DOJ Under Fire: Critics Warn It Could Become a 'Piggy Bank' as Trump Allies Seek Multimillion-Dollar Settlements

Legal experts and White House critics warn the Justice Department (DOJ) risks becoming a de facto "piggy bank" for politically connected figures as former President Donald Trump and several associates pursue multimillion-dollar claims against the government.

Trump is seeking roughly $230 million in compensation tied to two federal probes into his conduct, the largest single demand reported so far. Other figures in his orbit are exploring sizeable payouts as well, and recent developments have renewed public concern about the department’s settlement practices.

Senators' provision and renewed settlement talks

A provision inserted into legislation to reopen the government allows up to 10 senators to sue for $1 million each after certain privacy violations; Senator Lindsey Graham (R-S.C.) has indicated he intends to use that option after special counsel Jack Smith obtained phone records tied to his office. The House voted unanimously to repeal the provision, calling it an obvious self-enrichment loophole, but Senate leadership has so far resisted taking up the repeal.

At the same time, the DOJ appears to have reopened or advanced settlement discussions with other Trump-affiliated figures who previously faced judicial setbacks when pressing claims in court. Former National Security Advisor Michael Flynn and former White House lawyer Stefan Passantino — both of whom previously saw their suits dismissed — are reported to be back in talks with DOJ officials about potential settlements.

Legal context and watchdog scrutiny

Flynn had earlier pursued a $50 million malicious-prosecution claim related to his guilty plea to lying to the FBI in the Mueller investigation; a judge appointed by President George W. Bush dismissed that claim as insufficiently supported. Passantino’s suit, tied to his treatment in the Jan. 6 investigation, was dismissed by a federal judge in Georgia under the Federal Tort Claims Act. Legal experts say those decisions suggest the government has strong defenses.

“The fact that both cases were dismissed once does suggest that the government has significant legal defenses,” said Rupa Bhattacharyya, who previously led career settlement review at the DOJ and oversaw the 9/11 Victim Compensation Fund.

Those renewed talks have already attracted watchdog scrutiny. Democracy Forward has filed public-records requests seeking documents related to the discussions with Flynn and Passantino, urging transparency about whether taxpayer resources are being used to benefit politically connected insiders.

The judgment fund and political concerns

Central to critics’ concerns is the federal judgment fund, a permanent appropriation used to pay settlements and judgments against the United States. Because the fund is an indefinite appropriation with broad reach, some experts warn it could be an easy source of money for politically motivated payouts if safeguards erode.

“The judgment fund is an easy target for this sort of — for lack of a better word — corruption,” Bhattacharyya said. She noted that career staff usually review settlement decisions to assess legal risk and protect taxpayer interests, and cautioned that decisions driven by politics rather than good-faith legal analysis could produce harmful outcomes.

Democratic critics argue the pattern of demands — including cases tied to the Mueller probe and the Jan. 6 investigation — reflects an effort to enrich allies and reward loyalists. Representative Dan Goldman (D-N.Y.), a former federal prosecutor, called potential payouts “egregious partisan grifting,” while Representative Zoe Lofgren (D-Calif.), a member of the Jan. 6 panel, said settlement negotiations risk “ripping off the taxpayers.”

The Ashli Babbitt settlement and its ripple effects

Observers point to the June settlement in which the DOJ agreed to pay $4.75 million to the family of Ashli Babbitt — shot during the Jan. 6 events — as a possible signal that larger payouts are attainable. While wrongful-death settlements are not uncommon, some experts said they were surprised by both the size and the timing of the Babbitt payment, which occurred long before full discovery and with a trial date scheduled for 2026.

Critics say the combination of high-profile demands, the permanent judgment fund, and a prominent early settlement could prompt more politically connected claimants to seek large sums from the federal government.

Where things stand

No settlement for Flynn or Passantino has been finalized, and none of the senators authorized to sue under the special provision has yet filed a claim. The DOJ declined to comment on the active discussions. Legal analysts emphasize that strong, nonpartisan career oversight within the department is essential to prevent settlements driven by political considerations rather than sound legal assessment.

As calls for transparency grow, watchdog groups and lawmakers are pushing for public records and legislative fixes to limit what critics see as potential avenues for self-enrichment. The debates under way highlight broader tensions over the role of the DOJ, the protection of taxpayer funds, and the independence of federal legal institutions.