On Tuesday, New York Supreme Court Justice Arthur Engoron ruled that former President Trump is liable for “persistent fraud” after the New York State Attorney General’s Office (OAG) said Trump had prepared, certified, and submitted to lenders false and misleading financial statements. Trump responded by condemning the ruling as “Democrat Political Lawfare.”
On November 3, 2022, the judge found that the defendants, including Trump, his two sons Donald Jr. and Eric, and members of the Trump organization “had a propensity to engage in persistent fraud by submitting false and misleading statements of financial condition on behalf of defendant Donald J. Trump.”
After the defendants moved to dismiss the complaint, the court denied the motion on January 6, 2023. The defendants appealed that ruling.
Trump responded in a post on his social media platform Truth Social.
“The widespread attack against me, my family, and my supporters has devolved to new, un-American depths, at the hands of a DERANGED New York State Judge, doing the bidding of a completely biased and corrupt ‘Prosecutor,’ Letitia James,” Trump wrote. “This is Democrat Political Lawfare, and a Witch Hunt at a level never seen before. It is an attempt to badly injure the opposing Party’s Leading, by far, Political Candidate.”
He added, “Nothing like this has ever happened in our Country before. My Civil Rights have been violated, and some Appellate Court, whether Federal or State, must reverse this horrible, un-American decision. If they can do this to me, they can do this to YOU!”
Trump has maintained that his financial statements were not fraudulent because they contained disclaimers. Engoron dismissed that argument, however, writing, “The defendants’ reliance on these ‘worthless’ disclaimers is worthless.”
“Defendants followed the same procedure each year to create false and misleading SFCs,” a memo from NY Attorney General Letitia James in support of the plaintiffs’ motion stated in late August. “The SFCs include amounts for Mr. Trump’s assets, mostly real estate holdings, that are represented to be stated ‘at their estimated current values,’ a term defined in the applicable accounting rules as the value that a willing buyer and willing seller could agree on, where both are fully informed and neither is acting under duress. The associated liabilities are then subtracted from the ‘estimated current values’ to derive Mr. Trump’s net worth.”
Engoron wrote in his ruling issued on Tuesday, “Defendants repeat the erroneous argument that the complaint must be dismissed because OAG cannot demonstrate the requirements of a parens patriae action, which is one in the public interest,” then explained that a parens patriae action “permits the state to commence an action to protect a public interest, like the safety, health or welfare of its citizens.”
The judge went on to slam the Trump legal team’s reliance on what he characterized as other “bogus arguments,” including “rent regulated apartments are worth the same as unregulated arguments; restricted land is worth the same as unrestricted land; restrictions can evaporate into thin air; a disclaimer by one party casting responsibility on another party exonerates the other party’s lies.”
The ruling is the latest in a barrage of legal actions brought against Trump amid his presidential bid, including two federal indictments and two state-level indictments, all of which the former president and leading GOP candidate has condemned as attempts to keep him from winning reelection.
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