Trump’s Accountant Given Use Immunity Before NY Grand Jury Investigating Trump Organization

Above Image: Photoshopped Time cover from Trump’s former lawyer and “fixer” Michael Cohen. From your imagination to God’s ears, Mikey.

The Washington Post has more bad news for “Mafia Don” Trump and his crime family in what has been a very bad week for him on the legal front: Trump’s longtime accountant testifies to N.Y. grand jury in criminal probe:

A longtime accountant for former president Donald Trump — who helped prepare Trump’s taxes and the financial statements his company used to woo lenders — testified recently before a New York grand jury investigating Trump’s financial practices, according to two people familiar with that investigation. Ruh-roh.

Accountant Donald Bender, of the firm Mazars, appeared before a grand jury that was impaneled this fall by Manhattan District Attorney Cyrus R. Vance Jr. (D) to weigh potential criminal charges, the people said.

In addition, in recent weeks prosecutors have interviewed Rosemary Vrablic, a former managing director at Deutsche Bank who arranged hundreds of millions of dollars in loans to Trump, according to people familiar with the investigation. Vrablic’s interview was not before the grand jury. Instead, one person said, prosecutors pressed Vrablic about Trump’s role in dealings with the bank.

The people who described these interviews spoke on the condition of anonymity to describe an ongoing investigation.

The appearances by Bender and Vrablic suggest prosecutors are seeking information about Trump’s finances from a small circle of outside partners who handled details of Trump’s taxes and real estate deals. Bender and Vrablic were never Trump’s employees, but they knew more about his company’s inner workings than many employees did.

Prosecutors are investigating whether Trump’s company broke the law by giving widely different valuations for the same property at the same time. In some cases, for instance, the Trump Organization provided low valuations to property-tax officials, while telling lenders that the same property was worth much more. [What Trump’s former attorney and “fixer’ Michael Cohen testified about to Congress.]

Bender’s first appearance before the grand jury was brief, the people said. But they said he could return for more testimony in the coming weeks.

His appearance could be significant because Bender handled vast amounts of Trump’s financial information as an outside accountant. Prosecutors already obtained millions of pages of Trump-related documents from Bender’s firm, after a court battle that went to the Supreme Court twice.

Now, they have sought testimony from a man who could serve as a human road map to that data.

Note: Two of Al Capone’s bookkeepers, Leslie Shumway and Fred Ries, turned state’s evidence against Capone in return for immunity and witness protection, when told by the Feds that the Capone mob would probably kill them if they didn’t, as knowing too much they would be a liability to remain alive. Is history now rhyming?

This line of inquiry appears separate from the felony charges filed over the summer against the Trump Organization’s longtime chief financial officer, Allen Weisselberg, and two Trump corporate entities.

Those charges focused on allegations of tax evasion in the Trump Organization’s payrolls. Prosecutors said Weisselberg had concealed portions of executives’ pay — including his own — from the IRS. Weisselberg and the two companies have pleaded not guilty.

Spokespeople for Vance and New York Attorney General Letitia James (D), who is collaborating with Vance on the criminal probe, declined to comment. So did attorneys for Bender and Trump, and spokespeople for Mazars and Deutsche Bank.

There are two separate long-running investigations of Trump’s financial practices in New York state.

One is led by James, the attorney general, and it is civil in nature — meaning it could end in a lawsuit. In that investigation, James has already interviewed top Trump Organization employees, including Weisselberg and Trump’s son Eric, according to court documents. She is now seeking to take a deposition of Trump himself in early January.

The other investigation is led by Vance, in collaboration with James. It is criminal in nature, meaning it could end in misdemeanor or felony charges. That investigation is about to have a new leader: Vance is leaving office at the end of the month, to be replaced by newly elected Alvin Bragg (D).

If Vance or Bragg ever seeks to file charges against Trump himself, the burden of proof will be high. They would need to do more than simply prove the Trump Organization’s numbers were wrong.

They would need to show why they were wrong — to prove that Trump intended to deceive.

Dude, literally every utterance out of this grifter’s mouth is intended to deceive. How hard can this be?

That proof is unlikely to come from an email. Trump has never used email, either as a businessman or as a politician, employees have said. Instead, legal experts said, any evidence of Trump’s intent would have to come from someone close to him who could report what he said about his finances, and why.

That is a small circle. Weisselberg was in it. But so far, there has been no indication that he has cooperated with the district attorney’s investigation. Weisselberg’s lawyer declined to comment Tuesday.

Now, prosecutors appear to have expanded their focus to a small set of outside advisers who were not Trump employees but still handled details of Trump’s finances.

Last year, for instance, James’s investigators interviewed Sheri Dillon, an outside attorney who worked with Trump on tax and real estate issues, according to court filings.

