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
Trump Organization monitor flags financial misstatements
A report issued Friday by the former judge appointed to serve as the Trump Organization's independent monitor by Judge Arthur Engoron found that the company has been cooperative, implemented some changes, and issued necessary corrections to financial statements; however, the report also outlined multiple errors and misstatements observed by the monitor over her 14 months in the role.
The report, by independent monitor Barbara Jones, was issued at the request of Judge Engoron ahead of his expected ruling in Trump's civil fraud trial.
"It is important to note that the Trump Organization acknowledged the disclosure issues described after I brought them to its attention and has been open to recommendations to improve accuracy and transparency," Jones wrote in her report.
However, Jones wrote, "Absent steps to address the items above, my observations suggest misstatements and errors may continue to occur, which could result in incorrect or inaccurate reporting of financial information to third parties."
Trump lawyer calls NY AG's 'Pharma Bro' comparison 'irresponsible'
A day after New York Attorney General Letitia James cited a ruling involving "Pharma Bro" Martin Shkreli to support a lifetime real estate ban for Donald Trump, a defense lawyer responded in a letter to the court calling the comparison "misplaced and irresponsible."
The New York AG said Tuesday that a federal appeals court decision upholding a lifetime industry ban for Shkreli should convince Judge Arthur Engoron to impose a lifetime real estate ban on Trump.
Defense attorney Clifford Robert, in response, wrote Wednesday that "the absurdity of the Attorney General's latest effort would be almost comical but for the sobering future consequences of her shameless abuse of power."
Robert argued that Trump's fraud case lacks witnesses, complaints, and victims compared to Shkreli's case.
In a statement to ABC News, Trump attorney Chris Kise said the ruling in Trump's case could have far-reaching implications for the New York business community.
"This is not just about President Trump. Every major bank CEO and every Wall Street participant should speak out now before the Attorney General's shocking and tyrannical interference in the capital markets places all New York business transactions at risk," Kise said.
NY AG cites 'Pharma Bro' ruling in seeking lifetime ban for Trump
The New York attorney general's office says a federal appeals court decision upholding a lifetime industry ban for disgraced "Pharma Bro" Martin Shkreli should convince Judge Arthur Engoron to impose a lifetime real estate ban on Donald Trump.
In a letter to Judge Engoron, state attorney Colleen Faherty cited Tuesday's decision in the Shkreli case to justify the NY AG's request to ban the former president from the New York real estate industry for life.
According to Faherty, New York State Executive Law 63(12) -- which was used in the NY AG's lawsuits against both Trump and Shkreli -- gives the court the ability to "issue a permanent and plenary ban in a particular industry."
"63(12) is the Swiss Army knife of the AG's Office," said Tristan Snell, a former lawyer with the New York attorney General's office who used the law to sue Trump over the now-defunct real estate seminar called Trump University. "If you don't have laws like this in place, that you basically allow lies and misrepresentations to be endemic."
A final decision in Trump's civil fraud case is expected later this month.
James releases video of Trump's April 2023 deposition
New York Attorney General Letitia James on Friday released video of former President Trump's April 2023 deposition in the case.
Video of the deposition, the transcript of which was released by the attorney general in August 2023, was released as part of a public records request.
As ABC News reported in August, Trump in the deposition called his real estate portfolio "the Mona Lisa of properties" and suggested his assets were worth far more than what appeared in his statements of financial condition that are at the center of the New York AG's case.
The videotaped deposition proved to be a preview of Trump's testimony at trial earlier this month, in which he bragged about his finances and declared himself "an innocent man."
Insurance underwriter to testify
An underwriter who worked on a Trump Organization insurance policy to cover legal expenses incurred by the firm's executives is scheduled to testify this morning.
Michael Holl, an underwriter at Tokio Marine HCC, worked on the Trump Organization's Directors and Officers insurance policy in 2016 and 2017, according to the New York attorney general.
With Donald Trump about to be inaugurated president at the time, the Trump Organization attempted to increase their policy's limit to $50,000,000, which was ten times higher than their previous limit, according to the attorney general.
"In response to specific questioning from the underwriters, the Trump Organization personnel represented that there was no material litigation or inquiry from anyone that could potentially lead to a claim under the D&O coverage," the state alleged in their complaint.
However, four months before that representation was made, Trump Organization executives learned about an ongoing investigation by the attorney general into the Trump Foundation as well as Trump family members, according to the complaint.