New York Attorney General Letitia James unveiled a civil fraud lawsuit against former President Donald Trump and three of his adult children Wednesday regarding the Trump Organization's alleged manipulation of its asset valuations.
The attorney general is seeking for Trump and his empire to pay a minimum of $250 million for allegedly engaging in fraudulent business practices. James also revealed that her office uncovered evidence that the Trump Organization violated multiple state laws and is referring the matter to the IRS and the Southern District of New York for criminal investigations.
"This investigation revealed that Donald Trump engaged in years of illegal conduct to inflate his net worth ... to deceive banks and the people of the great state of New York. Claiming you have money that you do not have does not amount to the art of the deal. It’s the art of the steal," James declared during a press briefing.
James is alsocalling for Trump, Donald Trump Jr., Ivanka Trump, and Eric Trump to be barred from serving as "an officer or director in any corporation" or similar entity in New York. Furthermore, she is calling for Trump and his business empire to be barred from "entering into any New York State commercial real estate acquisition or from applying for loans" in New York for the next five years.
"Mr. Trump and the Trump Organization repeatedly and persistently manipulated the value of assets to induce banks to lend money to the Trump Organization on more favorable terms than [what] would otherwise have been available to the company," she explained during a press event.
Actions have consequences. We're seeking to:— NY AG James (@NewYorkStateAG) September 21, 2022
➡️Make Trump pay $250 million.
➡️Ban the Trumps from running NY businesses for good.
➡️Ban Trump and Trump Org from buying commercial real estate in NY for 5 yrs.
➡️We're making a criminal referral to the U.S. Dept of Justice.
Trump's lawyer quickly fired back, arguing that James was pursuing a political agenda.
"It is abundantly clear that the Attorney General’s Office has exceeded its statutory authority by prying into transactions where absolutely no wrongdoing has taken place," Trump lawyer Alina Habba said in a statement obtained by the Washington Examiner. "We are confident that our judicial system will not stand for this unchecked abuse of authority, and we look forward to defending our client."
Trump has personally disparaged the inquiry as a "witch hunt" and denied any wrongdoing. His team sought to broker a deal with James after she told a court earlier this year that her office uncovered evidence of wrongdoing. Her office rejected the deal, James confirmed during the briefing Wednesday. However, she stressed that "our doors are always open."
James has been conducting an investigation into the Trump Organization since 2019, when former Trump lawyer Michael Cohen testified before Congress that the Trump Organization manipulated asset valuations for tax and business benefit.
She detailed a number of examples that her office uncovered of the Trump empire issuing false and misleading financial statements and noted that she interviewed over 60 witnesses as part of the inquiry. Trump declined to answer questions before her last month by invoking his Fifth Amendment rights against self-incrimination as her office peppered him with over 500 questions.
Eric Trump similarly pleaded the Fifth, while Ivanka Trump and Donald Trump Jr. are believed to have answered questions for several hours, CNN reported. The Trumps had long fought subpoenas demanding deposition but were ultimately unsuccessful in court.
"All told, we uncovered more than 200 examples of false and misleading asset valuations that were used on his statements. The pattern of fraud and deception that was used by Mr. Trump and the Trump Organization for their own financial benefit is astounding," James saidduring the briefing.
Most of the alleged violations James cited spanned a 10-year period. She noted that many of the financial documents she referenced had been "personally certified as accurate by Mr. Trump or by one of his trustees."
Tactics used by the Trump Organization included "changing the methodology used to value properties from year to year without reason or notice," relying on brand premiums, and frequently ignoring the advice of outside professionals, according to James.
One example James cited was an instance in which the Trump Organization listed a commercial property on 40 Wall Street as being valued at $524 million in a 2011 statement, despite bank appraisals pegging its value at $200 million in August 2010.
"The examples I laid out just barely scratched the surface of the misconduct that we have uncovered," James added, noting that the complaint is over 280 pages long.
When pressed about how some of Trump's business partners failed to identify his alleged deceptive business statements for so long, James explained that not all of the organizations independently audited the appraisals and that others had been investigating the matter.
She also made it clear that there would be no escape for Trump in Florida.
"If, in fact, he decided to move to Florida, the reality is he still has to deal with the great state of New York and respond to the complaint," she said. "These corporations are currently — currently incorporated in the state of New York. Some are incorporated in Delaware, but they do business in the state of New York."
In tandem with James's civil inquiry into Trump's business practices, the Manhattan District Attorney's Office has been investigating whether the Trump business empire committed any crimes. James has been assisting in that inquiry and told the press her office will continue to cooperate with that investigation.
Recently, former Trump Organization Chief Financial Officer Allen Weisselberg entered a guilty plea with the Manhattan District Attorney's Office for fraud and tax evasion charges, leading to speculation that he could assist in its criminal inquiry of Trump. Former prosecutors have bashed the inquiry for being squeamish about targeting Trump.