Weisselberg's guilty plea: a legal coup for Donald Trump?

Allen Howard Weisselberg, the former Trump Organization CFO at New York State Supreme Court in New York
Allen Howard Weisselberg, the former Trump Organization CFO, arrives for a hearing at the New York State Supreme Court in the Manhattan borough of New York City, U.S., August 18, 2022. REUTERS/Eduardo Munoz

August 31, 2022 - Earlier this year, the Manhattan district attorney's office, in a controversial decision, declined to indict Donald Trump in connection with the preparation and use of his personal financial statements. But the Office did pursue a separate tax-related investigation of the Trump Organization for allegedly creating "off-the-books" income for key employees, including former Chief Financial Officer Allen Weisselberg, who was indicted on tax charges along with the company.

On Aug. 18, Weisselberg entered a plea of guilty to 15 felony counts, the entire indictment against him, promising to cooperate against his former employer, the sole remaining defendant, in the trial set for October.

Many interpreted this turn of events as a legal coup for the government. Michael Cohen, Donald Trump's former personal attorney, predicted that more Trump allies would "flip" and hold Trump responsible for his organization's financing schemes. Trump biographer Tim O'Brien reacted to the news by suggesting that the Trump Organization may be put out of business as a result of the upcoming trial.

Weisselberg's guilty plea, however, was not an unambiguous victory for the prosecution. It may even be a victory for Donald Trump.

The Weisselberg Case

If prosecutors have learned anything from their investigations of Trump, his businesses and his associates, it's that they must control the narrative to win. Ordinarily, nothing concentrates the public's mind like the prospect of an indictment or the equivalent, so control follows as a matter of course.

One of a prosecutor's most fearsome weapons is instilling the realization that charges are inevitable. Evading the consequences as much as possible normally becomes a priority for those facing indictments.

Yet Trump seems able to neutralize even this tactic. The District Attorney's Office told the court that Weisselberg's plea "directly implicates the Trump Organization in a wide range of criminal activity."

The plea does not, however, implicate Trump personally. Indeed, under the terms of Weisselberg's agreement, he will not implicate Trump or members of his family if he testifies, for he has said he does not believe they did anything wrong.

This is not normally how plea deals go down. Cooperating defendants usually do not get to pick and choose whom they will testify against, and it strains credulity to think that Weisselberg, who worked for Trump for more than half a century, has no information about him relevant to prosecutors.

Since Weisselberg was the prime beneficiary of the Trump Organization's alleged scheme, his promised testimony against the company will probably amount to little more than alluding to his own fraudulent conduct. His much-anticipated turn as a government witness may therefore be brief indeed.

Weisselberg's staunch refusal to provide testimony against Trump appears to have stymied prosecutors and limited the court's options. The New York Times reported that Judge Juan Merchan, who presides over the case, offered the final plea deal after Weissenberg rejected demands that he testify more broadly about Trump's business practices. Moreover, the judge forged this compromise over the objections of the District Attorney's Office. "Inside the Negotiations That Led a Top Trump Executive to Plead Guilty," The New York Times, Aug. 18, 2022, updated Aug. 19, 2022.

Lawyers for the Trump Organization have consistently said they have no intention of pleading out their client and look forward to trial. A measure of how much Trump and his circle fear Weisselberg's testimony was suggested by the following, reported in The New York Times article: A few hours after Weisselberg pleaded guilty, the company threw a birthday party for him at Trump Tower. Trump may merely have been playing head games with the prosecution; or he may be confident, having amply rewarded this loyal employee over many years, that Weisselberg will hold up at trial.

Will Trump slip off the hook again?

A favorable outcome for Trump personally isn't guaranteed, however. Judge Merchan won't sentence Weisselberg until after he testifies. If that testimony isn't found to be truthful, then the plea agreement will no longer apply. Instead of spending five months or less in prison, Weisselberg could face up to 15 years.

Given the heavy penalty for less than truthful testimony, Weisselberg must walk a narrow line. He is committed to denying Trump's culpability, regardless of the testimony of other witnesses or the probing questions of the government or Judge Merchan, but at the same time he must honor the terms of his plea agreement. Whether he can walk this line through the rigors of a criminal trial is an open question.

The best option for Trump may be to have the Trump Organization plead guilty and thereby avoid trial altogether. Trump would dodge another bullet, but at the cost of possibly putting his company out of business.

Kevin J. O'Brien is a regular contributing columnist on trial practice for Reuters Legal News and Westlaw Today.

Opinions expressed are those of the author. They do not reflect the views of Reuters News, which, under the Trust Principles, is committed to integrity, independence, and freedom from bias. Westlaw Today is owned by Thomson Reuters and operates independently of Reuters News.

Kevin J. O'Brien is a seasoned trial lawyer and partner at Ford O'Brien, LLP, based in New York City. He is a former Assistant U.S. Attorney for the Department of Justice and specializes in white-collar criminal defense, commercial and securities litigation on behalf of plaintiffs and defendants, regulatory enforcement cases, and arbitrations. He has tried over 25 court cases and numerous arbitrations to verdict. He can be reached at kobrien@fordobrien.com.