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.


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


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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 wants to appeal gag order in his civil trial, again

Donald Trump’s lawyers are seeking to appeal last week’s decision reinstating the gag orders in the former president’s civil fraud trial.

New York’s Appellate Division First Department vacated a temporary stay of the gag orders last week, and Trump’s lawyers are now seeking expedited leave to appeal the decision to New York’s Court of Appeals – the highest court in the New York State system.

Trump’s lawyers requested their application be reviewed by Judge David Friedman, who initially lifted the gag order on Nov. 16 before his decision was vacated by a panel of judges.

“Without expedited review, Petitioners will continue to suffer irreparable injury daily, as they are silenced on matters implicating the appearance of bias and impropriety on the bench during a trial of immense stakes,” Trump’s lawyers wrote in a new filing Monday morning.

In an emergency application for leave to appeal, Trump’s lawyers argued the gag orders “silence the core political speech of the leading Presidential candidate … at the height of President Trump’s campaign.”

Repeating past arguments against the gag order, Trump’s lawyers said the gag orders prohibit necessary speech to highlight the actions of Judge Arthur Engoron’s clerk, which they argue amount to “demonstrable partisan bias on the bench.”

“At stake is a civil defendant’s ability to critique, without fear of reprisal, the court presiding over a bench trial historic both by virtue of the parties thereto and the Attorney General’s novel and open manipulation of the Executive Law to punish her political enemies,” Trump’s lawyers wrote.


Expert testimony leads off last full week of defense's case

Donald Trump's lawyers are scheduled to call three expert witnesses to begin the last full week of their case.

Defense lawyers first plan to call real estate valuation authority Frederick Chin, whose expert report, filed with the court, faults the New York attorney general for taking a "narrow and limited view" of the value of Trump's assets in her complaint against the former president.

Like other defense experts, Chin argues in his report that Trump fairly valued his assets and properly disclosed his valuation approach to his lenders.

After Chin testifies, Trump's lawyers plan to call two experts to testify about Trump's valuation of his Mar-a-Lago property, which has been the subject of bitter debate since the start of the trial. Judge Arthur Engoron, in his pretrial partial summary judgment, already decided that Trump overvalued the property by at least 2,300%, and the defense experts -- Lawrence Moens and John Shubin -- are expected to challenge the judge's findings.

Defense attorneys intend to complete their questioning of the three expert witnesses by Wednesday, when Eric Trump is expected to return to the witness stand.


Trump financials cite phone calls that witness says didn't occur

Doug Larson's name appears across five years of Donald Trump's financial documents, according to records entered into evidence.

A longtime professional appraiser with the real estate firm Cushman & Wakefield, Larson was cited in Trump Organization documents as an expert at valuing properties like 40 Wall Street, Trump Tower, and an adjoining retail space called "Niketown." Spreadsheets entered as evidence explicitly reference multiple phone calls with Larson between 2013 and 2017.

When asked about these phone calls in court, Larson testified that no such conversations occurred.

"Is it fair to say that Mr. Trump valued Trump Tower at $526 million in conjunction with you?" state attorney Mark Ladov asked Larson.

"No, that is incorrect," Larson said.

"Were you aware that Mr. McConney was citing you as a valuation source in his work papers?" Ladov asked.

"No, I was not," replied Larson, who said he did not assist Trump Organization executives in valuing Trump Tower, Niketown, or 40 Wall Street, despite Trump's paperwork referencing him as a source.

Evidence presented by the state instead suggested that the valuations were determined using cherry-picked metrics from a generic email Larson sent clients.

"It's a way to get your name out to clients for potential work," Larson said about one such "email blast" that was used in a Trump Tower valuation.

Larson added that the valuations Trump Organization executives determined based on "consultation" with him used flawed methodologies, such as using capitalization rates related to office buildings to appraise the retail Niketown building.

"It doesn't make sense," Larson said about Niketown's $287 million valuation.

"It's inappropriate and inaccurate," Larson said about the Trump Organization relying on his name to support their valuations. "I should have been told, and appraisals should have been ordered."