Going down?

Tuesday 19 January 2021

Meet the state prosecutors who are chasing after Trump – not because of the Capitol riot, but because of his past dealings

The US Supreme Court doesn’t like to be hurried, but occasionally it can snap shut like a Venus fly trap.

For instance, this could happen: within a few days of Joe Biden’s inauguration the court issues a terse one-line opinion in the case of Vance v Mazars. This is the case in which Cy Vance Jr, district attorney for Manhattan, is seeking to force the release of Donald Trump’s tax records to nail him for fraud.

Mazars hold the records because they are the president’s accountants. The court has already upheld Vance’s first bid to see them, but Trump’s lawyers want one last chance to make the case for keeping them secret. In this scenario, the court says: don’t even bother. We’re not going to hear it. 

Then things could move fast. As one veteran US tax fraud investigator put it to me: “The inauguration happens on 20 January. Mazars will have all the files ready to be picked up from the 21st.”

Trump’s records are loaded into a van and driven from Mazars’ midtown headquarters to the DA’s office in the giant criminal justice complex on Hogan Place, near Wall Street. In short order, Trump is indicted by Vance, heir to a grand Democratic name, a man who grew up with Caroline Kennedy and knew Jimmy Carter like an uncle. The charges could be any or all of tax fraud, loan fraud, insurance fraud and falsifying business statements over at least a two-year period leading up to but not excluding his arrival in the White House. 

This too could happen: facing the prospect of a New York jury and overwhelming evidence already used to convict Michael Cohen, his former personal lawyer, Trump plea-bargains his way to a light sentence, not least to protect his children from an expanding investigation. 

Or this: he fights, and goes to trial, and then to jail for up to 20 years. 

The imposing Criminal Courts Building in lower Manhattan, New York

Trump’s terrifying stint in power is about to end. His battle with the lawyers who want to complete his humiliation now moves into high gear.

At noon tomorrow he goes back to using his own plane and his own homes at his own expense. That may not trouble him as much as his enemies hope – he never liked the White House much – but it troubles him greatly that two weeks after conspiracy theorists stormed the Capitol in his name he loses immunity from prosecution.

He is right to worry. The grounds for US presidential immunity are summarised in a 1973 memo by the Department of Justice which says, in essence, that presidents don’t have the bandwidth to defend themselves in office, but emphatically are not above the law. That focused Richard Nixon’s mind after Watergate, and it leaves Trump desperately vulnerable now.

Even before the riot, America’s need for a reckoning was acute. Trump had spent six weeks lying about the election result and had appeared to try to blackmail a state official to reverse it, in Georgia. “Now people are clamouring for him to be held accountable,” says Bennett Gershman, a law professor and former Manhattan prosecutor. “He can’t just walk away from this. He’s not going to just walk away from this. Why, when and how he’s held accountable is not yet clear, but it’ll happen.”

Trump has been the subject of more than 4,000 lawsuits in his career. Settling or counter-suing or just brazening them out have always been part of his modus operandi, but this is different. Before 6 January there were already a dozen active civil and criminal investigations naming him as a defendant, including two brought by women claiming sexual assault and rape. Since then he’s been impeached a second time and most of the clamour for accountability has been about sedition and incitement rather than tax returns. 

The author E. Jean Carroll, who has accused Donald Trump of sexual assault.

Twitter, generally, is hot for a federal prosecution that confronts Trump’s incitement head-on. So is America’s political class, but that doesn’t mean that it will happen. It’s not hard to find lawyers who think the riot makes a Trump trial of some sort more likely, but when pressed on who might actually win a conviction, most side with state prosecutors over federal, and New York over Washington. 

This is because New York prosecutors have been at this particular game longer, and the crimes they allege are easier to prove.

