President Trump, flanked by Acting Attorney General Todd Blanche and FBI Director Kash Patel, speaks to the press after the shooting at White House Correspondents dinner on April 25.Jose Luis Magana/AP
Get your news from a source that’s not owned and controlled by oligarchs. Sign up for the free Mother Jones Daily.
Sen. Ron Wyden, longtime Oregon Democrat and ranking member of the Senate Finance Commitee, has never been a fan of President Donald Trump. But I’ve never seen him quite this worked up.
The administration, Wyden declared in a statement on Friday, “is dripping with corruption from top to bottom” and is now plotting “among the most corrupt acts in American political history.”
What we are witnessing, he said, is nothing less “than a shakedown of the American people by a crook president and his crook lawyers…no more valid than if he had sued the White House kitchen for serving him an undercooked steak. Between this and the ballroom and a thousand other acts of corruption, Trump is a parasite on the American republic.”
In case you haven’t been glued to the news, the saga that has Wyden so enraged kicked off in late January, a week into Trump’s second term, when the president, along with his company and sons Eric and Don Jr., filed a lawsuit against the Internal Revenue Service seeking “at least $10,000,000,000” in damages.
Ten billion dollars!
Basically, in 2019 and 2020, an IRS contractor named Charles Littlejohn leaked Trump’s and the Trump Organization’s confidential tax returns and related filings to the New York Times, ProPublica, “and other leftist media outlets,” as the lawsuit put it. Admittedly, this was illegal, even though Trump had repeatedly (and falsely) promised to make his tax returns public. In 2024, Littlejohn was sentenced to five years in prison for his leaks, which included a trove of documents that revealed how little US billionaires pay in tax.
The Trump lawsuit claims that the leaks caused the Trumps and their company “reputational and financial harm, public embarrassment, unfairly tarnished their business reputations, portrayed them in a false light, and negatively affected President Trump, and the other Plaintiffs’ public standing.”
This is corruption of “a different scale,” because Trump “is negotiating a settlement with the government that he runs to take taxpayer money from hardworking folks.”
The reputational claims are notable, coming from a man found guilty or liable in several civil and criminal fraud cases and liable for defamation and sexual abuse. Trump’s company, the Trump Organization, was found guilty of criminal tax fraud and falsifying business records. And of course there’s Trump’s incitement of the violent attempt by his followers on January 6, 2021, to thwart the peaceful transfer of government, for which Trump was impeached though not convicted.
Early in his second term, Trump then pardoned all of the J6ers, dozens of whom, according to the legal watchdog group Citizens for Responsibility and Ethics in Washington (CREW), had been rearrested, charged, or sentenced for unrelated crimes in the wake of January 6, including rape, domestic violence, weapons charges, and possession of child pornography.
Some even reoffended after Trump pardoned them, including a man who had been sentenced to five years in prison for his role in January 6, and this past February pleaded guilty to threatening the life of the US House Minority Leader: “Hakeem Jeffries makes a speech in a few days in NYC I cannot allow this terrorist to live,” he’d written, according to court filings. “Even if I am hated, he must be eliminated, I will kill him for the future.”
All that aside, the primary legal question in Trump v. IRS is whether a president’s government lawyers can mount a meaningful defense against a president’s personal lawyers—in this case pertaining to the transgressions of that president’s own administration during his first term. The correct answer is: no, of course not.
CREW, along with the nonprofit group Public Citizen, filed a friend of the court brief in the Trump lawsuit, which notes, “The President’s two hats in this litigation—his personal capacity as plaintiff and his role as chief Executive—make it impossible for attorneys in the Department of Justice (DOJ) to fulfill their ethical duties to zealously represent the interests of the defendant agencies against President Trump’s claims.”
The brief urges Kathleen Williams, the federal judge in Florida overseeing the case, to hit pause on the proceedings and “enjoin the parties from terminating the lawsuit through an unconstitutional monetary settlement while the President remains in office.”
Now, as the New York Times first reported last Tuesday, there is talk of just such a settlement. Judge Williams had set a May 20 deadline for the two sides to submit briefs explaining why they should even be considered two sides—a prerequisite for any lawsuit, since one cannot sue oneself. Williams also, the Times noted, appointed six reputable outside lawyers to weigh in on “whether Mr. Trump’s lawsuit is legitimate.”
With seemingly little chance of convincing the skeptical judge, the two sides—which are actually one side—have scrambled to concoct a settlement prior to her deadline. Among the terms initially discussed, the Times noted, was that the IRS might be precluded from auditing the Trumps and their companies in the future.
