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CNN
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Former Trump Organization CFO Allen Weisselberg testified Tuesday that he knew he should have paid taxes on hundreds of thousands of dollars in benefits he received annually, including a company-paid Manhattan apartment that he said former President Donald Trump suggested he move into.
Weisselberg testified for about 90 minutes during the criminal trial of the Trump Organization in Manhattan, calmly walking the jury through the growth of the company from 50 employees when he started there in 1986 into an umbrella organization that includes 500 entities.
Under questioning by prosecutor Susan Hoffinger, Weisselberg answered “yes” as the prosecutor went through each of personal expenses he received from the Trump Org. – and that the company didn’t pay taxes on them from 2005 through 2017.
One of those untaxed benefits Weisselberg received was a more than $7,000 per month 1200 square foot luxury apartment overlooking the Hudson River in Manhattan.
The former CFO said Trump offered him the apartment in 2005 to cut his daily commute to Long Island where he lived at the time. Weisselberg sat down with Trump, who Weisselberg said asked him if he would consider moving into the city. Trump said, according to Weisselberg, it would “help you, help the company” and Weisselberg could work longer hours.
Weisselberg said after speaking with his wife, they agreed to move in and Trump authorized the expense.
He also said he expensed his utilities, phone, car leases and garage saying it was “part and parcel” with the apartment.
Either Weisselberg or Trump would sign the rent checks for his apartment. In total, he received as much as $200,000 in untaxed compensation in a year from all those benefits, according to his testimony.
Weisselberg testified had he asked for a raise the company would have had to pay him double – as much as $400,000, to cover the taxes.
In all, Weisselberg said he didn’t pay taxes on approximately $1.76 million in personal expenses from 2005 through 2017.
He acknowledged that he knowingly unreported his income on his tax forms to get the fringe benefits tax free, and he hid that information from the accountants at Mazars, he said, because he thought they would refuse to sign his tax returns had they known about it.
Trump Organization Controller Jeff McConney knew the practice was illegal when he generated the false W-2 and 1099 tax forms on Weisselberg’s behalf, according to Weisselberg.
McConney previously claimed on the stand that he didn’t think all of the expenses were handled improperly until an internal review years later.
Weisselberg on Tuesday also acknowledged that he was stripped of the chief financial officer title after he was arrested and charged with 15 counts of tax fraud and grand larceny. Weisselberg, whose voice dropped to a whisper when discussing his crimes, said he continued to do most of the same work after he was indicted. That changed in October, several months after he pleaded guilty and agreed to testify, when Weisselberg said he began working from home and his contact with Eric Trump, who runs the company on a day-to-day basis, “stopped.”
Weisselberg said he is on paid leave and still expects to receive a $500,000 bonus in January in addition to his $640,000 salary.
The day Weisselberg finalized a plea deal with prosecutors in August, his son threw a birthday party for him at Trump Tower. Weisselberg attempted to downplay it, saying he regretted it, and that “it was a small cake.”
Weisselberg is expected to continue on the stand Thursday morning.
Two Trump Organization entities are charged with nine counts of tax fraud, grand larceny and falsifying business records in what prosecutors allege was a 15-year scheme to defraud tax authorities by failing to report and pay taxes on compensation provided to employees. The former president is not a defendant in the case and is not expected to be implicated in any wrongdoing.
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