Trump’s War to Keep His Finances Secret Just Lost Its First Battle

“This was definitely a win for the House.”
May 21, 2019, 6:00pm
Trump’s war to keep his finances secret just lost its first battle

WASHINGTON — President Trump has pulled out all the stops to prevent Congress from investigating his administration, his family and his finances, defying subpoenas and suing his political opponents to keep his records hidden.

But Trump’s strategy suffered a significant setback on Monday when U.S. District Judge Amit Mehta ruled the president's lawsuit to block his longtime accounting firm, Mazars USA, from turning over documents to House Democrats had no merit. In doing so, Judge Mehta not only undermined one of Trump’s key legal defenses but also reaffirmed Congress’ power to investigate the president.


The decision marks an important early victory for House Democrats trying penetrate Trump’s unprecedented stonewalling of Congress, a historic standoff that Democratic leaders have called a Constitutional crisis.

“This judge ruled not only in favor of Congress and their investigative authority,” said Martin J. Sheil, who served over 30 years as an investigator at the IRS, “but in such profound language that it leaves, as far as I’m concerned, no wiggle room for appeal.”

Now, Democrats are aiming to wield that decision like a cudgel in their other legal duels with the president. Next up: Trump’s longtime lender, Germany’s Deutsche Bank, which is widely believed to have among the most detailed information of Trump’s finances.

Congressional authority

Trump has pushed Congress to the brink in recent weeks, forcing them to deliberate in public over what, if any, means were available to them to compel a defiant president to comply with subpoenas for witnesses and documents. Democrats have even begun fighting with one another over whether they should just impeach Trump already in order to speed along their investigations.

But Judge Mehta’s decision, dropping just one week after a single day of oral argument, may give Democrats reason to hold back a bit longer and focus on the courts, where things may move along faster than expected.

Citing congressional investigations of former Presidents Bill Clinton and Richard Nixon, the judge rebuked Trump’s attorneys’ argument that the subpoena for eight years’ worth of financial records from Trump’s accountant amounted to nothing more than political harassment.


“Congress plainly views itself as having sweeping authority to investigate illegal conduct of a President, before and after taking office,” Judge Mehta wrote. “This court is not prepared to roll back the tide of history.”

Congress’ power to investigate is predicated on the notion that the nation’s lawmaking body shouldn’t pass laws without having its facts straight first, and should therefore be allowed to call in witnesses and review relevant documents.

“The critical inquiry, then, is not legislative certainty but legislative potential,” Mehta wrote. “If the subject matter of the investigation is ‘one on which legislation could be had,’ Congress acts within its legislative function.”

Monday’s victory for Democrats, however, doesn't mean that all future rulings will turn so easily in their favor, said Michael Stern, who served as senior counsel to the House of Representatives from 1996 to 2004.

The ruling didn’t deal with other legal arguments that Trump’s team has already begun raising in his defense — such as executive privilege, the principle that internal presidential communications should be kept secret. Trump has already declared executive privilege over the unredacted portions of Special Counsel Robert Mueller’s report, and its underlying evidence.

“This was definitely a win for the House, and there are certainly things here that could be cited by the House in future cases that could be helpful,” Stern told VICE News. “But the real issue in the Mueller case is executive privilege, and that wasn’t an issue in this case.”

Next up: Deutsche Bank

Democrats from the House Financial Services Committee wasted no time forwarding Judge Mehta’s decision to the judge in the Deutsche case, where oral arguments are scheduled for Wednesday.

In that instance, Trump has sued the bank itself, along with another lender, Capital One, asking a judge to block them from turning over documents in response to a joint request from the House Financial Services Committee and House Intelligence Committee.


House Intel chairman Rep. Adam Schiff, a Democrat from California, hailed Judge Mehta’s decision as “good news.”

Deutsche has been closer to Trump’s family business than any other bank over the past two decades, lending or participating in loans to Trump totaling $2.5 billion over 17 years. Last weekend, The New York Times reported that officials at Deutsche’s internal anti-money-laundering division had noticed multiple suspicious-looking transactions at entities controlled by Trump and his son-in-law, Jared Kushner.

But executives at Deutsche rejected their employees’ advice that those transactions be reported to a federal financial-crimes watchdog, the Times reported.

Both Trump and Deutsche denied the allegations, but the Times’ report only fueled more speculation about what Deutsche knows about the president and his family business.

On Tuesday, Trump’s lawyers appealed the Mazars decision, hoping the U.S. Court of Appeals for the D.C. Circuit will see the issue differently.

Cover: President Donald Trump pumps his fist to the crowd after speaking to a campaign rally in Montoursville, Pa. (AP Photo/Evan Vucci)