The Controversial Settlement Practices Under Trump

Emily Bazelon: Hello, David. I hope you’re having a good May. Spending time with your grandchildren last weekend must have brought some joy to you this month.

Discussing Jeff Sessions may seem unexpected, though the Trump administration had many peculiarities. As Trump’s first Attorney General, Sessions issued a 2017 memo that stopped the Justice Department from settling lawsuits by directing payments to third parties not directly harmed by the actions leading to the lawsuit. The aim was, according to Sessions, to ensure settlement money compensated only the victims.

This was a reaction to cases where the Obama Justice Department settled disputes that Republicans criticized. A notable case involved banks settling with the government over lending practices from the 2008 financial crisis by donating to organizations like the National Council of La Raza and NeighborWorks, which assisted with legal aid or community improvement in affected areas. Republicans accused the DOJ of bypassing Congress to support Democrat-favored groups.

The previous practice differs from the recent $1.776 billion fund announced by the Trump Justice Department. This fund bypasses Congress to pay Trump allies, in exchange for Trump and his family dropping a dubious $10 billion lawsuit against the IRS concerning leaked tax information.

For transparency, the agreement included a clause granting Trump immunity from any tax probes into him, his family, or businesses “FOREVER,” as emphasized in an all-caps document signed by Acting Attorney General Todd Blanche.

David French: You’re correct, comparing the Obama-era approach with Trump’s actions shows a stark contrast. Trump is setting up a massive fund, valued at $1.776 billion, over which he has complete control. This fund can potentially enrich many of his MAGA supporters.