The Trump Grifter Family band

Federal prosecutors in Manhattan this past week appeared to be barreling forward on a collision course with President Trump. Forbidden from indicting him by their superiors in Washington, the prosecutors instead are likely to turn their guns on the president’s family and close associates and, perhaps most significantly, the business he spent his life building, according to former Department of Justice officials.

In court filings, a dramatic sentencing hearing and an unusually revelatory press release, the prosecutors in the office of the U.S. Attorney for the Southern District of New York added substantially to the mound of public evidence that the president has criminal exposure for arranging secret payments to women during the federal election campaign.

In a sentencing memo, the Southern District cited Michael Cohen’s claims that Donald Trump, as a presidential candidate, had directed Cohen to secretly pay off two women who claimed to have had affairs with Trump, in violation of campaign finance laws. In a lower Manhattan courtroom, as he pleaded with a judge for leniency, Cohen cast himself as a weak man and instrument of Trump’s will.

Shortly after the sentencing hearing concluded, Southern District prosecutors revealed for the first time that they had entered into a cooperation deal with American Media Inc. (AMI), the company that publishes the National Enquirer, which had assisted Cohen by negotiating and making one of the secret payments, $150,000 paid to Karen McDougal based on a sham contract, on the understanding that Cohen would reimburse AMI for the expense. (Despite the understanding, he never actually reimbursed AMI.)

AMI agreed to help Southern District prosecutors by providing evidence in exchange for not being charged. Both Cohen and AMI said that the hush money payments, which Trump was involved with and knew about, were intended to influence the presidential election by keeping derogatory stories about Trump out of the news.

“I think that they’re clearly building a case, right?” said Mimi Rocah, a 16-year veteran of the Southern District now in private practice. “They’re not trying to get Cohen to cooperate against AMI because AMI has a nonprosecution cooperation agreement. And they’re not cooperating AMI just against Cohen because he has already pled out. So there seem to be other targets in their sights.”

While it appears the Southern District is assembling a powerful criminal case against Trump, one of the targets for prosecution may be not the president himself, but the Trump Organization.
[...]
Federal investigations such as Southern District’s are secret, and any discussion of who future targets might be is necessarily speculative, but the charging documents from that office contain some strong hints that the Trump Organization and its executives could be the targets.

Both Rocah and Sandick pointed specifically to allegations that two Trump Organization executives, referred to in charging documents as Executive 1 and Executive 2, had concocted a fraudulent scheme to pay Cohen back for his payment to Stormy Daniels. NBC News and the Wall Street Journal have reported that Executive 1 is the longtime chief financial officer of the Trump Organization, Allen Weisselberg, who was granted immunity by the Southern District in its investigation.
[...]
These machinations, presumably, served a dual purpose. First, they allowed the Trump Organization to maintain the fiction, on its books and before its auditors, that Cohen was simply being periodically paid for legal work on behalf of the company, rather than reimbursed for one-time campaign expenses. “The Company accounted for these payments as legal expenses,” the SDNY prosecutors wrote. Second, in order to maintain consistency with the Trump Organization’s deceptive accounting treatment, Cohen would have to report the full amount received as taxable income on his tax returns, rather than accurately identifying it as an untaxed reimbursement. The increased, or “grossed up,” amounts would have been to cover Cohen’s resulting taxes, since the payments to him were being classified as income, rather than a reimbursement.

The contortions may not just put the Trump Organization’s executives at risk; they could expose the president’s cherished business as well.

“I think there’s a possibility of the Trump Organization as a whole being charged,” Rocah said.

“Charges against the Trump Organization seem like a way of addressing through one path what you might not be able to address through a different path,” Sandick agreed.
[...]
Former prosecutors pointed out that a prosecution of a business organization would not be undertaken lightly. The Department of Justice’s frequently revised guidelines on the subject “generally tend to discourage charging organizations because of the concern about harm to third parties,” Sandick said.

On the other hand, it’s unclear how many employees the Trump Organization has, and thus could be affected, since much of their work seems to be in the area of licensing the Trump name, according to Sandick.

“The truth is nobody, even those of us in the alumni network, lived through something quite like this,” said Sandick. “I was there during 9/11 and we saw lots of huge cases, high profile things. I remember lots of big things happening in the office. But this is, kind of, of a different magnitude.”

The stipulation agreement was part of a larger agreement to break up the charity and distribute its remaining funds, under judicial supervision, to other charitable groups approved by New York Attorney General Barbara Underwood, the Washington Post reported Tuesday.

“This is an important victory for the rule of law, making clear that there is one set of rules for everyone,” Underwood said in a statement. “We’ll continue to move our suit forward to ensure that the Trump Foundation and its directors are held to account for their clear and repeated violations of state and federal law.”

In her statement, Underwood also cited “a shocking pattern of illegality” that led to this decision.

Among other things, the Trump Foundation is currently being investigated for allegations the president and his three eldest children, Donald Jr., Eric, and Ivanka Trump, used the charity for their personal benefit and to benefit the president’s 2016 campaign. According to the Post, “Trump used the charity’s funds pay off legal settlements for his private business, to purchase art that decorated one of his clubs and to make a prohibited political donation.”