An insurance insurer, Claudia Mouradian, whose deposition was presented at trial, said she relied on the Trump Organization’s claim that a statement reporting that approximately $6 billion in combined golf and real estate assets had been verified by professional appraisers.
These were some of the statements presented during six weeks of trial and testimony in a lawsuit brought against Trump and his company by New York Attorney General Letitia James (D). His civil case seeks to show that the former president, his adult children and his company deliberately inflated the values Trump included in his annual financial statements to obtain better terms from bankers and insurers.
James filed his lawsuit last year and is asking New York Supreme Court Justice Arthur Engoron to fine the company. at least $250 million and leave Trump and his family unable to operate in New York by prohibiting them from borrowing money or owning businesses. Trump’s defense has denied any wrongdoing.
By the time James’ side rested on Wednesday, with the defense team scheduled to begin presenting its case on Monday, the attorney general’s office had sought to paint Trump as a figure whose ego depended largely on how he compared to other billionaires and developers, and had lied in financial records to bolster his own position.
A mountain of documents presented at trial also demonstrated the company’s inconsistent and irregular methodologies in compiling financial statements for its benefit. In total, 25 witnesses were called to discuss documents and share first-hand accounts.
They included Trump, his adult sons Donald Trump Jr. and Eric Trump, and his daughter Ivanka Trump, who is not charged in the case. Each of them testified that he knew little or nothing about the creation of financial documents at the center of the trial.
Donald Trump Jr. and Eric Trump They testified this month that they trusted the company’s accountants.
“If they had assured me in their expert opinion that these things were fine, I would have accepted it and signed accordingly.” Donald Trump Jr. said.
Legal analysts and other observers say the testimony so far has possible shortcomings, including the fact that no employees have testified that Trump ordered the securities to be manipulated, except Cohen, who previously admitted to lying under oath and has a well-documented and admitted grudge against Trump. And there are also no traces of records leading directly to Trump, who famously avoids communicating by email.
However, the case has clearly irritated Trump, who repeatedly attended and denounced the trial throughout the process. It also carries huge implications for him and his company.
Engoron, who is handling the case without a jury, already ruled before the trial that the The company’s financial statements were fraudulent and it is requesting that a receiver be installed to “dissolve” Trump’s entities in the state.
“If you were to win this case based on people who worked with Trump, you would have a hard time,” Stephen A. Saltzburg, a law professor at George Washington University, said in an interview.
Saltzburg said James’ strongest point in his public comments to date has been about the importance of Financial statements.
“I think it will be demonstrated by the fact that the discrepancies are more than just honest errors of judgment,” Saltzburg said. “I think the judge is going to hold those who signed the documents responsible.”
This is a civil case, not a criminal trial, so none of the defendants face any time behind bars as a result. It comes as Trump faces a looming series of legal problems, including four separate criminal cases filed against him this year. Amid all these accusations and accusations, Trump is also the leading contender for the Republican presidential nomination next year.
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When Trump took the stand to testify last week, he clashed with Engoron and disparaged James and his case. His office also got Trump to confirm that he played a role in preparing the statements, sometimes providing feedback to his staff as they prepared them.
“Is it correct that you were responsible for determining the values indicated in the financial statement?” Kevin Wallace, a senior lawyer on James’ team, asked Trump during direct examination.
“I… have proven that I know more about real estate than other people,” Trump said. “So if someone asked me or had an opinion, I would give it.”
Trump tried to launch some surprise counterattacks against investigators, but he didn’t always succeed. He repeatedly highlighted the extensive legal disclaimers included in his annual returns, and at one point produced a copy of one from his pocket, attempting to present his own unofficial evidence at trial.
The disclaimer was not smoking gun: it had been a matter of public record. for several years since Cohen first discussed Trump’s alleged use of the statements to mislead business partners and provided copies of the records to Congress. When Trump, as a witness, was told he could not present evidence, he added it to his long list of complaints alleging unfair treatment at trial.
While the trial and lawsuit have taken aim at Trump’s own image as a business colossus, legal experts and analysts said James’ case also had limitations.
