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tv   The Rachel Maddow Show  MSNBC  July 2, 2021 1:00am-2:00am PDT

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>> cringe it's not for us to be clear. he should have been out in retirement, but he didn't because he think that it would politicize the court, get on joining us this hour, leona helmsly. she went to prison. she was an actual multibillionaire for real. she was president of the helmsly hotel including the park lane in new york city and the helmsly palace. she, herself appeared in ads for
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some of her hotels bragging about how rich and exacting she was and how she needed all of the best stuff. she insisted on it in all of had err hotels and why you should come stay at her hotels. kind of familiar but it worked for the 1980s until it didn't. turns out despite being a billionaire and not only the image of immense wealth. leona helmsly and her husband had engaged in a couple of chizling tech cheats including a couple of renovations done at a vacation home in connecticut. renovations like putting in a dance floor but she billed the renovations to the hotel
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company. she had the hotel pay to do those renovations on her private home that had the double benefit of not having to pay for those and also her hotel company got to deduct the payments as a business expense, even though they weren't. it was just stuff she wanted personally. yeah, she went to prison. the trial where she got convicted probably made her even more famous than the hotels. only the little people paid taxes at the house fraud and extortion trial. the conversation took place at the helmsly home in grenich.
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i said, you must pay a lot of taxes. she said, we don't pay taxes. only the little people pay taxes. she testified that staff salaries were paid by helmsly businesses and her paycheck was issued by the harley hotel based in cleveland. she ordered groceries and supplies for the house from the park lane hotel and the items were delivered in a hotel van. the assistant attorney asked if she ever purchased food locally. she said she did so only a few times. she said, i bought something for the house that we ate. she testified when she asked mrs. helmsly to reimburse her for the food. she said, quote, you boat it.
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you pay for it. leona, only the little people pay taxes, helmsly went to for which is a crazy thing to bothe turns out exactly the kind of crime that super rich people they can get away with and can get caught for particularly if they are brazen about it. the salaries of her maid and over servants and renovations, the business paid for it. that meant nothing came out of her pocket. she was convicted on 33 counts. people famously shouted at her
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and taunted her from the steps. she went to prison in 1992. when she got out, she had community service for her. she tried get her employees to perform those for her. she died in 2007. nearly headline in every owe bitry called the ex con to be the queen of main. using your business to pay for your personal stuff and not pay taxes is a good way to go to prison. do you remember on seinfeld, the soup nazi. he had all these specific rules
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for exactly how you were supposed to order soup. if you didn't follow the rules, he screamed no soup for you. the soup nazi was based on a real guy run by a guy who would really scream if you didn't order fast enough or if you didn't stand in the right place. that chizling scheme of dude who paid taxes. running your business that your business provides personal stuff and then writes it off. the ways those are designed to
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hide. these are tried and true accounts. if you don't study these things or you watch seinfeld or read a single tabloid in the 80s. for comically high-profile people, this is a tried and true way to end up in the crowbar hotel. which is why, presumably, those people who tried to commit those know that they ought to be subtle about it. mostly. not all. what new york prosecutors spelled out in court was a variety of this kind of alleged crime that was according to prosecutors, not at all subtle. the word we might use is brazen. the word used in court before the judge was audacious. the prosecutor called it a
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sweeping and audacious scheme. >> calling from the 59 calendar. number one, the trump corporation, trump payroll and allen wisenberg. the judge, any reason we cannot continue? >> none. the clerk, allen wiseleberg. an indictment charging you with grand larceny in the second degree and other related charges. how do you plead? guilty or not guilty? the defendant, not guilty. the trump corporation, the grand jury of the county of new york has charged you with scheme to defraud in the first degree. corporation pleads not guilty. the trump payroll corporation, charging you with scheme to defraud. how do you plead, guilty, not
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guilty. the company pleads not guilty. thank you. the judge, very well. a different prosecutor rises. your honor, in light of the many cases, as spelled out this was a 15-year long tax fraud scheme involving off the books payments which is a type of crime charged against companies and executives all the time. contrary to today's assertion by the company's ceo, former president donald trump, this is not a, quote, standard practice or the act of a rouge or isolated employee but instead by the most senior executives benefitting themselves and themselves receiving pay raises. the chief financial officer himself avoided taxes on
