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
Attorney general back in attendance
New York Attorney General Letitia James is attending the civil trial this morning.
After greeting the press in the courtroom's gallery, James returned to same front-row seat she used earlier in the trial.
James attended the first six days of the trial but had not been in the courtroom the last week.
Trump says he'll return to courtroom this morning
Donald Trump plans to attend his ongoing fraud trial in downtown Manhattan this morning, the former president said in a Truth Social post this morning.
Star witness Michael Cohen, Trump's former lawyer and self-described "fixer," will be absent from the courtroom after a medical issue delayed his testimony.
Trump will instead hear testimony from his company's assistant controller, Donna Kidder.
State attorneys also plan to call real estate executives who appraised Trump properties, as well as real estate executive Jack Weisselberg, the son of former Trump Organization CFO Allen Weisselberg, who worked on a refinanced loan for Trump's 40 Wall Street property.
Trump was in attendance for the first three days of the trial when it began two weeks ago.
Trump Hotels chief accounting officer concludes testimony
State attorney Andrew Amer concluded his direct examination of Trump Hotels chief accounting officer Mark Hawthorn by applauding Hawthorn's skills and experience.
Amer highlighted that Hawthorn successfully conducted cash flow analysis, understood estimated current value, and applied the generally accepted accounting principles to his work.
Asked by Amer if he was ever asked to work on Trump's statement of financial condition -- a job that was handled by other executives like CFO Allen Weisselberg and controller Jeffrey McConney, who in earlier testimony acknowledged their lack of knowledge regarding foundational accounting principles -- Hawthorn replied that he was never approached about the task.
"I would be qualified to give it a try," said Hawthorn.
Hawthorn then stepped down from the witness stand to make way for Trump Organization assistant controller Donna Kidder to begin her testimony, after which court was adjourned for the day.
Kidder's testimony is scheduled to resume tomorrow morning, when former President Trump is expected to return to the courtroom.
Assets on statement were apparently overstated, exec says
Trump Hotels chief accounting officer Mark Hawthorn testified that in 2018 he inadvertently overstated the value of Trump's assets by relying on Trump's statement of financial condition.
When an outside accounting firm requested the amount of Trump's liquid assets, Hawthorn said he consulted the financial statement that listed "cash equivalents in excess of $290 million."
The New York attorney general alleges that Vornado Partnerships, a separate company with whom Trump has a limited partnership interest, owned 30% of the "cash and cash equivalents" Trump claimed in his 2018 statement.
In his testimony, Hawthorn said that information was not disclosed in the statement. He also said that he only was able to view the statement briefly in a 20-minute Google Meet session.
"It appears to have been overstated," Hawthorn said of the representation of Trump's assets on the statement.
Judge stops expert's testimony following state's objection
Donald Trump's lawyers abruptly stopped the testimony of their first expert witness -- who was expected to testify for a full day or two -- after Judge Engoron limited the topic areas of his testimony.
Steven Witkoff, a real estate investor and longtime friend of Trump's, was brought into court by the defense team to testify that Trump's Doral golf club was undervalued in Trump's financial statements.
But Judge Engoron sustained an objection from the state barring any testimony about the valuation of Doral, significantly limiting Witkoff's testimony and appearing to hamper the defense strategy proposed by Trump's attorney Chris Kise.
Kise argued that the inaccuracies in Trump's statement of financial condition can cut both ways: Even if some properties were overvalued, other properties like Doral were significantly undervalued and balanced out the statement, according to Kise.
"It is highly, extraordinarily relevant if there are assets that are undervalued substantially on those same statements," Kise said. "They can't look at this one-sided."
State attorney Andrew Amer fiercely rebutted that argument, telling Engoron he should not take the defense's position that the inconsistencies "come out in the wash."
That argument appeared to convince Engoron, who said that overvaluations would not "insulate" a false valuation. He promised to sustain any objection that related to the value of Doral -- an approach Kise described as "lunacy."
"The reader of the financial statement has the right to know whether each particular number was accurate," Engoron said. "They are looking for accuracy."