New York AG Weighed Hitting Trump With Racketeering Charges

It’s long been a mystery why no New York prosecutor has dared to go after Donald Trump with racketeering charges—the strongest and most obvious type of criminal case for his storied history of deceit in the corporate world.

The New York attorney general’s office has, of course, accused Trump of inflating property values in a civil case. And the Manhattan district attorney charged Trump with 34 felonies related to falsifying business records in service to his Stormy Daniels hush money payments. But those cases would pale in comparison to the potential legal jeopardy Trump would face if a prosecutor went after the former president for running—in effect—a criminal enterprise.

The DA seems to have passed on that idea. But new reporting from The Daily Beast reveals that the AG’s office, which was positioned to do it on its own, looked at bringing criminal charges against Trump—and may have been stymied by state offices under the administration of former New York Gov. Andrew Cuomo.

New York AG Considered Investigating Giuliani Over Ukraine

This previously undisclosed bureaucratic showdown is now being surfaced in response to the recent leak of internal AG documents that have been sent to the DA’s office last week. Among them is a memo circulated at the AG’s office in 2020 that outlined exactly how to go for the jugular by indicting Trump for essentially running a mob, according to emails reviewed by The Daily Beast. If he were found guilty, the potential punishment would be severe: a mandatory year in prison and up to 25 years behind bars.

Top brass at the state office didn’t respond to the proposal in writing, internal emails show. But AG Letitia James and her top deputy briefly considered it in private talks, according to a person familiar with the matter who would only speak on condition of anonymity.

“It was certainly discussed. This was not something that was deliberately ignored,” this person said.

The AG’s office ultimately rejected the notion of going solo with an indictment alleging what New York laws call “enterprise corruption.” Instead, as previously reported, it loaned two of its lawyers to the Manhattan DA’s office, which already had an ongoing criminal investigation. The move made sense, according to legal experts who have closely watched this unfold. The DA has clear jurisdiction over local crimes, while the AG would need special permission from the governor.

But here too is a key part of the mystery that hasn’t been told until now: Pairing up with the DA was a backup plan.

The AG had already been “diligently” conducting its own preliminary criminal probe into Trump’s finances, but its attempts to seize the billionaire’s New York tax information were “stonewalled” at the time by Cuomo’s administration, according to a second source familiar with the investigation who also spoke to The Daily Beast on condition of anonymity.

After publication, a Cuomo spokesperson disputed the allegation that the administration had stonewalled any tax information.

“No one I talked to today has any recollection of this, but of course the Department of Tax and Finance or any other executive agency would have complied with a lawful subpoena,” Cuomo spokesperson Rich Azzopardi said. “If there was any question about whether Letitia James’ office had operated within the bounds of what was appropriate and supported by the law, well I suppose it wouldn’t have been the first or last time.”

These new disclosures shed light on an issue that has long frustrated legal experts, who have spent years openly asking why these two prominent offices haven’t gone for the proverbial kill shot against Trump.

Have a news tip for The Daily Beast? Send it to tips@thedailybeast.com.

To report this story, The Daily Beast reviewed internal AG communications recently shared with the DA’s office and spoke to several people with varying levels of access to the past and ongoing criminal investigations against Trump and his associates in New York City.

By mid-2020, attorneys at the AG’s office were already developing what could have been a full-on criminal case against Trump, focusing on the way he lied on his finances, the second source said.

A team of lawyers conducting a civil investigation, however, already had a head start.

Those lawyers had gathered extensive information about what seemed to be fantasy accounting at Trump’s forested Seven Springs estate north of Manhattan, and they had already issued a May 2020 subpoena on one of the billionaire’s sons, Trump Organization executive Eric Trump.

What would become a civil bank fraud investigation forged ahead of the criminal probe by September of that year, when Justice Arthur F. Engoron ordered the younger executive to answer investigators’ questions.

It was in the midst of these quiet law enforcement efforts that the attorney general’s chief of staff received a curious idea from someone who wasn’t working on the Trump cases: John Oleske, a senior enforcement counsel at the agency. Why not treat Trump like a mob boss, and charge him accordingly?

The Mob Boss Tactic Trump Uses to Keep People From Flipping

The email proposing the idea was sent Nov. 20, 2020, just as then-President Trump was refusing to accept the failure of his re-election bid and starting what would be a multi-pronged underhanded attempt to remain in power. The rising national tension is readily apparent in the memo’s tone, which warned that “the absence of any prosecutorial action poses a high risk of additional major criminal activity, including existential‐threat‐level attempts to continue to corrupt the federal and other state governments.”

