Ms. James is seeking to bar the Trumps, including Donald Jr., Eric and Ivanka, from operating a business in the state again. It concluded that Mr. Trump and his business violated state criminal laws and “plausibly” also violated federal laws. Her office, which does not have the authority to bring criminal charges in this case, referred the findings to federal prosecutors in Manhattan. They declined to comment on whether they would investigate. The 220-page lawsuit, filed in state Supreme Court in Manhattan, describes in new and startling detail how Mr. Trump’s annual financial statements were a collection of lies, according to Ms. James. The statements — annual filings that include the company’s estimated value of its holdings and debts — wildly inflated the value of nearly every one of its property marquees, according to the suit. They include Mar-a-Lago in Florida, Trump Tower and 40 Wall Street in Manhattan. The company also regularly rejected the estimates of outside experts. After a bank ordered an appraisal that found 40 Wall Street was worth $200 million, the Trumps immediately valued it at well over twice that amount. In all, the lawsuit said 11 of Mr. Trump’s annual financial statements included more than 200 false and misleading asset valuations. “The number of grossly inflated property values is staggering, affecting most if not all real estate holdings in any given year,” according to the lawsuit. Ms. James, a Democrat running for re-election, filed the suit weeks after the former president refused to answer hundreds of questions under oath in an interview at her office. Mr. Trump, in a post on the social networking site Truth Social, attacked the investigation and Ms. James, as he has done throughout the investigation. “Another witch hunt by a racist Attorney General, Letitia James,” Mr. Trump wrote, adding, “She is a fraud who campaigned on a ‘get Trump’ platform.” Mr. Trump has long used his net worth to create a public persona as a self-made billionaire, an image that underpinned his initial run for the White House. But, according to Ms James, he had a financial incentive to inflate his property values. His company, the Trump Organization, provided the fraudulent financial statements to lenders and insurers, the lawsuit said, “to obtain favorable financial terms,” including lower interest rates and insurance premiums. In all, Ms. James said, the Trumps were able to obtain a quarter of a billion dollars that the company now wants to forfeit.
Understand New York State’s Civil Case Against Trump
Card 1 of 6 An empire under control. Letitia James, the New York state attorney general, conducted a multi-year political investigation into the business practices of former President Donald J. Trump, culminating in a lawsuit accusing Mr. Trump of “stupendous” fraud. Here’s what you need to know: The origin of research. The investigation began when Michael D. Cohen, Mr. Trump’s former personal lawyer and retainer, testified to Congress that Mr. Trump and his staff had manipulated his net worth to suit his interests. In a statement, the Trump Organization noted that its lenders “earned large profits — hundreds of millions of dollars in interest and fees” from their dealings with the company. The statement also attributed Ms. James’s action to “politics, pure and simple,” arguing that she was “putting her own political ambitions above the safety of New Yorkers.” “We look forward to defending our client against each of the attorney general’s baseless allegations,” said Mr. Trump’s lawyer, Alina Haba. Alan S. Futerfas, a lawyer for Ivanka Trump and Donald Trump Jr., declined to comment. But on Twitter, Donald Trump Jr. wrote that Mrs. James is “outfitting her office to go after her political opponents!” Ms. James wants to extract a steep price from the former president and his company. Her lawsuit asks a judge to appoint an independent monitor to oversee the company’s financial practices and oust the Trumps from leadership of their family business. Ms. James also seeks to prevent the family from acquiring real estate in New York for five years. If a judge agrees, Mr. Trump and his children would also be permanently barred from serving as officers or directors of any New York company. While Ms. James has stopped short of trying to dismantle the Trump Organization, she wants to shut down at least some of the former president’s New York businesses. It is unclear whether a judge would accept some of the harsher consequences he seeks. In an unrelated case against the National Rifle Association, Ms. James sought to dissolve the organization, only for the judge to reject that request. Her case against Mr. Trump could also be difficult to prove. Property valuations are