DONALD Trump and his sons Eric and Don Jr committed fraud by inflating the value of the real estate and financial assets of the Trump Organization for years, a New York judge ruled on Tuesday.
The ruling by Judge Arthur Engoron is a setback for the former president ahead of a trial in the civil case due to begin on Monday and a partial victory for New York state Attorney General Letitia James.
James has accused Trump, his two eldest sons and other Trump Organization executives of lying to tax collectors, lenders and insurers for years in a scheme that routinely exaggerated the value of their properties.
Trump’s lawyers had asked the judge to throw out the case ahead of the trial by granting what is known as a summary judgment in his favor.
James had also asked for a summary judgment, however, seeking that Trump be found liable ahead of the trial and the judge sided with the attorney general.
In addition to finding that Trump and his sons committed fraud, the judge also revoked the business licenses that allowed the Trump Organization to operate some of its New York properties.
James is seeking $250 million in penalties and the removal of Trump and his sons from management of the family empire, the Trump Organization.
James claims that Trump and his associates submitted “grossly inflated” numbers to banks and insurers each year between 2011 and 2021 “to secure and maintain loans and insurance on more favorable terms.”
They allegedly fraudulently overvalued the net worth of Trump company assets by billions of dollars, resulting in “hundreds of millions of dollars in ill-gotten savings and profits.”
James has alleged that the overvaluation of Trump’s assets was between $1.9 billion and $3.6 billion per year.