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
Defense plans to request a halt to the proceedings
Donald Trump's legal team plans to request a stay of the ongoing fraud trial, pending their appeal of Judge Engoron's partial summary judgment ruling issued last week, defense lawyer Chris Kise notified Engoron in court.
In seeking to halt the trial, the defense team said they plan to file their request tomorrow morning and wanted to provide notice to the state.
State attorneys objected that less than 24 hours' notice is not enough.
"That's clearly not sufficient," Engoron said of the notice, adding that the appellate court could deny the request due to the lack of proper notice.
Note on financial document suggests Trump had final say
A marked-up version of the Trump Organization's 2014 statement of financial condition suggests that Trump himself issued final approval for the statements, according to the document, which was entered into evidence today.
The document included a handwritten note from longtime Trump Organization Controller Jeffrey McConney saying "DJT TO GET FINAL REVIEW."
The document also included a list showing the 2013 value of Trump's properties, which McConney had crossed out to adjust to the 2014 values.
Testifying on the stand, McConney -- who joined the Trump Organization in 1987 and was responsible for Trump's financial statements between 2011 and 2017 -- testified that he worked in conjunction with accounting firm Mazars USA and Trump Organization chief financial officer Allen Weisselberg to issue the statements.
While McConney acknowledged that he wrote the note on the document, he could not provide specifics about the extent of Trump's involvement.
Judge outlines next steps for dissolving Trump's companies
As the questioning of witnesses continues, Judge Engoron has issued an order outlining the next steps to dissolve Trump's companies in New York.
Engoron last week found that Trump and his adult sons used fraudulent documents to conduct business, and ordered the cancellation of his business certificates in the state. Trump appealed that ruling yesterday.
In today's order, Engoron asks the defendants to provide a list of "entities controlled or beneficially owned by Donald J. Trump" -- and the other co-defendants -- to the Hon. Barbara S. Jones, the independent monitor overseeing Trump's business activities.
Trump is also required to notify Jones of any new business applications or changes to preexisting entities.
The order also gives the parties 30 days to recommend a receiver to oversee the dissolution of Trump's corporate assets. However both parties previously suggested that they plan to recommend Jones for that position.
In the meantime, the ongoing trial is being held to determine what additional penalties Trump might face and what might happen with the multiple causes of action included in the attorney general's lawsuit.
Trump firm didn't prepare financial statements, controller says
Longtime Trump Organization controller Jeffrey McConney, a defendant in the case, has taken the stand.
McConney testified that he was responsible for Trump's statement of financial condition from 2011 until 2017, when the responsibility was passed on to another employee.
But McConney was quick to differentiate his role from that of the organization's accounting firm, Mazar's USA.
"We as the Trump Organization didn't prepare the statement," McConney said.
Unlike most witnesses who generally aren't allowed to hear other witnesses testify, McConney -- as a defendant in the case -- is entitled to be in the courtroom for the entire trial. However, today is the first time he has appeared.
Judge fines Trump $354 million
Former President Donald Trump must pay $354 million for fraudulent business practices, Judge Arthur Engoron has ruled.
Trump's sons Donald Trump Jr. and Eric Trump have been fined $4 million apiece, and former Trump Organization CFO Allen Weisselberg has been fined $1 million.
The decision bars Trump barred from serving as an officer of a New York company for three years, and bars his sons for two years apiece.
Regarding the dissolution of Trump's companies, the decision says, "This Court hereby modifies its September 26, 2023, Decision and Order solely to the extent of removing the language ordering the LLCs cancellation en masse. The restructuring and potential dissolution of any LLCs shall be subject to individual review by the Court appointed Independent Director of Compliance in consultation with Judge Jones."
In his decision, Engoron wrote that "Defendants' refusal to admit error -- indeed, to continue it, according to the Independent Monitor -- constrains this Court to conclude that they will engage in it going forward unless judicially restrained."
"Overall, Donald Trump rarely responded to the questions asked, and he frequently interjected long, irrelevant speeches on issues far beyond the scope of the trial," the judge wrote. "His refusal to answer the questions directly, or in some cases, at all, severely compromised his credibility."
"The accountants created these 'compilations' based on data submitted by the Trump entities," the decision said. "In order to borrow more and at lower rates, defendants submitted blatantly false financial data to the accountants, resulting in fraudulent financial statements. When confronted at trial with the statements, defendants' fact and expert witnesses simply denied reality, and defendants failed to accept responsibility or to impose internal controls to prevent future recurrences."
Of Donald Trump Jr., Engoron wrote, "Despite disclaiming responsibility for or knowledge of the Statements of Financial Conditions' contents, Trump, Jr. still insisted that the Statements of Financial Condition were 'materially accurate.'"
Engoron's decision follows an 11-week civil trial in New York, where Trump and three of his adult children testified.
New York Attorney General Letitia James sued Trump, his two adult sons, and Trump Organization executives in September 2022 for issuing fraudulent financial statements -- including over 200 false and misleading asset values between 2011 and 2021 -- to get better loan terms and business deals.