“There is already more than enough evidence for a [New York State] prosecutor to pursue grand jury investigations and potential indictments against Trump, his 3 oldest children, and other key associates (eg Guiliani) for enterprise corruption,” Oleske wrote.

Oleske floated the idea of pursuing a single overarching case with criminal charges against Trump and his lieutenants for faking business records, insurance fraud, mortgage fraud, perjury, money laundering, and tax fraud—many of which would later resurface in subsequent criminal indictments and a civil lawsuit, but notably broken apart into smaller standalone cases.

The lawyer noted that the AG’s office could build on its previous victories in court against Trump for running a real estate education scam dubbed “Trump University” and his Trump Foundation charity that was misused as a personal checkbook for political donations.

Oleske also cited the evidence laid out in the Pulitzer Prize-winning investigation by The New York Times that exposed Trump’s serial tax dodging. If senior leadership was on board with the idea, all it would have taken to kickstart the case would be a letter from Gov. Cuomo’s administration authorizing the AG to pursue this route.

But the AG had already requested information necessary to seek a referral to launch an official criminal investigation and hadn’t gotten it yet, the second source said.

When it seemed apparent that the AG was sitting on a mountain of damning evidence without the ability to pull the trigger—while the Manhattan DA had scant evidence and a clear line of fire—they paired up. James reassigned two state investigators, who got deputized as New York County assistant district attorneys.

In initial talks between both offices, AG lawyers acknowledged that their previous civil cases against the scammy university and political slush fund charity discovered conduct that could be charged criminally, potentially bolstering an enterprise corruption case, according to a source familiar with those interoffice discussions.

“Her office was better positioned to do it,” this third person said. “We thought about the racketeering case. We'd have to do it by rounding up the facts and documents the attorney general already had. It was not impossible. But they had them.”

But without the governor’s approval, the AG’s office was in a bind. Lawyers gathered the evidence and witnesses to build the case together with a mob takedown in mind: targeting the boss’ underlings. Half a year later, that team nailed the Trump Organization and then-Chief Financial Officer Allen Weisselberg on tax fraud charges, a case they won at trial that sent the accountant to Rikers Island and slapped the company with a relatively puny but legally capped $1.6 million fine.

But looking back at Oleske’s memo outlining an enterprise corruption case, one line stands out: a warning that the DA’s office “could prosecute (most of) these crimes, but cannot be relied upon to do so.”

Three years on, that word of caution has taken on a new meaning. Despite public calls for prosecutors to build a robust mob takedown against Trump, there still isn’t one.

“The memo was prescient,” said John Moscow, a former Manhattan prosecutor who has long advocated for New York law enforcement to target Trump with this type of all-encompassing criminal charge.

He noted that the case the AG did file eventually—a 222-page lawsuit accusing Trump of bank fraud that’s now on trial and has already scored a major victory that could destroy the tycoon’s real estate empire—reads like an enterprise corruption case in all but name.

“As a civil case, it’s a slam dunk. And the judge pretty much ruled against Trump already. As a criminal case, it’s still a strong, strong case,” Moscow said.

In the legal profession, Moscow is renowned as the man who revolutionized the use of New York’s mob-busting enterprise corruption statute. In the 1990s, during his time as the Manhattan DA’s deputy chief of investigations, Moscow refitted the tool as a sharpened blade to hunt down Wall Street fraudsters—most famously using it against what was once the seventh-largest bank in the world, BCCI, for money laundering and other financial crimes. That investigation took years, drained significant government resources, and even ruffled feathers by highlighting the inaction by the better equipped feds over at the Department of Justice—in some ways a parallel to the situation in New York City now with Trump.

Federal prosecutors at the Southern District of New York, widely considered the most powerful such office in the nation, never went after Trump while he was in office—or since he left, for that matter. It was up to the state AG and local DA to fill the vacuum.

Former DA Cyrus Vance Jr. initially led the charge to probe Trump’s finances and assembled a team of prosecutors and outside advisers to develop such a case, but that iteration of the team fell apart when he departed from the office and was replaced by DA Alvin Bragg Jr.

The new DA oversaw the conviction against Weisselberg and the Trump Organization. But instead of pursuing mob charges against Trump, Bragg sought a criminal indictment against Trump for faking business records while trying to bury salacious details about his one-night stand with the porn star Stormy Daniels by paying her hush money. That matter is set to go to trial in March 2024.

