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NY AG files civil fraud suit against Trump

Ranb

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Ranb
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New York attorney general files civil fraud lawsuit against Trump, some of his children and his business

https://www.cnn.com/2022/09/21/poli...eneral-letitia-james-fraud-lawsuit/index.html

The New York state attorney general filed a sweeping lawsuit Wednesday against former President Donald Trump, three of his adult children and the Trump Organization, alleging they were involved in an expansive fraud lasting over a decade that the former President used to enrich himself.

In the more than 200-page lawsuit, Attorney General Letitia James, a Democrat, alleges the fraud touched all aspects of the Trump business, including its properties and golf courses. According to the lawsuit, the Trump Organization deceived lenders, insurers and tax authorities by inflating the value of his properties using misleading appraisals.

“These acts of fraud and misrepresentation were similar in nature, were committed by upper management at the Trump Organization as part of a common endeavor for each annual Statement, and were approved at the highest levels of the Trump Organization – including by Mr. Trump himself,” the lawsuit states.
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They're seeking $250 million. I thought it would have been more than that.

Ranb
 
I think the most important part from this is:

James said she believes state and criminal laws may have been violated and referred the matter to the US attorney's office for the Southern District of New York and the Internal Revenue Service.
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(I think she meant state and federal, might be a mess-up on CNN's part, as shocking as that might be).

I'm sure the attorney's office for the SDNY has been looking into it already, but any criminal referral is bound to put a little giddy-up in their case. Especially if it comes part and parcel with evidence of crimes already.

Ranb said:
They're seeking $250 million. I thought it would have been more than that.

Ranb
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Well that and...

to permanently bar Trump and the children named in the lawsuit from serving as the director of a business registered in New York state. She is also seeking to cancel the Trump Organization's corporate certificate, which, if granted by a judge, could effectively force the company to cease operations in New York state.
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That's a huge blow I would think. He has Trump tower and a **** ton of rental properties in NY if I remember right. That would be pretty devastating.
 
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Ranb said:
New York attorney general files civil fraud lawsuit against Trump, some of his children and his business

https://www.cnn.com/2022/09/21/poli...eneral-letitia-james-fraud-lawsuit/index.html



They're seeking $250 million. I thought it would have been more than that.

Ranb
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Just listening to all those charges gave me a semi, or at least made me smile, assuming some or all will stick.

I think there's a separate conclusion in civil suits that can award punitive damages. Not mentioned here, though.
 
The AG is also going after the organization's ability to operate as a business. That's even more damaging than the fine.
 
I'm thrilled. Now for the state and federal criminal charges!

I hope the Danny Downers who kept insisting he would never be charged will now stop.

On cue as expected from Trump cultists:

New York Rep. Elise Stefanik, the conference chair:

"Tish James has been on a deranged anti-Trump mission since she became Attorney General. This is just another chapter of an illegitimate witch hunt."
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Rep. Lee Zeldin (R-N.Y.), who's running for New York governor, said, "It's more about her trying to fulfill a campaign promise than anything else."


Rep. Jim Banks, the Republican Study Committee chair who's vying for majority whip next year,...
"House Republicans will hold partisan actors posing as law-enforcement agents accountable for abusing their power when we retake the majority," Banks said in a statement, calling James' investigation an "illegitimate fishing expedition."
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Even more predictable is Trump's response:


"She is a failed AG whose lack of talent in the fight against crime is causing record numbers of people and companies to flee New York,’ former president says"
The former president responded on Truth Social, writing, “another Witch Hunt by a racist Attorney General, Letitia James, who failed in her run for Governor, getting almost zero support from the public, and now is doing poorly against Law & Order AG candidate, highly respected Michael Henry.

“I never thought this case would be brought - until I saw her really bad poll numbers. She is a fraud who campaigned on a ‘get Trump’ platform, despite the fact that the city is one of the crime and murder disasters of the world under her watch!” he added.

