Tish James asks court to bar Trump Organization from offloading assets while civil fraud case against ex-president plays out
The New York state attorney general, Letitia James, on Thursday urged a court to appoint an independent monitor to oversee Donald Trump’s family company before a civil fraud case – against the former president, three of his adult children and the family’s real estate firm – goes to trial.
James’s injunction also sought to bar Trump’s company from conducting “significant fraudulent and illegal business” of precisely the kind described in the lawsuit filed by her office against him in September.
James asked a state court in Manhattan to bar the Trump Organization from offloading its assets while the case plays out and to prevent it issuing financial statements that do not explain their methodology, court papers showed. James asked to speed up the case and sought a trial date for October 2023.
The attorney general said it was necessary to install the monitor before the trial to make sure the company does not sell assets and to oversee its submission of financial information to third parties.
The injunction claimed that despite the lawsuit less than a month ago, Trump and his associates have proceeded to indulge in activities that they were aware are “improper or fraudulent”.
Examples include a 2021 statement that still has an “improper ‘fixed assets’” system used in assigning the value to his golf clubs, as well as the absence of restrictions on use of the Mar-a-Lago property when valuing that property. Furthermore, Trump is allegedly still holding on to $93m from a partnership with the Vornado real estate organization as his own.
James in September sued Trump, three of his adult children – Donald Trump Jr, Eric Trump and Ivanka Trump – and the company, accusing it of overvaluing its assets and his net worth through a decade of lies to banks and insurers.
Trump and his company deny wrongdoing and call the case a politically motivated “witch-hunt”. James is a Democrat.
Through the lawsuit, James is seeking to remove the Trumps from power at their company, prohibit Trump and the three adult children named in the case from serving as corporate officers or directors in New York, impose a monitor at the company and “prohibit the Trump Organization from acquiring any commercial real estate or receiving loans from New York-based entities for five years.”
The Trump Organization manages hotels, golf courses and other real estate around the world, and had been under investigation by James for more than three years.
The Manhattan district attorney, Alvin Bragg, has separately charged the Trump Organization with criminal tax fraud, and is preparing for a 24 October trial.
James asked in the injunction for an independent agent who, until the trial, will monitor any activity relevant to sharing financial information.
“Given the centrality of a particular cast of characters in the fraudulent conduct – including Mr Trump, Mr Weisselberg, Mr McConney, Donald Trump, Jr (as trustee), and Eric Trump – and the continued role of many of them in the closely held Trump Organization, the company’s leadership cannot be relied upon to ensure that financial submissions regarding Mr Trump’s assets and net worth are truthful, are not misleading (including by omission of important facts), and are compliant with applicable accounting principles,” read the motion.
“That Mr Trump – the person with beneficial ownership of the Trump Organization’s assets and effective control over them – continues to extol the statements is confirmation that appointment of an independent monitor is warranted and appropriate.”
The filing also gave some details about why James’s office had come to lack trust in the Trump organization.
“When OAG raised its ‘concern that the Trump Organization may be seeking to move assets out of state,’ and asked counsel for ‘some assurance that there will be no change to the status quo ante over the coming months (or that [OAG] will at least have reasonable advance notice of asset transfers),’ the Trump Organization offered no assurances,” read the filing.
