The New York attorney general’s office told a court Tuesday night that its investigators had uncovered evidence that former President Donald Trump’s company used “fraudulent or misleading” asset valuations to obtain loans and tax benefits.
The court filing said state authorities have not yet decided whether to file a civil lawsuit over the allegations, but that investigators must question Trump and his two eldest sons as part of the investigation.
Trump and his lawyers say the investigation is politically motivated.
In court documents, Attorney General Letitia James’ office provided its most detailed report yet in a lengthy investigation into allegations that Trump’s company overstated asset values to obtain favorable loan terms, or misstated the value of the land to reduce your tax burden. .
“The Trump Organization,” he said, “has exaggerated the value of land donations made in New York and California in documents filed with the IRS to justify several million dollars in tax deductions.”
The company misreported the size of Trump’s Manhattan penthouse, saying it was nearly three times its actual size, a difference in value of about $176 million, James’ office said, citing deposition testimony from the chief financial officer. of Trump, Allen Weisselberg, who was indicted last year for tax fraud in a parallel criminal investigation.
James’ office detailed its findings in a court motion seeking to compel Trump, his daughter Ivanka Trump and his son Donald Trump Jr. to comply with subpoenas seeking their testimony.
Investigators, the court documents explained, had “developed significant additional evidence indicating that the Trump Organization used fraudulent or misleading asset valuations to obtain a range of economic benefits, including loans, insurance coverage, and tax deductions.”
Trump’s legal team has tried to block the subpoenas, calling them “an unprecedented and unconstitutional move.”
They say James is improperly trying to obtain testimony that could be used in the parallel criminal investigation, overseen by Manhattan District Attorney Alvin Bragg.
Trump sued James in federal court last month, seeking to end his investigation.
In the lawsuit, his lawyers claimed that the attorney general, a Democrat, had violated the Republican’s constitutional rights in a “thinly veiled effort to publicly smear Trump and his associates.”
In the past, the former Republican president has denounced the James investigation and the Bragg investigation as part of a “witch hunt.”
In a statement Tuesday night, James’ office said it has not decided whether to take legal action, but said the evidence gathered so far shows the investigation should continue unimpeded.
“For more than two years, the Trump Organization has used delaying tactics and litigation in an attempt to thwart a legitimate investigation into its financial dealings,” James added.
“So far in our investigation, we have uncovered significant evidence suggesting that Donald J. Trump and the Trump Organization falsely and fraudulently valued multiple assets and misrepresented those values to financial institutions for financial gain.”
Although the civil investigation of James is separate from the criminal investigation, his office has been involved in both, sending several attorneys to work side by side with prosecutors from the Manhattan district attorney’s office.
James’s office said that under state law, it could seek “a wide range of remedies” against companies found to have committed business fraud, “including revocation of a license to conduct business within the state, removal of an officer or director of the board of directors, and the restitution and return of illicit profits”.
In court papers, James’ office said the evidence shows Trump’s company:
- He listed his Seven Springs property north of New York City as worth €256 million, based on the dubious assumption that he could make €142 million from the construction of nine luxury homes.
- A “brand premium” of 15% to 30% was added to the value of some properties because they bore Trump’s name, despite the fact that the financial statements explicitly indicated that they did not incorporate brand equity.
- He inflated the value of a golf club in suburban New York by millions of dollars by counting membership fees that were never sold or paid.
- He valued a Park Avenue condominium tower at $308 million, based on the income it could make from unsold units, even though many of those apartments would likely sell for less because they were covered by rent stabilization laws.
- He valued an apartment rented from Ivanka Trump at €22 million, even though she had the option to buy it for €7.4 million.
- He said in documents that his stake in an office building, 40 Wall Street, was worth between €463 million and €530 million, two to three times the estimate reached by appraisers working for lender Capital One.
Earlier, a judge sided with James in an earlier request to question another Trump son, Trump Organization executive Eric Trump, who eventually sat down for deposition but refused to answer questions.
Last year, the Manhattan district attorney brought tax fraud charges against the Trump Organization and Weisselberg, its longtime chief financial officer.
Weisselberg has pleaded not guilty to charges that he and the company evaded taxes on lucrative fringe benefits paid to executives.
Both investigations are related, at least in part, to allegations made in news reports and by Trump’s former personal attorney, Michael Cohen, that Trump had a history of misrepresenting the value of assets.
The revelations about the attorney general’s investigation came on the same day that Trump ally Rudy Giuliani and other members of the legal team who had tried to overturn the results of the 2020 presidential election were subpoenaed by a House committee. of Representatives investigating the US Capitol insurrection.
George is Digismak’s reported cum editor with 13 years of experience in Journalism