“Attorney General Letitia ‘Peekaboo’ James, a total crime fighting disaster in New York, is spending all of her time fighting for very powerful and well-represented banks and insurance companies, who were fully paid, made a lot of money, and never had a complaint about me, instead of fighting murder and violent crime, which is killing New York State.”

“She is a failed AG whose lack of talent in the fight against crime is causing record numbers of people and companies to flee New York. Bye, bye!” he wrote.
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Hercules56 said:
I'm not interested until I see criminal charges
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A judgment or settlement could shut down his business and cost him hundreds of millions of dollars in fines. His lenders might call in their outstanding loans. The impact could be more severe than a criminal conviction resulting in probation. We all know that nobody is going to send a former President to prison.
 
New York AG Trump lawsuit a 'political hit job' driven by left's desire to 'punish' him: Bill Barr
https://www.foxnews.com/media/new-y...cal-hit-job-lefts-desire-punish-him-bill-barr

Former Attorney General Bill Barr dismissed the lawsuit filed by the New York attorney general against former President Donald Trump and his children as a "political hit job," telling Fox News it is yet another symptom of "Trump derangement syndrome" and the left's desire to "punish" Trump.

"It’s hard for me not to conclude it’s a political hit job," Barr said Wednesday on "America Reports." "This is a woman who campaigned for office promising she was going to go after Trump, which I think is a tremendous abuse of office to go head-hunting and targeting individuals."
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Barr knows what's up. But around here, nothing is ever politically-motivated when it comes to going after Trump. :rolleyes:
 
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Keep in mind when reading this that I am anti-Trump, and want him gone from politics.

Could be something, could be nothing. I do note that none of the entities supposedly defrauded by Trump have sued him themselves, which is certainly interesting. As far as the appraisal BS goes, be serious. No lender relies on a borrower's appraisal (this was the business I worked in for 40 years), any good loan officer can do a desk valuation in 20 minutes that won't be more than 10% off the $10,000 appraisal that an MAI will provide.

Ditto with the tax assessors. They generally know what they are doing and of course there is always the assessed valuation versus the market valuation amusement when dealing with tax assessors. These are somewhat dark waters but suffice to say that big property owners have staff to handle tax appeals and shockingly they always appeal to have their taxes reduced.

On the radio they mentioned two specific cases. In one Trump supposedly overstated the size of his personal apartment by a factor of 3. If the claim is true then Trump's got some 'splaining to do. The second supposedly concerned deed restrictions on Mar-A-Lago that result in it having a lower value than claimed. Too vague to comment on, but again none of his lenders have sued him over these deals.
 
Brainster said:
Keep in mind when reading this that I am anti-Trump, and want him gone from politics.

Could be something, could be nothing. I do note that none of the entities supposedly defrauded by Trump have sued him themselves, which is certainly interesting. As far as the appraisal BS goes, be serious. No lender relies on a borrower's appraisal (this was the business I worked in for 40 years), any good loan officer can do a desk valuation in 20 minutes that won't be more than 10% off the $10,000 appraisal that an MAI will provide.
Ditto with the tax assessors. They generally know what they are doing and of course there is always the assessed valuation versus the market valuation amusement when dealing with tax assessors. These are somewhat dark waters but suffice to say that big property owners have staff to handle tax appeals and shockingly they always appeal to have their taxes reduced.

On the radio they mentioned two specific cases. In one Trump supposedly overstated the size of his personal apartment by a factor of 3. If the claim is true then Trump's got some 'splaining to do. The second supposedly concerned deed restrictions on Mar-A-Lago that result in it having a lower value than claimed. Too vague to comment on, but again none of his lenders have sued him over these deals.
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Greed by individual bank personnel - see Deutsche Bank.

Why haven't they sued? Every heard of the saying "if you default on 500K you are in trouble; default on 500M and the bank is in trouble." Trump was lying to Mazars and the lenders, but they didn't want his BS publicized because they were a party to it and didn't want to lose other customers.
 
