“Follow the money”: Experts suspect Weisselberg’s “muted” testimony linked to $2M severance deal

The lapses in former Trump Organization CFO Allen Weisselberg’s recollection of his work for Donald Trump during his testimony in the former president’s ongoing civil fraud trial could stem from the $2 million severance agreement he made with the company earlier this year, legal experts suspect.

Weisselberg, a fellow defendant in the civil suit who took to the stand as a prosecution witness Tuesday, testified that he couldn’t recall speaking with Trump, Don Jr. and Eric Trump, or former Trump attorney and fixer Michael Cohen about their statements of financial condition, which were key to the company’s deal-making with banks and insurers and are at the center of the trial.

Among responses to the other dozens of questions he could not recall answers to, the former executive also acknowledged that he “periodically” received comments from the former president about the documents before they were finalized but said he couldn’t remember any details about changes to them that Trump may have requested. In a May deposition that’s now an exhibit in the case, the former chief financial officer explained that his conversations with Trump about the financial statements were limited. 

“It was more of just handing it to him and him taking it up to his apartment, maybe reading it in the evening, and making some notations giving it back to me,” Weisselberg said, according to a transcript of the deposition.

The deposition also revealed that, in leaving the Trump Organization in 2022, Weisselberg — who left a New York City jail six months ago following a 100-day stint after he pleaded guilty to fraud and tax evasion in 2022 — had signed a severance agreement with the company in January of this year, allowing him to receive $2 million paid in quarterly installments over two years. 

Upon learning of the contract, legal experts suspected that it played a role in Weisselberg’s forgetfulness on the stand Tuesday.

“If you want to understand why Allen Weisselberg’s testimony against the Trump Organization is muted, just follow the money,” former federal prosecutor Renato Mariotti wrote on X, formerly Twitter, of the severance agreement. “He is still owed $1.25 million by the Trump Org, to be paid according to the schedule below. That is likely on his mind as he testifies.”

According to the schedule, Weisselberg is slated to receive five more severance payments between December of this year and December 2024. 

MSNBC legal analyst Lisa Rubin dug deeper into the ex-chief financial officer’s agreement with the Trump Organization in a thread on X, highlighting a passage that prohibited Weisselberg from communicating with, providing information to or otherwise cooperating “in any way with any other person or entity, including his counsel or other agents,” who have claims against the company in relation to the claim. The clause also bars Weisselberg from taking any action to “induce, encourage, instigate, aid, abet or otherwise cause any other person or entity to bring or file a complaint, charge, lawsuit or other proceeding of any kind against the Company.”

Though stipulations like the one agreed upon in the document are not “atypical,” Rubin notes, the timing and context of the agreement raise concerns.

While Weisselberg left the company at the end of 2022, he didn’t execute the agreement until the day before his Jan. 10, 2023 sentencing, and it wasn’t signed by Alan Garten, the Trump Organization’s chief legal officer, until Jan. 12, which was two days after Weisselberg was imprisoned, Rubin said. She also pointed out that the former executive didn’t receive his first payment per the contract until Mar. 31, 2023, a date over two months into his sentence and “certainly *after* reports that the Manhattan DA was still investigating Weisselberg for insurance fraud.”

Returning to his severance obligations, Rubin noted that the requirement that he cooperate in litigation against the company by meeting with the Trumps regarding “discovery or pretrial issues” and potential testimony likely means Weisselberg was obligated to meet with them prior to his trial testimony.

Plus, while the agreement ensures his repayment for any legal fees in matters against him or the company, he’s barred from hiring an attorney without the company’s prior approval and “to the extent there is no direct conflict of interest and at the election of the Company, [Weisselberg] shall be jointly represented by counsel for the Company,” the document says, according to Rubin.

“Put another way, if he wants his own fees paid, they get to decide who represents him and even force their own lawyers on him,” she added.

Those obligations, she said, are not as significant as the one prohibiting Weisselberg from giving information to anyone with claims against the company or anyone individually released by the agreement. 

“Read broadly, the agreement precludes Weisselberg from voluntarily cooperating with any law enforcement or prosecutorial agency in exchange for lenience as to other crimes for which he could be under investigation and/or ultimately charged,” Rubin continued.

“And yes, that might be the definition of unenforceable as a matter of public policy,” she concluded. “But if you’re Weisselberg, what incentive do you have to test that proposition when you have $2 million in severance, payable even if you die, riding on it? None.”

---

Want a daily wrap-up of all the news and commentary Salon has to offer? Subscribe to our morning newsletter, Crash Course.

---

His controversial testimony nonetheless both helped and harmed Trump’s case in the lawsuit, Rubin asserted in an analysis for MSNBC earlier Wednesday, arguing that his time on the witness stand “gave way to important, if not damning admissions.”

She first pointed to his admission that the selling price, rather than the asking price, of real estate is an appropriate metric in determining its value.  

“That concession probably meant little to him, but it was huge for the AG’s office, which has shown evidence that [fellow defendant and Trump Organization executive Jeffrey] McConney used the asking price of certain New York residences to inflate the estimated value of Trump’s Trump Tower triplex apartment,” Rubin writes.

When asked about the accuracy of his 2017 representation to accounting firm Mazars that the financial statements were presented in compliance with generally accepted accounting principles (GAAP), Weisselberg responded that the company “relied on Mazars to know GAAP.” But when the prosecutor questioning him asked if that meant they relied on the firm to make representations to itself, Weisselberg said no.

While he admitted to giving Trump the financial statements to review before he became president, Weisselberg also admitted that once Trump assumed the role, he started giving the documents to either of Trump’s eldest sons but couldn’t recall exactly who or whether he discussed the statements with either. 

“It’s curious that Weisselberg more clearly remembered the period before Jan. 2017,” Rubin said in the analysis. “One has to wonder whether, in light of who currently manages Trump’s real estate empire day-to-day, Team Trump desperately wants to insulate the two brothers from admissions of wrongdoing.”

Weisselberg attempted to distance himself from the Trump Organization’s insurance program in the testimony, at one point insisting the company had “no real reason” to procure any appraisals while conceding that it was “possible” they retained the appraisals conducted for the lenders’ benefit, Rubin said. Ultimately, she concluded. Weisselberg was forced to acknowledge that he was a part of the group the insurance employees interacted with and that insurers visited them to review the statements of financial condition. 

The lawsuit, brought by New York Attorney General Letitia James, accuses Weisselberg of embellishing the financial statements to meet Trump’s demands while authorizing exaggerated valuations for assets despite appraisals indicating the contrary. She seeks $250 million in penalties and a range of sanctions on the company, alleging that it, Trump and its executives engaged in fraud for years by exaggerating the value of its assets on its statements of financial condition.