Investigators probing Donald Trump's finances have gotten hold of some of his tax records, allowing them to move ahead even without a Supreme Court order that would give them eight years of his returns.
Manhattan District Attorney Cyrus Vance Jr., who subpoenaed Trump's accounting firm Mazars USA in 2019, is leading one of the most closely watched cases that could result in criminal charges. While Vance agreed to await a high-court decision on forcing the handover of tax records from 2011 to 2018, his office now has some of the information from other sources, according to people familiar with the matter.
That information could help Vance support allegations that Trump's company used accounting gimmicks to overstate the value of its assets when applying for loans and underplay it to reduce its tax bills, according to the people, who asked not to be named because the matter is private.
Charges aren't imminent as Trump departs Washington. But losing the election in November meant Trump also will lose what presidential protections he had when he's replaced by Joe Biden at noon. Among those he claimed: that a sitting president cannot be charged with a crime.
No sweeping immunity
Trump invoked that longstanding Justice Department policy to fight Vance's request for the tax records. In July, the Supreme Court rejected the president's bid for sweeping immunity but left open the possibility that he could make more specific objections. Lower courts have since rejected Trump's arguments that the subpoena is overly broad and was issued in bad faith, and the matter is once again before the Supreme Court.
A spokesman for Vance's office declined to comment on what it was looking at, but the Manhattan prosecutor sketched a possible outline for his investigation in a court filing in September.
In that filing, a response to Trump's complaint that the subpoena amounted to a "fishing expedition," Vance cited a range of alleged financial misrepresentations by the Trump Organization already reported in the news media. Taken together, his office wrote, the company could have violated various New York statutes related to tax fraud, insurance fraud and the falsification of business records.
Vance isn't the only one who wants the tax returns. Trump has also been trying to stave off House Democrats who sought them after taking power two years ago. That fight continues - on Inauguration Day.
The Supreme Court, without explanation, has deferred action for the past three months on Trump's bid to block Vance's subpoena. The delay has kept the document demand on hold because Vance agreed in October not to enforce the subpoena while the Supreme Court considered Trump's request.
Should the court reject Trump, Vance would be free to insist that Mazars turn over the information. Mazars has said it will comply with its legal obligations.
Even as the battle has worn on, Vance's office has made significant progress in its investigation, including interviewing people who worked with the Trump Organization or are familiar with its business practices.
The office has spoken with Michael Cohen, Trump's former lawyer and "fixer," who pleaded guilty to violating campaign finance laws on behalf of Trump during his 2016 run. It has also spoken with representatives of Deutsche Bank AG, which has lent more than $300 million to Trump, and Aon Plc, an insurance broker that did significant business with the Trump Organization.
Significance of FTI
Vance's decision to hire financial consulting firm FTI Consulting, which was reported by the Washington Post last month, suggests that the prosecutor has already identified examples of potential wrongdoing at the Trump Organization, according to the people.
In a high-profile case such as this, FTI can guide Vance's investigators through a company's statements and explain any nuances that might justify -- or undermine -- the company's claims. If prosecutors do file charges against the Trump Organization or individual officers, an FTI representative could serve as an expert witness in court.
The Supreme Court case isn't the only issue hanging over the DA's investigation. Vance is in the last year of his current four-year term, but so far hasn't declared whether he will run for re-election in the Democratic primary, which will be held in June. Several other candidates have said they would challenge him.
While Vance's office is staffed with career professionals who would proceed with any case launched this year no matter who is DA next January, the Trump Organization probe is being guided by his general counsel, Carey Dunne.
Vance recruited Dunne from the law firm of Davis Polk & Wardwell LLP four years ago. It's not clear whether Dunne would stay on if Vance leaves.