Brainster said:
Keep in mind when reading this that I am anti-Trump, and want him gone from politics.

Could be something, could be nothing. I do note that none of the entities supposedly defrauded by Trump have sued him themselves, which is certainly interesting. As far as the appraisal BS goes, be serious. No lender relies on a borrower's appraisal (this was the business I worked in for 40 years), any good loan officer can do a desk valuation in 20 minutes that won't be more than 10% off the $10,000 appraisal that an MAI will provide.

Ditto with the tax assessors. They generally know what they are doing and of course there is always the assessed valuation versus the market valuation amusement when dealing with tax assessors. These are somewhat dark waters but suffice to say that big property owners have staff to handle tax appeals and shockingly they always appeal to have their taxes reduced.

On the radio they mentioned two specific cases. In one Trump supposedly overstated the size of his personal apartment by a factor of 3. If the claim is true then Trump's got some 'splaining to do. The second supposedly concerned deed restrictions on Mar-A-Lago that result in it having a lower value than claimed. Too vague to comment on, but again none of his lenders have sued him over these deals.
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If you were fronting a shadowy organisation that wanted to launder their ill-gotten gains into the USA, how easy would it be to lend the loot to some front guy who has inflated the value of his properties. Does that not become collateral for profit-taking inside the USA? And the higher the dodgy valuation the merrier, because more loot can be "loaned". Just give the front guy a tip or two...perhaps a credit card to pay for his red ties and golf carts?
 
slyjoe said:
Greed by individual bank personnel - see Deutsche Bank.

Why haven't they sued? Every heard of the saying "if you default on 500K you are in trouble; default on 500M and the bank is in trouble." Trump was lying to Mazars and the lenders, but they didn't want his BS publicized because they were a party to it and didn't want to lose other customers.
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I worked for an Insurance company. They even let staff get away with fraud and just fired them. Bad for the image to go public.
 
Banks didn't bother to investigate sub-prime mortgage derivatives; what makes anyone think they bother to investigate what Trump tells them, especially given how hard it is to get any information from Trump.
 
Slate has more detail and I gotta say the case is sounding thinner and thinner. On the property tax issue:

Understating the value of Trump International Hotel and Tower in Las Vegas in order to pay less in property taxes. (“We cleaned their clock,” an outside tax counsel is said to have told Eric Trump after a hearing in which an appraiser paid by the Trump Organization painted a dim picture of the tower’s financial outlook for Clark County officials.)
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Like I said, pretty typical for commercial real estate; if you aren't appealing your assessment you're an idiot, a point Slate acknowledges later:

Cheating on one’s taxes is not a crime generally viewed with sympathy by the public, but on that front, one individual in the commercial real estate business that Slate contacted noted that striving for lowball appraisals for tax purposes—while painting a pretty picture for lenders and investors—is something that “everyone” does. (This person did acknowledge that one can, of course, go “too far” in doing so.)
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As expected the supposed "victim" of the fraud is Deutsche Bank, but:

Nor, it would appear from the suit, did Trump ever default on the terms he arranged with the bank.
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Here's another one that raised an eyebrow here:

Playing games with estimates of the value of Trump-owned land in New York state and at Mar-a-Lago that he promised not to develop in exchange for a “conservation easement” tax break. In the former case, Trump is accused of receiving tax credits that would have been much smaller if they had been valued accurately; in the latter, he’s accused of promising the government that he wouldn’t develop certain land—and then estimating, in personal statements given to financial institutions, what it’d be worth if he did develop it. (One example of the number fudging going on: In the process of considering internally whether to donate the land, Trump et al. are said to have been told by an independent appraiser that a certain number of lots, which the Trumps had estimated in their own financial statements as being worth $23 million each, were actually worth about $700,000 apiece.)
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I guarantee the land in question was not collateral for any loans, because the conservation easements would have come up as a Schedule B item (exceptions to clear title). This is also related to the Deutsche Bank loans. But again according to Slate:

While the examples of inflated valuations might be embarrassing to Trump personally, the main “victim” as outlined in the suit is Deutsche Bank, whose personal-wealth division is portrayed as eager to win Trump’s business but not so eager to verify or double check any of the financial claims made on his behalf by his representatives.
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It's going to be hard to argue then that the misrepresentations were material.

