A New York judge has ruled that former United States President Donald Trump and his sons, Eric and Donald Jr., are liable for fraud and lied about asset values and net worth for years.
The decision came amid the $250-million lawsuit brought forward by New York Attorney General Letitia James. The judge said that fraud was committed for years while the Republican businessman was building the real estate empire that was responsible for catapulting him to fame and the White House.
Judge Finds Trump Liable for Fraud
Judge Arthur Engoro found that the three individuals, along with executives from their company, routinely and repeatedly deceived banks, insurers, and others by massively overvaluing assets and exaggerating Trump's net worth on paperwork.
The judge's ruling came days before the start of a non-jury trial that will hear accusations about the former president and the Trump Organization and how they lied for a decade about asset values and his net worth to get better terms on bank loans and insurance, as per The Guardian.
In his ruling, Engoron wrote that the documents clearly contain fraudulent valuations that defendants used in their business dealings. The New York attorney general also said that Trump had effectively engaged in what she called a "bait and switch" operation."
She explained that this was inflating the former president's net worth by as much as $2.3 billion and by one measure as much as $3.6 billion, on annual financial statements that were given to banks and insurers.
Additionally, James said that assets whose values were inflated include the former president's Mar-a-Lago estate located in Florida, his penthouse apartment in Manhattan's Trump Tower, and several other office buildings and golf courses.
Following the judge's ruling, a trial is expected to start next week on the amount of damages owed, and the full breadth of Engoron's ruling, or how it would play out, remains unclear. Engoron canceled the business certifications of the Trump entities that are included as defendants in the $250-million case, including the Trump Organization, according to CNN.
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Dissolving Entities
The move is considered to be a major blow to the business that has been so synonymous with the former president's personal brand. Now, a receiver will be put in place to "manage the dissolution" of the corporate entities.
There are two New York properties that are part of the controversial lawsuit; the commercial tower at 40 Wall Street, and the Trump family compound located at Seven Springs. However, questions still remain as to how the receiver would dissolve the properties, if the ruling would affect properties located outside of New York state, and if the Trumps could transfer the New York-based assets into a new company found outside of the state.
Former judge, Barbara Jones, will also continue her role as a court-appointed monitor of financial activity at Trump Organization Inc. This is a separate entity from the similarly named LLC.
In response to the ruling, Trump posted a statement on his social media platform, Truth Social, on Tuesday, criticizing James and Engoron. He said that his civil rights have been violated and argued that some Appellate Court, whether Federal or State, have to reverse the "horrible, un-American decision," said NBC News.
