DOJ faces ethics nightmare with Trump bid for $230M settlement

The Department of Justice (DOJ) is facing pressure to back away from a request from President Trump for a $230 million settlement stemming from his legal troubles, as critics say it raises a dizzying number of ethical issues.

Trump has argued he deserves compensation for the scrutiny into his conduct, describing himself as a victim of both a special counsel investigation into the 2016 election and the classified documents case.

The decision, however, falls to a cadre of attorneys who previously represented Trump personally.

Rupa Bhattacharyya, who reviewed settlement requests in her prior role as director of the Torts Branch of the DOJ’s Civil Division, said most agreements approved by the department are typically for tens of thousands of dollars or at most hundreds of thousands.

“In the ordinary course, the filing of administrative claims is required. So that’s not unusual. In the ordinary course, a relatively high damages demand on an administrative claim is also not that unusual. What is unusual here is the fact that the president is making a demand for money from his own administration, which raises all sorts of ethical problems,” Bhattacharyya told The Hill.

“It’s also just completely unheard of. There’s never been a case where the president of the United States would ask the department that he oversees to make a decision in his favor that would result in millions of dollars lining his own pocket at the expense of the American taxpayer.”

It’s the high dollar amount Trump is seeking that escalates the decision to the top of the department, leaving Deputy Attorney General Todd Blanche, as well as Associate Attorney General Stanley Woodward, to consider the request. Blanche served as Trump’s personal criminal defense attorney, while Woodward represented Trump’s co-conspirator in the Mar-a-Lago documents case, and both have signed agreements requiring them to recuse themselves from matters involving the president for one year.

Joseph Tirrell, who previously served as the top ethics adviser at the Justice Department, said the obligation to recuse also extends to any matter in which a reasonable person might question a federal employee’s impartiality. They can seek a waiver, but that requires additional review.

“Should that federal employee take action in this matter that involves their former employer? And, based on my experience, no way, right?” Tirrell said.

“The appearance of partiality is just so overwhelming. I mean, it’s a couple hundred million dollars,” requested by the only person who could fire Blanche or Woodward.

Tirrell said that their job security hinges on Trump, a president with a penchant for firing those who buck his demands, which also creates issues.

“There’s another criminal statute that applies to all federal employees that says, again, you can’t work on matters in which you have a financial interest,” he said.

“President Trump has made clear, and his actions have shown, that he will fire people who don’t make decisions that align with his priorities. And so I think that’s a pretty clear statement from him that if Mr. Blanche and Mr. Woodward or any other employee at the department were to make a decision contrary to his wishes, they would lose their jobs, and that implicates this criminal statute, in my opinion.”

Richard Painter, who served as the White House ethics lawyer under President George W. Bush, also said the situation was “an egregious conflict of interest.”

“That’s a clear conflict of interest for all the people in the Justice Department,” he said, adding that there are also issues with the underlying claims Trump is making in the settlement.

“So we have a claim that’s no good. We have a conflict of interest in the Department of Justice, and if they did pay out the money, it’s a likely violation of the Emoluments Clause of the Constitution.”

Trump has acknowledged the unusual nature of the situation, saying it’s “awfully strange to make a decision where I am paying myself.”

The Justice Department has said it will follow ethical obligations in the matter, and it’s unclear what further actions have been taken on the request.

“In any circumstance, all officials at the Department of Justice follow the guidance of career ethics officials,” Justice Department spokesperson Chad Gilmartin said in a statement.

However, Bondi fired Tirrell, removing the top official who would have provided guidance on the matter. 

The Justice Department has six months to consider a request for a settlement, after which the party can go to court with their claim.

Bhattacharyya said Blanche and Woodward would be wise to take no action whatsoever.

“Because of the ethics problem here, I think the best course is to do nothing. I would not want them either to grant or deny the claim, because I think either one is an ethics conflict, frankly,” said Bhattacharyya, now the legal director at the Institute for Constitutional Advocacy and Protection at Georgetown University.

But Tirrell said the Justice Department officials would have the same ethical problems in dealing with the matter in court, saying Trump’s best bet would be to ask Congress for the $230 million.

There, however, Trump would face constitutional issues, as lawmakers say accepting the $230 million in any fashion would violate the Domestic Emoluments Clause of the Constitution, which bars the president from taking any state or federal funds beyond his $400,000 salary.

“The Constitution does not say the President may not receive payments ‘unless he thinks he was treated unfairly,’” House Judiciary Committee Democrats wrote in a letter to Justice Department leadership.

In that same letter, they argue Bondi, Blanche and Woodward all risk violating their oath of office to uphold the Constitution if they approve the settlement.

“As the senior Department of Justice (DOJ) officials responsible for approving that shakedown, you each face a choice: uphold your constitutional oath and refuse this flagrantly illegal demand, or become complicit in perhaps the most brazen violation of the Constitution’s anti-corruption provisions in American history,” the panel’s Democrats wrote.

Legal experts have also raised questions about the strength of Trump’s claims. Little is known about the details of Trump’s complaints surrounding the special counsel investigation, but in a piece penned by Painter and other White House ethics lawyers, they note numerous presidents have been the subject of such a probe and did not respond by filing a claim.

But in the Mar-a-Lago claim, one of Trump’s arguments has already been reviewed by the courts. Trump said his privacy was violated by the search of his home, but Judge Aileen Cannon rejected similar arguments in court that the warrant authorizing the move was unlawful. 

Trump is also claiming in that filing that he was the victim of a malicious prosecution, but that can also be a tough claim to make given that documents with classified markings were found in his home and that the Justice Department often charges those who mishandle national security documents.

Painter said he was highly critical of the Biden family ethics scandals, arguing that Hunter Biden crossed a line by selling art and in his business dealings in Ukraine. But he said while others in the GOP have criticized enrichment from the presidency, the figure requested by Trump is “the difference between shoplifting and stealing the whole dang store.”

Painter said if the Justice Department does agree to the settlement, Trump could be sued to get the money back once he leaves office, equating it to the Treasury Department seeking to recoup funds if they erroneously give money to a taxpayer.

“The first thing is going to happen is when we get another president in there, the United States government is going to sue and get the money back. And I think they have one heck of a good claim and it’d be one big mess for the Justice Department,” he said.

 “So I think they ought to think twice before they do this.”