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
Defense's accounting expert to return to witness stand
The defense's accounting expert, Eli Bartov, is scheduled to return to the witness stand for a second day of testimony in Donald Trump's civil fraud trial.
During a full day of testimony yesterday, the New York University professor offered a full-throated endorsement of Trump's statements of financial condition that are at the heart of the attorney general's case, saying, "I've never seen a statement that provides so much detail and is so transparent as these statements."
Of discrepancies like Trump overvaluing his Trump Tower penthouse by $100 million in 2012, Bartov characterized it as a mistake and not fraud.
Trump, in attendance at the trial yesterday, told reporters, "He found absolutely no fraud, accounting fraud of any kind. This is a highly respected man. I don't know him, but he's an expert witness."
Trump is not expected to attend court today for Bartov's cross examination, when defense attorneys are expected to scrutinize his conclusions and his motives for testifying, including over $500,000 in compensation for his testimony.
Trump credits trial for boosting his poll numbers
Donald Trump, exiting court at the conclusion of Thursday's testimony, told reporters that New York Attorney General Letitia James' civil fraud case against him is a "disgrace."
"There was no problem with the loans. The bank was really happy, they testified. Everything was perfect, and it's a disgrace that this case goes forward," Trump said.
His legal spokesperson, Alina Habba, accused the attorney general's team of hypocrisy for criticizing defense expert Eli Bartov, who testified as a state witness after then-New York Attorney General Barbara Underwood sued Exxon Mobil in 2018 for allegedly defrauding investors. The suit, which James took over when she became New York attorney general in 2019, was unsuccessful.
"We just listened to testimony from a man who has such distinct recognition as an accounting expert that even Letitia James and the OAG team used him themselves as an accounting expert," Habba said. "Today when he was on the other side, they spent the entire day objecting, because he was giving testimony that didn't suit their claims."
Trump, meanwhile, boasted to reporters about "leading by about 40 points" in the Republican presidential primary, which he said was partially driven by the civil trial against him.
"It's driving up my polls because the people of our country get it," Trump said. "My poll numbers are the highest I've ever had."
Bartov is set to continue his testimony on Friday, with Trump scheduled to take the stand as the defense's final witness on Monday.
'There is no fraud here,' accounting expert testifies
If Donald Trump was a student in Eli Bartov's class, his statements of financial condition would earn him an "A," the New York University professor said on the stand.
"I've never seen a statement that provides so much detail and is so transparent as these statements," Bartov said, praising the "awesome amount of information" in the financial documents that are at the center of the New York attorney general's case against Trump.
"There is no fraud here," Bartov said flatly.
Despite his effusive praise for the statements, the professor attempted to underplay the significance of the documents, emphasizing that lenders would be expected to do their own valuations to decide about lending to Trump. Deutsche Bank's credit memos -- which regularly marked down Trump's asset values by as much as 50% -- proved that the banks used additional information to independently scrutinize Trump's financial statements, according to Bartov.
"It is impossible to argue -- it is really absurd to argue -- that Deutsche Bank or any bank or any lender would make lending decisions based on the SOFC," Bartov said of Trump's statement of financial condition. "This should close the book on this case."
"Everywhere you look, you see this is simply an absurd argument," Bartov said.
'Gotta lose some weight,' Trump says, examining sketch
During testimony, Donald Trump has been sitting at the defense counsel table with few items other than an unopened, Trump-branded water bottle and a stack of sticky notes.
But during breaks in testimony, he's taken a page from his son Donald Trump Jr., who chatted with court sketch artist Jane Rosenberg when he testified last month.
The former president has done the same, chatted up the court's sketch artists during two breaks in testimony.
Rosenberg said that when Trump surveyed her rendering of him, he offered a simple, "Nice."
Trump also examined a rendering by sketch artist Isabelle Brourman.
"Wow, amazing," Trump said, according to Brourman. "Gotta lose some weight."
Weisselberg concedes Trump's triplex is smaller than valuation
Former Trump Organization CFO Allen Weisselberg testified that Trump's triplex apartment in Trump Tower is 10,996 square feet -- which is a third the size that Trump claimed on financial documents.
In October 1994, Trump signed a document that certified his penthouse triplex is 10,996 square feet, but his statements of financial condition for several years beginning in 2012 listed the apartment as 30,000 square feet.
An attorney with the New York attorney general's office showed the page with Trump's signature to Weisselberg, who appeared to struggle to explain the discrepancy.
"It was always in my mind a de minimis asset on the statement of financial condition," Weisselberg said. "I never even thought about the apartment."
Louis Solomon of the attorney general's office confronted Weisselberg with emails from Forbes magazine seeking clarity about the apartment's size, as well as a letter signed by Weisselberg certifying the 30,000 square foot figure to the Trump Organization's then-accountant, Mazars USA.
Weisselberg offered a lengthy take on the discrepancy, prompting Judge Arthur Engoron to intercede.
"Your role is to answer the questions, not to give speeches. Please just answer the questions," Engoron said.
"Forbes was right, the triplex was actually only 10,996, right?" Solomon asked.
"Right," Weisselberg finally conceded.
"I've been through quite a bit the last two years," Weisselberg said at one point during the morning's questioning. The former CFO moved to Florida following three months in jail after he pleaded guilty last year to criminal fraud charges and subsequently testified against the Trump Organization.