Following Weisselberg's indictment, the Trump Organization terminates his employment.
Allen Weisselberg's departure from dozens of subsidiaries may portend a shake-up in former President Donald Trump's family business.
According to a person familiar with the matter, a week after state prosecutors in Manhattan indicted Donald J. Trump's family business and its chief financial officer, Allen H. Weisselberg, the company began removing Mr. Weisselberg from every leadership position he held at dozens of its subsidiaries.
The move could be a precursor to a broader shake-up at the former president's company, the Trump Organization, as Mr. Trump and his senior executives adjust to the reality of the indictment. While Mr. Weisselberg remains employed by the Trump Organization and there is no indication that Mr. Trump wishes to part ways with him, the company may seek to reassign him to a less visible position.
The Trump Organization initiated the change last week, when it began removing Mr. Weisselberg's name from subsidiaries and corporate entities affiliated with him, a person familiar with the matter said, and public records showed that he was no longer associated with at least 20 Trump companies incorporated in Florida on Monday. As other states process their records in the coming days and weeks, the full extent of his removal will become clear.
The decision to remove Mr. Weisselberg, who has been under increasing pressure from prosecutors to turn on Mr. Trump and cooperate with the investigation, represents the latest fallout from Mr. Trump's and the Trump Organization's criminal tax charges unveiled on July 1.
The indictment detailed a 15-year scheme, according to prosecutors, to compensate Mr. Weisselberg and other employees through off-the-books perks and bonuses. According to prosecutors, this enabled Mr. Weisselberg to evade nearly $1 million in federal, state, and local taxes.
“To put it bluntly, this was a massive and audacious illegal payments scheme,” Carey Dunne, general counsel for Manhattan District Attorney Cyrus R. Vance Jr., stated during an arraignment in Manhattan's State Supreme Court on the day the charges were announced.
Mr. Trump was not named in the charges, but prosecutors have stressed that the investigation is ongoing. According to people familiar with the matter, the investigation is continuing to focus on Mr. Trump and possible financial wrongdoing at the company.
Mr. Trump, a Republican, has repeatedly denied wrongdoing and characterized the investigation as a politically motivated "witch hunt." Mr. Vance's representatives, who are Democrats, have denied any political motivations.
Mr. Trump has also attempted to downplay the conduct at the center of the indictment, dismissing it as routine fringe benefits. Mr. Trump's attorneys have argued that the case should be resolved in a civil court, not a criminal court.
Nonetheless, Mr. Dunne, the general counsel, stated that the conduct described in the indictment was not "standard business practice" or the work of a rogue employee. “It was orchestrated by the company's most senior executives, who benefited financially from secret pay raises at the expense of state and federal tax payers,” he said.
Mr. Dunne also chastised the company for continuing to employ Mr. Weisselberg as Chief Financial Officer, lamenting that "he remains the company's most senior financial fiduciary to this day."
It is unknown whether the Trump Organization will eventually strip him of that title — or take another action to distance him from the company — and the company's decision is fraught with ethical and legal concerns. While prosecutors continue to pursue Mr. Weisselberg's cooperation, any indication that the company may abandon him could create a schism between him and Mr. Trump, encouraging him to cooperate with the investigation.
The decision to strike his name from the subsidiaries was an interim measure that reflected the company's recognition that Mr. Weisselberg's continued service as a director of a corporate entity while facing criminal charges was untenable.
Mr. Weisselberg's name was struck from more than a dozen Trump Organization subsidiaries' corporate filings in Florida alone on Friday.
Among the subsidiaries were the Trump Payroll Corporation, which the indictment alleges fraudulently reported employees' compensation at the Trump Organization, as well as a number of entities associated with the company's Florida real estate business.
Bloomberg and Business Insider reported last week that Mr. Weisselberg had been removed as a director of the company's Scottish golf club, the first of a wave of departures. According to the Wall Street Journal, he was fired from the payroll company on Monday.
Mr. Weisselberg has pleaded not guilty to receiving nearly $1.8 million in valuable bonuses and benefits — including an apartment, company cars, and private school tuition for his grandchildren — and failing to pay taxes on those perks.
“He will vigorously defend himself against these charges in court,” his attorneys, Mary E. Mulligan and Bryan C. Skarlatos, stated in a statement following his arrest.
Ms. Mulligan declined to comment on Monday regarding the removal of Mr. Weisselberg's name from the subsidiaries.