often subjective and financial statements include a disclaimer stating that they have not been audited. If there was a trial, his lawyers would likely emphasize that Deutsche Bank and Mr. Trump’s other lenders were hardly victims. all his loans are either current or paid off, some before they are due. Mr. Trump is known not to use email, so any instructions he may have given his employees about the company’s financial statements may not be in writing. The lack of an incriminating email – or a witness at his company willing to testify against him – could complicate Ms James’s attempt to show that he deliberately used his financial statements to defraud lenders and insurers. While Mr. Trump has often used law enforcement scrutiny to portray himself as a political martyr and raise money from his supporters, Ms. James’s lawsuit suggests that his success is the product of fraud and scandal. There was the Westchester County Golf Club that was valued as if it had charged hefty initiation fees that were never actually collected. the “cash” that Mr. Trump counted even though it belonged to one of his associates; and the pretense that his Mar-a-Lago club and golf course in Scotland could make money from building homes in real estate, even though the Trumps had agreed to limit such development. In another example cited in the case, the Trump Organization grossly overvalued a group of rent-stabilized apartments at Trump Park, its Park Avenue building — apartments that Donald Trump Jr. once described as “the bane” of his existence. The apartments were valued by an independent appraiser as worth $750,000. the Trump Organization, in 2011 and 2012, valued them at nearly $50 million. The lawsuit adds to Mr. Trump’s extensive legal woes. He faces a number of criminal investigations into his conduct in the final weeks of his presidency. Last month, the FBI investigated Mar-a-Lago in an investigation into the removal of sensitive material from the White House. Federal prosecutors are investigating his efforts to overturn his 2020 election loss, and a Georgia prosecutor is conducting a criminal investigation into possible meddling in state elections. Authorities in New York have been investigating Mr. Trump and his family business since 2018, when the Manhattan district attorney’s office launched an investigation. The following year, the political investigation of Ms. James began, and the two offices began zeroing in on how Mr. Trump’s company valued its assets. As part of his investigation, the Manhattan district attorney pressed the Trump Organization’s chief financial officer, Allen H. Weiselberg, to turn to his longtime employer. When Mr. Weisselberg refused to cooperate, the bureau charged him with a years-long scheme to avoid paying taxes on lucrative off-the-books perks. The company was also charged and is scheduled to go to trial in October. Mr. Weisselberg, who is also a defendant in Ms. James’s lawsuit, pleaded guilty to 15 felonies and agreed to testify at trial, putting the company at a significant disadvantage. His attorney, Mary E. Mulligan, declined to comment. The Manhattan criminal investigation has not resulted in charges. Earlier this year, Manhattan District Attorney Alvin L. Bragg directed prosecutors to drop their bid to prosecute Mr. Trump after he and some of his aides raised concerns about proving a criminal case. Such cases require a higher burden of proof than a civil case such as the one filed by Ms. James. While Ms. James does not have the authority to indict Mr. Trump, a footnote in the lawsuit said she provided her findings to the United States attorney’s office in Manhattan. He notes that the conduct described in the complaint appears to amount to bank fraud and making false statements to a bank. The lawsuit also alleged that the financial statements violated “numerous state laws.” Asked about the possibility of federal charges, Mr. Bragg said in a statement that the investigation into Mr. Trump and his company was “active and ongoing.” Ms. James’s lawsuit represents the culmination of a contentious years-long political investigation that Mr. Trump and his lawyers have tried to thwart and delay at almost every turn. In April, a judge in New York State charged Mr. Trump in contempt of court for not fully complying with Ms. James’ subpoena seeking some of his personal records. The judge, Arthur F. Engoron, eventually lifted the contempt order, but only after Mr. Trump paid a $110,000 fine. Judge Engoron also ordered Mr. Trump, as well as Ivanka and Donald Trump Jr., to be questioned under oath by Ms. James’ investigators. (Eric Trump has previously been questioned about the investigation, during which he repeatedly invoked his Fifth Amendment right against…