This (at the end) strikes me as the most intriguing:

Flat-out lying to a company that provided Trump organizations with surety bonds and another company that insured the organizations against litigation risks about whether Trump’s financial statements had been prepared by third parties (they hadn’t been) and whether he and his businesses were the subject of any ongoing governmental litigation that could lead to investigations (they were).
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Brainster said:
Slate has more detail and I gotta say the case is sounding thinner and thinner. On the property tax issue:



Like I said, pretty typical for commercial real estate; if you aren't appealing your assessment you're an idiot, a point Slate acknowledges later:



As expected the supposed "victim" of the fraud is Deutsche Bank, but:



Here's another one that raised an eyebrow here:



I guarantee the land in question was not collateral for any loans, because the conservation easements would have come up as a Schedule B item (exceptions to clear title). This is also related to the Deutsche Bank loans. But again according to Slate:



It's going to be hard to argue then that the misrepresentations were material.

This (at the end) strikes me as the most intriguing:
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I am sure your apologetics will provide some solace to the fact that your guy lost...but I will go with the idea that the AG, who I believe is objectively more knowledgeable in these matters, has all her ducks in a row.
 
Brainster said:
Slate has more detail and I gotta say the case is sounding thinner and thinner.
.....
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Pretty basic summary here:
For that matter, why would he claim that a group of rent-stabilized apartments he owned were worth 65 times their actual value, according to James? Why would he claim his tower at 40 Wall Street was worth $524 million, when a contemporaneous professional appraisal set its value at roughly $200 million? Why would he claim that the Trump Organization had cash on hand that James said did not exist? Why would he assert, or boast, that the name “Trump” — just the gold-plated name itself — added huge amounts to the valuations of other properties?

According to the lawsuit, the practical reason was to fraudulently represent to banks that he and his company had more assets than they truly did. That allowed him to obtain loans at lower interest rates and insurance coverage with lower premiums, the suit alleges, amounting to an estimated $250 million in unwarranted benefits during the decade between 2011 and 2021. James’s suit seeks to recover that money from the firm — and to punish Trump, his daughter Ivanka, his sons Donald Jr. and Eric, and the Trump Organization by severely limiting, if not eliminating, their ability to do business in the state of New York.
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https://www.washingtonpost.com/opinions/2022/09/21/letitia-james-trump-marketing/

If he lied about the value of his assets -- up or down -- to borrow more money, to pay less interest, to pay lower taxes or reduce his insurance premiums, that's pretty clearly fraud with identifiable victims. And the AG's hundreds of pages apparently have pretty specific details about years of such conduct.

ETA: The actual suit -- 222 pages -- is on-line.
https://www.politico.com/f/?id=00000183-60c5-da48-a3e3-e0e5115d0000
 
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Brainster said:
Keep in mind when reading this that I am anti-Trump, and want him gone from politics.

Could be something, could be nothing. I do note that none of the entities supposedly defrauded by Trump have sued him themselves, which is certainly interesting. As far as the appraisal BS goes, be serious. No lender relies on a borrower's appraisal (this was the business I worked in for 40 years), any good loan officer can do a desk valuation in 20 minutes that won't be more than 10% off the $10,000 appraisal that an MAI will provide.

Ditto with the tax assessors. They generally know what they are doing and of course there is always the assessed valuation versus the market valuation amusement when dealing with tax assessors. These are somewhat dark waters but suffice to say that big property owners have staff to handle tax appeals and shockingly they always appeal to have their taxes reduced.
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First of all, even if an appraiser or tax assessor could do proper valuations, its still illegal to submit faulty values to them. (At the very least, you would want to ensure things don't get improperly valued if the bank or tax official is having a bad day and lets a bad value slip through.)

