Alleging a widespread effort to manipulate property valuations by former President Donald Trump, three of his sons and his namesake company, New York Attorney General Letitia James announced Wednesday that her office is suing them, seeking $250 million. and the end of its operations in the state. .
James’ office alleged in a 221-page complaint filed Wednesday that Trump, Donald Trump Jr., Ivanka Trump and Eric Trump, as well as others who have served as company executives at the Trump Organization, participated in a scheme to a year to enrich himself by inflating the values of a wide swath of properties, stretching across his international real estate empire.
“Stating that you have money that you don’t have is not the art of the deal, it is the art of theft,” James said at a news conference on Wednesday. He added that the investigation involved interviews with more than 65 witnesses.
During the news conference, James said he was seeking to dissolve Trump’s company, but later clarified that dissolution is not among the remedies his office is seeking.
James’ office is asking a judge to revoke the Trump Organization’s business certificate, effectively barring it from doing business in New York. His office seeks to permanently bar Trump and his children named in the lawsuit from serving as officers or directors of any business entity in New York, including his family’s business. He is also calling for a five-year ban on Trump and the company acquiring New York real estate or borrowing from any New York-based company.
In a statement to CBS News, Alina Habba, a lawyer for Donald Trump, said that “today’s presentation is not focused on the facts or the law, but is focused solely on furthering the political agenda of the Attorney General.”
“It is abundantly clear that the Attorney General’s Office has exceeded its legal authority by meddling in transactions in which there has been absolutely no wrongdoing,” Habba said. “We are confident that our court system will not tolerate this unbridled abuse of authority, and we look forward to defending our client against any and all unsubstantiated claims by the Attorney General.”
The complaint accuses the company of more than 200 instances of false asset valuations.
“The amount of grossly inflated asset values is staggering and affects most, if not all, real estate holdings in any given year,” James’ office wrote in the complaint.
It alleged that Trump and the company used “factually false assumptions and blatantly inappropriate methodologies with the intent and purpose to falsely and fraudulently inflate Mr. Trump’s net worth in order to obtain beneficial financial terms from lenders and insurers.”
In a case highlighted in the complaint, the state alleges that Trump’s company said a dozen rent-stabilized apartments on Trump Park Avenue were listed on corporate documents as worth more than $49.5 million. In fact, the suit says, they had been appraised at a total of $750,000.
In another example, the suit says a property in suburban New York known as “Seven Springs” was appraised by a bank at $25 million and the following year at $30 million. The complaint says Trump’s company valued it at up to $291 million in financial paperwork.
James’ office launched its civil investigation in 2019 after Michael Cohen, Trump’s former lawyer, testified before Congress, raising questions about whether the Trump Organization had “issued fraudulent financial statements,” according to court documents related to the investigation. The initial focus of the investigation was whether the Trump Organization inflated asset valuations while seeking loans and insurance coverage and understated the value of other assets to reduce tax liability.
It turned into an exhaustive investigation of dozens of Trump properties and years of Trump Organization finances. Investigators from James’ office examined more than a million pages of documents and issued subpoenas to dozens of current and former executives who work for the Trump Organization and other companies connected to it. Finally, in August, Trump and two of his children, Ivanka and Donald Trump Jr., came forward to testify after nearly a year-long feud.
Trump invoked his Fifth Amendment right against self-incrimination and refused to answer hundreds of questions.
The investigation unfolded as a “special proceeding,” in which a New York judge presided over years of contentious disputes over subpoenas and other challenges in often public filings and hearings.
The proceedings made public developments that might otherwise have remained confidential, such as a letter sent to the company in February by its longtime accounting firm, Mazars USA, cutting ties with the Trump Organization and saying that decade-old financial statements “They should no longer be trusted.”
In court, lawyers from James’ office described an effort to untangle finances at properties from Los Angeles to Scotland. They repeatedly said their investigation was uncovering evidence that Trump and his company “fraudulently” valued multiple assets and “misrepresented” those values to the financial institutions with which they partnered.
Lawyers for the Trump Organization denounced the effort in hearings and filings as an unprecedented “fishing expedition.”
The company repeatedly tried to stop the investigation and shield the Trumps from the statements, but the New York courts rejected them each time, ruling the investigation and their subpoenas legal.
Trump and his company have repeatedly denied all allegations of wrongdoing, calling them a “witch hunt” and a “political crusade.” Trump’s lawyers did not immediately respond to requests for comment.
The lawsuit comes as Trump and the company face mounting legal jeopardy. The Trump Organization is on trial in a criminal trial on October 24 in Manhattan, where it will fight charges of fraud and tax evasion. The company has entered a not guilty plea in the case.
Trump is at the center of at least two federal investigations: a grand jury investigation into his alleged role in the events leading up to the January 6, 2021 attack on the US Capitol found at his home in Florida. He is also the focus of a grand jury in Fulton County, Georgia, investigating Trump’s conduct after he lost the 2020 election.