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$1.7 million of income. the former ceo, former president donald trump, himself signed many of the illegal compensation checks. to put it bluntly, this was a sweeping and audition illegal payments scheme. as noted, the chief financial officer himself directed that company records be deleted to conceal his participation in this scheme with the knowledge of the company yet, he remains to this day, the most senior financial fid usury in the company. no attempt on the people involved to report the crime, repay the proceeds or amend any false tax returns. when confronted, the highest level decided to not cooperate. instead, the company forced us to litigation for a year and a half including two trips to the supreme court. even then, failed to comply with
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subpoenas and refused to allow us to speak to any employees in the grand jury. to be clear, the company has a complete right to adopt this type of approach. but having done so, it doesn't have the right to turn around and ask for the leniency and benefit that applies to a company that does cooperate. in short, no clearer example of a company that should be held to criminal account. finally, to address what this case is not about. this case is not about politics. this investigation, which is ongoing has been thorough careful and proper and limited to subject matters within our jurisdiction. politics has no role and played no role here. considered by an impartial grand jury. we look forward to a review of the minutes that will confirm
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impartiality. the judge nods to the defense council and says, council. thank you, your honor. i appreciate the press release. i don't think at this point it warrants a response bit by bit, claim by claim. i don't think i'll warrant it at this time. thank you. >> anything else? >> your honor, i don't have a microphone. should i stand? >> we'll hand you a microphone. i would like to say on behalf of mr. weisselberg. i would like to object to the extent they relate. thank you. >> that was the meat of it. the discovery after that, which
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prosecutors have to give the evidence they've got at one point, when they talked about handing it over, they note as the prosecutors said, this is an on going investigation they asked for a protective order and whatever they have to hand over to get a good look at all the evidence so everybody has a fair shot. that would mean defense orders can't show any material to the public or anybody not directly involved in the case. there's a protective order. we'll never see the recovery. the other thing was this sad
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moment. the prosecutor says to the judge. while these charges are eligible for bail, we believe from is a flight risk. so surrender of the passport is necessary to reasonably assure the return to court. the defendant has been and will remain the cfo. the evidence would demonstrate an ample record of travel by private jet with significant means and connection outside the jurisdiction. the surrunder of the passport is an alternative condition to ensure defendants will return to court. it is our understanding the defendant consents and is prepared to surrender the passport. do you in fact consent? >> defense lawyer says, yes, your honor. the judge just says bluntly, turnover your passport.
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>> there was no bail. he did turnover his bass port but he was released on his own recog nice ans. they set the status will be held in september. in addition to what happened in the room, we have the written account of the charges. there are 15 felony charges. four counts of criminal tax fraud. first degree scheme to defraud. conspiracy count. four counts of offering a false instrument for filing the charge and chief financial officer. the charge he faces alone which is grand larceny, which is theft. they are accusing him of stealing, in effect, from the irs by knowingly obtaining a tax
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refund he was not supposed to get. but the news here. the genuinely and surprising news. number one, this is a lot of charges. 15 felony charges is a more serious indictment than trump lawyers have been trying to spin for the past week or so for sure. this is heftier indictment than they prepared for or people were expecting. number two, in statements today from the d. a's office, remember, this has been a joint investigation and in that exchange about why they need a protective order, it was made clear by prosecutors speaking in court and from the d.a. and
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attorney general made more clear than i expect today. that this isn't it. in all likelihood more is coming. we believe the special grand jury we first learned about last month that has been meeting next week and will continue to meet for the next six months. meeting next in very blunt terms. the charges ushered in a new phase of the business practices of his company. the indictment was narrowly focused and melee the next steps
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which will focus on mr. trump. the next steps will focus on mr. trump. on the next phase, prosecutors will continue scrutinizing whether they manipulated profit to obtain tax value. there has been some speculation that bank fraud and insurance fraud that had been reported. there was some discussion that maybe that wasn't going anywhere. it sounded like that was next with a focus on himself.
