Trump civil fraud case: Judge fines Trump $354 million, says frauds 'shock the conscience'
The former president was found to have defrauded lenders.
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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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
'We are not going to hear about the disclaimer clause,' says judge
After tamping down on Trump at the start of the day, Judge Engoron has largely been granting him space to engage in the kind of provocative language he often uses on social media.
But at one point, when Trump pulled out a piece of paper about a disclaimer and said it vindicates him, Engoron stepped in.
The former president argued in his deposition earlier this year, and has repeatedly said on social media, that a so-called "worthless" disclaimer included in his statements of financial condition -- which warns lenders that the valuations in the document require judgment and that they should do their own analysis -- insulates him from liability.
Engoron, an a partial summary judgment issued before the start of the trial, ruled otherwise.
"No, no, no, we are not going to hear about the disclaimer clause," Engoron responded when Trump pulled out the paper.
Trump airs complaints against judge, New York AG
After a cordial question-and-answer interlude seemed to cool down the temperature in courtroom, the former president has grown increasingly animated as he levels complaints against the judge and the New York attorney general, whom he called "a political hack."
When state attorney Kevin Wallace asked Trump if he disagreed with the attorney general's assessment of the value of some of the Trump Organization's properties, Trump fired back.
"I think it's fraudulent," Trump said. "The fraud is on the court, not on me."
Looking at Wallace but motioning toward Judge Engoron, Trump said of the judge, "You ruled against me before you knew anything about me ... he called me a fraud and he didn't know anything about me."
Referring to New York Attorney General Letitia James, Trump said: "It's a political witch hunt and I think she should be ashamed of herself."
Wallace has largely ignored Trump's asides, instead moving on to the next question. After a particularly agitated exclamation, Wallace asked Trump, "You done?"
"Yes," Trump replied.
Real estate valuations aren't a science, defense says
Despite addressing two overvaluations on his statement of financial condition, Trump has repeatedly tried to stymie the state attorney's yes-or-no line of questioning regarding his financial statement, underscoring his legal team's defense that real estate valuations are an art, not a science.
Earlier, in response to a question about the compilation of his financial records in 2021, Trump invoke his work in the White House to demonstrate that he was too preoccupied with the nation's business to engage in his own.
"I was so busy in the White House," Trump said. "My threshold was China, Russia and keeping our country safe."
"Just for the record," state attorney Kevin Wallace replied, "you weren't president in 2021?"
"No, I wasn't," Trump acknowledged.
Trump acknowledges adjusting 2 overvaluations
Donald Trump acknowledged during direct examination that he overvalued at least two properties in his statements of financial condition, though he broadly represented that the statements underestimated his total net worth.
"Did you ever think that the values were off in your statement of financial condition?" state attorney Kevin Wallace asked about the document at the center of the case, which the New York attorney general has alleged contained fraudulent valuations.
"Yes, on occasion. Both high and low," Trump said, appearing to surprise Wallace, who paused to allow Trump to continue his answer.
Compared to his sons, who largely testified that they deferred to accountants and lawyers, Trump portrayed himself as an experienced businessman who "was certainly more expert than anybody else" when it came to the value of his own properties.
Asked about properties like 40 Wall Street and a retail space near Trump Tower, the former president confidently used real estate shorthand to explain why he thought certain properties were undervalued. He also repeated that his brand value -- which was not included in his financial statement -- is worth billions.
"The most valuable asset was the brand value," Trump said. "I became president because of my brand."
However, Trump acknowledged that two properties -- his triplex apartment in Trump Tower and his Seven Springs estate in New York's Westchester County -- were overvalued and had to be adjusted in his financial statement.
"I thought the apartment was overvalued when I looked at it," Trump said, appearing to refer to a $200 million correction applied to his statement after Forbes magazine reported that he falsely stated the apartment was three times its actual size.
Asked about the change in the statement, Trump acknowledged the square footage mistake, which he blamed on a broker, while also claiming that the number was "not far off" from reality when you consider the square footage of Trump Tower's roof.
"It's a mistake … [but] there's a disclaimer clause so you don't have to get sued by the attorney general of New York," Trump said.
Trump made a similar admission about the $291 million valuation of Seven Springs.
"I thought it was too high and we lowered it," Trump said, though he could not provide specifics about the changed valuation.
Cohen recounts his criminal history
Michael Cohen, hunched slightly on the witness stand, began his testimony by outlining the federal charges to which he pleaded guilty and served prison time -- including tax evasion and lying to Congress -- as Trump leaned back in his chair with his arms folded across his chest.
Once Trump's self-described bulldog, Cohen has not shared a room with Trump in five years, he said prior to his testimony.
As he recounted his criminal history, Cohen invoked the names of Stormy Daniels and Karen MacDougal, two women who in 2016 were paid to keep quiet about long-denied affairs with Trump. Defense attorney Chris Kise moved to strike the answer but the judge overruled the objection.
Colleen Faherty, an attorney with the state attorney general's office, asked Cohen if his crimes occurred while he was employed by Trump, to which Cohen responded "Yes" and affirmed his employer was "Donald J. Trump."