Judge Tentatively Denies Dismissal of Trump RICO Charges

Financial FAQs

It looks like Donald A Trump will be on trial under RICO, or The Racketeer Influenced and Corrupt Organizations Act. A federal judge strongly indicated last Friday he would allow a lawsuit to move forward against Republican presidential nominee Donald Trump under RICO by former customers who contend they were defrauded by his defunct real estate program, Trump University, reports Greg Moran, for the San Diego Union-Tribune.

U.S. District Court Judge Gonzalo Curiel issued a tentative oral ruling from the bench at the start of a hearing in San Diego on a motion to dismiss the case by Trump’s lawyers. The ruling came a day after Trump accepted the GOP nomination at the Republican National Convention in Cleveland, said Moran.

RICO is a United States federal law that provides for extended criminal penalties and a civil cause of action for acts performed as part of an ongoing criminal organization, says Wikipedia. The RICO Act focuses specifically on racketeering, and it allows the leaders of a syndicate (such as a corporation) to be tried for the crimes which they ordered others to do or assisted them in doing, closing a perceived loophole that allowed a person who instructed someone else to, for example, murder, to be exempt from the trial because he did not actually commit the crime personally.

Curiel said that plaintiffs had met the legal requirements to move the case forward and have a jury decide it.  Trump “participated in a scheme to defraud” people who signed up for the seminars, some at a cost of about $35,000.

The complaint, filed in 2013 by former customer Art Cohen, is one of two class-action lawsuits that Trump is facing in San Diego over Trump University before the same judge. Trump also faces a lawsuit in New York.

The lawsuits allege that Trump University gave seminars and classes in hotel ballrooms across the country that were like infomercials, constantly pressuring customers to buy more and, in the end, failing to deliver. Cohen went to a three-day seminar in 2009 in Palo Alto, California, for $1,495 and bought into the "Gold Elite" mentorship program for $34,995.

But that may not be the most serious financial crime Trump is guilty of. He won’t release his tax returns, even though he has said he would in the past. And that means he could be hiding a whole lot of sins.

It’s been well-documented that Donald Trump has a history of promising to release his tax returns — and then not doing so. In 2011, when Trump was spearheading the movement questioning whether President Obama was born in the United States, Trump told ABC News that he would release his tax returns if Obama released his long-form birth certificate. “I’d love to give my tax returns,” he said, in the ABC interview.

But once Obama released his birth certificate, Trump hedged. “At the appropriate time I’m going to do it,” he said. The appropriate time never came.

Then, in 2012, Trump criticized Republican presidential nominee Mitt Romney for being slow to release his tax returns. Trump was asked by Fox News whether he’d ever have a problem releasing his returns.

“No,” he said. “I actually think that it’s a great thing when you can show that you’ve been successful, and that you’ve made a lot of money, that you’ve employed a lot of people. I actually think that it’s a positive.” But again, he refused.

This is even though such Republican luminaries as former GOP presidential nominee Mitt Romney has criticized Donald Trump for failing to disclose back taxes, repeatedly suggesting that the billionaire’s financial records may contain “a bombshell” that could damage his White House bid.

“I think we have good reason to believe that there’s a bombshell in Donald Trump’s taxes. I think there is something there,” Romney said on Fox News’ “Your World” with Neil Cavuto. “The reason I think there is a bombshell in there is because every time he is asked about his taxes, he dodges and delays.”

What could he be hiding? The first thing the public would find is Trump's tax rate. The candidate has bragged about paying a very low tax rate and taking advantage of the complex US tax code with its many loopholes. This is what Romney’s tax returns revealed—that he paid a lower tax rate than his secretary.


Then there is the much-publicized claim that he has a net worth of “billions”, even ten billion, he has claimed most recently.  This would be hard to ascertain from tax returns alone, as they report income rather than assets. Tax expert David Cay Johnston has uncovered past audits of Donald Trump from the 1980s and 90s that show no income at all, but lots of undocumented expenses.

In fact, Trump’s taxes may have been fraudulently filed, in some cases.  When shown a photocopy of Trump’s 1984 tax return during an appeal, Jack Mitnick, Trump’s accountant for more than 20 years, testified that “we did not” prepare that return, referring to himself and his firm, and he said did not know who did. However, Mitnick did not dispute that it was his signature on the photocopy.

The original tax return was never found, the judge noted.  “Among the issues raised by Mitnick’s 1992 testimony is whether Trump or someone acting on his behalf substituted a return that he or someone else prepared and then transferred Mitnick’s signature using a photocopier,” said Johnston.

So the fact that Trump is worth "billions" would be hard to ascertain from tax returns alone.  But his repeated promises to release his taxes, and then refusing to do so, should be a red flag to voters. What is he hiding that he is willing to break the precedent of every President since Richard Nixon to release their taxes and that will further damage his reputation for truthfulness?

We should know within days what Judge Curiel’s verdict will be on Trump’s RICO indictment. It doesn’t look good, needless to say, as he could be convicted of a felony, which would be grounds for impeachment should he be elected President.

Harlan Green © 2016

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