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.


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


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Cohen details how he says he inflated Trump's statements

According to Michael Cohen, the process of "reverse engineering" Donald Trump's 2011 financial statement began with a phone call.

"Mr. Trump would like to see you," Trump's executive assistant told Cohen, according to his testimony today.

Cohen testified that he then personally met with Trump and former Trump Organization CFO Allen Weisselberg to begin the process of inflating Trump's financial statement.

"I am actually not worth 4.5 billion. I am really worth six," Trump directed him and Weisselberg, according to Cohen.

Following that meeting, he and Weisselberg engaged in a multi-day process of marking up Trump's financial statement with red ink to eventually increase Trump's total net worth to Trump's "desired number," Cohen said.

Apart from the marked-up document, which Cohen said was scanned, he left behind no contemporaneous notes, text messages, or emails about the process.

"What is the highest price per square foot achieved in the city," Cohen described about the process to determine comparable properties to value Trump assets. "We would use those numbers to inflate these numbers."


'He is not a credible witness,' Trump says of Cohen

Minutes after Michael Cohen alleged he was tasked with reverse engineering Trump Organization financial statements, Donald Trump continued his attacks on his former lawyer while exiting the courtroom during a break in the trial.

"His record is a horrible one. All you have to do is ask the Southern District of New York," Trump said in reference to Cohen's 2018 guilty plea on charges related to his role in making hush payments to two woman who claimed to have long-denied affairs with Trump.

"He is not a credible witness," Trump said.

During Cohen's testimony, Trump also took to social media to post flattering quotes Cohen gave to news outlets about Trump in 2011 and 2016.

"He's more like a patriarch, a mentor. These qualities make him very endearing to me, which is why I am so fiercely loyal to him and committed to protecting him at all costs," Cohen told the New York Times in 2016 -- which was posted by Trump on Truth Social minutes after Cohen began his testimony.

The former president told reporters he wasn't concerned about Cohen being on the stand.

"We're not worried at all about his testimony," Trump said.

Cohen, exiting court separately during the break, quipped that seeing Trump again after five years was a "heck of a reunion."


Cohen says he was tasked to 'reverse engineer' asset values

Michael Cohen, under questioning from state attorneys, testified it was his job to help Trump look as rich as he wanted to.

"I was tasked by Mr. Trump to increase the total assets based upon a number that he arbitrarily elected, and my responsibility -- along with Allen Weisselberg -- predominantly was to reverse engineer the various different asset classes, increase those assets in order to achieve the number that Mr. Trump had tasked us with," Cohen said, referring to former Trump Organization CFO Allen Weisselberg.

Cohen joined the Trump Organization in 2007 as executive vice president and special counsel to Trump, putting him "directly under Mr. Trump" in the corporate hierarchy, Cohen said.

"I reported and only handled work for Mr. Trump and so I was his special counsel. Whatever issues he had, whatever created ire for him, he would bring it to me to resolve," Cohen said.

"So the only person who asked you to perform work was Donald J. Trump?" state attorney Colleen Faherty asked.

"Correct," Cohen responded.

Cohen affirmed his involvement in preparing Trump's statements of financial condition and told the judge those documents were "shared with third parties," including insurance brokers.


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."


Cohen testifies how Trump's inflated statements were used

Donald Trump used his inflated financial statements to convince journalists about his net worth, to lower his insurance premiums, and even to support his bid to purchase the Buffalo Bills football team, according to Michael Cohen.

Cohen described how the Trump Organization would grant external parties only limited access to the documents themselves, often presenting them during video calls -- rather than handing out the document for external parties to keep -- in the process of demonstrating Trump's net worth.

For example, Cohen described using the documents in a meeting with a journalist from real estate news site "The Real Deal" to "create the story about how much Trump was actually worth," Cohen said.

According to Cohen, Trump Organization executives used Trump's financial statements in meetings with insurance companies to obtain lower premiums, and Trump would occasionally attend these meetings to help move the process along.

"About three quarters of the way through the meeting, Mr. Trump would then come in, and there would be an extended conversion about his net worth, and that he was richer than the insurance companies," Cohen testified, adding that Trump's drop-in to the meeting was pre-planned.

Trump's financial statement also proved vital when Trump attempted to get a line of credit for a 2014 bid to purchase the Buffalo Bills, according to Cohen.

"We can all agree that Mr. Trump never owned the Buffalo Bills," Judge Engoron remarked.