“Trump is a jerk and a bully, but all he did [on 6 January] was get up and talk to people. He had no criminal intent, and both his speech and conduct are protected by presidential immunity and the First Amendment,” says Timothy Hoover, a defence lawyer channeling the arguments Trump’s team would make against a case based on the facts of the insurrection. And there are structural reasons why such a case would probably be hard to win. Prosecutors have to prove guilt beyond a reasonable doubt while Trump has to prove nothing. Prosecutors would be in uncharted legal waters while Trump’s lawyers would have a ready-made free speech defence. The decision to bring a case would be at least partly political and easy to attack as a “crusade”. And as a federal prosecution it would need the support of the Department of Justice, which Biden has urged his incoming attorney general to withhold. He doesn’t want his presidency to be all about his predecessor.

In New York almost none of this applies. Its state prosecutors don’t need to have the DoJ onside. The prosecution has a battle-tested strategy ready to go from the case of Michael Cohen (and Stormy Daniels – we’ll get to her). Attacking Trump as a businessman is less political than attacking him as ex-president. And there is probably nowhere on earth where more lawyers are salivating more eagerly for a Trump conviction than the city he used to call home. 

Three of these lawyers stand out.

The stand-in

New York politics is a blood sport, and most of the state’s top prosecutors are elected. An exception is Audrey Strauss, acting US attorney for the Southern District of New York (SDNY). She is 73, the daughter of Russian immigrants and a steely scourge of Trump acolytes since the 1970s.

Audrey Strauss speaks on the occasion of Ghislaine Maxwell’s arrest in connection with the Jeffrey Epstein case

Strauss is in post partly as a result of a deal agreed in pressure-cooker circumstances by her old boss and Trump’s attorney general last summer. The outgoing US attorney was Geoffrey Berman, a Republican whom Trump tried to fire for going after Cohen and his replacement as Trump’s personal lawyer, Rudy Giuliani. Berman agreed to go, but only on condition that Strauss, his deputy, take over.

“If the [attorney general’s] theory was to remove Berman and replace him with somebody more susceptible to Trump’s desires, he failed,” one Strauss admirer told the FT. In fact, Trump now faces more trouble from her than he ever did from Berman, because she was already the SDNY’s go-to prosecutor on everything to do with Trump. 

It was Strauss who made sure Cohen went to jail for illegal hush money payments on Trump’s behalf to Daniels and a former Playboy model; Strauss who then investigated Giuliani’s ties to Ukraine in the build-up to Trump’s first impeachment; Strauss who followed the money in that case to two Ukrainian-American businessmen whom she charged with making illegal campaign contributions – to Trump.

More than 40 years ago Strauss defeated an attempt by Roy Cohn, Trump’s mentor, to overturn the convictions of two New York mafiosi, and she is now well placed to funnel information gleaned on Trump in federal investigations to the Manhattan DA’s office, two blocks from her own. 

The politician

150 miles up the Hudson, the person deciding whom the state of New York will pursue in court is Letitia James, the second woman to hold the post of state attorney general, and the first woman of colour. 

Letitia James takes to the podium. It’s thought that she will soon run for higher political office

James’s CV bears a striking resemblance to that of Kamala Harris, the former AG of California who is about to be vice-president. Both are graduates of Washington’s historically black Howard University who climbed the ziggurat of American justice as career prosecutors. For her own part James is likely to run for state governor or mayor of New York City next. In public she exudes a zen-like calm, and last year she told Whoopi Goldberg, host of ABC’s The View, that when it comes to deciding her priorities “politics stops at the door”. 

This is contested, and not just by the Trumps. (Ivanka Trump, served with a subpoena for financial documents by James’s office last year, complained of “harassment, pure and simple”.)

The previous year, when James won election as a Democrat, she practically campaigned on the slogan “I’m going after Trump,” says a former state prosecutor also based in Albany. Since then she has led or joined more than 70 lawsuits against the Trump administration on behalf of women, immigrants, the environment, the US Postal Service and Obamacare, among many other mistreated elements of American society. 

As for Trump himself, James is running a wide-ranging investigation of his business affairs which she says has been forced on her by Cohen’s testimony before various congressional committees. As she put it to Goldberg in the measured tones of a headteacher at assembly: “Cohen testified that in fact the financial statements of the Trump Organisation included information that the president as well as some of his children perhaps inflated his assets so that they can get financial terms for loans and insurance coverage. In addition to that, they deflated those same assets for the purposes of evading and avoiding tax liability.”

