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
State to question defense expert on potential fine
State attorney Kevin Wallace is expected to complete his cross-examination of the defense's expert witness Robert Unell, who yesterday provided the most direct challenge to the state's analysis that found that Donald Trump's misstatements cost his lenders $168 million in lost interest.
New York Attorney General Letitia James is expected to use that lost interest analysis to justify part of the fine she wants to levy against Trump -- also known as a disgorgement -- for his allegedly ill-gotten gains.
Unell testified yesterday that he found the lost-interest analysis conducted by the state's expert Michiel McCarty was inaccurate based on real-world market conditions, including the interest rates used by commercial real estate lenders who are "living and breathing these deals daily."
"I have not seen anything to indicate that was an accurate interest rate," Unell said about the interest rates in the state's analysis.
Judge Arthur Engoron twice interjected during Unell's testimony to suggest that Trump still cost his lenders money, referring back to his partial summary judgment in which he said, "The less collateral for a loan, the riskier it is, and a first principal of loan accounting is that as risk rises, so do interest rates."
Trump attorney calls NY AG's case 'fraud with no victims'
Following the adjournment of court for the day, Trump attorney Chris Kise criticized the attorney general's case on the basis of testimony from the Deutsche Bank executives who said they were eager to do business with Trump regardless of the contents of his financial statements.
Echoing past comments, Kise described the case as a "fraud with no victims" in comments to ABC News.
Kise also slammed today's appellate court ruling reinstating Judge Engoron's limited gag orders as a "total breakdown of the rule of law."
"Now you have the front-running presidential candidate who can't even comment about why he thinks he's not getting a fair trial," Kise said about the impact of the ruling.
"I'm not sure how much more absurd it can get for President Trump," he said.
Expert disputes allegation that Trump cost lenders $168M
Robert Unell, an expert in commercial real estate, disputed the analysis conducted by the state's expert, Michiel McCarty, who testified that Trump's alleged deceptions cost his lenders $168 million in lost interest.
"It is really, in my opinion, a very narrow-minded support," Unell, testifying for the defense, said about the assumptions McCarty made regarding the interest rate of the loans.
Unell said that Trump's lenders made money, faced less risk in their investments over time, and sought additional business from the former president and his family. He also criticized the allegation that Trump risked defaulting on any of his loans by offering himself as a personal guarantor of the loans.
"It means the bank got what they wanted ... they had a warm body who was going to stand behind the loan and provide credit support," Unell said about Trump's personal support of the loans.
Judge Engoron interjected at multiple points to question Unell about his findings, at one point noting that the loans would have been pricier for Trump if lenders faced more risk stemming from Trump inflating his assets.
"The more value in collateral, the less risk, the lower the interest rate," Engoron said.
NY court official says judge's wife hasn't posted about Trump
Over the last week, Donald Trump has made multiple posts on social media about a social media account he alleges belongs to Judge Arthur Engoron's wife, accusing her of sharing multiple posts critical of the former president, including doctored images depicting Trump in prison.
"Judge Engoron's Trump Hating wife," Trump called her Wednesday on Truth Social.
A court official on Thursday denied that any of the posts referenced by Trump were made by Engoron's wife.
"Justice Engoron's wife has sent no social media posts regarding the former president. They are not hers," court spokesperson Al Baker wrote in a statement.
Trump, ignoring judge's warning, tells court he's an 'innocent man'
Before Judge Arthur Engoron could even get Trump to agree to the terms the judge had laid down for the delivery of Trump's closing statement, the former president launched into a five-minute address while seated at the defense table.
It began when defense attorney Christopher Kise asked the judge to reconsider his decision and allow Trump to speak, and Engoron asked Trump if he would stay within the bounds of his closing argument.
Trump pressed immediately on.
"Well I think, your honor, this case goes outside the facts," Trump said. "The financial statements were perfect. The banks got all their money back. They were as happy as can be."
Ignoring the judge's prohibition regarding delving into politics, Trump said, "This is a political witch hunt that should be set aside. We should receive damages for what we've gone through."
He also attacked New York Attorney General Letitia James.
"I'm an innocent man. I've been persecuted by someone running for office," Trump said. "This statute is vicious. It doesn't give me a jury. It takes away my rights."
He said the tripling of the square footage of his Trump Tower penthouse on his statement of financial condition was a mistake -- "an honest mistake" that was corrected.
Trump declared, "This is a fraud on me. What's happened here, sir, is a fraud on me."