Former US President Donald Trump underpaid his estate by billions of dollars and routinely misled banks and others about the value of valuable assets such as golf courses, hotels and his Mar-a-Lago estate, the attorney general said Wednesday of New York in a lawsuit seeking permanently disrupt the Republican’s ability to do business in the state. Attorney General Letitia James called it: “The Art of Stealing.” The suit, filed in state court in Manhattan, is the culmination of the Democrat’s three-year political investigation into Trump and the Trump Organization. Trump’s three oldest children, Donald Jr., Ivanka and Eric Trump, were also named as defendants, along with two longtime company executives. In its 222 pages, the suit struck at the core of what made Trump famous, casting a black light on the image of wealth and opulence he embraced throughout his career — first as a real estate developer and then as a reality TV host on “The Apprentice ” and later as president. It cites dozens of cases of alleged fraud, many involving claims made in annual financial statements that Trump would give to banks, business associates and financial journals as proof of his wealth as he sought loans and deals. For example, according to the lawsuit, Trump claimed his Trump Tower apartment — a three-story penthouse filled with gilded light fixtures — was nearly three times its actual size and valued the property at $327 million. No apartment in New York has ever sold for anywhere near that amount, James said. Trump applied similarly fuzzy math to his Mar-a-Lago estate in Palm Beach, Fla., according to the lawsuit, valuing the private club and residence at up to $739 million — more than 10 times a more reasonable estimate of its value. . Trump’s figure is based on the idea that the property could be developed for residential use, but the terms of the deed prohibit that. “This investigation revealed that Donald Trump engaged in years of illegal conduct to inflate his net worth, defraud the banks and the people of the great state of New York,” James said at a news conference. “Claiming to have money you don’t have is not the art of the deal. It’s the art of the steal,” she said, referring to the title of Trump’s 1987 memoir, “The Art of the Deal.” James said the investigation also uncovered evidence of possible criminal wrongdoing, including insurance fraud and bank fraud, but that her office referred those findings to outside authorities for further investigation. Trump, in a post on his Truth Social platform, denounced the lawsuit as “Another witch hunt” and denounced James as “a fraud who campaigned on a ‘get Trump’ platform.” Trump’s lawyer, Alina Haba, said the charges are “meritless” and that the lawsuit “focuses neither on the facts nor the law — rather, it is focused solely on advancing the Attorney General’s political agenda.” In the lawsuit, James asked the court to bar Trump and his three oldest children from ever running a company based in the state again. It is also seeking payment of at least $250 million, which it said were the estimated benefits derived from the alleged fraud. And it wants Trump and the Trump Organization to conduct commercial real estate buyouts for five years, among other sanctions. James’ lawsuit comes amid an unprecedented whirlwind of legal challenges for a former president, including an FBI investigation into Trump’s handling of classified records and investigations into his efforts to sway the 2020 election. While James’ lawsuit continues in civil court, Manhattan District Attorney Alvin Bragg is working with James’ office in a parallel criminal investigation. Trump cited fear of prosecution in August when he refused to answer questions in a deposition with James, invoking his Fifth Amendment protection against self-incrimination more than 400 times. The chances of a criminal prosecution were thought to be diminishing in recent months after Bragg allowed a grand jury to dissolve without charges. Bragg said again Wednesday, however, that the criminal investigation was “active and ongoing.” A criminal prosecution would have a much higher burden of proof than a civil suit. And in a criminal case, prosecutors would have to prove that Trump intended to break the law, which is not necessarily required in a civil case. “Generally in criminal cases you have to prove intent. In civil cases, simple negligence or intentional misrepresentation creates liability,” said Neama Rahmani, a former federal prosecutor in San Diego who now practices law at a Los Angeles firm. The U.S. attorney’s office in Manhattan said it was aware of James’ citation for possible criminal violations, but otherwise declined to comment. The Internal Revenue Service’s criminal investigations division said it “does not confirm the existence of investigations until court documents are released.” The Trump Organization is set to go on trial in October in a criminal case that alleges it planned to give tax-free perks to senior executives, including its longtime chief financial officer Allen Weiselberg, who himself took home more than $1.7 million more. Weiselberg, 75, pleaded guilty on August 18. His plea agreement requires him to testify at the company’s trial before beginning a five-month prison sentence. If convicted, the Trump Organization could face a fine of twice the amount of unpaid taxes. Weisselberg and another Trump Organization executive, Jeffrey McConney, were also named as defendants in James’ lawsuit. At the same time, the FBI continues to investigate Trump’s storage of sensitive government documents at his Mar-a-Lago estate in Florida, and a special jury in Georgia is investigating whether Trump and others tried to influence state election officials. All the legal drama is playing out ahead of November’s midterm elections, where Republicans are trying to win control of one or both houses of Congress. Meanwhile, Trump is laying the groundwork for a potential comeback campaign in 2024 and has accused President Joe Biden’s administration of targeting him to hurt his political chances. Trump’s past refusal to answer questions during his deposition could be held against him if a lawsuit ever goes to a jury. In civil cases, courts are permitted to draw adverse inferences from these Fifth Amendment pleadings. “If Trump wanted to argue that some accounting decision was harmless rather than malicious, he may have already missed the opportunity when he decided to stay silent,” said Will Thomas, an assistant professor of business law at the University of Michigan. In a previous conflict, James oversaw the shutdown of Trump’s charity for allegedly misusing its assets to settle business disputes and bolster his White House bid. A judge ordered Trump to pay $2 million to a number of charities to settle the matter. James, who ran for office as Trump’s critic and watchdog, began scrutinizing his business practices in March 2019 after his former personal attorney Michael Cohen testified to Congress that Trump overstated his wealth in financial statements he provided to Deutsche Bank while trying to get financing to buy the NFL’s Buffalo Bills. Associated Press reporters Bernard Condon, Bobby Caina Calvan and Jill Colvin in New York and Fatima Hussein in Washington contributed to this report.
