Some think the tax fraud will be hard to prove. It won’t be. The Trump Organization made prosecution easy by maintaining two separate sets of books documenting their fraud. One set of books for the purpose of misstating compensation to Weisselberg as another kind of expense and another secret set of books to record what Weisselberg was really being paid. Here’s how it worked.
Suppose you go to work for a company, we’ll just call it “The Keith Organization.” Your job is to be the CFO of Keith Org. The company agrees your total compensation will be $100,000 per year. Let’s assume that’s a bargain rate for someone of your talents, and in such a position, but Keith Org wants to keep its costs down so that its owner (Keith of course) can get more. So Keith Org cooks the books to falsely make some of your income tax free to you.
Another person in the company (call him “Coconspirator 1”) cashes a company check for $10,000 cash. He gives you that $10,000 which you use however you want. That should obviously be income for you but it is not reported by the company as compensation to you and you do not declare it as income. Of course, for the books to balance the company has to declare it as some sort of expense, and it does. It records the $10,000 as “Holiday Entertainment” on its official books. It is deducted from the Keith Inc’s bottom line as such for tax purposes.
In the meantime, another secret set of books is used to make sure Keith Inc is paying you all that $100,000 it agreed to and no more. On that set of books the company records that it gave you $90,000 in tax reportable regular salary, and the $10,000 under the table cash. Thus, the company, and you, are able to make sure you got the $100,000 promised.
In the meantime you benefit from $10,000 of your $100,000 in income being tax free making your real, effective income a few thousand more than Keith Inc agreed to pay you.
And that’s basically it. In fact, that was one of the exact schemes used, right down to labeling cash given Weisselberg as “Holiday Entertainment.” The only difference was in the scale and variance of the methods and labels used. Sometimes it was tuition for Weisselberg’s kids, other times rent for cars, other times a luxury condo lease, but it worked the same way with the separate books proving the fraud.
Separate books the prosecutors have.
Oh, and this went on for 15 years. Does anyone really believe it’s possible that “Keith,” who really does run the company, didn’t know about it?