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New York orders Trump companies to pay $1.6M for tax fraud

MARY LOUISE KELLY, HOST:

In a Manhattan courtroom today, a judge ordered two companies owned by Donald Trump to pay $1.6 million in penalties. NPR's Ilya Marritz covered the criminal trial of the former president's business, which resulted in a guilty verdict on 17 counts. That was last month. Ilya is with us now. Hey there.

ILYA MARRITZ, BYLINE: Hello.

KELLY: So $1.6 million - a lot of money for most of us. Is it a lot for the crimes that the Trump businesses were convicted of?

MARRITZ: Not really. At trial, prosecutors showed that executives working for Trump engaged in a wide variety of maneuvers to evade local, state and federal taxes over more than a decade. And many of those tricks also benefited the Trump business. One executive got an apartment and cars and private school tuition, all undeclared, off the books. That meant Trump didn't have to raise that executive's wages for many years, and the Trump business also skirted payroll and Medicare taxes.

KELLY: And tell me a little bit about court today. Was anybody from the Trump business, Trump family there?

MARRITZ: It's a funny thing. When a business is on criminal trial, the executives don't need to be there. So instead of Donald Trump or his sons, Don Jr. and Eric, who now run the business, we had a bunch of lawyers. And they asked the judge to impose a lighter penalty, arguing that the tax maneuvers their client was convicted of were approved by accountants, and the intent was never to benefit the Trump companies financially. The judge did not agree. He said they were deflecting, and then he ordered the maximum possible fine.

KELLY: OK. So the maximum possible fine - a small fine, though, for the Trumps, as we just noted - is it a big victory for the district attorney?

MARRITZ: You know, that number for the fine comes from the New York statute book, and that was the maximum. There's a dollar amount attached to each criminal count. District Attorney Alvin Bragg did talk to reporters afterwards. He called the former president's sentencing and conviction historic, and he said it should serve as an example to those who would think about cheating on their taxes. But he also acknowledged that $1.6 million may not be much of a deterrent.

(SOUNDBITE OF ARCHIVED RECORDING)

ALVIN BRAGG: I want to be very clear. We don't think that is enough. Our laws in this state need to change in order to capture this type of decade-plus systemic and egregious fraud.

MARRITZ: So it may hurt the Trump companies a little bit to be fined. But when the judge told the defense team you have two weeks to pay up, they did accept it.

KELLY: Are they going to appeal? Is that what's next?

MARRITZ: Yes. They say they will appeal the verdict. And beyond that, here in New York, there is also a related civil fraud case brought by Attorney General Letitia James. That is slated to begin in October. And like this case, James' case is about cheating on taxes and lying on documents. But the breadth of the alleged malfeasance is really almost global. It looks at Trump properties like Mar-a-Lago in Florida, Trump Tower here in New York, golf courses in Scotland and California.

KELLY: Any big takeaway from today's sentencing? I suppose I'm asking in the context of the many other legal probes involving the former president.

MARRITZ: Yeah, I think the lawyers preparing that civil case I just referred to, for the New York attorney general - they will be very encouraged that the Trump companies got the largest possible penalty today. Their case targets not only the Trump business, but also the Trump's themselves - Donald Trump and his three eldest children. And the potential penalties are big. Attorney General James wants to remove the Trumps from leadership roles in the company. She says they should be barred from buying or selling real estate in New York or applying for loans for five years, and she's demanding a $250 million fine. All of that could cause real pain if she is successful. Trump says he did nothing wrong, of course. But big picture, today's sentencing, I think, is another sign that some of the Teflon has come off of Donald Trump. But he still has never been charged with a crime, and the issue of whether and how to investigate and charge former presidents remains really fraught.

KELLY: NPR's Ilya Marritz, thank you.

MARRITZ: You're very welcome.

(SOUNDBITE OF MAREN MORRIS SONG, "GIRL") Transcript provided by NPR, Copyright NPR.

Mary Louise Kelly is a co-host of All Things Considered, NPR's award-winning afternoon newsmagazine.
Ilya Marritz