Justice Department Withdraws Controversial Fund for Trump Supporters

Acting U.S. Attorney General Todd Blanche officially withdrew a controversial $1.776 billion fund. The project sought to compensate followers of President Donald Trump who claimed to have been victims of political persecution during the Joe Biden administration.

Blanche issued the formal order on August 2, 2026. With this decision, he seeks to unblock his permanent nomination as attorney general, which faced obstruction from 2 key senators from the Republican Party.

The withdrawal of the fund, known as the “anti-militarization fund,” clears the way for a crucial vote in the Senate Judiciary Committee. The measure ends weeks of internal tension and high-level negotiations.

Why was the fund created?

The project emerged as part of a legal settlement to resolve a $10 billion lawsuit that Trump filed against the Internal Revenue Service (IRS). The president accused the agency of leaking his tax records. The settlement, facilitated by the Justice Department under Blanche’s interim leadership, included the creation of a $1.776 billion fund. The initiative would allow compensation for individuals who claimed to have been prosecuted for political reasons under the Biden administration.

However, the plan generated strong bipartisan backlash. Democrats and some Republicans warned that the money could be used to compensate Capitol attackers from January 6, 2021, and other Trump political allies. In the face of criticism, Blanche assured in June that the fund was “dead.” But Republican senators John Cornyn (Texas) and Thom Tillis (North Carolina) demanded a written and binding order guaranteeing its permanent elimination.

What does Blanche’s order say?

The Justice Department order establishes, “beyond any doubt, that the fund does not exist.” Blanche formally revoked the directive from May 18, 2026, that had authorized its initial creation. The text details that since the announcement of the IRS settlement, no administrator was ever designated to manage the money, no funds were transferred, and no claims were paid.

Beyond eliminating the fund, the agreement with senators limits the scope of another controversial clause. It restricts tax audit immunity solely to the original plaintiffs, including the president, and the IRS. In his X account, Blanche confirmed the arrangement. He said his team met with senators over the past weeks to address any concerns and that those good faith conversations resulted in the cancellation order.

How does this affect Blanche’s nomination?

The fund withdrawal unblocks Blanche’s Senate confirmation. In the Judiciary Committee, Democrats oppose en bloc, so the interim attorney general needs the support of all Republicans to advance to the full Senate. A single vote against from Cornyn or Tillis would have sunk the nomination. Both senators conditioned their support on the written elimination of the fund and clarification of the tax terms.

Cornyn and Tillis