Secondly, I think you are overestimating the ability of those parties to do their assessments. Some officials are overworked, and the information they need may be hard to get. (After all, if Trump said "This property I own is a dump", how does a tax official evaluate it? They probably don't have access to private business records of the Trump organization or other entities, its doubtful they would have the resources to send inspection teams, etc.)

Remember, Weisselberg (Who was, you know a Trump Organization officer) has been convicted of tax fraud going back years. If its so easy to identify fraud on a day to day basis, why wasn't he caught sooner?
...again none of his lenders have sued him over these deals.
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Again, probably not all that big of a deal.

As others have suggested, it could be a case of wanting to avoid embarassment. And if they did sue, the case would be tied up in courts for years and possibly cost more in legal fees than they would get in a settlement.
 
Susheel said:
I am sure your apologetics will provide some solace to the fact that your guy lost...but I will go with the idea that the AG, who I believe is objectively more knowledgeable in these matters, has all her ducks in a row.
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My guy? I don't support Trump, I want him gone one way or another. But as the old saying goes, when you shoot at the king, you'd better kill him. From what I've read so far, this gun seems likely to misfire.
 
Segnosaur said:
.....
Secondly, I think you are overestimating the ability of those parties to do their assessments. Some officials are overworked, and the information they need may be hard to get.
....
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A basic tool in real estate is comparables. An appraiser or assessor looks at the actual sale prices of similar properties in the same place. Every property is unique, but when Trump claimed values wildly out of line with the market, that's more than a difference of opinion.
 
Brainster said:
My guy? I don't support Trump, I want him gone one way or another. But as the old saying goes, when you shoot at the king, you'd better kill him. From what I've read so far, this gun seems likely to misfire.
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Why do you insist on the that? This is a civil suit, not a criminal trial. Proving that Trump benefited from lying about matters of fact really shouldn't be hard. He lost on his scam foundation and he lost on his scam Trump U. Why would this be different?

It will be entertaining -- and compelling -- when the prosecution plays the videos of Trump and his little boy taking the Fifth hundreds (literally) of times at their depositions. The jury will likely conclude that if they recognize their own criminal culpability, they sure knew they were up to no good in these valuation claims.
 
Brainster said:
Keep in mind when reading this that I am anti-Trump, and want him gone from politics.

Could be something, could be nothing. I do note that none of the entities supposedly defrauded by Trump have sued him themselves, which is certainly interesting.
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That could be for a number of reasons

1. They do not have standing to do so.
2. They do not have the necessary resources to find evidence to support a claim.
3. They figure it would be such a long, protracted fight, the cost benefit ratio would be a large negative number.
4. They realise that once the NY government is done, there will be nothing to gain anyway.

Brainster said:
As far as the appraisal BS goes, be serious. No lender relies on a borrower's appraisal (this was the business I worked in for 40 years), any good loan officer can do a desk valuation in 20 minutes that won't be more than 10% off the $10,000 appraisal that an MAI will provide.
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5. They may be found to have violated laws (or at least standards) themselves in their own business practices
 
Brainster said:
My guy? I don't support Trump, I want him gone one way or another. But as the old saying goes, when you shoot at the king, you'd better kill him. From what I've read so far, this gun seems likely to misfire.
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"The King"? Really? Methinks that dog has had his day.
 
Brainster said:
Could be something, could be nothing. I do note that none of the entities supposedly defrauded by Trump have sued him themselves, which is certainly interesting. As far as the appraisal BS goes, be serious. No lender relies on a borrower's appraisal (this was the business I worked in for 40 years), any good loan officer can do a desk valuation in 20 minutes that won't be more than 10% off the $10,000 appraisal that an MAI will provide.
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Just a couple of things to add to this that I didn't know earlier when I posted the first reply, but that I do known now because I have watched the whole press conference, including questions and answers.