How much is it really worth? Trump’s Seven Springs estate in Mount Kisco, New York

The language is softened at the edges, but this is where the legal pincer starts to hurt. The testimony includes claims that Trump once put the value of his own brand as loan collateral at $4 billion, only for Forbes to value it at $125 million two years later; and that the family’s upstate New York estate at Seven Springs was valued at $25 million for the purposes of tax liability, and ten times as much for a write-off. 

The only consolation for the ex-president will be that James’s investigation is civil, not criminal. Back in New York City it’s the other way round. 

The blue-blood

So far, as he prepares his case against Trump, Cyrus Vance Jr has let Letitia James keep public attention focused on hers. But everyone I spoke to for this story expects Vance to be the first to file charges. 

Cy Vance arrives at federal court for a hearing related to Trump’s financial records

For his legacy, if not for reelection, he needs a big win. The son of Carter’s Secretary of State, Vance has been Wall Street’s DA for 11 years and in that time has gained a reputation as a coddler of the rich. A decade ago he was forced to drop sexual assault charges against Dominique Strauss-Khan, the former head of the IMF, after failing, as one critic puts it, to get his ducks in a row. The same year one of his subordinates stunned a judge by asking for leniency for Jeffrey Epstein, the billionaire rapist, even though Epstein had already been convicted of sex crimes in Florida. Vance eventually secured a conviction in last year’s landmark Harvey Weinstein rape trial, but not before failing to prosecute when allegations of sexual misconduct by Weinstein first surfaced in 2015. 

“To take a Trump case and lose would be the worst thing,” says Gershman. “He’s got to be able to make a prediction that he’s got the evidence overwhelmingly, and if so he’s surely going to go ahead.”

Martin Sheil, the former tax investigator, believes Vance may already have all the evidence he needs regardless of the Supreme Court’s next move in Vance v Mazars. It’s standard practice to seek copies of tax documents from banks as well as from a defendant’s accountants, he says. By now Vance should also have everything he needs from Deutsche Bank, Trump’s biggest creditor; from his insurers; from New York State authorities (in relation to Trump’s properties); and from Audrey Strauss at the SDNY, who has “almost certainly” shared all the evidence she used in the Cohen case.

In that case Cohen pled guilty to eight counts of fraud and testified that on each count he acted “at the direction of Individual 1” – later identified as Trump.

Michael Cohen takes the elevator in Trump Tower, before he and his then boss parted ways

Vance now has a choice to make. He could bring a prosecution tightly focused on the Cohen case and argue that if ex-presidents are not immune, then Trump must now be guilty by the same logic that convicted his lawyer. Or he could allege multiple felonies across the Trump Organisation, the better to ensnare the spider at the centre of the web.

Either way, it all goes back to sex.

Four and a half years ago I met Trump at his golf course near Aberdeen to interview him for The Times. He’d recently become the presumptive Republican presidential nominee and the idea was to ask him what a Trump presidency might look like. 

We sat on overstuffed sofas in his clubhouse and he offered half-sentences on Isis and “military” [sic] and why the EU couldn’t last. (It was the day after the Brexit vote.) Looking back, I wish I’d had the clairvoyance to ask him about Stormy Daniels. 

Reconstructing Trump’s campaign calendar, it’s likely he was already fretting about how to prevent an October surprise that might narrow his chances against Hillary Clinton. Daniels, a porn star who later went on a “Make America Horny Again” tour to take advantage of her sudden fame, may have been on his mind. She claims to have had an affair with Trump in 2006, a year after he married Melania. He denies it, but by September 2016 Daniels had intimated she was ready to go public. 

Stormy Daniels performs at a strip club in Fort Lauderdale, 2018

That month, Cohen privately recorded a conversation with Trump in which they discussed another woman claiming to have had an affair with him, the former Playboy model Karen McDougal. The following month Cohen arranged to buy the rights to McDougal’s story and prevent it being published, and he paid $130,000 for Daniels’ silence out of his own pocket.

