The Trump administration is scrapping plans for a nearly $1.8 billion fund that would have compensated allies of President Donald Trump, Acting Attorney General Todd Blanche told lawmakers Tuesday, retreating from a program that drew fierce political backlash and threatened to stall key parts of the White House agenda.
Blanche Says Fund Will Not Proceed
“We are not moving forward with the fund, period,” Blanche said during a House hearing on the Justice Department budget, according to Reuters. Rep. Grace Meng (D-N.Y.) pressed him further, asking, “Not moving forward ever?” Blanche answered, “Correct.”
The blunt declaration marked a rare Trump administration reversal in the face of mounting opposition to a fund that officials said was designed to compensate people who believed the criminal justice system had improperly targeted them.
Since officials established the fund on May 18, a judge paused it and Democrats and Republicans criticized it. Lawmakers said they were troubled by limited oversight and by the possibility that people involved in the Jan. 6, 2021, attack on the U.S. Capitol could receive taxpayer-funded payouts.
Tax Settlement Provision Remains Intact
The fund grew out of a settlement between Trump and the Justice Department resolving his $10 billion lawsuit against the IRS over the alleged mishandling of his tax records. As part of the same deal, the IRS agreed to drop any pending probes into whether Trump had paid his fair share of taxes.
Pressed on whether the administration would also abandon that part of the settlement, Blanche said “nothing has changed with that.” He said the administration was only backing away from the $1.8 billion fund.
Signs of the retreat surfaced Monday, when a person familiar with the matter told The Associated Press that Trump was reconsidering the fund. The Justice Department separately said it would comply with a Virginia court order temporarily blocking the fund for at least several weeks.
Democrats Demand Written Guarantee
At Tuesday’s hearing, Democratic lawmakers pressed Blanche to put the fund’s cancellation in writing. Blanche refused. “Why do I need to put something in writing?” he said. “I’m not committing to doing anything in writing.”
Rep. Rosa DeLauro (D-Conn.) said Blanche should not have signed off on the tax-audit provision because he formerly served as Trump’s personal attorney. Blanche said the agreement did not give Trump “blanket immunity” and rejected her criticism.
A source close to Trump told Reuters on Monday that the president is “not thrilled,” but accepts the pause as the only path forward “for now.”
Image via Shutterstock/ Robert V Schwemmer
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