DOJ creates fund tied to Trump IRS tax-leak settlement
The Justice Department announced Monday that it is creating a $1.776 billion “Anti-Weaponization Fund” aimed at compensating people who say they were unjustly investigated and prosecuted for political purposes. The department said the arrangement is part of a settlement resolving President Donald Trump’s lawsuit against the Internal Revenue Service over the leak of his tax returns.
Acting Attorney General Todd Blanche said the fund would offer a legal pathway for those who believe they were harmed by politicized enforcement. In a statement, Blanche said, “The machinery of government should never be weaponized against any American, and it is this Department’s intention to make right the wrongs that were previously done while ensuring this never happens again.”
Blanche is scheduled to face questions about the fund on Tuesday when he testifies on Capitol Hill about the Justice Department’s budget. The department did not identify any specific individuals who might receive payouts, and it said there are no “partisan requirements” for applicants, while also saying applicants could seek a payout and an apology if they believe they were unfairly persecuted.
Democrats and government watchdogs criticized the settlement as both legally improper and politically motivated. A group of nearly 100 House Democrats signed onto a legal brief urging a judge to block what they called an unprecedented resolution that they said would unjustly enrich people close to the president with taxpayer dollars and create a pathway for meritless claims of political persecution.
One of the brief’s supporters, Donald Sherman, president of Citizens for Responsibility and Ethics in Washington, called it “one of the single most corrupt acts in American history,” in a statement. Rep. Jamie Raskin, the top Democrat on the House Judiciary Committee, characterized the agreement as a device to divert federal money, saying in a separate statement that it was “a racket designed to take $1.7 billion of taxpayer dollars out of the Treasury and pour it into a huge slush fund for Trump at DOJ to hand out to his private militia of insurrectionists, rioters, and white supremacists.”
At the White House on Monday, Trump was asked about whether people who committed violence on Jan. 6, 2021, should receive compensation from the fund. Trump said, “It’ll all be dependent on a committee,” adding, “I didn’t do this deal. It was told to me yesterday.” He said the fund was intended for “reimbursing people who were horribly treated.”
Under the department’s plan, a five-member commission appointed by Blanche would oversee the fund. The Justice Department said a settlement resolution was intended to address what it described as wrongful conduct during the prior administration’s enforcement actions, including by allowing people who believe they were targeted for political purposes to apply for payouts.
The settlement also fits into a broader legal and political narrative Trump has advanced since returning to office, including his repeated claims that the Justice Department during the Biden administration was “weaponized” against him. Trump has pointed to now-abandoned criminal charges from his first two terms, including allegations related to efforts to overturn the 2020 presidential election results and to the handling of classified documents at Mar-a-Lago.
In defending the settlement, Trump’s attorneys suggested in a court filing seeking to dismiss the case that the resolution would not be reviewable by a judge. The House Democrats’ brief argued instead for judicial review, saying the agreement would open the door to claims of political persecution that were not appropriately limited by case-and-controversy requirements.
The underlying lawsuit stems from a leak of Trump’s tax returns that he said caused reputational harm. Trump filed the case in Florida earlier this year, and his sons Donald Trump Jr. and Eric Trump also joined the suit. In 2024, Charles Edward Littlejohn, a former IRS contractor, was sentenced to five years in prison after pleading guilty to leaking tax information about Trump and others to news outlets between 2018 and 2020.
The judge overseeing the case, Kathleen Williams, dismissed it Monday. In her filing, she admonished federal agencies, including the Justice Department, for not being transparent about the settlement deal, saying no agency “submitted any settlement documents nor filed any documents ensuring that settlement was appropriate where there was an outstanding question as to whether an actual case or controversy existed.” Williams had previously assigned a group of attorneys to assess whether a conflict existed because, as sitting president, Trump was suing entities whose decisions she said were subject to his direction. Lawyers for the president asked a judge last month to pause the case for 90 days while the parties worked to resolve the matter.
The Justice Department said it was creating the fund as part of the resolution of Trump’s lawsuit, and it pointed to a prior Obama administration fund that compensated Native American farmers who said they faced racial discrimination. Opponents of the agreement said the difference in purpose—compensating those alleging political targeting tied to the Trump administration’s settlement—makes the deal qualitatively different from earlier compensation arrangements.