What you need to know about Trump’s civil fraud lawsuit
The trial of Donald J. Trump will continue Monday in a New York courtroom, with him on the witness stand, part of a proceeding that threatens the business empire that underpins his public persona and fueled his run for the White House .
The lawsuit stems from a lawsuit filed by New York Attorney General Letitia James, which accuses Mr. Trump and other defendants, including his companies and sons Donald Jr. and Eric, of fraudulently inflating the value of assets to obtain favorable loans and insurance contracts. .
Over the past five weeks, lawyers from the attorney general’s office have argued that Mr. Trump’s employees arbitrarily assigned values to individual assets to arrive at the former president’s desired net worth. Mr. Trump’s lawyers have responded that the assets had no objective value and that different valuations are standard in real estate.
The judge, Arthur F. Engoron, ruled before the trial that Mr. Trump and the other defendants were liable for fraud, and that their financial statements were replete with examples of such misconduct.
When the trial ends, Judge Engoron will decide whether Mr. Trump must pay a significant fine or be subjected to some other punishment. Mrs. James has asked that he pay $250 million and that he and his sons be permanently barred from running a business in New York.
Mr. Trump, a Republican, has denied any wrongdoing. After his testimony on Monday, his daughter Ivanka will testify on Wednesday. The attorney general’s office is then expected to drop its case.
Mr. Trump’s lawyers will then present a defense. They are expected to recall many witnesses who have already testified, including the defendants, and to call their own experts. The trial is expected to last until December 22, but could be completed sooner.
Here’s what’s happened so far:
Gag orders
During the first week of the trial, Judge Engoron ordered Mr. Trump not to comment on members of the judge’s staff on social media. The admonishment came in response to a post from Mr. Trump that showed a photo of the judge’s law clerk, Allison Greenfield, while Senate Majority Leader Chuck Schumer mocked her as “Schumer’s girlfriend.”
A copy of the message remained on Trump’s campaign website. On October 20, Judge Engoron called it a “flagrant violation” and fined Mr. Trump $5,000.
The following week, Mr. Trump told reporters outside the courtroom that Judge Engoron “has a person sitting next to him who is very partisan, maybe even much more partisan than him.” Justice Engoron fined him $10,000.
On Friday, Mr. Trump’s legal team continued those attacks, saying communications between the judge and his law clerk during the hearing created a “perception of bias” that could lead to a mistrial.
A few hours later, Judge Engoron banned all lawyers from making statements about the internal and confidential communications between him and his staff.
Engoron argued that the safety of his staff outweighed the defendants’ First Amendment rights, writing that since the start of the trial his office had been “inundated with hundreds of harassing and threatening phone calls, voicemails, emails, letters and parcels’.
Arguing the case
Twenty-three witnesses testified, including four defendants: former Trump Organization comptroller Jeffrey McConney; the former chief financial officer, Allen Weisselberg; and Mr. Trump’s sons. Through evidence such as spreadsheets and emails, the attorney general’s team has tried to demonstrate the defendants’ intent to inflate Mr. Trump’s financial statements and have financial institutions rely on them.
Mr. McConney testified that some of his valuations were the result of an error or oversight, but that others were intentional, such as not including twelve rent-stabilized apartments in Trump Park Avenue’s valuation.
Mr McConney said he did not act alone. He said he arrived at or reiterated exaggerated values after discussions with Mr. Weisselberg.
On the witness stand, Mr. Weisselberg acknowledged his role in some of the manipulation of Mr. Trump’s assets. He also implicated his former boss, saying Mr. Trump had reviewed the financial statements before finalizing them.
Younger Trumps testify
Both Trump sons tried to distance themselves from the annual accounts. During three days of testimony, the attorney general’s office tried to dispel their claims last week.
Eric Trump said he did not focus on valuations but was confronted with emails showing he actively participated in the valuation of the Trump Organization’s assets. The attorney general’s office also tried to show that he ignored an independent estimate of the value of the family’s golf club in Westchester County, NY.
Donald Trump Jr. was presented with evidence showing that he was aware of discrepancies in the valuations. He was shown an email he had received from Forbes magazine warning him of errors in a financial statement. But shortly afterwards he had told his accountants that the document contained no material misstatements.
Donald Trump Jr. was also confronted about his signature on letters taking responsibility for the financial statements, testifying at one point that he expected the company’s largest lender to rely on their accuracy.