The District Attorney for Manhattan is an important position because that region covers the main financial district in the US and thus the DA can prosecute wrongdoing by the financial giants. The position is an elected one and the current occupant Democrat Cyrus Vance, Jr. has long had a reputation for treating wealthy and powerful people leniently, especially those who happened to contribute to his election campaigns like Harvey Weinstein and the Trump family, while going hard after poor and minority communities. In the last couple of years he has changed course slightly and been investigating Donald Trump’s financial interests, convening a grand jury to present evidence and possibly seek indictments. He has announced that is not running for re-election this year and this has led to a scramble to replace him, with eight candidates.
Given the importance of the position and the fact that the person who is elected will be responsible for continuing the Trump investigation, it is important that the person elected be willing to vigorously go after white collar crime. The Democratic primary election is on June 22 and this is the key election since the person who gets the Democratic nomination is a likely shoo-in in the general election in November.
In the trove of tax returns that ProPublica received, they found that one of the leading candidates also has a history of tax avoidance like the others it discovered.
Tali Farhadian Weinstein, who is married to hedge fund manager Boaz Weinstein, is running for Manhattan district attorney in the Democratic primary, in which early voting has already begun. She and her husband reported income as high as $107 million in 2011, and she recently donated $8.2 million to her campaign — more than her seven Democratic rivals have raised in total.
But in 2017, according to a trove of tax data obtained by ProPublica, she and her husband paid no federal income tax. In 2015 and 2013, they also paid no federal income tax. In 2014, she and her husband paid $6,584.
She has presented herself as a centrist in a progressive Democratic field. A former federal prosecutor and general counsel for the Brooklyn DA’s office, she has picked up a string of high-profile endorsements, including from former Attorney General Eric Holder, former Democratic presidential nominee Hillary Clinton, the New York Daily News and the New York Post.
Farhadian Weinstein has received hundreds of thousands in donations from wealthy financiers, including contributions from Citadel’s Ken Griffin, PointState Capital’s Zach Schreiber and Pershing Square founder William Ackman. That has prompted criticism that she will be soft on white-collar crime as the DA in the nation’s financial capital. She has said those donations will not influence her.
In two of the years that the Weinsteins paid zero federal income tax, 2017 and 2015, their returns show millions in business losses. In those years, the couple reported a net negative income.
But they avoided virtually all federal income taxes even in two of the years in which they made money. In 2014, their adjusted gross income was almost a million dollars. That year, the couple’s deduction for investment interest expense skyrocketed to just under a million dollars, essentially wiping out their taxable income for the year. The tax code allows investors to take a deduction for interest paid on money they borrow to invest. That effectively allows their risk-taking to be subsidized by other taxpayers.
In 2013, the couple reported $1.5 million in adjusted gross income and still paid no federal income tax. That year, the couple reported a deduction of more than $1 million for “miscellaneous expenses” — a catchall deduction, since eliminated, that can include expenses for tax and investment advice and some legal expenses. (The tax records obtained by ProPublica did not enumerate the specifics of those expenses, and Farhadian Weinstein declined to answer questions about them.)
Unfortunately the left has not been able to coalesce around a single candidate. Bernie Sanders has endorsed civil rights attorney Tahanie Aboushi while Color of Change PAC endorsed Alvin Bragg. Hillary Clinton and Eric Holder, always faithful to serving Wall Street, have of course endorsed Weinstein. According to the polls, Weinstein and Bragg are leading.
Given that Manhattan is a big media market, running an election campaign is expensive and thus rich people who can donate to their own campaigns and have rich friends have a big advantage. The list of wealthy people in the financial sector who have contributed to Weinstein’s campaign is a big warning sign that she should not be elected.