Aside from Trump’s signature on the statements themselves, James did not present any company documents showing that Trump participated in the preparation of the statements or the inflation of the securities.
Only one witness pointed directly at Trump, and he has publicly acknowledged that he has not always been honest, even under oath.
“Mr. Trump tasked me with increasing total assets based on a number he arbitrarily chose… [to] to increase those assets to reach the amount that Mr. Trump had entrusted to us,” Cohen, Trump’s former lawyer and “fixer,” testified on October 24.
However, over hours of combative cross-examination, Cohen admitted that in February 2019 he told Congress that Trump never ordered him or his former finance chief, Allen Weisselberg, to change their annual net worth reports. Cohen later clarified in the ongoing civil trial that, while Trump never outright said he ordered the forgeries, he hinted at his expectations as a “mob boss” making decisions in code.
Other witnesses called on James’ side refused to point fingers at Trump. Birney’s testimony largely relieved Trump executives of blame. Accountant Donald Bender, who did Trump’s personal and business taxes for decades, said he relied on the Trump Organization’s figures to compile reports but that he was not aware of any intentional manipulation.
Additionally, the Trump Organization’s largest lender, Deutsche Bank, made millions from its relationship with the Trumps. Trump’s top banker there previously said in a statement that she was not aware of any misinformation that Trump or the other family members had given to the bank, which could undermine the idea that the statements had unfairly benefited Trump.
Trump’s defense has argued that there were no victims in the case and that nothing illegal occurred.
As the defense begins to present its own case, Donald Trump Jr., Trump’s eldest son, who is a defendant in the case, as is his brother, Eric Trump. — He will return to the stand as the defense’s first witness. Trump’s lawyers are expected to argue that his financial statements were legitimate, that valuations are subjective and that Trump’s properties were worth a fortune.
None of the banks were misled because they did not rely on the statements to verify Trump’s value as a business partner, the defense says.
A ruling before the Engoron trial remains potentially consequential in the case, although with questions about its ultimate meaning.
In the Sept. 26 ruling, Engoron ordered that all of Trump’s “business certificates” in the state be canceled. The decision came like an earthquake, clearly putting Trump at risk of losing control over his New York empire. But his wording left lawyers to argue what exactly it meant for his company.
New York business certificates allow limited liability corporations (LLCs) to operate under trade names. Trump Corporation, for example, has a certificate that allows it to operate under the name Trump International Realty, according to county records. The certificates are sometimes called “DBA” certificates, for “doing business as.”
Engoron ruling confused some experts in part because it canceled the certificates, but not necessarily the underlying LLCs, which could give Trump’s lawyers a window to argue that the businesses could still be viable.
Legal experts said the effect would be the same.
“The Trump Organization is an association of all of these LLCs together, based on business certificates,” said Brian Quinn, a law professor at Boston College. Bank loans likely require such affiliations to remain current, he said.
Celia Bigoness, a law professor at Cornell University, said that if the certificates were canceled, “all other authorizations arising from those certificates” would also be canceled, including basic needs like the ability to collect sales taxes.
The judge also ordered that a trustee be appointed to “manage the dissolution of the terminated LLCs.”
Gregory E. Louis, an associate professor of law at CUNY School of Law, said Engoron may not have been clear in his wording, but that his rulings together indicated that “at least Judge Engoron understands the scope of his order.” having dissolved the underlying companies. also.
Despite that setback, Trump hasn’t backed off from his statement numbers, blatantly explaining during his Nov. 6 testimony that he felt most values were still lower than they should have been.
“The total value figure is much greater than the figure in the financial statements,” Trump testified.
Trump’s lawyers have apparently tried to create a record they could use in any appeal proceedings to help them preserve the company’s structure.
John C. Coffee Jr., a law professor at Columbia University, said Trump could be working against his team’s efforts to build the most effective appeal by focusing much of his own energy on attacking Engoron.
“I think Trump’s quite volatile performance… [and his] The occasional moments of anger hurt him, because judges basically respect the judiciary and don’t like defendants insulting them,” Coffee said.
O’Connell and Berman reported from Washington.