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number one, the initial indictment is a lot of charges, 15 felonies. number two, there is more coming in the three, there's been a lot of discussion about an unindicted co-conspirator. as far as we can tell, that is not president trump himself. so you understand, here is one of the places this phrase occurs in the indictment. it says, quote, operation in the conspiracy from 2005 through the date, the named defendant and others including co--conspirator number one agreed to implement a compensation scheme. that unindicted co-conspirator does not appear to be president trump. i will explain whys that the
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case. it will seem that better chance that unindicted co-conspirator is more likely to be somebody like the controller for the trump organization. the sort of lower level of the company that reported to allen weisselberg. there is a reason this person is not named. we don't have any reason to believe if he is the controller, he has left. as far as we can tell, he's still there. there is always the possibility when they are pointed to that that person is cooperating. prosecutors said they have not been allowed to talk to any employees outside the process. we know that controller spoke with the process.
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the reason i say it does not appear to be former president trump is because he's described otherwise several times. he's described bluntly as a person who signed checks and used to make illegal payments to private schools for some weisselberg's family members and to pay rent for an expensive apartment. there is no effort by prosecutors to hide donald trump's identity when p it comes to his involvement. so it wasn't make sense that they would describe him bluntly in those places and as the unindicted co-conspirator elsewhere. the conduct described here is not subtle or particularly well hidden. at least no longer hidden from
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prosecutors. did you see the wire, where the character says, are you taking notes? classic scene. >> is you taking notes on a criminal conspiracy? what are you thinking, man? >> that's how it worked on the wire. here is how it worked on the trump organization. quote, beginning in 2005 and part of the scheme, weisselberg draw rental checks on the apartment where he and his wife lived. they directed the trump organization to issue checks to pay for the utility bills
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including electricity, phone, cable television. during this period, trump organization also paid for his monthly garage expenses. kons tugt employee compensation and taxable income and these payments were not booked in the trump corporation's general leger. for years, the trump organization obtained internal measures to track indirect compensation. otherwise reported to authorities. >> he's effectively getting paid. deducted from his salary. definitely part of his compensation. they didn't report it and didn't
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list it in company's books and did describe it to the penny on a sheet. is you taking notes on a criminal conspiracy? what are you thinking? they kept internal records of stuff they were otherwise keeping off the books. really? prosecutors now apparently have that. 0 audacious and sweeping is how the prosecutor describes it. here is another point. the scheme to have trump's company pay for personal stuff for trump organization executives as described as a scheme. not only did those executives not have to pay for those out of pocket, they would there by dodge taxes on the company and employee side.
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the indictment says that scheme was not limited to allen weisselberg and his family. they describe other persons who benefitted from this alleged illegal scheme. similarly, there were other executives that worked for the company but regularly paid in ways that made it look like they weren't getting compensated as employees. this he were getting paid as consultants that was an important way pay for the company. described as a further part of the scheme to defraud. no other executives as described as the beneficiary. it was sclis explicitly
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described by "new york times" reporter in the pulitzer prize winning report as it related to ivanka trump, the president's daughter. detailing the financial records that showed her as being paid as an employee and consultant to the trump organization in a way that seemed custom designed to try to evade taxes both for the company and for her. that is the executive scheme described as the end of the indictment. prosecutors say weisselberg benefitted from such a scheme and others did too. >> that is the ivanka scheme
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described last fall. like i said, apparently, there is more to come in this investigation. we've got more to come. hold that thought.
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in order to obtain this remarkable indictment against the company of former president trump and chief financial officer. they had to battle all the way to the supreme court twice. trump lost that fight and in february, prosecutors did finally get access to millions of pages. february, they got access. by may, they empanelled a special grand jury to meet three days a week and consider those charges. today's indictment and charges unveiled is the first public facing product. it may not be the last. it is still sitting and expected to sit until the end of the
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year. right now, there are two known entities. one is that prosecutor's office the other entity is a small reporting entity at the "new york times" that won a pulitzer prize writing about it. they've been writing about how the trump family has spent years aggressively avoiding paying taxes. with us, executive reporter for the "new york times." >> thanks for having me. >> reading the indictment today and knowing what prosecutors said in court do you feel like you saw some of this coming.
