Blanche has been recused from this matter because he worked as one of Trump’s personal attorneys on the Carroll appeals, according to a source familiar with the matter. Blanche has not attended meetings or been involved in discussions about the investigations, and the investigation is being overseen by other officials in the deputy attorney general’s office.

Senior leaders at the Justice Department referred the investigation to federal prosecutors in Chicago, according to two sources familiar with the matter. While Carroll’s deposition took place in New York, one of the individuals who helped cover some of Carroll’s legal fees, Hoffman, has a nonprofit based in Chicago. This geographic link likely influenced the assignment of the case to federal prosecutors in that jurisdiction.

The Funding Controversy

Hoffman’s support of the case caught Trump’s attorneys off guard when it came to light on the eve of trial. In a 2022 videotaped deposition, Carroll told then-Trump attorney Alina Habba that no one else was paying for her legal fees. But two weeks before the trial, Carroll’s attorneys informed the judge and Trump’s lawyers that they secured funding from Hoffman’s nonprofit.

Carroll’s lawyers said she never met nor had conversations with anyone associated with the nonprofit. Habba said in court at the time that Carroll’s team “conspired to conceal the truth for nearly six months.” The judge permitted Trump’s attorneys to question Carroll again in a deposition, which has not been made public.

When the trial began two weeks later, Judge Lewis Kaplan said he saw no issue with Carroll’s credibility and blocked the lawyers from asking about Hoffman’s funding. The judge's decision at that time effectively shielded Carroll from immediate legal consequences regarding the funding disclosure, but the issue has now resurfaced in a federal criminal context.

Carroll is still embroiled in multiple legal battles with the president. Juries awarded Carroll millions of dollars in damages, which the president is appealing. Trump has appealed the $5 million sexual abuse case judgement to the Supreme Court and has pledged to do the same with the $83 million defamation case.

The Supreme Court has deferred its decision on whether to take up Trump’s appeal twelve times. The most recent deferral was made Wednesday morning. In a different case, the president unsuccessfully asked for the Justice Department to join the case as a defendant so that he could argue he is immune from liability. An appeals court panel of judges said the argument was raised too late in the legal process.

Future Legal Implications

CNN’s John Fritze contributed to this report. This story was updated to remove a statement errantly provided by the Justice Department.

As the Justice Department investigation proceeds, the legal landscape for both parties remains volatile. The criminal probe into Carroll introduces a new layer of complexity to an already protracted dispute. If prosecutors can secure charges related to the alleged perjury, it could significantly impact the standing of Carroll’s civil judgments, potentially undermining the credibility of her claims in the eyes of the public and future legal proceedings.

Conversely, Trump’s continued appeals of the civil verdicts suggest his legal strategy remains focused on overturning the financial penalties and damages already awarded. The repeated deferrals by the Supreme Court indicate a cautious approach to intervening in these high-profile cases. The outcome of this criminal probe could serve as a pivotal moment in the ongoing saga, potentially setting precedents for how funding disclosures are treated in high-stakes litigation involving public figures. The interaction between the criminal investigation and the pending civil appeals will likely dictate the next phase of this legal war, with implications for political accountability and legal ethics.