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U.S.


DONALD TRUMP AND HIS COMPANY "REPEATEDLY" VIOLATED FRAUD LAW, NEW YORK JUDGE
RULES

By Graham Kates

Updated on: September 26, 2023 / 7:19 PM / CBS News

 * 
 * 
 * 

Trump and his company "repeatedly" violated fraud law, judge rules

Donald Trump and his company "repeatedly" violated state fraud law, a New York
judge ruled Tuesday.

The ruling came in response to a request by New York Attorney General Letitia
James seeking judgment on one of the claims in her $250 million civil lawsuit,
which is scheduled to go to trial on Oct. 2. Judge Arthur Engoron agreed in his
ruling with James' office that it is beyond dispute that Trump and his company
provided banks with financial statements that misrepresented his wealth by as
much as $3.6 billion.



"The documents here clearly contain fraudulent valuations that defendants used
in business," Engoron wrote in his ruling, in which he ordered the defendants'
New York business certificates canceled. He ordered that within 10 days, they
must recommend potential independent receivers to manage the dissolution of the
canceled LLCs.

Click here to view related media.
click to expand

James' office sued Trump, his sons Donald Jr. and Eric, and the Trump
Organization in September 2022, claiming they committed extensive fraud over
more than a decade while seeking loans from banks. In addition to $250 million,
her office is seeking several sanctions that would severely hamper the company's
ability to do business in New York.

Both sides sought summary judgments from Engoron. James' office asked for the
ruling delivered Tuesday, saying it would streamline the trial if Engoron found
certain facts were beyond dispute: that Trump and the company issued false
business records and false financial statements.

The Trumps' legal team asked Engoron to toss the case. They argued many of the
loans in question occurred too long ago to be considered as part of this case.

Engoron also ruled on that motion Tuesday, rejecting it. 

The upcoming trial will now focus on other allegations in the lawsuit related to
falsification of business records, issuing false financial statements, insurance
fraud and conspiracy.



The Trumps and their company have denied wrongdoing and accused James, a
Democrat, of pursuing them for political reasons.

In a statement Tuesday evening, Alina Habba, legal spokesperson for Trump's Save
America PAC, called the judge's ruling "fundamentally flawed at every level" and
said they would "immediately appeal."

"It is important to remember that the Trump Organization is an American success
story," the statement said. "The fact that this Court summarily found that there
is no question of fact, finding in part that Mar-a-Lago is worth approximately
$20 million and issue a decision of this magnitude is an affront to our legal
system."

The judge found as fact that Trump and the company overstated the valuations of
many properties by hundreds of millions of dollars. He cited the Palm Beach
Assessor valuation of Trump's Mar-a-Lago club at between $18 million and $28
million for each year between 2011 and 2021 — the values for which he paid local
property taxes. During those years, Trump valued the property at between $328
million and $714 million on his annual statements of financial conditions.

Mar-A-Lago, former President Donald Trump's private club in Palm Beach, Florida.
Eva Marie Uzcategui/Bloomberg via Getty Images

During arguments Friday related to the motions, a lawyer for James' office said
Trump signed off on so-called statements of financial condition portraying many
properties he and his company owned as worth hundreds of millions more than the
valuations of appraisers they had hired.



Trump attorney Christopher Kise said in response that the valuations reflected
"Mr. Trump's investment genius." He pointed to Trump National Doral Miami golf
club, which was purchased out of bankruptcy for about $150 million in 2012. Kise
said it's worth "well more than $1 billion" now.

"What Doral demonstrates is that President Trump is a master at finding value
where others see nothing," Kise said.

Engoron gave some indication he didn't buy Kise's argument during that hearing.
Engoron peppered Kise with questions, frequently interrupting him, and at one
point raising his voice as he banged his fist on the bench.

"You cannot make false statements and use them in business — that's what this
statute prohibits," he said.

Engoron also ruled Tuesday on a separate motion by the New York attorney general
seeking sanctions against Trump's legal team for repeatedly making arguments
Engoron and other courts had already rejected. James' office asked the judge to
impose a fine of $20,000.



Engoron ruled in the attorney general's favor but upped the amount, fining five
attorneys $7,500 each, for a total of $37,500.


TRUMP INVESTIGATIONS

More
Donald Trump and his company "repeatedly" violated fraud law, N.Y. judge rules
Trump's lawyers accuse special counsel of seeking to "muzzle" him
Three "fake electors" argue their cases should move to federal court
Garland says "no one" has told him to indict Trump
Trump reiterates request that judge recuse herself from his Jan. 6 case
More
   In:
 * The Trump Organization
 * Donald Trump

Graham Kates

Graham Kates is an investigative reporter covering criminal justice, privacy
issues and information security for CBS News Digital. Contact Graham at
KatesG@cbsnews.com or grahamkates@protonmail.com


Read More

First published on September 26, 2023 / 4:43 PM

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