Judge Finds Donald Trump and Sons Liable for Fraud, Cancels Trump Organization’s Business Certification
In a major blow to former President Donald Trump and his family, a New York judge has ruled them liable for fraud and canceled the business certification of the Trump Organization. Judge Arthur Engoron found that the Trumps provided false financial statements for approximately a decade, violating New York state law. The ruling came just days before the civil case brought by the New York attorney general’s office was set to go to trial.
Attorney General Letitia James had sought $250 million in damages and a ban on the Trumps from serving as officers of a business in New York. She also aimed to prevent the company from engaging in business transactions for five years. Judge Engoron granted James’ motion for summary judgment, stating that Trump, his sons, and others were “liable as a matter of law for persistent violations” of state law.
The judge found that the financial statements provided by the Trumps to lenders and insurers were false and that they repeatedly engaged in fraud. This ruling directly contradicted Trump’s claims that he did not inflate the values of his golf courses, hotels, and properties on financial statements used in business transactions.
Attorney General James expressed her satisfaction with the ruling, stating, “Today, a judge ruled in our favor and found that Donald Trump and the Trump Organization engaged in years of financial fraud.” She added that they look forward to presenting the rest of their case at trial.
The judge’s ruling also included the cancellation of the business certifications of the Trump entities involved in the case, as well as the appointment of a receiver to manage the dissolution of these corporate entities. The judge did not clarify how the receiver would handle the properties involved in the lawsuit, including the commercial tower at 40 Wall Street and the Trump family compound at Seven Springs. Moreover, there are questions regarding whether the ruling would impact properties outside of New York state and if the Trumps could transfer the New York-based assets into a new out-of-state company.
Among the allegations against Trump is the inflation of the value of his triplex apartment at Trump Tower, resulting in an overvaluation of between $114 million to $207 million. The judge emphasized that such discrepancies could only be considered fraud. He further criticized the Trumps’ defense and their reliance on “bogus arguments.”
In response to the ruling, Trump condemned Judge Engoron, accusing him of doing the bidding of Attorney General James. Trump called for intervention from the highest courts in New York State or the Federal System, emphasizing that he considers the situation unjust.
Trump’s attorney, Christopher Kise, called the ruling “completely disconnected from the facts and governing law.” He stated that President Trump and his family will appeal the decision to rectify what he sees as a miscarriage of justice.
The trial is still set to proceed, although the start date is currently uncertain. Trump has filed a petition with the state appeals court to implement a decision in June that certain claims may be moot due to the statute of limitations. The appeals court has paused the start of the trial to allow a larger panel of judges to weigh in on the issue. A decision is expected later this week.
Correction: The original article stated that the judge ruled on multiple claims from the attorney general’s office. However, Judge Engoron ruled on one claim in favor of the attorney general’s office.