“Repeated illegality”: NY AG files lawsuit against Trump and kids alleging 200 instances of fraud

“The pattern of fraud and deception that were used by Trump and the Trump Organization is astounding," James said

By Igor Derysh

Managing Editor

Published September 21, 2022 12:35PM (EDT)

Ivanka Trump, Donald Trump and Letitia James (Photo illustration by Salon/Getty Images)
Ivanka Trump, Donald Trump and Letitia James (Photo illustration by Salon/Getty Images)

New York Attorney General Letitia James on Wednesday announced a lawsuit against former President Donald Trump and three of his adult children, accusing them of a yearslong fraud scheme.

James filed a 220-page lawsuit detailing Trump's efforts to inflate his personal net worth by billions to get favorable loan agreements and deflate it to pay less in taxes. The suit alleges more than 200 instances of fraud over a 10-year period by Trump, Ivanka Trump, Donald Trump Jr., Eric Trump and other Trump Organization officials.

The lawsuit seeks about $250 million in penalties. James is also seeking to permanently ban Trump and his kids from being in the office of any New York company and a ban on loans from any financial institution registered in New York for five years, among other penalties.

James at a press conference on Wednesday accused Trump of "violating the law as part of his efforts to generate profits for himself, his family and his company" with the help of his children.

Trump violated a New York statute that "gives the attorney general broad and special powers to go after persistent and repeated fraud and illegality," she said.

James alleged that Trump and his children violated multiple state laws, including falsifying business records, issuing false financial statements, insurance fraud and engaging in a conspiracy to commit those violations.

James said that some of the instances also violated federal criminal law, including issuing false financial statements to institutions and bank fraud. James said her office referred those violations to federal prosecutors and the IRS.

Trump attorney Alina Habba called the allegations "meritless."

James has investigated the Trump Organization's business practices for three years. Trump and his kids have tried to avoid testifying and turning over documents in the probe, suing in federal court to block the investigation before the bid was dismissed. Trump also sought to block the probe in state court but a judge in February ordered Trump, Trump Jr., and Ivanka Trump to sit for depositions. Trump invoked his Fifth Amendment right against self-incrimination more than 440 times in his deposition.

James said that the evidence focused on the Trump Organization's statements of financial condition between 2011 and 2021, the accuracy of which was the responsibility of Trump and later Donald Trump Jr. and indicted CFO Allen Weisselberg after Trump ran for president.

"Each statement was personally certified as accurate by Mr. Trump or by one of his trustees… with the intention that the information in the statements would be relied upon by banks and insurers," James said. Trump expressed a desire for his net worth in the statements to increase, James alleged, which she said Trump Organization executives complied with repeatedly in their "fraudulent preparation of the statements." Both Trump and Weisselberg invoked their Fifth Amendment rights when questioned about the scheme under oath, James said.

The statements included ever-changing methodologies to calculate the value of assets and properties and in some cases were based on entirely false numbers, James alleged. Trump inflated the size of his apartment almost threefold in one case to boost its valuation, she said in her press conference. In another instance, the company inflated the value of its property at 40 Wall Street from around $200 million to more than $500 million, according to the probe.

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In other cases, James argued, Trump violated restrictions that would have lowered his property values to inflate the value of certain properties. She cited Trump's Mar-a-Lago resort in Florida as one example, arguing that it should have been valued at around $75 million based on its earnings but was valued by Trump as high as $700 million.

"The examples I laid out just barely scratch the surface of the misconduct that we have uncovered," James said, pointing to nearly two dozen assets that were "fraudulently inflated."

"The pattern of fraud and deception that were used by Mr. Trump and the Trump Organization for their own financial benefit is astounding," she said. "It was a scheme that by its very nature became more profitable over time. And it was all in stark violation of the law," she added.

Read the full lawsuit below:

Trump Complaint NY AG by Igor Derysh on Scribd

By Igor Derysh

Igor Derysh is Salon's managing editor. His work has also appeared in the Los Angeles Times, Chicago Tribune, Boston Herald and Baltimore Sun.

MORE FROM Igor Derysh

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Donald Trump Donald Trump Jr. Eric Trump Ivanka Trump Letitia James Politics Reporting Trump Organization