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Shkruar nga Roland Lindner
The decision in the fraud trial in New York is a big loss for the former president. This could lead to significant changes in his company...
The conclusion of the fraud trial in New York raises questions about the future of Donald Trump's real estate empire. The judge in charge, Arthur Engoron, on Friday did not only impose a fine of almost 355 million dollars on the former American president. He has also decided that Trump's company, the Trump Corporation, will be placed under tighter scrutiny. In the future, two independent supervisors will monitor it every step of the way.
According to the decision, Trump himself is no longer allowed to serve on the board of directors or supervisory board of a company in New York state for three years; this would also apply to parts of the Trump Organization.
His sons Eric and Donald Jr. were also involved in this decision: They were handed a two-year ban and must each pay a fine of $4 million.
They both currently hold the title of "Executive Vice President" at the company, with Eric acting as the de facto CEO [administrator].
The judge's ruling could have the effect that the Trump empire will be run, at least temporarily, by managers outside the family.
"Your lack of remorse borders on pathology"
The lawsuit stems from a lawsuit filed in September 2022 by New York Attorney General Letitia James. She accuses Trump of giving inflated valuations for his real estate empire for years in order to get more favorable loan terms from banks.
The lawsuit contains a number of examples: Trump is said to have specified a floor area of 2,800 square feet for his three-story apartment in Trump Tower, even though it was only a little more than 1,000 square feet.
James initially asked for a fine of $250 million, but later revised the amount to $370 million. The judge came very close to the ideas of the prosecutors with his decision. Of the fine now imposed, $168 million is attributable to interest alone, which Trump is said to have saved through inflated valuations.
Judge Engoron had harsh words for Trump in his 92-page ruling.
"In order to be able to borrow more money at lower interest rates, the defendants blatantly submitted false financial information." During the trial, they were not ready to accept responsibility. "Your complete lack of remorse borders on pathology."
Trump warned of an appeal of the decision
The judge also wrote that he had also taken into account the fact that Trump's companies had committed illegal acts in the past and that this was not his "first case". Trump himself damaged his credibility on the witness stand by not answering questions directly or by not answering them at all. For example, he insisted that Mar-a-Lago, his private club in Florida, would be worth between one and a half billion dollars, which would be many times more than the most expensive private residential property currently in the US .
Trump's lawyer, Alina Habba, called the decision "manifest injustice" and announced that they will send the case to appeal. However, Trump must post bail within 30 days, meaning the decision is likely to have financial ramifications for him very soon. Given the large number of properties in his portfolio alone, there is probably no risk of him filing for bankruptcy, but his liquid assets could shrink significantly.
Trump said under oath last year that he had more than $400 million in cash. It's conceivable that Trump would be forced to sell real estate to pay the fine, especially since he was ordered to pay $83 million in another civil case just weeks ago. He is supposed to pay this amount to author E. Jean Carroll, who accused him of damaging her reputation by denying that he raped her in the 1990s.
The decision in New York could be even worse for the Trumps. The public prosecution had requested even longer detentions. The judge also overturned an earlier order revoking Trump's New York business licenses. This could have resulted in Trump losing control of some of his most iconic properties, such as Trump Tower. Engoron said that because there will now be multiple independent overseers of the Trump companies, removing the licenses is no longer necessary.
The trial in the civil case began in October and dragged on until January. Trump also took the witness stand and denied the allegations. He said he believes the properties in his financial reports are not overvalued, but undervalued. He also regularly attacked Justice Engoron and Attorney General James during the trial. His lawyers argued that there were no victims. Financial houses such as Deutsche Bank, which lent money to Trump, did not suffer financial losses and did not complain of fraud. Furthermore, real estate valuation is a subjective matter.
Trump's fortune is estimated at 2.6 billion dollars
In its lawsuit, the Attorney General's Office cited violations of New York Executive Law 63(12). This is a law intended to punish repeated deceptive business practices. In order to prove fraud under this law, it is not necessary that the act was committed intentionally or that someone was harmed.
In addition to the civil disputes, Trump also faces four criminal lawsuits. He has used his high-profile legal battles to solicit donations. His total assets were recently estimated by Forbes at $2.6 billion. In 2015, the year before he became president, it was at a record $4.5 billion.
He himself said during this time that his wealth was more than 10 billion dollars. Forbes estimates the current value of Trump's New York real estate at $690 million. [Translated by: ISHJ]
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