Overview
- On Monday the Justice Department said it would respect a federal judge's order that halted deposits and would not pursue the proposed $1.776 billion compensation fund.
- The fund grew out of a settlement in which President Trump agreed to drop a $10 billion suit against the IRS in return for creating a pool to compensate people who claim they were politically targeted, and reports said the deal would also limit future IRS audits of Trump and his businesses.
- A Virginia federal judge, U.S. District Judge Leonie M. Brinkema, temporarily blocked the fund and scheduled a June 12 hearing to examine claims that the settlement may have been deceptive and to prevent irreversible payouts.
- Senior Republican senators, led publicly by John Thune, joined Democrats in pressing the White House and threatened to withhold or delay other legislation, a revolt that helped tip the administration toward abandoning the plan.
- State Democratic officials in places like California, New York and Wisconsin proposed 100 percent taxation of any payouts to neutralize benefits, and the controversy has raised lasting questions about ethics, separation of powers and how the executive uses settlements to affect oversight.