violations, and obstruction over the Deepwater Horizon explosion and oil spill) or Tyson Poultry (indicted and convicted for large-scale environmental violations). The Trump Org’s charged conduct seems mild even next to my humble state-level case against the crooked, bribe-paying engineering firm.
If successful — keep in mind that indictment is the easy part, while unanimous conviction by proof beyond a reasonable doubt is much tougher — a corporate prosecution can result in meaningful penalties. The company might have to pay fines or restitution (repayment to victims, that is). The company might end up subject to supervision by an outsider to enforce compliance with laws moving forward. Or in some scenarios the company could be dissolved, either specifically by court order or as a practical consequence of a prosecution — if, for example, the corporation loses business, or if banks call in loans due to an indictment. Bottom line: this prosecution will hamper the Trump Organization’s financial prospects, and could put it out of business permanently, though that seems unlikely here given the limited nature of the charges.
But a corporate indictment cannot legally result in a prison sentence for any individual. You might reasonably wonder whether the principal officers of a company ought to be automatically criminally liable for that company’s acts. We could have a spirited debate about whether that should be so; but the law simply says it isn’t. If prosecutors want to send a person to prison, they must specifically charge and convict that person in his individual capacity — as my former office did in the case of the crooked engineering firm and its top brass.
This doesn’t mean Donald Trump is in the clear just yet. The DA certainly might decide to add charges against Trump (they’ve stressed the investigation is ongoing, as all prosecutors do, always), or they might flip people who get them to the next level (more on this in a bit). But it does appear that, at the moment, prosecutors don’t have enough ammo to bring a criminal charge against Trump personally. Instead, it seems they are trying to build a case by applying pressure on potentially valuable witnesses to cooperate.
The Trump Org indictment could help prosecutors move towards that goal. If the Trump Org loses business, or gets shut down altogether, as a result of this week’s indictment, that could kick off a potent chain reaction. If I had to list out the reasons why, in my experience, people decide to flip, the top two items would be: (1) to reduce their own prison time, and (2) because the money ran out. (I’m not even sure what number three would be; there would certainly be a massive dropoff after reason two.)
If the cash spigot runs dry for the Trump Org and those who depend on it for income, then key players will start to think hard(er) about flipping. But if there’s no money left to pay the lawyers and to maintain the lifestyles, then it becomes time to preserve the basics — including, first and foremost, staying out of prison. I prosecuted more than a couple mobsters and other criminals who flipped in some part because the money dried up.
Which brings us to Allen Weisselberg. Prosecutors have identified Weisselberg — correctly in my view, as a tactical matter — as the fulcrum of this case, as the pressure point that could break the matter wide open. Weisselberg has the two traits that make him the ideal cooperator. First, he has insider access; he has been the Chief Financial Officer of the Trump Org for decades, and he’s the only member of the Org’s inner circle whose last name isn’t “Trump” (the others being Donald, Don Junior, Eric, and, formerly, Ivanka, who left the Org to go be a vastly unqualified senior White House advisor to her pops in 2017).
Second, now that he has been indicted individually — the kind of indictment that can send a person to prison — Weisselberg has a tangible incentive to flip. This will all come down to loyalty. How will Weisselberg weigh the downside of fighting the DA’s newly-filed charges and risking exposure to prison time against the upside of cooperating and potentially sparing himself? Weisselberg turns 74 years old in a few weeks (happy birthday, Mr. W!) and the prospect of even a couple years in New York state prison must be daunting.
On the other hand, the charges are far from ironclad, involving nuanced applications of the law around tax write-offs. Most criminal defendants ultimately get convicted, but I’d put Weisselberg in the small group that has a reasonable chance to beat the case. And there’s no public sign yet that Weisselberg has parted ways with the Trumps after decades by their side. To the contrary, he reportedly continues to go into work at the Trump Org every day, and his lawyers have informed prosecutors that he does not intend to cooperate. Of course, those guarantees were made before Weisselberg found himself on the short end of an indictment; the reality of criminal charges sometimes can shake people loose and compel them to cooperate.
It’s still possible the DA gets around to indicting Trump, or other officers, even if Weisselberg “stands up” (as they say in the mob to refer to guys who fight their charges without flipping). They’ve got Michael Cohen’s (probably too-eager) cooperation, limited though it may be in specificity and by his oft-stated personal hatred for Trump; they’ve got Trump’s tax returns and many more documents; they’ve got testimony from the Trump Org controller, Jeffrey McConney, though we don’t know whether his testimony was helpful or harmful to Trump’s cause.
But we also know Trump has never been an e-mailer or a texter, so there’s no incriminating smoking gun (imagine how different the world might be if Trump texted as freely as he once tweeted…). There’s no indication that prosecutors have wiretapped Trump or otherwise obtained an incriminating recording of him. And it seems nobody in that familial inner circle (or Weisselberg) has flipped yet.
This week’s charges have dealt a solid blow to the Trump Org. But if this is all that New York prosecutors end up doing on the case, then it’ll be an embarrassingly weak showing for them — and Donald Trump will, once again, emerge relatively unscathed.
Elie Honig is the author of the book, “Hatchet Man: How Bill Barr Broke the Prosecutor’s Code and Corrupted the Justice Department,” out now. It is available at here.