Trump civil fraud case: Judge fines Trump $354M, says frauds 'shock the conscience'

The former president was found to have defrauded lenders.

Last Updated: October 20, 2023, 8:43 AM EDT

Former President Donald Trump has been fined $354.8 million plus approximately $100 million in interest in a civil fraud lawsuit that could alter the personal fortune and real estate empire that helped propel him to the White House. In the decision, Judge Arthur Engoron excoriated Trump, saying the president's credibility was "severely compromised," that the frauds "shock the conscience" and that Trump and his co-defendants showed a "complete lack of contrition and remorse" that he said "borders on pathological."

Engoron also hit Donald Trump Jr. and Eric Trump with $4 million fines and barred all three from helming New York companies for years. New York Attorney General Letitia James accused Trump and his adult sons of engaging in a decade-long scheme in which they used "numerous acts of fraud and misrepresentation" to inflate Trump's net worth in order get more favorable loan terms. The former president has denied all wrongdoing and has said he will appeal.

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Here's how the news is developing. All times Eastern.
Feb 16, 2024, 4:07 PM EST

Summary of penalties

Donald Trump and his adult sons were hit with millions in fines in the civil fraud trial and barred for years from being officers in New York companies. The judge said the frauds "shock the conscience."

Donald Trump: $354 million fine + approx. $100 million in interest
+ barred for 3 years from serving as officer of NY company
Donald Trump Jr.: $4 million fine
+ barred for 2 years from serving as officer of NY company
Eric Trump: $4 million fine
+ barred for 2 years from serving as officer of NY company
Former Trump Organization CFO Allen Weisselberg: $1 million fine
+ barred for 3 years from serving as officer of NY company
+ barred for life from financial management role in NY company
Former Trump Organization controller Jeffrey McConney:
+ barred for 3 years from serving as officer of NY company
+ barred for life from financial management role in NY company

Oct 20, 2023, 8:38 AM EDT

Ivanka Trump files motion to keep from testifying

Day 14 of the proceedings gets underway following a motion filed late Thursday by Ivanka Trump that seeks to quash three subpoenas that would compel her to testify in the trial.

Donald Trump's eldest daughter, who was no longer a part of the Trump Organization by 2016, was dismissed from the civil suit by an appeals court in June.

But the New York attorney general still plans to call her as a witness in the state's case. In early September, the AG sent subpoenas to three corporate entities affiliated with Ivanka Trump to force her to testify in person.

Ivanka Trump listens attends an event, Aug. 4, 2020, in Washington, D.C.
Drew Angerer/Getty Images, FILE

"The NYAG, which never deposed Ms. Trump, is effectively trying to force her back into this case from which she was dismissed by a unanimous decision of the Appellate Division, First Department," Ivanka Trump's lawyer, Bennet Moskowitz, wrote in Thursday's filing.

Moskowitz argued that the subpoenas should be thrown out since they were not properly served and because the AG lacks jurisdiction to force Ivanka Trump, who is no longer a New York resident, to testify.

"The NYAG knows this, which is why it has subpoenaed three corporate entities as an end-run around its failure to pursue Ms. Trump's deposition when it had the chance," the filing said.

In a Thursday email that was entered as an exhibit to the motion, a lawyer for the attorney general's office indicated they do not plan to request Judge Arthur Engoron hold Ivanka Trump in contempt. They instead plan to file a motion today to compel her to appear in court, according to the email.

Oct 19, 2023, 6:17 PM EDT

Witness disputes Eric Trump's recollection of appraisals

Over three hours of testimony, real estate executive David McArdle described multiple phone calls, emails, and meetings with Eric Trump to appraise several of the Trump Organization's trophy assets.

But when prosecutors played a video in court of the deposition Eric Trump gave in the case, the Trump Organization VP said he didn't recall working on the appraisals with McArdle.

"I recognize the name very vaguely," Eric Trump said of McArdle on the deposition video. "I really haven't been involved in appraisal work on this property."

"Do you believe that Eric Trump was not involved in the appraisals you worked on?" state attorney Sherief Gaber asked McArdle.

"No," McArdle replied.

Court was subsequently adjourned for the day.

Oct 19, 2023, 5:58 PM EDT

Statements appear to ignore appraisals of undeveloped lots

Cushman & Wakefield executive David McArdle, who was hired to appraise the value of 71 undeveloped residential units at the Trump National Golf Club in Westchester County, New York, testified that he also conducted multiple appraisals for conservation easements at the property in 2014 and 2015.

Signing a conservation easement would allow the Trump Organization to give up their development rights and treat the difference in property value as a charitable donation, according to the New York attorney general.

By giving up the right to develop the 71 residential units, McArdle found that the donation was worth $43 million, according to an April 2014 appraisal. A later appraisal McArdle conducted in 2015 landed on a similar valuation of $45.2 million.

But Trump's financial statements from those years appear to ignore the appraisals, valuing the land from the undeveloped units at $101 million, according to documents entered into evidence.

"Based on the supporting data, the only source for the increase in the number of units and profit per unit were telephone conversations with Eric Trump," the New York attorney general alleged in her complaint.

McArdle also testified that he was consulted to appraise Seven Springs, a New York estate Trump purchased for $7.5 million in 1995.

To value the property, which could be subdivided into 24 to 26 residential lots, McArdle testified that he toured the site, consulted a local expert, and spoke with Eric Trump on multiple occasions.

"He had a very high opinion of the property, which didn't surprise me," McArdle said.

His appraisal ultimately determined the total value for the lots in 2014 was $30-$50 million, McArdle said.

But the New York attorney general alleges that appraisal was ignored in Trump's 2014 financial statement, in favor of a "false and misleading" value of $161 million for a portion of the undeveloped lots.

Oct 19, 2023, 2:15 PM EDT

Eric Trump sought higher valuation of golf course, appraiser says

Eric Trump personally pushed for a higher valuation for 71 undeveloped residential units at the Trump National Golf Club in Westchester County outside New York City, a real estate executive testified.

David McArdle of the real estate firm Cushman & Wakefield said he was hired to appraise the future value of the duplex units to be built along the golf course's 18th hole fairway. McArdle said he personally worked with Trump Organization VP Eric Trump on the project in 2013.

"Eric loved this project. He thought it was very special," McArdle said.

When McArdle eyed a value between $40-$45 million, Eric Trump pushed for a higher value, McArdle said.

In this June 7, 2016 file photo a view of the clubhouse at the Trump National Golf Club Westchester in Briarcliff Manor, N.Y.
Mike Segar/Reuters, FILE

In an email that was entered into evidence, McArdle wrote to a colleague regarding Eric Trump: "He continues to call me. I am uncomfortable not replying, please call him."

McArdle testified that he wanted to be "respectful" to Eric Trump, who he hoped to work with on future projects; however, McArdle said he and Eric Trump continued to disagree about the value of the undeveloped units.

"Eric had certain ideas about value. They may have been more lofty than $45 million," McArdle testified.

McArdle said was firm on the $45 million valuation, adding that he did not want to put "Eric in a vulnerable position" because the appraisal could be "under a lot of scrutiny by the IRS or a court."

"We were sort of at the end, and anything beyond $45 million would have put people at risk," he said.

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