The Justice Department is suing a friend and former business partner of Ivanka Trump for his alleged role in defrauding the federal government out of millions of dollars in tax liabilities on his father’s estate, Politico reported Friday.
The suit follows a Politico investigation of New York businessman Moshe Lax’s alleged financial crimes, and the irregularities in the Internal Revenue Service’s handling of a $27 million lien on his father’s estate.
The suit seeks more than $60 million in unpaid tax liabilities, according to Politico. It alleges that Lax, his sister Zlaty Schwartz, and his late father, Chaim Lax, committed 10 separate “sham transactions” to evade tax liability, hiding family assets from the IRS.
Though Trump isn’t mentioned or accused of wrongdoing, Madison Avenue Diamonds, the business that Trump helped run for years under the name Ivanka Trump Fine Jewelry, is one of the schemes outlined in the complaint. Lax allegedly transferred a roughly $21 million interest in Madison Avenue Diamonds from his father’s estate to a holding company for nothing in return, Politico reported.
Trump Organization General Counsel Alan Garten told Politico last summer that the business was “still owed a significant amount of money” by Lax from the jewelry venture. It is not clear whether the debt has been absolved since then.
“The issues in this case have nothing to do with Ivanka or the Ivanka Trump brand,” a spokesperson for Trump’s brand told Politico. “These licensing arrangements were terminated by the Ivanka Trump brand in 2016 prior to Ivanka entering government service.”