AG James Turns to Court to Force Trumps to Comply With Investigation

reprints


Attorney General Letitia James asked the courts to back up her office’s request for more information from The Trump Organization about tax submissions and financial statements used to obtain loans, stating that previous testimony had “misleading statements and omissions” and found “significant evidence” of potential fraud at the company.

With the request specifically pointed to former President Donald J. Trump and his children — Donald Trump, Jr., and Ivanka Trump the three could be required to appear for sworn testimony as part of the ongoing civil investigation into the Trump Organization’s finances, James’ office announced on Tuesday.

SEE ALSO: Gowanus Rezoning Should Be an Unmitigated Triumph. Why It’s Not.

“For more than two years, the Trump Organization has used delay tactics and litigation in an attempt to thwart a legitimate investigation into its financial dealings,” James said in a statement. “Thus far in our investigation, we have uncovered significant evidence that suggests Donald J. Trump and The Trump Organization falsely and fraudulently valued multiple assets and misrepresented those values to financial institutions for economic benefit. The Trumps must comply with our lawful subpoenas for documents and testimony because no one in this country can pick and choose if and how the law applies to them.”

James accused The Trump Organization of fraudulently propping up the values of numerous properties around the state, partly to help Trump’s personal net worth seem higher than it actually was.

One of the properties in question is Seven Springs, a 212-acre asset in Westchester County, N.Y., that was purchased by the organization in 1995. From 2004 to 2007, the Trump family increased the value of the property from $80 million to $200 million, then up to $291 million in 2012, according to James’ office.

Two separate appraisers actually valued the property at $56 million, James’ office claims. James also claimed that Trump’s triplex apartment in Trump Tower may have its value overestimated by $200 million.

Other accusations include miscategorizing assets as cash, a failure to disclose that the value of Trump Organization assets that may have been inflated by an undisclosed amount, failure to use industry-standard techniques of valuation such as discounting future revenues and expenses to their present value, or choosing as “comparables” only similar properties in order to impute valuations from public sales data, according to the attorney general’s office.

But The Trump Organization says the family is unbothered by what they claim is an attempt to fulfill a political promise to voters when James was running for attorney general in 2019, attributing the effort to force testimony from the Trump family to James’ recently calling off her bid for governor.

“She defrauded New Yorkers by basing her entire candidacy on a promise to get Trump at all costs without having seen a shred of evidence and in violation of every conceivable ethical rule,” a spokesperson for The Trump Organization said in a statement Wednesday. “Three years later she is now faced with the stark reality that she has no case. So, in response to Trump suing her and filing multiple ethical complaints, and on the heels of her failed governor’s race, she has no choice but to mislead the public yet again by misrepresenting the facts and ignoring her own inflammatory comments. Her allegations are baseless and will be vigorously defended.”

For his part, Trump has been on the offensive against James, who he says has been on a political witch hunt against him, by launching a December 2021 countersuit that accused her of using her office to attack political adversaries with the hopes judges would halt or rein in the attorney general’s probe.

While Trump and his organization have not been officially charged of wrongdoing, the Manhattan district attorney’s office previously indicted The Trump Organization’s chief financial officer, Allan Weisselberg, for allegedly evading taxes on a total of $1.8 million in perks from the company. The DA is also reportedly weighing charges against Trump COO Matthew Calamari for allegedly benefitting from a tax evasion scheme

Mark Hallum can be reached at mhallum@commercialobserver.com.