Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Trump Organization fraud trial delayed after witness tests positive for COVID

Published 11/01/2022, 03:03 PM
Updated 11/01/2022, 06:16 PM
© Reuters

© Reuters

By Karen Freifeld and Jonathan Stempel

NEW YORK (Reuters) -The criminal tax fraud trial of the Trump Organization went on hold on Tuesday after the company's controller, Jeffrey McConney, who had been testifying as a prosecution witness, tested positive for COVID-19.

McConney had been coughing during his testimony earlier in the day and on Monday after he took the stand as the first witness in the trial. He tested positive after complaining of illness during Tuesday's lunch break.

Justice Juan Merchan, who oversees the case in Manhattan Supreme Court, said the trial could resume on Nov. 7 if the 67-year-old McConney felt better. He said court protocol called for McConney to isolate for six days.

The unexpected delay came after McConney testified that the Trump Organization paid well over $1 million in untaxed benefits for Allen Weisselberg, its longtime former chief financial officer.

McConney's testimony could bolster prosecutors' argument that the former president's company improperly paid Weisselberg off-the-books benefits to keep him happy by reducing his tax bill, and save money itself.

The Trump Organization, which operates hotels, golf courses and other real estate around the world, was charged in 2021 by the Manhattan district attorney's office with awarding executive perks over 15 years without reporting the additional income to tax authorities, and falsely reporting bonuses as non-employee compensation.

If convicted, the company could face $1.6 million in fines. A conviction could also complicate its ability to do business.

The case is one of several legal matters faced by Donald Trump, as the Republican former president, 76, weighs another White House run in 2024 after losing to Democrat Joe Biden in 2020.

Trump has not been charged, while two Trump Organization units have pleaded not guilty.

Weisselberg pleaded guilty and agreed to testify for the prosecution, which viewed him as a prime beneficiary of the tax scheme.

The plea agreement calls for Weisselberg to serve five months in jail. He remains on the Trump Organization's payroll, but stepped down as CFO after being charged.

TRUMP WAS 'THE BOSS'

McConney's illness was disclosed outside the jury's presence by prosecutor Joshua Steinglass, who told Merchan that the district attorney's office had arranged for a COVID-19 test.

The judge later said that McConney tested positive.

McConney has worked for the Trump Organization since 1987, and received immunity after testifying to a grand jury.

Before being sidelined, McConney testified that Weisselberg's $540,000 annual salary and $400,000 annual bonus did not change for a decade, but that he was awarded perks including rent and private school tuition payments.

McConney said that before becoming president, Trump would decide how much Weisselberg would be paid each year.

"Prior to 2017, he was the boss," McConney said, referring to Trump.

McConney was shown a 2005 lease that Trump signed for a $6,500-a-month Manhattan apartment for Weisselberg and his wife.

"That is President Trump's signature," McConney testified, looking at Trump's trademark black Sharpie signature.

He said one of Trump's companies paid about $1 million in rent, more than $80,000 in utilities and $45,000 for parking, and more than $195,000 for Mercedes-Benzes for Weisselberg and his wife between 2005 and 2017.

McConney said Trump personally signed more than $315,000 in checks for private school tuition for Weisselberg's grandchildren, and Weisselberg received more than $29,000 in cash to disperse as Christmas gifts.

The controller also said other Trump entities, including a golf club and his Mar-a-Lago club in Florida, paid bonuses to some Trump Organization employees that would make them appear to be independent contractors instead of employees.

© Reuters. Witness Jeff McConney is questioned by Assistant Manhattan District Attorney Joshua Steinglass as a Trump corporate expense chart is shown, during the Trump Organization's criminal tax trial in Manhattan Criminal Court, New York City, U.S., October 31, 2022 in this courtroom sketch. REUTERS/Jane Rosenberg

It was not until 2017 or 2018, by which time Trump's sons Donald Jr and Eric had taken the helm, that the company changed its practices after a memo from its tax lawyer, McConney said.

McConney remains on the Trump Organization's payroll, and prosecutors view him as a hostile witness.

 

Latest comments

It should be on Americans' mind as they reflect on how they (or their fellow Americans) were stupid enough to vote for him.
so guilty till proven innocent because people around you (who haven't been found guilty) are being charged. it sounds like everyone crying about hunter and Jim biden, but your blind partisanship doesn't let you see anything other than what your echo chamber tells you to see
   There were other trials.  People around Trump had already been found guilty.
The standard of innocent until proven guilty is for the purpose of whether to use prison/execution, NOT for the purpose of deciding who to vote for.
www.amazon.com/bleach/s?k=bleach
How ironic
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.