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The move follows a temporary block on the creation of the fund by a federal court judge last week.
The Trump administration has officially dropped its controversial plans to create a massive $1.8 billion fund, the BBC, The Washington Post, and Axios report.
The program was originally designed to compensate individuals who claim they were unfairly targeted or investigated by federal agencies.
Acting Attorney General Todd Blanche confirmed the sudden reversal during a tense congressional hearing on Capitol Hill.
“We’re not moving forward with the fund, period,” Blanche told lawmakers on Tuesday, with one source telling Axios, “It’s dead for now.”
The proposal was initially announced to settle a lawsuit filed by President Donald Trump against the Internal Revenue Service over leaked tax returns. However, the plan immediately sparked intense outrage from across the political spectrum.
Rising political fury
Both Democrats and several Republicans quickly voiced strong opposition to the idea. Critics argued the money could end up compensating people prosecuted over the US Capitol riot, including individuals convicted of assaulting police officers.
Congressional leaders put heavy pressure on the administration to abandon the scheme entirely. Senate Majority Leader John Thune came out forcefully against it, while Senate Democratic Leader Chuck Schumer vowed to legally eliminate the program.
Schumer blasted the idea on social media, writing that Democrats would push legislation to ban what he described as “Trump’s corrupt MAGA slush fund.”
Former Vice President Mike Pence also joined the critics, calling it a “bad idea from the start.”
Blocked by courts
The sudden decision to scrap the plan follows a significant legal roadblock. Last week, US Judge Leonie Brinkema temporarily stopped the creation of the fund after two men filed a discrimination lawsuit in Virginia.
The Department of Justice had previously defended the project on X, stating it was meant “to make up for the tremendous abuse, harm, and hate unfairly shown to so many people.” Officials added that the program was “open to anybody who was so weaponized, targeted, or persecuted.”
While the government ultimately backed down, Blanche refused to put the final cancellation in writing despite requests from lawmakers.
“I’m not committing to putting anything in writing,” Blanche said, insisting that his verbal confirmation was clear enough.
Sources: Department of Justice statement, X post by Chuck Schumer, congressional testimony of Todd Blanche, the BBC, The Washington Post, and Axios
