NEW YORK – The criminal tax fraud fees revealed Thursday against Donald Trump’s corporation are a blow to a corporation that is already recovering from the surprise of deals canceled in the wake of the Capitol uprising and have an effect on the coronavirus pandemic in hotels and clubs.
The indictment would likely make it harder for Trump to make new deals, get bank loans and bring new cash to his sprawling debt-side business.
The former president himself has been indicted through prosecutors, but investigations continue.
Here’s a review of the company and the challenge it faces now:
WHAT IS THE TRUMP ORGANIZATION?
The company is a business entity comprising a lot of corporations and associations that own or manage buildings, hotels, residential towers, golf clubs, trademarks, licensing agreements and other assets around the world.
These corporations have a percentage of staff with the Trump Organization, adding Trump’s two adult sons, Donald Jr. and Eric, both executive vice presidents, and Allen Weisselberg, the accused monetary leader.
WHAT ARE THE ALLEGATIONS?
A grand jury indictment accused the Trump Organization of conspiring to get most sensible executives to mislead their taxes by failing to signal reimbursement, such as misuse of apartments and cars, paying tuition or reimbursing non-public expenses.
The company pleaded guilty, as did Weisselberg, one of Trump’s most important and unwavering employees.
The company claims that neither it nor Weisselberg did anything and claimed the allegations were politically motivated.
Weisselberg is also accused of cheating on his taxes by disguising his full-time apartment in New York, where he turned to the city’s income tax source.
WHAT IS TRUMP’S CURRENT SITUATION IN THE COMPANY?
Trump resigned from the positions he held in many entities of the Trump Organization in more than 20 countries before taking the presidential oath 4 years ago.
It was his attempt to allay fears that he would use the presidency to help his business. At that time, he created an acceptance as true to keep his assets and transferred day-to-day control to his two adult children and to Weisselberg.
But Trump was once again the sole owner or the primary owner of those piles of businesses and can benefit from them at any time. Recently, he returned to his old offices at Trump Tower on Fifth Avenue, but it’s unclear to what extent he took on his old business. role of overseeing operations.
WILL THE COSTS BE DETRIMENTAL TO THE COMPANY’S ABILITY TO DO BUSINESS?
If the Trump Organization is convicted, it will have to pay a fine of twice the amount of unpaid taxes, or $250,000, whichever is greater. The company may also have to replace the way it operates.
But even in the absence of a conviction, the prosecution can be problematic.
“Defendant companies, personal or public, giant or small, face serious collateral consequences,” said Daniel Horwitz, a white-collar defense attorney at McLaughlin and Stern and a former prosecutor with the Manhattan District Attorney’s Office.
“Companies in the monetary sector are reluctant to do business with them,” Horwitz said. “Their access to capital is limited or cut off, as is their ability to position their liquid assets in banks and brokerage firms. “
WHAT HAPPENED TO THE OTHER COMPANIES THAT WERE WARNED OF THE CRIME?
The giant arthur andersen accounting corporation began to lose auditing activities after criminal fees were established in connection with its paintings at Enron, and eventually had to fire tens of thousands of painters. In 2005, the Supreme Court overturned his conviction for obstruction of justice. , however, too backward and the company collapsed.
Other corporations heavily affected by criminal fees come with the now-defunct Drexel Burnham Lambert, the 1980s junk bond giant, once a large hedge fund SAC Capital, and oil company BP, which had to pay billions in criminal fees for its role in the explosion of a drilling rig in the Gulf of Mexico.
WHAT IS THE LIKELY BLOW TO TRUMP’S BUSINESS?
The Trump Organization would possibly find it harder to make deals to put Trump’s call on buildings or products, attract tourists to its golf courses and borrow money.
Possibly he could cope with the blows. It is an expanding company, however, its operations are undeniable and the scenes: it manages golf clubs and hotels, collects checks from the corporations that occupy the offices it owns and charges license fees to buildings and the like that employ its name.
While some businesses have collapsed after criminal fees, others have survived or even prospered. Others who won so-called deferred criminal fees did well afterwards, adding pharmaceutical giant Bristol-Myers Squibb, accused of accounting fraud, and JPMorgan Chase
Stocks of any of them are at or near record levels.
WHAT ARE THE FORMER PRESIDENT’S FUTURE BUSINESS PLANS?
He said, however, there are apparent movements.
Branding experts say the company can continue to use Trump’s fame to make licensing deals around the world. In the years surrounding his television hit, “The Apprentice,” Trump made deals to put his names on suits, ties, steaks and residential towers in Las Vegas, Chicago and New York.
Trump’s logo has been broken through his divisive rhetoric and positions. It is known how successful a new licensing effort would be.
While parked, hotels and residential towers in various locations got rid of his call from their buildings. His company had to abandon its plans for new hotel chains due to a lack of interest from potential partners.
The biggest damage of all was the allegations Trump incited in the bloody siege of the Capitol in January, when real estate brokers, lenders and businesses cut bridges soon after.
The Associated Press reported earlier this year that condos in many buildings that allowed the use of their call were drastically reduced, and agents claimed that some potential buyers even refuse to look at apartments in buildings with Trump’s call on the door.
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This story has been corrected to remove an erroneous reference to Bank of America’s conviction for reckless lending in a criminal case. The bank was found responsible in a civil case and the verdict was overturned on appeal.
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