BackMajor setback for Trump as Judge rules ex-US President and sons committed ‘fraud’ by inflating asset values
Judge rules that Donald Trump and his sons committed fraud by inflating the value of Trump Organization assets.
PremiumIn a setback for the former US President ahead of a trial in the civil case, Donald Trump and his sons Eric and Don Jr committed fraud by inflating the value of the real estate and financial assets of the Trump Organization for years, said New York Judge Arthur Engoron on Tuesday.
New York State Attorney General Letitia James has accused Trump, his two eldest sons, along with other Trump Organization executives of lying to tax collectors, lenders, and insurers for years in a scheme that routinely exaggerated the value of their properties, AFP reported.
Trump's lawyers had asked the judge to throw out the case ahead of the trial by granting what is known as a summary judgment in his favor. In addition, James had also asked for a summary judgment, however, seeking that Trump be found liable.
The judge also revoked the business licenses that allowed the Trump Organization to operate some of its New York properties. Currently, James is seeking $250 million in penalties and the removal of Trump and his sons from management of the family empire, the Trump Organization.
James claimed that Trump and his associates submitted ‘grossly inflated’ numbers to banks and insurers each year between 2011 and 2021 to secure and maintain loans and insurance on more favorable terms, as per AFP reports.
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They allegedly fraudulently overvalued the net worth of Trump company assets by billions of dollars, resulting in "hundreds of millions of dollars in ill-gotten savings and profits."
James has alleged that the overvaluation of Trump's assets was between $1.9 billion and $3.6 billion per year.
Among the properties falsely overvalued -- by between $114 million to $207 million -- was Trump's apartment in Manhattan's Trump Tower, whose square footage was given as 30,000 square feet when it is actually 10,996 square feet.
"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," the judge said as quoted by AFP.
Trump, the frontrunner for the 2024 Republican presidential nomination, has denounced the case as a "witch hunt," calling James, who is a Democrat and Black, "racist."
In January, the Trump Organization was fined $1.6 million by a New York judge in a criminal tax and financial fraud case. The 77-year-old twice-impeached Trump also faces federal criminal charges for the mishandling of classified documents and conspiracy charges for trying to overturn the 2020 election results.
(With AFP inputs)
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