It’s worth keeping track of these payments, because of all the transactions in Trump’s transactional life they’ve shown a unique capacity to go on detonating under its foundations. 

The first people outside Trump’s immediate entourage to know about them were investigators working on Robert Mueller’s Russia probe. They stumbled on the Daniels money while combing through campaign finance records looking for evidence of collusion with Moscow – because when Cohen was eventually reimbursed, it was out of campaign funds. Mueller’s team referred the payment to the SDNY as not germane to their inquiry but still potentially illegal. 

The Daniels case has snowballed for two reasons. The first was Cohen himself, for ten years Trump’s consigliere and by his own account a wannabe big shot in his own right. But not a stupid one. As a lawyer he knew the payment could be construed as an illegal use of campaign funds under federal law, but also that his decision to advance it on behalf of his client amounted to an illegal loan under New York state law. Once he realised he was trapped, he flipped, and having flipped he has not held back.

The loyal servant has become Trump’s loudest enemy. Cohen testified enthusiastically against him to try to get his three-year sentence cut. Last year he rushed out a book in which he claims to know Trump better than anyone – “the real man, in strip clubs, shady business meetings and in the unguarded moments when he revealed who he really was: a cheat, a liar, a fraud, a bully, a racist, a predator, a con-man.” He launched a podcast series called Mea Culpa, chatting in one recent instalment to Ben Stiller about playing him on Saturday Night Live. And last week Cohen spent several hours answering questions about Trump’s relationship with Deutsche Bank in the offices of Cy Vance Jr.

Exhibit A: A copy of a cheque paid to Cohen by Trump is displayed during a meeting of the House Oversight Committee

The second reason the Daniels payment proved so consequential is more speculative. By itself the hush money offered Vance only a misdemeanour case against the president. That came with a minimal two-year statute of limitations on which Trump’s allies in the Department of Justice quietly ran down the clock. But if Vance could link the payment to more serious crimes such as tax and bank fraud, the statute of limitations would rise to six years. Then, assuming Trump lost to Biden, the case would outlast Trump’s term and his immunity. 

So Vance expanded his investigation. He said it was in response to public reports of “extensive and protracted criminal conduct at the Trump Organisation”, but it was also because otherwise he would run out of time. Whatever charges he brings against Trump he has a window of about two years to make them stick.

Big questions remain. What do the documents Vance has collected actually say? Will he go after Trump for obstruction of justice while in office as well as fraud beforehand? (If so, Mueller’s Russia report includes 185 pages of carefully signposted evidence.) How will he prove intent on the part of a man who’s spent his career paying others to do his dirty work?

It may come down to a careless voicemail, a scribble on a tax return, or a cheque that Trump is known to have written to Cohen to cover part of his reimbursement. 

Alternatively it could come down to one man who hardly ever speaks in public, let alone to journalists. Step forward, Allen Weisselberg, chief financial officer of the Trump Organisation for the past 30 years, as loyal to the memory of Trump’s late father as to the son. Cohen has said under oath that Weisselberg helped set up the payments. Weisselberg denies knowing what they were for, but court-watchers in New York say he will have to feature in any Trump prosecution – either as witness or defendant. More than anyone, Sheil says, Weisselberg knows where the bodies are.

Donald Sr. and Donald Jr. arrive for a press conference at Trump Tower. Between them is Allen Weisselberg

The strange thing about this story is that five bodies are lying in plain sight – those of Officer Brian Sicknick and the four others who died as a result of the 6 January assault. A huge political constituency, including most of Biden’s supporters, believes Trump should be held personally accountable, before anything else, for the desecration of the hearth of American democracy. It could happen, but as things stand a New York prosecution for falsification of business documents and related felonies looks more likely.

There is, of course, a final scenario to consider. Letitia James wins the governorship of New York and quietly lets her Trump investigation lapse. Cy Vance Jr wins reelection as DA and decides to “look forward, not back”. Meanwhile, as an old Washington friend puts it: “Trump fucks off to Florida to play golf and pretend he’s still president.”

Photographs: Getty Images

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