The Manhattan district attorney's office and New York attorney general's tax investigation into Allen Weisselberg, involving a corporate apartment, cars and school tuition for his grandchildren, is at an advanced stage, according to a person familiar with the matter. On Friday, his former daughter-in-law Jennifer Weisselberg met again with prosecutors.
Prosecutors could decide whether to seek an indictment against Weisselberg as soon as next month, the person said.
Whether Weisselberg, who has been with the Trump Organization for nearly 40 years, cooperates could help determine whether he faces criminal charges and whether Trump and the company itself face state charges in an investigation that has spanned three years involved a Supreme Court battle over a subpoena for Trump's taxes, and delved into multiple financial pockets of the company.
His testimony could be critical. Trump doesn't use email and there are a few people, including Weisselberg who could explain how decisions were made in the Trump organization. Weisselberg, if he cooperated, could give prosecutors evidence about the intent behind some of the decisions. It is not clear whether prosecutors believe they have evidence that the Trump Organization violated state laws.
In addition to fringe benefits given to Weisselberg, prosecutors are looking into other employees at the Trump Organization who received benefits and whether it was a tactic by the Trump Organization to avoid paying payroll taxes, people familiar with the investigation said.
Two of those individuals under scrutiny for receiving subsidized rent and company cars are Matthew Calamari, Trump's one-time security guard who rose to chief operating officer, and his son, one of the people said, and The Wall Street Journal first reported
A lawyer for the Calamaris did not immediately respond to a request for comment. The investigation into Calamari is not as advanced as the investigation of Weisselberg, the person said.
Trump has called the investigation a "witch hunt" and said it is politically motivated. Weisselberg has not been accused of any wrongdoing. His attorney declined to comment.
Manhattan District Attorney Cy Vance's term ends in six months and he is expected to make a decision in the case before he leaves office, people familiar with the investigation have told CNN. The New York Times first reported that Vance's office could make a decision whether to charge Weisselberg this summer.
The investigation's focus on the Trump Organization has recently narrowed to benefits the company gave to employees, such as corporate apartments, cars and hotel rooms, and whether appropriate taxes were paid, people familiar with the investigation have told CNN.
Vance's office has made broad records requests to the Trump Organization about benefits they have provided to employees, ranging from cars, apartments, rooms at hotels or club benefits, the people say.
Prosecutors are still looking at the accuracy of values the company assigned to certain assets, such as Trump Tower, and whether lenders, insurers or tax authorities were misled and if the company filed false business records, the people said.
Pressure from prosecutors has been relentless
For months, pressure has been building on Weisselberg to cooperate with prosecutors. Since late last year, the attorney general and district attorney have gathered evidence on Weisselberg, personally, aided in part by his former daughter-in-law, Jennifer Weisselberg, who has been cooperating with authorities. She has turned over boxes of financial records and has met with investigators multiple times.
Jennifer Weisselberg previously told CNN that she has discussed perks that she and her ex-husband Barry, a Trump Organization employee received, ranging from corporate apartments to car leases. She also told CNN in April she believes that at least one of her children's tuition payments were paid for, at times, by Donald Trump. In a 2018 divorce deposition, Barry testified that his father paid for the former couple's children's tuition at Columbia Grammar & Preparatory School, an elite Manhattan private school.
Frank Perrone, an attorney for the school, declined to comment on Jennifer Weisselberg's allegation but told CNN, "The school's policy is to always cooperate with lawful requests for information from a prosecutor."
The school also received a total of $200,000 in donations in 2012, 2014, 2015, and 2016 from the now-defunct Trump Foundation, according to a CNN review of its filings. Allen Weisselberg was listed as the treasurer for the Trump Foundation for each of the four years donations were made, according to the documents.
Duncan Levin, an attorney for Jennifer Weisselberg, said she is continuing to cooperate with prosecutors and met with them as recently as Friday to answer additional questions.
"It is clear that Ms. Weisselberg is an important witness in this unfolding investigation and she is taking that role very seriously," Levin said in a statement to CNN.
Typically, prosecutors would inform Weisselberg's attorneys that they are prepared to charge him and allow them an opportunity to push back against the charges or relay what Weisselberg would be willing to tell prosecutors about the Trump Organization to ward off an indictment.
Criminal tax cases against individuals for not paying taxes on corporate benefits or school tuition are rare, tax lawyers say. But digging into personal finances is a common tactic prosecutors use as they look for anything that could be used as leverage to win someone's cooperation. Weisselberg has added a criminal defense lawyer who specializes in taxes.
Recently, Jeffrey McConney, the controller of the Trump Organization who reports to Weisselberg testified before a grand jury, people familiar with the matter told CNN. He was asked about corporate benefits and gifts and generally how the company works, the people say.
McConney is likely to appear again and other individuals from the Trump Organization may be called before the grand jury, the people say.
Under New York state law, a witness can be compelled to appear before the grand jury and receive immunity for his or her testimony. However, the witness can be prosecuted for perjury if he or she lies on the stand. In those instances, prosecutors often don't know what the witness will say in advance but they can confront the witness with documents or records and lock in the witness' testimony.
McConney could not be reached for comment.
Weisselberg has cooperated in other cases
Weisselberg has cooperated with criminal and civil investigations before but now he faces the prospect of jail time. If Weisselberg is charged and convicted of a state felony tax crime he could face anywhere between no mandatory prison time to one to three years on the low end, depending on the class of the felony and the amount of money involved.
Weisselberg was granted partial immunity in the federal prosecution of Michael Cohen, Trump's former attorney, who pleaded guilty to nine crimes, including lying to Congress and facilitating hush money payments to two women who alleged affairs with Trump. Trump has denied the affairs.
He also has sat for depositions in civil investigations involving Trump University and the Trump Foundation and the parallel civil investigation into the Trump Organization's finances conducted by the New York attorney general.
Last year, the New York attorney general's office said in court filings that it subpoenaed Weisselberg for his testimony and he sat for a deposition over three days in July and August when he was questioned, in part, about taxes.
According to the filing, when Weisselberg was interviewed by the New York attorney general's office, he said he had no first-hand knowledge that the Trump Organization recognized as income a $100 million loan that was forgiven on the Chicago hotel tower. Rather, he said, he could not identify any return where the forgiven debt was treated as income and was relying solely upon his recollection of conversations he had years earlier with the Trump Organization's accountants.
He also was unable to provide investigators with information about how the Trump Organization treated a conservation easement donated on the Seven Springs property in its tax returns, according to the filing by the New York attorney general.
When the Trump Organization valued properties, Trump said in a civil deposition that the only person with whom he dealt and the person he placed the responsibility on -- was Weisselberg.
"I would give my opinion," Trump said in the deposition. "We'll talk about it," he said, adding that "ultimately" and "predominately" it was Weisselberg who came up with the final values, which Trump said he viewed as "conservative."
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