In the more than 200-page lawsuit, Attorney General Letitia James, a Democrat, claims the fraud affected all aspects of Trump’s business, including his properties and golf courses. According to the lawsuit, the Trump Organization defrauded lenders, insurers and tax authorities by inflating the value of its properties using misleading appraisals.
“These acts of fraud and misrepresentation were similar in nature, were committed by senior management in the Trump Organization as part of a concerted effort for each annual report, and were authorized at the highest levels of the Trump Organization — including Mr. . himself,” said the lawsuit.
James said he believes federal and criminal laws may have been violated and referred the matter to the U.S. attorney’s office for the Southern District of New York and the Internal Revenue Service.
James is seeking $250 million in alleged ill-gotten gains to permanently prevent Trump and the children named in the lawsuit from being directors of a business registered in New York state. He is also seeking to revoke the Trump Organization’s certificate of incorporation, which, if granted by a judge, could force the company to cease operations in New York state.
Trump previously called James a “renegade prosecutor” who he said was running a “vindictive and self-serving fishing expedition.” The Trump Organization called his previous claims “baseless” and denied any wrongdoing.
Responding to Wednesday’s announcement, Trump’s attorney Alina Habba said in a statement to CNN: “Today’s filing is not based on the facts or the law — rather, it is aimed solely at advancing the Attorney General’s political agenda. It is abundantly clear that the Attorney General’s Office has exceeded its statutory authority by applying in a transaction where no offense has been committed.”
Weisselberg’s attorney, Nicholas Gravante, declined to comment.
The lawsuit comes as Trump faces legal pressure as prosecutors take investigative steps that move closer to his inner circle.
Trump faces multiple criminal investigations from federal and state prosecutors involving the accuracy of his company’s financial statements, interference in the 2020 presidential election, and his handling of classified documents after leaving office. Trump has denied any wrongdoing.
AG concludes that Trump lied 200+ times about the value of his assets
James alleges that the former President and his company made “numerous fraudulent, false and misleading representations” over a 10-year period, according to the lawsuit, which featured what it called “200 false and misleading valuations” of Trump’s assets.
“The financial statements in question were issued annually; each contained a significant number of fraudulent, false, and misleading representations about the Trump Organization’s numerous assets; and many engaged in specific transactions with financial institutions,” the lawsuit alleges.
A three-year investigation
The announcement is the latest development in a three-year investigation led by James into the Trump Organization’s finances.
In January, James’ office said it had found “significant” evidence showing the Trump Organization used false or misleading asset counts in its financial statements to obtain loans, insurance and tax benefits. The following month, Trump’s longtime accounting firm resigned.
James launched his investigation in 2019 after Trump’s former fixer and private attorney Michael Cohen testified before Congress alleging that Trump inflated the value of some assets to get loans and insurance and undervalued others to get tax benefits.
In addition to the new fraud case, the Trump Organization is set to go on trial next month for alleged involvement in a 15-year tax fraud scheme and its longtime chief financial officer has agreed to testify against the company.
In recent weeks, the Trump Organization offered to settle the case even as they denied any wrongdoing, but James’ office made it clear it was not interested in a deal, people familiar with the matter said.
The family was placed by the AG’s office
In April, after a long legal battle to enforce subpoenas for Trump and his adult children, attorneys for James’ office said they were nearing the end of the investigation and needed the Trumps’ testimony before making a decision.
Last month, Trump did not answer questions and asserted his Fifth Amendment right against self-incrimination when presented by the attorney general’s office. Eric Trump, who runs the business every day, also invoked his Fifth Amendment in 2020 answering more than 500 questions.
Since Trump and Eric Trump refused to answer questions, if the case goes to trial, the jury could issue an “adverse instruction” against them for not answering questions. That could lead to higher penalties against them or the company if they are found liable.
Ivanka Trump and Trump Jr. all answered questions during interviews that lasted more than seven hours, sources told CNN.
This story has been updated with additional information.