That would be “unheard of,” says John Koskinen, who served as IRS commissioner under President Barack Obama. “I don’t recall the IRS ever promising a taxpayer that there would be no audits,” he told me. “Audits get settled all the time, but promising no audits simply raises the question of what someone is worried about or trying to hide. This is especially troubling when, as the president acknowledges, the Department of Justice, representing the IRS in the case, works for the president.”
The proposed settlement provides “financial reward for those who attacked American democracy. “
When I spoke with CREW’s president, Donald Sherman, on Friday, he called the lawsuit “a stunningly corrupt attempt for the president to take taxpayer money and put it in his pocket.”
While Trump has done many corrupt things during his second term, Sherman told me, those have mostly involved outsiders buying access and influence—via foreign investments in Trump crypocurrency enterprises, for example, or billionaires shelling out for Trump’s monster ballroom. “He’s sought to get foreign countries to put money in his business. He sought to get American corporations to pay for his pet projects. He sought trademarks and things like that. Not the best—pretty corrupt,” Sherman said.
But this proposal, he added, “is of a different scale and a different order in terms of the corruption involved, because the president is suing the government that he runs, and negotiating a settlement with the government that he runs to take taxpayer money from hardworking folks.”
The story took another turn later on Friday, when ABC News came out with new details: Trump would consider dropping the IRS lawsuit and other audacious claims he’d made against the DOJ in 2023 and 2024, seeking $230 million in restitution for what he claimed was malicious prosecution related to Russia’s 2016 influence campaign and the FBI’s August 2022 raid of Mar-a-Lago to recover classified documents. “I was damaged very greatly and any money I would get, I would give to charity,” he told the New York Times. (In 2019, a court forced Trump to pay $2 million and admit to misusing his family’s own charitable funds for political purposes.)
The settlement now under discussion, ABC reported, would entail the creation of a $1.7 billion fund to be overseen by a commission ultimately under Trump’s control. The money wouldn’t go directly to Trump, but rather would be used to compensate people purportedly victimized by the “weaponization” of the DOJ under President Joe Biden.
On Saturday, ABC’s Katherine Faulders wrote on X that she’d been told the commission would be “likely be called ‘The President Donald J. Trump Truth and Justice Commission,’ and the total amount available in the fund will be… $1.776 billion.”
Cute.
There are “major problems with the settlement idea,” says Don Moynihan, a professor of public policy at the University of Michigan. First, it provides “financial reward for those who attacked American democracy. The consequence of not punishing Trump for January 6th is that now he rewards his supporters.”
“It is also,” Moynihan told me, “part of a pattern where Trump is violating the basic separation of powers—[$1.8] billion is a lot of money. There is no way that Congress would approve it. And yet, Trump will simply take these taxpayer resources.”
Using public money to reward the perpetrators of right-wing violence seems potentially far worse, even, than using it to enrich the president.
Can this be stopped? “It’s really up to the court to stop because obviously the majority in Congress has abdicated any responsibility,” CREW’s Sherman said. But if the parties act before the judge rules, things could get tricky. “There’s probably some narrow mechanisms where the court could overturn a settlement,” he added. Barring that, enough Republican lawmakers would have to draw the line—which they have done only very rarely with this president.
And that’s a big problem. We already have seen a great deal of corrupt intent from Trump’s DOJ, both in its actual weaponization against officials Trump despises—like former FBI director James Comey and Fed Chair Jerome Powell, whose term ended on Friday—and in its monetary settlements with Trump’s allies.
In April, for example, Trump’s DOJ agreed to pay a $1.25 million to Trump loyalist Michael Flynn, who in 2017 pleaded guilty to lying to the FBI amid the investigation of Russian election interference. (He was pardoned by Trump in November 2020.) His subsequent lawsuit against the DOJ accused federal prosecutors of “improperly and politically targeting General Flynn because of his lawful association” with the Trump campaign. (Flynn may stand to collect even more restitution in a separate case, according to Lawfare.)
Trump’s proposed $1.8 billion fund would lead to more of the same, and could potentially be used to pay off insurrectionists who engaged in violence in support of Trump on January 6—some of whom sued for restitution after he granted them clemency. This “slush fund,” as Rep. Jamie Raskin, a constitutional lawyer, told The New Republic‘s Greg Sargent, would be “a shocking new betrayal of the Constitution” and “an outrageous desecration of congressional power of the purse.”
What’s more, he pointed out, the Fourteenth Amendment prohibits the government from assuming any “obligation incurred in aid of insurrection or rebellion against the United States.”
Even by the standards of the Trump administration, a federal agency funneling cash into the president’s pocket indeed seems stunningly corrupt. Yet using public money to reward the perpetrators of right-wing violence seems potentially far worse—a clear and present danger to the republic.
As Raskin put it to Sargent, ominously, Trump and his lawyers “are figuring out a way to refund the January 6 militia, presumably to get them ready for the next round of battle.”
