New York’s attorney general is suing Trump and several of his children for fraud

(CNN) — New York Attorney General Letitia James on Wednesday filed a sweeping lawsuit against former President Donald Trump, his three grown children and the Trump Organization, accusing them of engaging in widespread fraud spanning more than a decade and the former president would have used to enrich himself.

The filings identify the defendants as Donald J. Trump, Donald Trump Jr., Eric Trump, Ivanka Trump, Allen Weisselberg, Jeffrey McConney, The Donald J. Trump Revocable Trust, The Trump Organization, Inc. and other companies associated with the Former Leader.

In the more than 200-page lawsuit, James, a Democrat, alleges the fraud extends to every aspect of Trump’s business. Including its properties and golf courses. According to the document, the Trump Organization misled lenders, insurers and tax authorities by inflating the value of their properties through misleading appraisals.

“You can’t ignore this behavior and dismiss it as some kind of kindness,” James said at a news conference in New York.

“The financial statements were grossly exaggerated, grossly inflated, factually incorrect and therefore fraudulent and illegal,” she added. “And as a result, we are seeking justice, and Mr. Trump, the Trump Organization, his family, all of them should be held accountable.”

In addition to Trump, his children, Donald Trump Jr., Eric Trump and Ivanka Trump are among those charged in the lawsuit. Allen Weisselberg, the former chief financial officer of the Trump Organization, and Jeff McConney, another longtime company executive, were also on hand.

James said he believed state and criminal laws may have been violated and referred the case to the US Attorney’s Office for the Southern District of New York and the Internal Revenue Service (IRS).

“These frauds and misrepresentations were of a similar nature, committed by senior Trump Organization executives as part of a concerted effort for each annual statement, and approved at the highest levels of the Trump Organization, including Mr. Trump himself,” the lawsuit states.

As part of the lawsuit, James is seeking damages of $250 million in alleged ill-gotten gains, as well as permanently barring Trump and his sons named in the lawsuit from serving as directors of any New York state-registered corporation. . It also seeks to revoke the Trump Organization’s corporate charter, which, if granted by a judge, could effectively force the company to cease operations in that state.

Trump has described James as a “fraudulent prosecutor” who he says is running a “traditional and self-serving” investigation. The Trump Organization called his previous allegations “baseless” and denied wrongdoing.

In response to Wednesday’s announcement, Trump’s attorney Alina Habba said in a statement to CNN: “Today’s court document does not focus on the facts or the law, but is focused solely on advancing the Attorney General’s political agenda. It is abundantly clear that the Attorney General has gone beyond statutory authority by interfering with business where absolutely no wrongdoing has occurred.”

Weisselberg’s attorney, Nicholas Gravante, declined to comment on the case.

The civil suit comes at a time when Trump is under increasing legal pressure, as prosecutors press ahead with investigations that draw ever closer to his inner circle.

The former president faces multiple criminal investigations by federal and state prosecutors, involving the accuracy of his company’s financial statements, interference in the 2020 presidential election and his handling of classified documents after he left office. Trump has denied all the allegations.

Prosecutors accused Trump of lying more than 200 times about the value of his assets

James alleged that the former president and his company made “numerous fraudulent, false and misleading statements” over a 10-year period, according to the lawsuit. The document also specifically highlighted what it called “200 false and misleading valuations” of Trump’s assets.

“The financial statements in question were issued annually; each contained a significant number of fraudulent, false and misleading statements about many assets of the Trump Organization. And most played a role in specific transactions with financial institutions,” the lawsuit added. .

“The scale of grossly inflated property values ​​is staggering,” the document continued.

According to James, Trump’s companies prepared financial statements each year to present to banks and other financial institutions. The statements showed the financial status of Trump’s companies, James said, and were used if the Trump Organization wanted to apply for a loan.

Each claim was personally verified as accurate by either Donald Trump, Donald Trump Jr. or Weisselberg, James explained to reporters on Wednesday.

Trump “made it clear” that he “wanted his net worth reflected in these statements to increase,” James said, “a wish that Mr. Weisselberg and others carried out year after year in their fraudulent preparation of these statements.”

Three years of research on finance

James’ announcement is the latest development in what has been a three-year investigation she has led into the Trump Organization’s finances.

In January, James’ office said it had found “substantial” evidence suggesting the company used false or misleading asset valuations in its financial statements to obtain loans, insurance and tax benefits. The company that had held Trump’s accounts throughout his life resigned the following month.

James began his investigation in 2019 after Trump’s former personal attorney, Michael Cohen, testified before Congress that the former president inflated the value of certain properties to get loans and insurance and understated others to get tax benefits.

In addition to the new fraud case, the Trump Organization faces trial next month on charges of participating in a 15-year tax evasion conspiracy. The company’s former CFO, Allen Weisselberg, has agreed to testify against the company.

Weisselberg, who served as the Trump Organization’s chief financial officer for decades, pleaded guilty in August to his role in a 15-year tax evasion scheme. As part of the settlement, he had agreed to testify against the real estate company at trial.

In recent weeks, the Trump Organization has offered to settle to avoid the lawsuit, though it has denied any wrongdoing. However, James’ office made clear it was not interested in a deal, people familiar with the matter said.

The family declared to the prosecutor’s office

In April, after a lengthy legal battle to enforce subpoenas against Trump and his adult children, lawyers in James’ office said they were nearing the end of their investigation and needed the family’s testimony before making a decision.

Last month, Trump did not answer questions, invoking his right not to incriminate himself under the Fifth Amendment, when called to testify by the district attorney.

Eric Trump, who runs the company, also pushed for his Fifth Amendment in 2020 in response to more than 500 questions.

Since Trump and Eric Trump refused to answer the questions, if the case goes to trial, the jury can draw an “adverse inference” against them for not answering them. It could lead to a higher penalty against them or the company if they are found liable.

Ivanka Trump and Trump Jr. answered questions in interviews that lasted more than seven hours, sources told CNN.

CNN’s Shawna Mizelle contributed to this report.

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