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>> we've been looking at his finances for five or six years. there are a number of issues we saw we think still need to be surfaced. interesting that today it was built more around donald trump's taxes than allen weisselberg's taxes. we saw four or five or six discreet issues i've heard are of interest to the manhattan d.a. one of the things that caught my eye is about a scheme you uncovered was paid this a way
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that seemed to have paid her income in a way that would have been advantageous. i wonder if you saw those particularly in the later part in that indictment which saw ongoing schemes around the way their compensation was described to authorities we saw others involved as well. there was $26 million found in consulting fees being paid from entities donald trump controlled outward. we couldn't see who they were going to but we saw them going
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out. when we saw it, we were like, where are these going. what we found, we were comparing taxes to other documents. we had public and other documents. we saw some went to a company controlled by ivanka trump as an officer and paid out to ivanka trump. why that was a red flag, she's an officer of the trump organization and has paid more than $2 million and is also getting consulting fees and something right away the irs should be getting. these sort of payments should be ordinary and necessary. you have to question why somebody who is making $2 million at the trump organization is also getting consulting fees. you are like, what's going on and we are reporting suspected and reported about is that this is an attempt to reduce taxable
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income and reduce income to his kids. this is an effect of reducing or avoiding gift tax. we didn't have access to other people's tax information to see if potentially eric trump was getting some is of these tamts or donald trump jr. was also getting payments but they are part of the member of the company getting money paid to ivanka. >> the kind of documents that would show that, is from your understanding as we could see that those are the kinds of documents that the prosecutors have? >> i can't imagine those would have and the attorney general would go after those and receive those payments called ttt. called trump, trump, trump. they've got those records.
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i don't know how far they've gotten. that's a real follow the money case. we saw it and started to work through it. we dead ended because ivanka trump had gone to the administration and had financial filings and we were able to match them up. i worked with two great or theers -- reporters on it. took a long time but it is there. that's one of the things the manhattan d.a. is looking at. >> thank you for your time and your clarity on this stuff. i really appreciate it. >> great. thank you. i want to bring into the conversation now dan alanso, who previously served in the prosecutor's office. the memo about how and when to
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file criminal charges against corporations. thank you for making time and being here. >> thanks for having me, racial. >> i am not a lawyer. and i am a nonseasoned observer of new york state criminal prosecutions. there were a number of things that spoke to me and surprised me in part that it was 15 charges and the prosecutors used pretty bold language and said it was an ongoing unrepentive scheme just wanted to get your reaction. >> it is understandable on that language and account for reasons
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i won't bore you with so it might have been a more stream lined approach. it tells that story. that is more powerful than we thought based on what we observed. >> let me bring you to a point because of the way of knowingly evading. the reporting is something that should have popped for the irs.
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saying if these were serious tax evasion, the irs would have come after us and been pursuing this. not some da in manhattan. what do you make of that charge? >> it is a little silly. i get it that why wouldn't the irs be doing it. i will tell you the irs was kind of an opec entity brought many years after. i wouldn't put any creed ans into the fact. they may well be in the normal course of things. in terms of this criminal
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investigation, that's not a real defense. you can't say, geese, we shouldn't be convicted of this ifs that the case, they wouldn't do any white color cases. so this is just one of them. that's a silly defense. >> scheme to defraud to the first degree is a jump bell of words i've never heard before what should we understand scheme to defraud to mean in terms of an alleged crime. from a prosecutors perspective it is a great stalt ut patterned after the fraud which means trying to get money from people or companies or property by lying to them by false or
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fraudulent pretenses. it is other than just a one-time transaction which is why this can allege a 15-year scheme in one account. it requires more than one victim yim. it was brilliant to include the irs as a victim. it takes a $100,000 case and turns it into a $900,000 case, which is more difficult. >> our new york prosecutor served as chief district attorney. thank you for being here. coming up next, as soon as i saw this, i knew i wanted to talk to dan and susan craig about this. the other person i most wanted to talk to is mary trump, donald trump's niece and she agreed to do an interview with us. that's coming up next. ing up ne.
