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.
Top headlines:
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
Court denies Trump’s effort to expedite gag order appeal
Former President Donald Trump’s request for an expedited grant of leave to appeal the gag orders in his civil fraud trial was denied Monday afternoon.
The gag order is now likely to still be in effect on Monday when Trump takes the witness stand in his own defense.
Trump’s lawyers requested that Judge David Friedman, who initially lifted the gag order, permit them to appeal the final decision that reinstated the gag order to New York’s Court of Appeals.
“You had a decision by a panel of judges. A single judge cannot undo a panel’s decision,” Lauren Holmes, a court attorney, said during a scheduling meeting Monday afternoon at the Appellate Division First Department.
Dennis Fan, a lawyer for the New York Attorney General, also declined to consent to expediting the briefing schedule.
“You just want to let this drag out until the end of the trial,” Trump attorney Christopher Kise said. “That’s what they are doing.”
Trump still has an avenue to appeal the decision to a higher court; however, the effort will take longer than his lawyers would like. Trump’s lawyers now face a deadline of Monday, Dec. 11 to file their papers to the First Department.
Developers have more latitude when valuing properties, expert says
Frederick Chin, a real estate valuation expert, testified that developers often have more latitude to value their properties compared to appraisers.
According to Chin, developers consider the enterprise value of their assets, meaning how different properties managed by the same company – such as Four Seasons or Ritz-Carlton hotels – increase in value as part of a collection of assets.
“The whole is worth more than the sum of its parts,” Judge Arthur Engoron said to summarize Chin’s testimony.
Chin added that developers also consider the long-term plan for how their assets might be impacted by outside circumstances, like the 2008 recession or the COVID-19 pandemic.
“Everyone in this room has a different perspective on what the next day and the future holds,” Chin said, comparing valuing assets to looking into a “crystal ball.”
Trump likely to attend trial Thursday, say sources
Former President Donald Trump will likely attend his civil fraud trial on Thursday, according to sources familiar with the matter. He is not expected to be in attendance on Wednesday when his son Eric testifies.
Trump last attended the trial on Nov. 6 when he testified as the last state witness. In total, the former president has attended the trial for eight of the 39 days the court has been in session.
Trump is scheduled to testify on Monday, Dec. 11, as the last witness in the case.
'Genius factor' can boost property value by billions, expert says
A defense expert in real estate valuation suggested that a developer's vision could add over a billion dollars of value to a vacant lot.
Frederick Chin, who was qualified as an expert in real estate valuation, argued that Donald Trump used the "as if" investment value of his properties, rather than their current "as is" market value. According to Chin, the "as if" valuation perspective allows a real estate developer to consider the long-term development plans of a property when determining its value.
For example, a vacant lot in the heart of New York City might have a market value of $500 million, according to Chin. A real estate developer who envisions a hotel on the property might see its investment value closer to $2 billion.
Judge Arthur Engoron, who frequently interjected into Chin's testimony, described the approach that resulted in a $1.5 billion difference in the value of a hypothetical vacant lot as a developer's "genius factor."
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.