Trump civil fraud case: Judge fines Trump $354 million, says frauds 'shock the conscience'

The former president was found to have defrauded lenders.

Former President Donald Trump has been fined $354.8 million plus approximately $100 million in interest in a civil fraud lawsuit that could alter the personal fortune and real estate empire that helped propel him to the White House. In the decision, Judge Arthur Engoron excoriated Trump, saying the president's credibility was "severely compromised," that the frauds "shock the conscience" and that Trump and his co-defendants showed a "complete lack of contrition and remorse" that he said "borders on pathological."

Engoron also hit Donald Trump Jr. and Eric Trump with $4 million fines and barred all three from helming New York companies for years. New York Attorney General Letitia James accused Trump and his adult sons of engaging in a decade-long scheme in which they used "numerous acts of fraud and misrepresentation" to inflate Trump's net worth in order get more favorable loan terms. The former president has denied all wrongdoing and has said he will appeal.


Summary of penalties

Donald Trump and his adult sons were hit with millions in fines in the civil fraud trial and barred for years from being officers in New York companies. The judge said the frauds "shock the conscience."

Donald Trump: $354 million fine + approx. $100 million in interest
+ barred for 3 years from serving as officer of NY company
Donald Trump Jr.: $4 million fine
+ barred for 2 years from serving as officer of NY company
Eric Trump: $4 million fine
+ barred for 2 years from serving as officer of NY company
Former Trump Organization CFO Allen Weisselberg: $1 million fine
+ barred for 3 years from serving as officer of NY company
+ barred for life from financial management role in NY company
Former Trump Organization controller Jeffrey McConney:
+ barred for 3 years from serving as officer of NY company
+ barred for life from financial management role in NY company


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Court adjourned for the day, with Trump on deck for Monday

Judge Engoron adjourned court until Monday, when the state plans to call former President Trump to the stand.

"We will reconvene on Monday at 10 a.m., and the first witness will be...?" Engoron asked state attorney Andrew Amer.

"The only witness will be Donald J. Trump," Amer said.


Eric Trump pressed on Mar-a-Lago valuation

Eric Trump has stepped down from the witness stand after facing an hour of questions from state attorney Andrew Amer.

Amer concluded his questioning by directly asking Eric Trump about the $2 million severance agreement between the Trump Organization and its former CFO, Allen Weisselberg.

"Did you participate in the business agreement to enter into this business decision with Mr. Weisselberg?" Amer asked.

"Yes," Eric Trump said.

"Did your father direct you to enter into this agreement with Mr. Weisselberg?" Amer asked.

"No, he did not," Eric Trump replied. He reiterated, "I did this agreement with Mr. Weisselberg."

Pressed on the value of Trump's Mar-A-Lago property, Eric Trump denied knowing that the club was valued for tax purposes as a commercial property used as a social club.

"It is very clear that Mar-a-Lago is not a club, it is a private residence. I don't see anything wrong with that. 100 percent," Eric Trump said.

Previous testimony and documents in evidence demonstrated that despite the property being restricted by deed to club usage, Donald Trump continued to overvalue the property as if it could be sold as a private residence. Judge Engoron already found that the club was overvalued by 2,300%.

"Mar-a-Lago is a residence that could be sold to a private individual," Eric Trump insisted.


Eric Trump testifies that he signed financial certifications

Eric Trump said that he signed three financial certifications to lenders that relied on his father's statements of financial condition, which are at the heart of the attorney general's case.

"I certified something I believed was accurate. My lawyers told me was accurate, and our financial people told me was accurate," Eric Trump said.

While Eric Trump did not certify his father's financial statements themselves, like his brother Donald Trump Jr., the attorney general has alleged that these certifications to lenders are similarly fraudulent.

Eric Trump said that he did not personally review the methodologies or supporting data for the financial statements themselves, instead relying on lawyers and accountants to verify the documents for him.

"I wouldn't sign something that I thought was inaccurate," he said multiple times.


Trump lawyer broaches mistrial over unproven report of bias

Eric Trump has resumed his testimony this morning.

Before he took the stand, Donald Trump's attorney Chris Kise said that the defense team is considering requesting the mistrial on the basis of a Breitbart report alleging bias from Judge Engoron's law clerk.

"I think the defense will have to give serious consideration to seeking a mistrial," Kise said, initially referencing a vague media report that "some random individual" filed a complaint on Oct. 3 alleging "accusations of partisan political activity" by the judge's clerk.

"It's not information, it's an allegation," Judge Engoron initially responded. "I don't know what you are talking about, and I will respond later."

A state attorney argued that Kise was arguing a "frivolous position" and requested specifics about the news report Kise cited.

"I'm not the internet person. I want to say it is on Breitbart maybe. It's on a news outlet," Kise said, prompting laughter from the gallery.

"This idea that somebody notified me ... is absolutely untrue. OK? Absolutely untrue," Engoron responded. "I will let everybody in the room decide what they think about Breitbart."

"It's a shame you descended to this level," Engoron added.

A court spokesperson subsequently described the report as "not a serious complaint."


Trump's business drew little scrutiny from bank, defense says

Deutsche Bank was a serious company in business with Donald Trump to make money, defense attorney Jesus Suarez said during his cross examination of former Deutsche Bank executive Nicholas Haigh.

At the height of its relationship with the Trump Organization the company loaned Trump over $378 million, and failed to commission independent appraisals of Trump's properties, Haigh acknowledged. While the bank listed lower estimates for the value of Trump's assets year after year, it continued to do business with Trump and his company.

"We ... the bank hadn't done all the due diligence one would do in the sense of the opinion of value you see in an appraisal," Haigh said, at one point agreeing with the defense's characterization that the bank's internal value services group conducted "sanity checks'' on the numbers.

The direct examination of Haigh by state attorney Kevin Wallace also left a central question about Deutsche Bank's activity unanswered.

In a letter to the court and in previous arguments, lawyers for the attorney general suggested that Haigh might have turned away Trump's business if he had known that Trump's assets were inflated in value.

"As this Court noted during summary judgment arguments, Mr. Haigh testified during OAG's investigation that he may not have authorized lending to the borrower if he had at that time been aware of the inflated asset values contained in Mr. Trump's SFCs [statements of financial condition]," a lawyer for the attorney general wrote to the court in a letter last week.

Wallace never directly posed the hypothetical to Haigh during his direct examination, leaving the question unresolved.

Court subsequently adjourned for the day, with Suarez telling the court he plans to continue his cross examination of Haigh through Thursday afternoon.