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Trump could be investigated for tax fraud, DA says for the first time

The Manhattan Prosecutor, which is in a year-long legal battle with President Trump over obtaining his tax returns, first suggested in a court case on Monday that they had grounds to investigate him and his companies for tax fraud.

The filing by District Attorney Cyrus R. Vance Jr.’s office provided rare glimpses of the firm’s investigation into the president and his business relationships, which began more than two years ago.

Mr. Vance, a Democrat, never disclosed the scope of his office’s criminal investigation, citing the grand jury’s secret. The investigation was stalled by battles over a subpoena issued by the office in August 201

9 for eight years of the president’s tax return.

Mr. Trump’s lawyers said the subpoena should be blocked, calling it “wild overseas” and politically motivated. Mr Vance responded to this argument in a carefully worded new file that did not directly accuse Mr Trump or any of his companies or employees of wrongdoing and tried not to divulge details of the investigation.

However, prosecutors listed news and public statements alleging wrongdoing by Mr Trump and his companies. The reports, the prosecutor said, would warrant an investigation by the grand jury into a number of potential crimes, including tax and insurance fraud and falsification of business records. It was the first time the office suggested that tax fraud could be one of the possible areas of investigation.

“Even if the grand jury alone examined the truth of the public allegations, such reports together fully justify the scope of the grand jury subpoena in this case,” the prosecutor wrote.

Jay Sekulow, an attorney for Mr. Trump declined to comment on the district attorney’s filing.

The President has announced that the Supreme Court dispute over the subpoena will end. “This is a continuation of the witch hunt, the largest witch hunt in history,” Trump said last month.

The conflict began when Mr. Vance’s prosecutors sent the grand jury subpoena to Mr. Trump’s accounting firm, Mazars USA, for tax returns and other financial records.

Mr Vance’s office has been investigating hush money payments made prior to the 2016 election to two women who claimed they were having affairs with Mr Trump.

More recently, prosecutors suggested in court files that their investigation be broader, including a focus on possible financial crimes and insurance fraud. Prosecutors said they considered Mr Trump’s records central to their investigation.

After the subpoena was issued, Mr Trump sued in federal court to block it, arguing that as the seated president he had blanket immunity from criminal investigations. Manhattan Federal District Court Judge Victor Marrero flatly dismissed the lawsuit, which had not previously been considered in court, and the President appealed.

The dispute eventually reached the Supreme Court, which issued a landmark decision against Mr Trump in July.

“No citizen, not even the president, is categorically above the general duty to produce evidence when required in a criminal case,” wrote Justice Colonel John G. Roberts Jr. for the majority.

However, the judges said Mr. Trump could return to the lower court and raise other objections to the scope and relevance of the subpoena. Mr Trump’s attorneys returned to Judge Marrero, arguing that the document request was political and “so extensive that it was an unguided and unlawful fishing expedition”.

In August, Judge Marrero rejected the president’s new arguments. The judge found that Mr Trump’s protracted legal battle could cause the statute of limitations on possible crimes to expire and effectively grant him the immunity to which the Supreme Court ruled he was not entitled.

“At its core, it means absolute immunity through a back door,” wrote Judge Marrero. He added, “Justice demands an end to this controversy.”

Mr. Trump is now appealing to the U.S. Court of Appeals for the Second Circuit. In recent court records, his attorneys described Judge Marrero’s opinion as “flawed from start to finish” and accused him of “piling up the deck against the President”.

“The president is not trying to revive any claim to categorical immunity,” the lawyers wrote. “He challenges this specific subpoena for a variety of reasons.”

The appeals court has scheduled an oral hearing on this matter for Friday. Under the court rules, either party could bring the case back to the Supreme Court, making the dispute unlikely to be resolved before the November 3rd presidential election.

Even if Mr. Vance’s attorneys ultimately receive Mr. Trump’s tax filings, the grand jury’s secrecy rules mean that the materials are unlikely to be released anytime soon. You might only show up if Mr. Vance’s office files a lawsuit and the tax returns are presented as evidence in court.

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