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 attorney says sons made no misrepresentations
An attorney for Donald Trump's adult sons, Eric Trump and Donald Trump Jr., added a brief opening statement of his own, defending his clients from accusations of wrongdoing.
"There was never a material misrepresentation made by Eric Trump or Donald Trump Jr.," said Clifford Robert, the attorney for Trump's adult sons, who help run the Trump Organization.
Robert said he disagrees "with just about everything" the state's prosecutor said in his opening remarks, and took aim at the state's star witness.
"Their major linchpin is Michael Cohen, a guy who lies to everyone," Robert said of the former Trump attorney.
AG's case sets 'dangerous precedent,' defense says
Attorney General Letitia James "is setting a very dangerous precedent for any business in the state of New York," warned Trump attorney Alina Habba in her opening statement.
Habba told the court she hadn't planned to make opening remarks, but that she felt moved to speak after hearing the state present its own opening statement. Habba accused the attorney general of targeting Trump before taking office, claiming the investigation and lawsuit were personal in nature.
"We are attacking a sitting president and two of his children and his employees for a statement of financial condition which is frankly worth less than what they are worth," Habba said.
Habba reiterated many of the points made earlier by co-counsel Christopher Kise, highlighting the fact that "these lenders made money," and arguing that "real estate is malleable -- the values change."
After Habba concluded her remarks, Judge Engeron engaged her in a series of follow-up questions, asking about her claim that the property appraisals at issue were "undervalued" by prosecutors.
Habba replied that "the Trump brand is worth something."
'The attorney general has no case,' defense counsel says
Former President Trump's defense counsel will present a "very different picture of the evidence" than the prosecution alleges, and will demonstrate that "there are many ways to value assets," according to opening remarks from Christopher Kise, Trump's lead attorney.
"We think the evidence is going to establish … President Trump has made billions of dollars building one of the most successful real estate empires in the world," Kise said, reiterating sentiments he conveyed in pretrial motions.
Kise offered a glimpse into the former president's defense, including plans to present testimony from a New York University professor who will explain that "there is no one generally accepted procedure to determine the estimated current value" of a property.
Other defense witnesses, including four Deutsche Bank officers who were involved in approving Trump's loans, will explain how they were able to craft their own independent risk analyses meant to mitigate the claims of fraud that are core to the state's case.
"Anyone committing fraud does not tell the other side, 'Please do your own analysis,'" Kise said regarding Trump's instructions to lenders.
Kise also previewed plans to undermine the state's key witness, former Trump attorney Michael Cohen, who Kise said has "lied to everyone and anyone he has come in contact with."
Kise reiterated the defense's claim that Trump did not commit fraud and that there were no victims of his alleged conduct.
"The attorney general has no case," Kise said.
Defendants were 'lying year after year,' prosecutors say
Prosecutors intend to prove in the coming months that "each defendant engaged in repeated, persistent, illegal acts in conduct of business," according to the opening statement from Kevin Wallace of the attorney general's office.
Referring to Judge Engoron's partial summary judgment last week, Wallace said that "the people have already proven" that former President Trump used "false, misleading" statements that were "repeatedly [and] persistently used in the conduct of business."
But prosecutors will further demonstrate that Trump and his co-defendants knew those statements were false and continued to peddle them anyway in furtherance of their alleged scheme, Wallace told the judge.
"The defendants were lying year after year," he said.
Wallace played clips of video depositions to punctuate his remarks, including testimony from Trump himself, as well as Eric Trump and former Trump attorney Michael Cohen -- whose congressional testimony years ago precipitated the state's investigation and some of the key allegations underpinning their case.
"The goal was to use each of [Trump's] assets and increase its value in order to get to the end result number," Cohen said during his taped deposition. "It was essentially backing in numbers to each of the asset classes in order to attain the number that President Trump wanted."
Trump and his co-defendants "knew that a high net worth was necessary to get and maintain certain financial benefits," Wallace said, pointing to basic principles of accounting and finance.
Throughout Wallace's remarks, the attorney general's office flashed graphics on television screens inside the courtroom showing some of the alleged inflated values of Trump's properties alongside the amounts the properties were appraised at.
Seated in his chair with his arms crossed, Trump visibly shook his head at times during the prosecutor's opening statement. At one point he seemed to mutter something under his breath.
The former president whispered with his attorneys throughout.
Michael Cohen to return to witness stand
Former Trump attorney Michael Cohen is set to face a grueling day of cross examination, as defense lawyers attempt to discredit him after his potentially damaging testimony yesterday.
Calm and confident when answering questions from a state lawyer, Cohen dealt a blow to his former boss early in his testimony yesterday when he said he "reverse engineered" Trump's financial statements to "achieve the number" Trump wanted, inflating the values of assets such as Trump Park Avenue, Trump World Tower, and the Miss Universe Pageant to achieve Trump's desired figure -- though his testimony was notably devoid of notes, communications, or draft financials to support his claims.
Trump's lawyer Alina Habba hammered at Cohen's inconsistencies during the first hour of cross-examination, confronting Cohen with his past guilty pleas and history of false testimony. A disbarred lawyer, Cohen's answers grew combative at times, often responding to questions with "objection" or "asked and answered."
Trump said in a Truth Social post this morning that he plans to attend court for a second day in a row. In a social media post overnight, he described Cohen's testimony yesterday as a "complete and total disaster."
New York Attorney General Letitia James offered a contrasting opinion of Cohen's testimony in a video statement posted to social media.
"Donald Trump lives in a fantasy land. He directed those around him to lie and scheme to make his fantasy a reality," James said.