Saturday, March 25, 2023 | Back issues
Courthouse News Service Courthouse News Service

Loyal Trump CFO Weisselberg sentenced to prison

Allen Weisselberg's plea deal made him a key albeit circumspect government witness as prosecutors went after the Trump Organization for decades of tax fraud.

MANHATTAN (CN) — The Trump Organization's longtime chief financial officer was handed a prison sentence Tuesday, five months after he pleaded guilty in a bid to play off pervasive payroll fraud within the namesake company of former President Donald Trump as a side effect of only his own individual greed.

Allen Weisselberg, 75, negotiated the deal carrying a five-month sentence in exchange for his agreement to testify against his former employer. He also faces five years of probation and must repay nearly $2 million in taxes.

Anticipating his immediate remand to the Rikers Island jail complex New York City, Weisselberg attended his 2:15 p.m. sentencing hearing at Manhattan Supreme Court in casual street attire: a forest green North Face zip-up fleece, white T-shirt, blue jeans and sneakers.

Nicholas Gravante, an attorney for Weisselberg with the firm Cadwalader, Wickersham & Taft, has said he anticipates Weisselberg will serve just 100 days of his sentence after a reduction for good behavior.

Begrudgingly ordering the agreed-upon sentence of five months, Judge Juan Manuel Merchan noted: "I’m not going to deviate although I believe that a stiffer sentence would appropriate given the evidence."

Merchan appeared irritated when Gravante pushed him to impose an even lighter sentence or for the second term of Weisselberg's incarceration to be served under house arrest. 

"Having presided over the trial [of the Trump Organization], and having heard the testimony and seen the evidence," Judge Merchan concluded that "the entire case was driven by greed."

Merchan took specific ire with one act of the fraud in which Weisselberg directed the Trump Organization's controller, Jeffrey McConney, set his wife up with a onetime $6,000 payroll check for a no-show job at the company so she could qualify for Social Security benefits.

“It was driven purely by greed. Pure and simple," Merchan said, finding the no-show job especially loathsome "at a time when so many Americans work so hard so they may one day be able to benefit from Social Security."

Weisselberg declined to speak at the sentencing hearing. He risked as much as 15 years in prison if he violated the terms of his plea agreement.

Manhattan District Attorney Alvin Bragg applauded the conclusion of his office's criminal case against Weisselberg and the Trump Organization.

“In Manhattan, you have to play by the rules no matter who you are or who you work for," the prosecutor said in a statement Tuesday afternoon. "These consequential felony convictions put on full display the inner workings of former President Trump’s companies and its CFO’s actions."

Former Trump Organization CFO Allen Weisselberg exits Manhattan Criminal Court on November 15, 2022, after testifying in the tax fraud case against two Trump entities. Weisselberg pleaded guilty to 15 tax fraud counts. (Nina Pullano/Courthouse News Service)

The Trump Organization is scheduled to be sentenced on Friday and faces a fine of up to $1.6 million. Unlike Weisselberg, the corporate entity pleaded not guilty and went to trial where a jury convicted it on all 15 felony counts against it.

When prosecutors unveiled the charges in 2021, they accused the Trump family real estate businesses and Weisselberg of conspiring to dodge taxes through an executive-compensation scheme whereby Weisselberg took in more than $1.7 million in payment as off-the-books perks.

Over the course of his nearly half-a-century as a Trump employee, Weisselberg received untaxed compensation from the Trump Organization disguised as rent for an Upper West Side apartment, private school tuition for his grandchildren, and his-and-hers Mercedes Benzes for himself and his wife.

Other Trump Organization executives were also shown to have accepted off-the-books compensation, but Weisselberg was alone in facing criminal charges for defrauding the federal government, state and city out of more than $900,000 in unpaid taxes and undeserved tax refunds.

Prosecutors said executives including Weisselberg took payments as both employees and independent contractors, thus allowing them to pay for personal expenses pre-tax and to take advantage of retirement options available only to those who are self-employed. 

Weisselberg testified at the Trump Organization's trial that the practice dates back to the 1980s, long before he began working for the future and now former U.S. president. After Trump won the election in 2017, that practice ended. 

“We were going through an entire cleanup process of the company to make sure that, since Mr. Trump is now president, that everything was being done properly,” Weisselberg said on the witness stand. 

Weisselberg testified that neither Trump nor his family knew about the scheme as it was happening, choking up as he told jurors: “It was my own personal greed that led to this.”

But prosecutors, in their closing argument, said Trump “knew exactly what was going on” and that evidence, such as a lease he signed for Weisselberg’s apartment, made clear “Mr. Trump is explicitly sanctioning tax fraud.”

Weisselberg said the Trumps remained loyal to him even as the company scrambled to end some of its dubious pay practices following Trump’s 2016 election. He said Trump’s eldest sons, delegated to run the company while Trump was president, gave him a $200,000 raise after an internal audit found he had been offsetting his salary and bonuses by the cost of the perks.

Having taken a leave of absence after his indictment, Weisselberg testified that he was still collecting $640,000 in salary and $500,000 in holiday bonuses.

In a nominal punishment, the organization did reassign Weisselberg from CFO to senior adviser and moved his office.

The family's goodwill continued even after Weisselberg agreed to cooperate with prosecutors. Just hours after finalizing his plea agreement in August 2022, Weisselberg was given a 75th birthday at Trump Tower with cake and colleagues.

"Maybe if he hadn’t agreed to testify, he would have gotten a bigger cake,” Assistant Manhattan District Attorney Joshua Steinglass joked at the trial's closing arguments.

The sentencings of both Weisselberg and the Trump Organization’s entities come the same week that investigators in Georgia concluded a grand jury probe into whether any crimes occurred in late 2020 as Trump and his allies worked to overturn his election loss in Georgia.

Read the Top 8

Sign up for the Top 8, a roundup of the day's top stories delivered directly to your inbox Monday through Friday.