Trump Drops $1.8B DOJ 'Anti-Weaponization' Fund After GOP Revolt

The Trump administration is pulling the plug on the Department of Justice’s $1.8 billion “anti-weaponization” fund after a federal court block and a rare bipartisan revolt on Capitol Hill. The fund was created as part of a settlement of President Donald Trump’s $10 billion lawsuit against the Internal Revenue Service and was intended to compensate people who were allegedly victims of prosecutorial overreach by the DOJ under the Biden administration.

What happened

The Trump administration plans to drop its controversial $1.8 billion “weaponization” fund the president sought to compensate alleged victims of prosecutorial conduct under his predecessor, two senior administration officials told Axios. Axios, in its report Monday, quoted a senior administration official as saying that the fund is “dead for now.”

In a statement, the Justice Department cited a Friday ruling by a federal judge that blocked the fund on a temporary basis, saying it “disagrees strongly” but “will abide by the Court’s ruling.”

The court block

On Friday, a federal judge blocked the DOJ from taking any action to create or disburse money from the fund for now as a lawsuit challenging it plays out in U.S. District Court in Alexandria, Virginia. Judge Leonie Brinkema also scheduled a June 12 court hearing on whether to maintain the injunction against the fund.

The move comes after a federal judge in Florida on Friday reopened Trump’s case against the IRS, whose settlement served as the basis for creating the $1.776 billion fund. In doing so, the judge ordered President Trump and the Justice Department to file briefs to explain “charges of collusion and whether the Parties are truly adverse.”

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The GOP backlash

It comes after a fierce and rare backlash from Senate Republicans, who threatened to team up with Democrats to block the fund. About half the Republican conference appeared ready to vote with Democrats to restrict or kill it, Sen. Ted Cruz, R-Texas, said last week.

Bashed as a political slush fund that could be tapped by those convicted in the Jan. 6, 2021, Capitol riot, Trump’s proposal has drawn bipartisan pushback in the GOP-led House and Senate. “This has become a distraction,” a second administration official said. “The president believes government was weaponized against people — it wasn’t just him. But this isn’t the time and vehicle for it.”

Why it matters for the reconciliation bill

The announcement is aimed at restarting the party-line “reconciliation” bill Republicans are trying to push through Congress to fund ICE and Border Patrol through the end of Trump’s term in office. That push stalled two weeks ago before the Memorial Day recess due to the “anti-weaponization” fund.

On Capitol Hill, Democrats have threatened to go all out to shut down the fund — through amendments in the reconciliation bill and potentially forcing votes on standalone legislation to prevent the administration from reviving it later. And they’re not convinced by the administration’s suggestion that it will backtrack on pursuing the fund. “If Trump and Republicans are truly abandoning this corrupt scheme, they should have zero problem banning it in law,” Schumer said.

Options market and stocks to watch

The fund itself doesn’t directly move tickers, but the political reset around the reconciliation bill and DOJ policy could ripple into a few corners of the tape:

GEO and CXW: Watch for flow tied to the restarted ICE/Border Patrol funding push, which directly benefits private detention operators.

AXON: Watch for any read-through on federal law enforcement budgets if the reconciliation bill finally moves.

DJT: Watch for headline-driven volatility on anything tied to Trump political setbacks or wins.

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