James was asked a question similar to yours by a reporter...

Reporter: "Did they just not check anything that people tell them or they presumed it was true or did they have hints that these things were not true, that they were being told? And what does it tell you about those institutions, that they would take his word for it?

Tish James: "Let me just say with respect to Mazars, Mazars indicated on the Statement of Financial Condition that they did not certify and that they did not audit these statements and that does not absolve Mr. Trump of submitting inaccurate information. With respect to Cushman-Wakefield, there is an ongoing investigation into Cushman-Wakefield, and then lastly with respect to Deutsche Bank... we're in conversations with Deutsche bank. They have been cooperating with our office.​

I think she has got the whole damned Trump Crime Family dead to rights.... there is no way to explain away this...

TrumpInflation.png
 
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I knew we had a thread about this. For posterity's sake, bumping it.

Trump guilty of fraud, says judge.

"Engoron found that Trump consistently overvalued Mar-a-Lago, inflating its value on one financial statement by as much as 2,300%. The judge also rebuked Trump for lying about the size of his Manhattan apartment. Trump claimed his three-story Trump Tower penthouse was nearly three times its actual size, valuing it at $327 million.

"“A discrepancy of this order of magnitude, by a real estate developer sizing up his own living space of decades, can only be considered fraud,” Engoron wrote."

https://apnews.com/article/1569245a9284427117b8d3ba5da74249
 
to be mildly fair to Trump, all these instances are also fraud perpetrated by the banks and insurers against their shareholders and customers for not doing even basic diligence.

And fraud by the Legislators against taxpayers for allowing bankers to take on high-risk debtors with no risk to themselves, legally or financially, since they can always depend on a bail-out and a very small wiggling of fingers.
 
The Great Zaganza said:
to be mildly fair to Trump, all these instances are also fraud perpetrated by the banks and insurers against their shareholders and customers for not doing even basic diligence.

And fraud by the Legislators against taxpayers for allowing bankers to take on high-risk debtors with no risk to themselves, legally or financially, since they can always depend on a bail-out and a very small wiggling of fingers.
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yeah, you can be sure that this pencil whipping of bank records, with bank and borrower both well aware of it, is not something unique to Trump at all, and you'd hope that a high profile example of it would result in broader, systematic scrutiny and reform, but that doesn't seem to have been the case.

It does seem a useful lesson though. If you're in the type of business where this kind of fraud is routine, probably best not to enter national politics where your opponents are going to be going through your past dealings with a fine tooth comb.
 
Why didn't NY charge Trump with criminal fraud? Why just a civil case? I dont get it.
 
Hercules56 said:
Why didn't NY charge Trump with criminal fraud? Why just a civil case? I dont get it.
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Presumably because proving criminal fraud is much more difficult while filing a civil suit against a business is more straightforward.
 
TurkeysGhost said:
Presumably because proving criminal fraud is much more difficult while filing a civil suit against a business is more straightforward.
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Lying about their value means also lying about their revenue and profits, would that not also be criminal tax evasion?
 
TurkeysGhost said:
Presumably because proving criminal fraud is much more difficult while filing a civil suit against a business is more straightforward.
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And it is white collar crime, they never hold the people responsible for the fraud or other financial malfeasance criminally liable. Look how few people went to prison in the 08 debacle.
 
Hercules56 said:
Lying about their value means also lying about their revenue and profits, would that not also be criminal tax evasion?
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Maybe, maybe not. Just because they lied to the bank doesn't mean they necessarily lied to the IRS. It's not like they are all in one big conference call. They easily could have pencil whipped the numbers for the bank while providing the correct values to the tax man.
 
TurkeysGhost said:
Maybe, maybe not. Just because they lied to the bank doesn't mean they necessarily lied to the IRS. It's not like they are all in one big conference call. They easily could have pencil whipped the numbers for the bank while providing the correct values to the tax man.
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This....is....true.

Sigh.
 
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