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
McConney suggested that Eric Trump review 2021 statement
Former Trump Organization controller Jeff McConney, on cross-examination, testified that he thought Eric Trump should review his father's statement of financial condition in 2021.
"You thought Eric Trump should review the statement of financial condition?" state attorney Andrew Amer asked after showing McConney his notes indicating "Eric should review SOFC."
"That was my thought," McConney said.
When Eric Trump testified, he described the statements as the responsibility of the Trump Organization's accountants.
"I never had anything to do with the statement of financial condition," Eric Trump testified, before partially walking back his statement to say, regarding notes that McConney requested from him, "I don't think that it ever registered it was for a personal statement of financial condition."
McConney says overvaluation of Trump’s penthouse was incorrect
Former Trump Organization controller Jeff McConney, testifying for the defense, said that he overvalued Donald Trump's penthouse apartment by over $100 million because he relied on an incorrect email.
Judge Arthur Engoron determined in his partial summary judgment that the penthouse was overvalued by as much as $200 million because it was falsely listed as being three times larger than its actual size.
To get to that value, McConney said relied on a Trump Organization broker who falsely represented the apartment was 30,000 square feet.
"I would rely on him. I figured he knew the property a lot better than I did," said McConney, who added that he never spent considerable time in the apartment.
The Trump Organization lowered the value of the penthouse by more than $200 million in 2017 after a Forbes magazine article exposed the error.
McConney's testimony came before he broke down on the stand at the end of his direct examination.
'I don't remember,' McConney says about Mar-a-Lago valuation
Earlier in his testimony, before breaking down on the witness stand, longtime Trump Organization controller Jeff McConney drew a blank when asked why Trump's Mar-a-Lago property was valued in Trump's statements of financial condition as a private residence rather than a social club -- a central allegation levied by the New York attorney general.
The property was valued in excess of $500 million on the basis that it could be sold as a private residence -- despite Trump signing a deed in 2002 with the National Trust for Historic Preservation that exclusively limited the property to being used as a club. The Palm Beach County Assessor subsequently appraised the market value of the club at less than $28 million, significantly lowering Trump's tax burden.
"I don't remember off the top of my head," how the property ended up being valued on Trump's financial statements as a residence, McConney said, confirming that was the case.
He testified that he could not remember having a specific conversation with outside accounting firm Mazars USA about the approach to valuing Mar-a-Lago.
While McConney could not recall why the decision to value the property as a private residence was made, he said that he used a reasonable approach to determining a price-per-acre based on nearby property sales. He said that their comparable property approach resulted in a $50 million decrease in value between 2014 and 2015.
"Our intention was always to reflect as best we could the value of these properties," McConney said.
Ex-controller, frustrated with probes, breaks down on stand
Former Trump Organization comptroller Jeff McConney broke down on the witness stand during his testimony for the defense, saying that it's "just really frustrating" to have his decades of accounting work called into question by investigators.
McConney said he felt proud of his years at the Trump Organization and testified that he "felt comfortable" with his contributions to Trump's statements of financial condition that are at the center of the case.
"I feel proud of what I did. Numbers don't represent fully what these assets are worth," McConney said.
He threw up his hands and choked up after defense attorney Jesus Suarez asked him why he no longer worked at the Trump Organization. McConney ticked off the list of subpoenas, depositions and investigations he has been part of, and said "I just couldn't do it anymore."
McConney described working at the Trump Organization as being like working with family, and said he "got to do a lot of things that a normal accountant wouldn't be able to do," like takes trips to Atlantic City, attend coworkers' weddings and work on "The Apprentice."
"I just wanted to relax and stop being accused of misrepresenting assets of the company I've been working for," McConney said. "To be hit with a negative comment every time is just really frustrating."
McConney briefly held his head down, wiped his eyes and quietly sobbed. "I'm sorry," he said.
"Mr. McConney, you OK or you need a couple of minutes?" Judge Arthur Engoron asked.
McConney declined to take a break.
Trump calls case a 'scam,' says he might testify
Exiting court during the break, Trump told reporters positioned nearby that the financial statements being reviewed in court included disclaimers, which his legal team has argued absolves him of wrongdoing.
"This case is a scam," Trump said during his walk back to court.
When asked if he would consider testifying, Trump said he might.