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early on in the trump presidency, obtaining hundreds of pages of documents of the business and family and ultimately the "new york times" turned those into investigations to show how for years the trump family participated in tax schemes and outright fraud. schemes that saved them virtually hundreds of millions of tax payments over the years. it was a mystery how attorneys could have gotten their hands on so much until this book came out by mary trump revealing she turned those over.
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they became the basis of a lawsuit mary trump launched against her uncle in which she alleges he cheated her out of hundreds of millions of assets. that lawsuit is part of the items a growing list of legal woes and charges brought in new york state court. joining us now is donald trump's niece too much and never enough how my family created the world's most dangerous man. a new book coming out called "the reckoning." thank you for being here. >> thank you. it is great to be here. >> let me ask your unique
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perspective on how your uncle and people around him will react to various accountability. criminal charges for his business is something new. anything like it he's never faced before. how do you think he'll react? >> i'm sure he's quite angry. i wouldn't want to be around him right now. unlike other people close to him who are probably extremely nervous, i don't believe donald will be because he's been getting away with this sort of thing for so long that he must feel immune because he always has been. these are the kind of charges that could have been levelled against him and other people in my family decades ago. he's also, i'm sure, quite confident in allen weisselberg's loyalty. he doesn't believe for a second he would flip on him.
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unless they could find somebody else would flip, donald will be completely confident in allen's loyalty for sure. >> another thing that struck me is the sort of bluntly worded reporting from the "new york times" that the next phase of the investigation. not only is there a next phase that there will be work and further indictments but that it focuses strictly on the indictment of your uncle and being looing at defrauding banks and tax authorities. wouldn't just be targeting the
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company or allen but him personally must seem like a different sort of a different level. >> yeah. sure. it shouldn't surprise anybody except perhaps donald because there are long-standing patterns here. my lawsuit will show just how consistent those patterns are and have been since the 80s. the other thing people need to understand is that when my grandfather was alive, donald was involved in everything that went on. after my grandfather started suffering from alzheimer's, nothing happened in my family or his business without his say so. he is running the show. he is always the person that knows what is going on. nobody does anything independent
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of him. that includes his siblings as well. he should be quite nervous but i think the fact that he's gotten away with so much for so long, including over the past four years when he was in the oval office will continue to give him a false sense of confidence. >> is that interrupted at all by the prospect that other executives of the organization who are his children may be in the line of fire here? i think the important threads to pull from that pulitzer prize reporting story at the "new york times" is that among others, it appears ivanka trump benefitted from the type of scheme described in the indictment that trump executives were compensated in ways designed to help evade taxes on their
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behalf. weisselberg is being charged. now we've got solid reporting that the investigation continues that raises the prospect that could be brought against his children? >> it does. they should be quite anxious right now. donald on the other hand will expect the same kind and level of loyalty he expects from allen. as far as donald is concerned, they have what they have because of him. they should be willing to take whatever hit they are going to take. he doesn't understand, i guess, how these things work. prosecutors won't stop at my cousins. they will be going for the bigger fish who would be donald who has been running this organization for over 30 years now. i think he would be surprised to learn that i don't believe my
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cousins would exert that kind of loyalty because his relationship with him is entirely transactional. so and conditional, i should say. they are not going to risk anything for him as he wouldn't risk anything for them. it should get really interesting. there are so many other documents that new york prosecutors have at their disposal. >> you have expectation allen weisselberg would cooperate than his children? >> as serious as these charges are, they may not end up with jail time or any significant amount of jail time. the down side of cooperating
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with allen would be the down side of going to jail if for a large enough period of time. it will be interesting to see just the case that can be made and the sentencing if it comes to that because, i think that will factor in for sure because they are much more sanguin. >> the new book comes out called "the reckoning" thank you for being here. >> thanks. it is great to see you too, rachel. >> stay with us. stay with us.
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