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
'Genius factor' can boost property value by billions, expert says
A defense expert in real estate valuation suggested that a developer's vision could add over a billion dollars of value to a vacant lot.
Frederick Chin, who was qualified as an expert in real estate valuation, argued that Donald Trump used the "as if" investment value of his properties, rather than their current "as is" market value. According to Chin, the "as if" valuation perspective allows a real estate developer to consider the long-term development plans of a property when determining its value.
For example, a vacant lot in the heart of New York City might have a market value of $500 million, according to Chin. A real estate developer who envisions a hotel on the property might see its investment value closer to $2 billion.
Judge Arthur Engoron, who frequently interjected into Chin's testimony, described the approach that resulted in a $1.5 billion difference in the value of a hypothetical vacant lot as a developer's "genius factor."
Trump wants to appeal gag order in his civil trial, again
Donald Trump’s lawyers are seeking to appeal last week’s decision reinstating the gag orders in the former president’s civil fraud trial.
New York’s Appellate Division First Department vacated a temporary stay of the gag orders last week, and Trump’s lawyers are now seeking expedited leave to appeal the decision to New York’s Court of Appeals – the highest court in the New York State system.
Trump’s lawyers requested their application be reviewed by Judge David Friedman, who initially lifted the gag order on Nov. 16 before his decision was vacated by a panel of judges.
“Without expedited review, Petitioners will continue to suffer irreparable injury daily, as they are silenced on matters implicating the appearance of bias and impropriety on the bench during a trial of immense stakes,” Trump’s lawyers wrote in a new filing Monday morning.
In an emergency application for leave to appeal, Trump’s lawyers argued the gag orders “silence the core political speech of the leading Presidential candidate … at the height of President Trump’s campaign.”
Repeating past arguments against the gag order, Trump’s lawyers said the gag orders prohibit necessary speech to highlight the actions of Judge Arthur Engoron’s clerk, which they argue amount to “demonstrable partisan bias on the bench.”
“At stake is a civil defendant’s ability to critique, without fear of reprisal, the court presiding over a bench trial historic both by virtue of the parties thereto and the Attorney General’s novel and open manipulation of the Executive Law to punish her political enemies,” Trump’s lawyers wrote.
Expert testimony leads off last full week of defense's case
Donald Trump's lawyers are scheduled to call three expert witnesses to begin the last full week of their case.
Defense lawyers first plan to call real estate valuation authority Frederick Chin, whose expert report, filed with the court, faults the New York attorney general for taking a "narrow and limited view" of the value of Trump's assets in her complaint against the former president.
Like other defense experts, Chin argues in his report that Trump fairly valued his assets and properly disclosed his valuation approach to his lenders.
After Chin testifies, Trump's lawyers plan to call two experts to testify about Trump's valuation of his Mar-a-Lago property, which has been the subject of bitter debate since the start of the trial. Judge Arthur Engoron, in his pretrial partial summary judgment, already decided that Trump overvalued the property by at least 2,300%, and the defense experts -- Lawrence Moens and John Shubin -- are expected to challenge the judge's findings.
Defense attorneys intend to complete their questioning of the three expert witnesses by Wednesday, when Eric Trump is expected to return to the witness stand.
Judge again denies request to subpoena independent monitor
Judge Engoron again denied a request from the defense to subpoena the Trump Organization's independent monitor for testimony.
Twice this week, Trump's attorneys unsuccessfully sought to call to the stand former judge Barbara Jones, the monitor appointed by Engoron to oversee the Trump Organization's finances after the New York attorney general accused the firm of fraud.
Trump attorney Chris Kise tried for a third time Friday.
"We should be entitled to the benefit of having Judge Jones here to respond to those questions about any ambiguities that might exist in her reports," Kise said.
State attorney Andrew Amer argued against the request, citing Jones' immunity as an agent of the court.
"Your request to subpoena Judge Jones is denied," Engoron said, describing the request as a "dangerous infringement on court immunity."
In her latest report issued to Engoron this week, Jones reported that the Trump Organization was "in compliance" but under "enhanced monitoring."
Court was subsequently adjourned for the day following Engoron's ruling.
Ex-accountant says statements were 'Trump Org's responsibility'
Prosecutors have called their first witness to the stand: Donald Bender, a former accountant at Mazars USA, the firm that for years handled Trump's taxes.
Bender testified at length about his involvement in compiling Trump's statements of financial condition between 2011 and 2020, which he described as "balance [sheets] of Mr. Trump's assets and liabilities."
Bender said the standards and inputs for the statements were largely decided by Trump Organization executives.
"That was the Trump Organization's responsibility," Bender said about the accounting standard used in the statements.
As Bender answered the state's questions, Trump was seen taking notes at the defense table.
Bender described spending roughly half his time on Trump's business and personal financial matters toward the end of his career at Mazars.
The firm severed its business relationship with Trump last year after learning of the attorney general's findings during the AG's probe.