Source: Cohen might face N.Y. state tax probe

ALBANY, N.Y. — New York’s attorney general is looking to open a criminal investigation into whether Michael Cohen violated state tax law, a person familiar with the matter told The Associated Press on Thursday.

Attorney General Barbara Underwood has requested a criminal referral from the state tax department to investigate and potentially file charges against Cohen, according to the person, who spoke on the condition of anonymity.

Cohen’s lawyer, Lanny Davis, declined to comment on his client’s latest legal obstacle. The development was first reported by The New York Times.

Cohen, the former personal lawyer for President Donald Trump, owes at least $1.4 million to the IRS after pleading guilty Tuesday to evading federal taxes. It’s unclear if he also misstated his income on state returns.

Cohen failed to report more than $4 million in income on his federal tax returns between 2012 and 2016, including $1.3 million from his taxi medallion holdings, according to court papers filed in connection with his plea.

Cohen was already in contact with state tax officials on another matter, personally calling them the same day he received a subpoena from state investigators looking into the Trump Foundation.

A state official confirmed the call but would not divulge the details of the exchange, which came Wednesday just hours after Cohen received the subpoena.

AP first reported the existence of the subpoena Wednesday. It was issued as part of the state’s ongoing investigation into Trump and the Trump Foundation to determine whether the Republican commander in chief or his charity broke state law or misstated their tax liabilities.

Besides his work for Trump, Cohen spent years amassing yellow cab medallions, the hard-to-get licenses adorning the hoods of taxis in New York and Chicago that were once worth a fortune, but whose values have plummeted in recent years due to competition from ride-hailing services like Uber and Lyft.

Many medallion owners who used them as collateral to borrow money are now in deep financial trouble, unable to pay back creditors.

Once such taxi magnate, Evgeny Freidman, nicknamed the “Taxi King” by New York’s tabloid newspapers, managed Cohen’s medallions for years, even after state prosecutors charged him last summer with pocketing more than $5 million in taxes.