Vrablic, meanwhile, dealt with many of Trump’s largest business loans. Vrablic left Deutsche Bank in December 2020, according to regulatory filings. Vrablic said at the time that the departure was her decision.

When Vrablic met with Vance’s staff, one of the people said, prosecutors asked her about Trump’s personal role in dealing with the bank. An attorney for Vrablic declined to comment.

For Bender, Trump’s longtime accountant, even his brief appearance before the grand jury had legal significance. Under New York law, witnesses before a grand jury are automatically granted immunity from prosecution — meaning that Bender could not be charged for his work for Trump.

Bender has provided a wide array of accounting services to Trump for decades. At his firm, Bender led a “select group of tax experts” who managed Trump’s affairs, former Mazars accountant Henry Kogan wrote in 2017 in an essay on a literary website.

“Donald’s entire professional existence revolved around one client, that client’s organization, and the hundreds of entities represented inside an IRS form,” Kogan wrote.

Bender personally signed the tax forms for Trump’s charitable foundation until it shut down in 2018, following a lawsuit by the New York attorney general that said the charity engaged in “persistently illegal conduct.” Trump was ordered to pay $2 million in damages. Neither Bender nor the firm was accused of any wrongdoing.

Beginning in at least 2003, Bender’s firm has also compiled Trump’s “statements of personal financial condition” that the future president circulated among journalists and others to brag about his finances.

The documents listed Trump’s business assets but frequently contained inflated figures, such as claiming more home lots or acres or office floors than his properties actually had, while omitting some liabilities, such as bank debts, according to copies of the documents.

Bender was questioned in court proceedings about those statements as part of Trump’s suit against journalist Timothy O’Brien. Asked by a defense attorney whether Trump’s 2003 statements were “subjective” or not, Bender said that the accountants did not audit these numbers — they took Trump’s assertions about the values of his properties and wrote them up, without checking to see if they matched reality.

“Do you believe that different people could reach different conclusions about the valuation of the same property?” an attorney for O’Brien asked.

“I don’t — it’s not my area — I’m not an appraiser. It’s not my job,” Bender said.

BTW, Timothy O’Brien won that lawsuit. O’Brien later wrote, My Lawyers Got Trump to Admit 30 Lies Under Oath.

The New York Times adds, Trump Fraud Inquiry’s Focus: Did He Mislead His Own Accountants?

As prosecutors in Manhattan weigh whether to charge Donald J. Trump with fraud, they have zeroed in on financial documents that he used to obtain loans and boast about his wealth, according to people with knowledge of the matter.

The documents, compiled by Mr. Trump’s longtime accountants and known as annual statements of financial condition, could help answer a question at the heart of the long-running criminal investigation into the former president: Did he inflate the value of his assets to defraud his lenders?

In recent weeks, prosecutors in the office of the Manhattan district attorney, Cyrus R. Vance Jr., have questioned one of Mr. Trump’s accountants before a grand jury as part of their examination of the financial statements, said the people with knowledge of the matter. Prosecutors also interviewed his longtime banker, another person said.

If the prosecutors seek an indictment, the case’s outcome could hinge on whether they can use the documents to prove that a defining feature of Mr. Trump’s public persona — his penchant for hyperbole — was so extreme and intentional when dealing with his lenders that it crossed the line into fraud.

Whenever Mr. Trump needed a loan, he would provide potential lenders with the statements, which contained optimistic projections about the value of his real estate business as well as sweeping disclaimers noting the numbers’ limitations.

Mr. Vance’s prosecutors found that the accountants who put together the statements relied on underlying information provided by the Trump Organization, Mr. Trump’s family business, according to the people with knowledge of the matter, who were familiar with the questions prosecutors asked and spoke only on condition of anonymity because they were discussing confidential testimony.

The prosecutors, working with the office of the New York State attorney general, Letitia James, have examined the possibility that Mr. Trump and his deputies at the company cherry-picked favorable information — and ignored data that ran counter to it — to essentially mislead the accountants into presenting an overly rosy picture of his finances.

While the numbers could implicate Mr. Trump, disclaimers in the statements that the data had not been audited or authenticated could help his defense, underscoring the challenge that prosecutors face as they grapple with whether to charge the former president.

Everyone declined to comment for this report.

Mr. Trump did not personally assemble the data for the accountants, but the documents left no doubt as to who was accountable for their contents: “Donald J. Trump is responsible for the preparation and fair presentation of the financial statement in accordance with accounting principles generally accepted in the United States of America,” his accountants wrote in a cover letter attached to the statements in 2011 and 2012.

Yet the accountants also acknowledged they “have not audited or reviewed” the information and “do not express an opinion or provide any assurance about” it, a common caveat in statements of financial condition. The accountants disclosed that, while compiling the information for Mr. Trump, they had “become aware of departures from accounting principles generally accepted in the United States of America.”

