Former president Donald Trump, his family business and three of his children “grossly inflated” asset values on the Trump Organization’s real estate holdings, according to a civil lawsuit filed on Wednesday by New York Attorney General Letitia James, who accused Trump of “staggering fraud.”
The lawsuit details that 11 of Trump’s annual financial statements included more than 200 false and misleading asset valuations.
“Claiming that you have money that you do not have does not amount to the art of the deal, it’s the art of the steal,” James said at a news conference announcing the suit on Wednesday.
One over-valuation highlighted in the suit involved a dozen rent stabilized apartments in Trump Park Avenue that were listed on corporate paperwork as being worth more than $49.5 million.
In fact, according to the suit, the apartments had been appraised at a combined $750,000.
Another example: a property in suburban New York known as “Seven Springs” was appraised by a bank at $25 million, and the next year $30 million.
Trump’s company has valued it as high as $291 million in financial paperwork.
The lawsuit also details that Trump valued his Mar-a-Lago club property in Palm Beach, Fla., on the premise that it sat on unrestricted property and could be developed for residential use, even though he would have known that the club was subject to a slew of tight restrictions.
Mar-a-Lago “generated less than $25 million in annual revenue,” James said. “It should have been valued at about $75 million, but it was valued at $739 million.”
The valuations were used to fraudulently obtain loans and insurance coverage, according to the suit.
“For too long, powerful, wealthy people in this country have operated as if the rules do not apply to them,” James said. “Donald Trump stands out as among the most egregious examples of this misconduct. With the help of his children and senior executives at the Trump Organization, Donald Trump falsely inflated his net worth by billions of dollars to unjustly enrich himself and cheat the system.”
The suit seeks $250 million in damages, in addition to permanently barring Donald Trump, Donald Trump Jr., Eric Trump and Ivanka Trump from serving as an officer of a company in New York, and prohibiting the Trump companies named in the suit from doing business in New York state.
James also said Wednesday that she has asked federal prosecutors in Manhattan and the IRS to investigate Trump for possible federal crimes resulting from her three-year civil probe, which she said indicated possible crimes of bank fraud and making false statements to financial institutions.
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Chris Graham
