Trump appears to drop plan for $1.8 billion slush fund after judge’s rebuke, rare Republican revolt

US President Donald Trump appears to be backing off a plan for a $1.8 billion slush fund after a judge ordered a temporary block and Republican lawmakers mounted a rare revolt against the move.

The New York Times reported sources as saying that Trump had been leaning for days towards scrapping the fund amid widespread opposition.

The Trump administration on Monday signalled it was dropping the plan when the Department of Justice said it would abide by a federal judge's order not to proceed with the activation of the fund until at least June 12 when a hearing in the matter is scheduled. It also did not say if it would file an appeal against the order.

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The case is rooted in a plan to create a so-called ‘Anti Weaponization Fund’ stemming from a case Trump filed against his own administration’s Internal Revenue Service (IRS), seeking $10 billion in damages over the leak of his tax records in 2019. Trump settled the lawsuit in exchange for the creation of the $1.8 billion fund to purportedly compensate victims of legal persecution under the previous Joe Biden administration.

As part of the settlement, Trump also secured immunity for himself, his family, and his affiliates from audits of tax returns they have already filed. Such immunity could allow him to save at least $100 million in additional taxes and penalties, according to The Times.

Critics have described the Anti Weaponization Fund as a slush fund to pay friends, family, and allies with taxpayer money. In addition to concerns over the opacity of the fund and the potential formalisation of corruption, they also flagged the process that led to its creation: Trump sued the agencies he controlled and then sought a settlement from the same agencies.

Republican lawmakers have held tense meetings with Acting Attorney General Todd Blanche over the fund. They told him that the administration would need to overhaul the fund or Congress would do so, according to The Associated Press.

The report said that Republican senators discussed several ways to rein in the fund, such as limiting who could receive compensation, revising the fund’s decision-making process, or even scrapping it altogether.

Despite Trump’s apparent retreat, Senate Majority Leader John Thune said the Justice Department’s statement might not be “sufficient to satisfy a number of” Republican senators and that they were still “sorting through” a way forward, as per The Times.

When asked whether he was concerned that Trump might still veto plans to rein in the fund, Thune said "yeah".