Armed with those caveats, Mr. Trump’s lawyers would most likely argue that no one, let alone sophisticated lenders, should have taken his valuations at face value. And even if his valuations were false, the lawyers might argue, the lenders conducted their own analyses of Mr. Trump’s assets and concluded that he was a worthy borrower.

Mr. Trump’s lawyers could also call on people with expertise in property assessments to say that the value of a hotel or office building may be subject to various interpretations.

Mr. Trump, who has criticized Mr. Vance’s investigation as a political witch hunt, has deployed a similar defense in the past, chalking up any financial inconsistencies to “an innocent form of exaggeration,” as he called it in his 1987 book “The Art of the Deal.”

[T]he public got a glimpse of Mr. Trump’s statements when his former lawyer and fixer, Michael D. Cohen, released them when he testified to Congress in 2019.

Mr. Cohen, who split from Mr. Trump during the presidency and eventually pleaded guilty to several federal crimes, told Congress that “Mr. Trump inflated his total assets when it served his purposes such as trying to be listed amongst the wealthiest people in Forbes and deflated his assets to reduce his real estate taxes.”

Mr. Cohen provided Congress with Mr. Trump’s statements from 2011 to 2013. Mr. Trump, he said, had provided the documents to Deutsche Bank when inquiring about a potential loan to buy the Buffalo Bills.

The deal never materialized, but Mr. Vance’s prosecutors have questioned witnesses about Mr. Trump’s statements to Deutsche Bank during the process, the people said. They have questioned Mr. Cohen and an employee from Deutsche Bank, Mr. Trump’s main lender.

For years, Mr. Trump shared the statements with Deutsche Bank and other potential lenders to offer a glowing assessment of his financial health when he needed a loan for a hotel, golf course or office building.

But before impressing his lenders, Mr. Trump had to have his employees assemble spreadsheets detailing the underlying value of his assets, according to people with knowledge of the process. The employees would then send the spreadsheets to his accounting firm, Mazars, which would compile the information into the annual statements.

The statements, issued as of June 30 every year, often began with a one-page list of Mr. Trump’s assets. Each property — Trump Tower, his golf clubs, his hotels — was listed next to a dollar amount that represented its supposed value. His cash and investments received a value, too, as did the Miss Universe pageants and other assets.

The second and final page of the 2011 and 2012 statements described Mr. Trump’s liabilities — essentially a list of any outstanding loans — and then reported his net worth. In 2011, Mr. Trump claimed a net worth of $4.2 billion. In 2012, it was more than $4.5 billion.

In determining the value of a property owned by Mr. Trump, his employees often looked at recent selling prices of comparable buildings, a common real estate valuation method.

But prosecutors have questioned whether the Trump Organization routinely selected the most valuable properties, even if they were not completely comparable, and disregarded sales of buildings that would have dragged down Mr. Trump’s valuations, the people with knowledge of the matter said.

The prosecutors have also scrutinized how the company projected future income that was not guaranteed, the people said.

Some of the irregularities that appeared in the statements were relatively trivial — Mr. Trump claimed, as he often has, that Trump Tower was 68 stories tall when it was really 58 — while others raised larger questions about the legitimacy of the numbers. The 2011 statement omitted his hotel in Chicago — and the tens of millions of dollars in debt Mr. Trump had personally guaranteed on the property.

The 2012 statement’s cover letter detailed a long list of disclaimers, including that the statement contained predictions about the future and that it did not include data for the Chicago hotel. The omission, the accountants suggested, ran contrary to an important rule of thumb: “Accounting principles generally accepted in the United States of America require that personal financial statements include all assets and liabilities.”

The accountants concluded the letter with a broad note of caution: “Users of this financial statement should recognize that they might reach different conclusions about the financial condition of Donald J. Trump.”

In addition to the Mazars cover letter, Mr. Trump added his own addendum to the statements of financial condition, a series of explanations and caveats that referred to the values in the statements as estimates.

His lawyers are likely to contend that these caveats absolve Mr. Trump of criminal liability. They could also argue that the lenders are not actually victims, highlighting the fact that his main lender, Deutsche Bank, made money in its dealings with Mr. Trump. (The Trump Organization is expected to soon sell the lease on its hotel in Washington for at least $375 million and pay off Deutsche Bank’s loan to that property.)

But even the former president’s own notes point to his involvement in determining the values that would be represented.

The value of Trump Tower, the notes said, was based partly on “an evaluation by Mr. Trump.”

The Manhattan DA’s office has assembled an “A Team” of FinCen and RICO lawyers, and forensic accountants. They should be able to handle any obfuscation that Trump’s lawyers throw at them. Trump has not had much success in court so far. Trump loses on a regular basis. For him it is all about delay.