Trump's 'weaponisation' fund on hold after backlash

US President Donald Trump's nearly $1.8 billion fund to compensate ‌victims of alleged government "weaponisation" has been put on hold after the White House faced fierce opposition from Republicans in Congress.

The rare rebuke of Mr Trump demonstrated some Republicans' increased willingness to flex their political power against the president, particularly after his endorsement of Texas Attorney General Ken Paxton over incumbent Senator John Cornyn ahead of a crucial midterm election.

The proposal was dropped as senators returned to Washington after their Memorial Day break and faced an impasse with the president over a $72 billion bill to fund ICE and Border Patrol operations.

Speaking to reporters, Senate Majority Leader John Thune said he made clear to the White House the fund needed to be killed.

"They gave us an ultimatum," a White House source said, describing how Republican politicians negotiated with the White House over the fund.

The White House's goal is to speed passage of the funding package, said the source, who like other sources spoke on the condition of anonymity to discuss internal deliberations.

The Republican rebellion was an extraordinary act of defiance given Mr Trump's insistence on loyalty and his threats to back primary candidates against those who do not toe the line.

The fund emerged from a legal settlement between Mr Trump and the Justice Department to resolve an unprecedented $10 ‌billion lawsuit against the IRS over the alleged mishandling of his tax records.

The $1.776 billion was meant to pay people who said they had been the subject of government abuse.

The fund sparked swift legal challenges and political uproar, including from Senate Republicans, who expressed anger that people who attacked the US Capitol on 6 January 2021, could receive taxpayer-funded payouts.

Critics condemned it as a slush fund.

On Friday, federal judges in Virginia and Florida issued orders that temporarily halted the fund until 12 June and called for further review, respectively.

In a statement yesterday, a Justice Department spokesperson said the DOJ "disagrees strongly" with those decisions but, "the Department will abide by the court's ruling".

The Justice Department statement did not commit to abandoning the fund entirely, only to following the court ruling pausing the fund that is likely to expire this month.

A DOJ spokesperson did not immediately address whether the fund had been permanently scuttled.

Blanche audition at stake

Since taking over as acting attorney general in April, Todd Blanche has moved quickly to prosecute Mr Trump's perceived enemies as he seeks to secure the job on a permanent basis.

The department secured criminal charges against former FBI Director James Comey, ramped up its investigation into former CIA Director John Brennan and removed press releases from its website about prosecutions of rioters who attacked the US Capitol.

But the backlash over the fund may represent the stiffest challenge yet to his bid to win the job permanently, raising questions over whether he can earn Senate approval if Mr Trump names him as attorney general.

Two sources sought to distance the White House from the fund, claiming it was the Justice Department and Mr Blanche's idea.

A Justice Department official, speaking on condition of anonymity to speak freely, said Mr Blanche was never in settlement negotiations.

But Trent McCotter, Mr Blanche's senior deputy, and attorneys from DOJ's Office of Legal Counsel were, said a source familiar with the matter.

In a tense meeting last month between Senate Republicans and Mr Blanche after the fund’s announcement, politicians yelled at the acting attorney general over the political optics of the fund.

"He did not come back with any answers," a White House source said, referring to Mr Blanche.

Trump 'not thrilled'

Mr Trump is "not thrilled" but understands this is the only way forward "for now," the source said, while adding that nothing is final until Mr Trump announces it.

Mr Thune, who said he talked to the White House over the weekend, told reporters that he thought the best way forward would be "if the administration decides to shut it down themselves".

House Speaker Mike Johnson also held a lengthy meeting at the White House yesterday to discuss the subject, a source familiar with the matter said.

Democrats, and some Republicans, questioned whether it was really killed and want guarantees it will not come back in another form.

"This week, Senate Democrats will push legislation to ban this slush fund and ensure no president can ever do this again," Senate Minority leader Chuck Schumer wrote on X.

The settlement agreement also barred the IRS from pursuing any audits into past tax claims for Mr Trump, his relatives and his companies for any tax returns filed before 18 May.

It was not clear how or whether the pausing of the fund would affect any possible audits of Mr Trump's past tax claims.