Entrance to the Trump Tower in Manhattan, New York. Photo: Ryland West/ALM

A Manhattan jury on Tuesday found two of former President Donald Trump's business entities guilty of scheme to defraud, criminal tax fraud and other crimes after nearly a day and a half of deliberation in state court. The companies, which both do business as the Trump Organization, may be sentenced to seven-digit fines and face difficulty as they seek loans and financing in the future. While Trump himself was not charged in the case, the verdict is the latest setback in a swirl of legal troubles facing the former president. In New York, the state attorney general has filed a civil fraud case against Trump, his oldest children and his businesses, while investigators elsewhere are examining his alleged removal of classified documents from the White House, his role in the Jan. 6 insurrection and his potential interference in the 2020 election in Georgia. Trump Organization attorney Alan Futerfas said the company plans to appeal the verdict. During the Trump Organization trial, which began at the end of October, jurors saw Trump's own signature marking his approval of some of the transactions in the alleged fraud scheme. While attorneys on both sides insisted Trump was not the focus of the case, jurors heard that he personally signed bonus checks and paid private school tuition for the grandchildren of the Trump Organization's then-chief financial officer Allen Weisselberg. The Manhattan District Attorney's Office in summer 2021 announced an indictment against Weisselberg and two entities doing business as the Trump Organization—the Trump Corporation and the Trump Payroll Corporation. Weisselberg, who is now on a paid leave of absence from the Trump Organization, pleaded guilty in August to a series of financial crimes. If he is found to have complied with all the terms of his plea agreement, he is set to serve five months or less of what otherwise might have been a five- to 15-year sentence. Under the terms of his plea agreement, Weisselberg was required to testify when called by the prosecution. He told jurors he is in the process of repaying nearly $2 million in unpaid taxes and penalties for allegedly failing to report compensation including luxury vehicle leases, rent on his Riverside Boulevard apartment, furniture and electronics, and private school tuition for his grandchildren. The Trump Organization defense team, including Futerfas, Susan Necheles, Michael van der Veen and William Brennan, argued that Weisselberg was a trusted employee who betrayed the Trump Organization by conducting a fraud scheme for his own gain and without the knowledge of the company's leaders. The defense team argued that the Trump Organization saved a negligible amount of money on Medicare taxes in the course of the scheme, while assistant district attorney Joshua Steinglass argued that the company saved hundreds of thousands of dollars it would have otherwise paid its executives in raises. Steinglass emphasized that, after the Trump Organization stopped paying Weisselberg's bills as part of a cleaning-up process when Trump moved to the White House, Weisselberg asked Trump's son Eric Trump for a raise. "'Now that I'm paying for everything on my own' was the argument that he used," Steinglass said, arguing that Weisselberg's phrasing indicated that the unreported compensation was known at the company. The defense team moved for a mistrial at the conclusion of Steinglass' summation, arguing that the Manhattan DA had presented Trump and his oldest children as unindicted co-conspirators after assuring the defense that the case would not be about Trump. Steinglass argued that he had to discuss Trump to combat the defense's "misleading impression" that Weisselberg went "rogue" to conduct the scheme on his own. Necheles told jurors that Trump delegated tax and accounting matters to Weisselberg, along with the accounting firm Mazars USA and the tax lawyer Sheri Dillon, now of Morgan, Lewis & Bockius. "The Trumps believed that the many fringe benefits they were given to their employees were legitimate and permissible," Necheles said. Acting Supreme Court Justice Juan Merchan rejected the mistrial motion. The judge had previously noted that he was "somewhat surprised" by how often the defense had brought up Trump by name, so he found it was appropriate for Steinglass to respond. Merchan reminded the jurors that they promised during jury selection that they would not let any bias for or against Trump come into their decision-making process. The attorneys also clashed at length over the phrasing of Merchan's charge to the jury, most notably his instructions regarding whether Weisselberg and Trump Organization controller Jeffrey McConney acted within the scope of their employment and "in behalf of the corporation." The phrase "in behalf of" is likely to be an issue on appeal. Merchan told the jurors that an agent's actions are not considered in behalf of the corporation if they were "taken solely to advance the agent's own interests." "Put another way, if the agent's acts were taken merely for the agent's personal gain, they were not undertaken in behalf of the corporation," he said. Steinglass told the jurors that Weisselberg clearly intended "at least some benefit" to the Trump Organization because, in the later years of the scheme, he subtracted the value of the unreported compensation from his actual salary and bonus. "He didn't ask for a raise, even after he decided to share the benefit he was receiving with the Trump Corporation," Steinglass said. Van der Veen urged the jurors to use their common sense to determine Weisselberg's intentions, which he said were focused on benefiting himself. In a statement, Manhattan District Attorney Alvin Bragg thanked the attorneys who prosecuted the case. "This was a case about greed and cheating. In Manhattan, no corporation is above the law," Bragg said. "For 13 years the Trump Corporation and the Trump Payroll Corporation got away with a scheme that awarded high-level executives with lavish perks and compensation while intentionally concealing the benefits from the taxing authorities to avoid paying taxes. Today's verdict holds these Trump companies accountable for their long-running criminal scheme."