The Trump Organisation resisted a deal even after its long-serving chief financial officer, Allen Weisselberg, agreed to plead guilty and testify at the company’s trial, which was focused on off-the-books luxury perks that the company doled out to some of its executives.
The Manhattan district attorney’s office did not accuse Trump, or anyone in his family, of taking part in the scheme, though prosecutors named the former president and his adult children liberally at trial. In their closing arguments, they used a single exhibit to try to convince jurors that Trump had approved of the scheme.
Although the Trump Organisation has maintained its innocence — and Trump has chalked up the case to a politically motivated witch hunt by District Attorney Alvin Bragg — the company might have been more willing to strike a deal if it had been facing a harsher punishment.
It is unclear what changes Trump might make to the company in the wake of the verdict. The Trump Organization is a collection of more than 500 corporate entities, only two of which were on trial.
It is possible that he could shutter those corporations — the Trump Corp. and the Trump Payroll Corp. — without much effort.
A company, of course, cannot be imprisoned, and the two convicted Trump corporations are not publicly traded. As such, there are no financial regulators to punish them or public investors to flee from them.
The Trump Corp. and the Trump Payroll Corp. are also not central to Trump’s moneymaking enterprise. They largely perform back-office functions, employing and paying top executives, so they do not hold any loans, liquor licenses or other privileges that might slip away in the wake of the conviction.
That’s not to say that the reputational harm from the conviction won’t inflict some damage. It could scare off potential lenders and business partners, or enable them to impose stricter terms on Trump. Local governments that do business with Trump — he operates public golf courses in Los Angeles and New York City — might use the verdict as leverage to wiggle out of their contracts, and it could discourage other government agencies from doing deals with him.
And the toll from being a felon could make it harder to retain employees and, eventually, to expand the company.
Yet the Trump Organisation was in retreat long before its conviction.
Midway through the polarizing Trump presidency, it shelved plans for new hotel brands and lost some of its signature hotels. In the span of a year, the Trump name was removed from hotels in Panama, Toronto and Manhattan. And rather than tackle new projects, the company opted to tend to properties it has held for years, including office and apartment buildings in New York, a handful of hotels and 16 golf courses that it owns or manages.
The Trump family — which had already adopted several self-imposed ethics restrictions, including a moratorium on new foreign deals — blamed much of the retrenchment on waves of political and legal scrutiny trailing the businessman president.
And that was before the Manhattan district attorney’s office even started examining Trump in 2018, or the New York attorney general’s office began its own investigation of his business practices the following year. Bragg’s prosecutors are continuing the criminal inquiry into Trump, which is focused on his business practices and his involvement in a hush money payment to a porn star who said she had an affair with him.
In September, New York Attorney General Letitia James was the first to strike at Trump directly. She sued him, along with the company and three of his children, accusing them of overvaluing their assets by billions of dollars. Her lawsuit asks a judge to oust the Trumps from leading their family business. Already, an independent monitor has been chosen to ensure that the company does not transfer any of its assets out of state.
And with the company now convicted, any plans for growth appear to be in flux.
In the middle of the trial, the Trump Organisation announced a new deal with a Saudi-based real estate company to license its name to a housing and golf complex that will be built in Oman. But the deal appeared to be a one-off, rather than a sign that Trump was suddenly back in deal-making mode.
The company might also have a changing of the guard in its executive ranks. Weisselberg is currently on paid leave from the company and it’s unclear whether he will continue to work there after the trial. His lawyer, Nicholas Gravante Jr., issued a statement saying Weisselberg’s “only obligation relating to the trial was that he testify truthfully, and clearly he did.”
The Trump Organisation’s brand faces deeper reputational problems, much of them stemming from the Trump presidency. The problems intensified in the wake of the January 6, 2021, attack on the Capitol by his supporters, after which banks and insurers fled the company.
It was a far cry from the period leading up to Trump’s presidency, during which the company opened five-star hotels in Chicago and Las Vegas, bought golf courses and licensed the Trump name to properties around the world that other companies developed.
In the final stretch of the 2016 presidential campaign, Trump opened a hotel in Washington, just down Pennsylvania Avenue from the White House. It soon became the centre of the MAGA universe.
This year, in a sign of the company’s broader retreat, the Trumps sold it.
This article originally appeared in The New York Times.
Written by: Ben Protess and Jonah E. Bromwich
Photographs by: Maddie McGarvey
©2022 THE NEW YORK TIMES
