Trump administration is scrapping $1.8B fund meant to compensate president’s allies, Blanche says

WASHINGTON (AP) — The Trump administration is scrapping plans to create a $1.8 billion fund meant to compensate allies of the Republican president, the Justice Department’s top official said Tuesday in retreating from a program that faced setbacks in the courts and a fierce political backlash that had threatened to stall key elements of the White House agenda.

“We are not moving forward with the fund, period,” Blanche said in response to questions at a House hearing on the Justice Department budget.

““Not moving forward, ever?” asked Rep. Grace Meng, a New York Democrat.

“Correct,” Blanche answered.

The blunt declaration marked an extraordinary, and rare, turnabout for a Trump Justice Department that just two weeks ago had pronounced the fund as an appropriate measure to make up for what officials insist was weaponized law enforcement during President Joe Biden’s Democratic administration. The fund has since been paused by a judge and lambasted by both Democrats and Republicans alike who said they were troubled by a lack of oversight as well as the potential for payouts to participants in the violent Jan. 6, 2021 riot at the U.S. Capitol.

Republicans had demanded reassurances that plans for the fund were off the table before they would move forward with legislation funding President Donald Trump’s immigration enforcement agencies.

When word of the settlement broke, the Senate was already navigating tricky passage of the immigration legislation with an added $1 billion in White House security costs — including for Trump’s ballroom project.

Furious, Senate Republicans jettisoned the White House security money from the bill and made clear they would not pass the legislation at all unless the White House made major changes to the settlement.

The $1.776 billion “Anti-Weaponization Fund” was established to resolve Trump’s lawsuit against the Internal Revenue Service over the leak of his tax returns. As part of that deal, the IRS agreed to drop all pending probes of Trump over whether he’s paid his fair share of taxes.

Pressed over whether it was also abandoning that part of the deal, Blanche said “nothing has changed with that,” and said the administration was only abandoning plans to create the $1.8 billion fund.

The hearing Tuesday before a House Appropriations subcommittee was scheduled for discussion of the Justice Department’s budget, but lawmakers quickly focused their questioning on the fund.

““This administration has engaged in what are perhaps the most brazen acts of flagrant corruption I’ve ever seen,” said Rep. Rosa DeLauro, a Democrat from Connecticut. “And you are at the center of many of them, Mr. Blanche.”

Signs of the retreat surfaced Monday when a person familiar with the matter said the Republican president was now reconsidering whether to move forward with the fund established to resolve his lawsuit against the Internal Revenue Service over the leak of his tax returns. The Justice Department also said Monday it would comply with a Virginia court temporarily blocking the administration’s “Anti-Weaponization Fund,” effectively agreeing to pause the plan for at least two weeks.

Another judge in Florida raised the prospect of reopening the IRS lawsuit because of “grievous allegations” of improper dealing made against the administration by settlement critics.

Eric Tucker And Alanna Durkin Richer, The Associated Press