That indictment is only a slice of what DA investigators originally imagined when they first started developing the case.

Trump ‘Committed Crimes,’ Prosecutor Wrote Before Quitting Manhattan DA’s Office

Mark Pomerantz, who once led that team before quitting in frustration, detailed the internal discussions at the DA’s office in his tell-all memoir published in February this year, People vs. Donald Trump: An Inside Account. He dedicated an entire chapter to the concept of charging Trump with enterprise corruption, describing it as a “highly ambitious, complicated, and labor-intensive agenda,” albeit one that his own investigative team “did not embrace… with full-throated enthusiasm.” Pomerantz remembers Vance calling it “bold,” but liking it.

“Everywhere we were drilling we seemed to be striking oil in terms of potential criminality. Fraud on financial institutions, fraud on government contract authorities, tax fraud, insurance fraud, consumer fraud, a phony charity—there were so many areas to look at because neither Trump nor the Trump Organization seemed to care about stepping over legal lines,” Pomerantz wrote. “Bringing an enterprise corruption charge would allow the prosecutors to weave together a host of different criminal acts under one big tent.”

The basic premise should come as no surprise. Trump critics, an ever-widening spectrum that now includes increasingly disillusioned Republicans, have pointed to the billionaire’s unapologetic lawlessness. The apparent weaknesses of pursuing smaller, separate investigations for corporate misdemeanors and questionable tax write-offs can be overcome with the sweeping power of a mob takedown case, Pomerantz argued in his book, because prosecutors instead focus on proving “a pattern of persistent illegal conduct.”

However, a fourth person familiar with the New York investigations expressed serious reservations about the strength of a massive case that places Trump at the top of a mafia organizational chart, with someone like Weisselberg as his underboss.

“Trump? He’s shady, but he’s a poser. Allen? He’s a squirrelly fuck. But I haven’t seen any evidence of him committing widespread crimes,” this person said. “There’s a ton of nickel-and-dime corner cutting. But it becomes hard to string together the crimes necessary [for an enterprise corruption case.] Chain of command and entity, that part of the Trump Organization indictment writes itself. But you have to string together certain crimes with a certain gravity in a specific amount of time. That’s harder to actually prove.”

This source—who has remained unimpressed with the DA’s single ongoing criminal case against Trump—suggested that Bragg’s office could eventually decide to build this enterprise corruption case as a way to “supersede their rinky-dink hush money indictment.”

Still, the DA’s office on Tuesday would not answer questions from The Daily Beast about whether an overarching racketeering charge is still under consideration.

Meanwhile, a spokesperson for the AG issued this statement: “Attorney General James brought an expansive civil fraud case that, for the first time ever, exposed Donald Trump’s extensive fraud and illegality. The judge has already ruled in our favor and found that Mr. Trump committed years of fraud, and we are currently at trial presenting the rest of our case.”

These new disclosures about the much-anticipated, never-delivered Trump mob case only address the early stages of the investigation. They don’t explain why the joint AG-DA team still hasn’t filed these charges.

Those most familiar with the case willing to talk on background said the simplest explanation is the one the public least wants to hear: Maybe it’s too hard to prove. After all, prosecutors failed to flip Weisselberg and others against their boss. And several have expressed apprehension about presenting such a huge case in front of a jury while relying on Trump’s lawyer-turned-nemesis, Michael Cohen, who endured a brutal cross-examination last week at the AG’s civil bank fraud trial in which he had to acknowledge his past conviction for lying under oath—and admitted to a fresh new one: lying to a federal judge.

The fiercely anti-MAGA crowd has long been chanting for Trump’s head on a platter while holding up prosecutors positioned to get him as hopeful saviors. At the height of the Trump-Russia investigation, wily entrepreneurs started selling Special Counsel Robert Mueller prayer candles. His eventual 448-page report was widely scorned, giving Trump a free pass without even answering the question that sparked the investigation.

James and Bragg now carry that sacred torch. Next month, the AG will complete her lengthy trial seeking to topple the tycoon’s real estate empire. Early next year, the DA will present his Stormy Daniels case that could land Trump a year in Rikers Island jail at the height of his 2024 presidential campaign. And even if they fail, the leading Republican frontrunner will still have to face prosecutors in Florida, Georgia, and the District of Columbia trying to take him down too.

Read more at The Daily Beast.

Get the Daily Beast's biggest scoops and scandals delivered right to your inbox. Sign up now.

Stay informed and gain unlimited access to the Daily Beast's unmatched reporting. Subscribe now.