NATIONAL NEWS

Donald Trump fraud verdict: $364 million penalty in civil fraud case

Feb 16, 2024, 12:22 PM | Updated: 12:43 pm

Image: Former President Donald Trump attends the closing arguments in the Trump Organization civil ...

Former President Donald Trump attends the closing arguments in the Trump Organization civil fraud trial at New York State Supreme Court in the Manhattan borough of New York, Jan. 11, 2024. (Photo: Shannon Stapleton, pool photo via AP files)

(Photo: Shannon Stapleton, pool photo via AP files)

NEW YORK (AP) — A New York judge ruled Friday against Donald Trump, imposing a $364 million penalty over what the judge ruled was a yearslong scheme to dupe banks and others with financial statements that inflated the former president’s wealth.

Trump also was barred from serving as an officer or director of any New York corporation for three years.

However, the judge backed away from an earlier ruling that would have dissolved the former president’s companies.

Trump lawyer Alina Habba called the verdict “manifest injustice” and “the culmination of a multi-year, politically fueled witch hunt.”

Judge Arthur Engoron issued his decision after a 2½-month trial that saw the Republican presidential front-runner bristling under oath that he was the victim of a rigged legal system.

Engoron concluded that Trump and his co-defendants “failed to accept responsibility” for their actions and that expert witnesses who testified for the defense “simply denied reality.”

The judge called the civil fraud at the heart of the trial a “venial sin, not a mortal sin.” But Engoron said the refusal by Trump and his associates to admit wrongdoing suggested they would continue if not constrained.

“Their complete lack of contrition and remorse borders on pathological,” added Engoron, a Democrat.

The stiff penalty was a victory for New York Attorney General Letitia James, a Democrat, who sued Trump over what she said was not just harmless bragging but years of deceptive practices as he built the multinational collection of skyscrapers, golf courses and other properties that catapulted him to wealth, fame and the White House.

Trump’s lawyers had said even before the verdict that they would appeal.

James sued Trump in 2022 under a state law that authorizes her to investigate persistent fraud in business dealings.

The suit accused Trump and his co-defendants of routinely puffing up his financial statements to create an illusion his properties were more valuable than they really were. State lawyers said Trump exaggerated his wealth by as much as $3.6 billion one year.

By making himself seem richer, Trump qualified for better loan terms, saved on interest and was able to complete projects he might otherwise not have finished, state lawyers said.

Even before the trial began, Engoron ruled that James had proven Trump’s financial statements were fraudulent. The judge ordered some of Trump’s companies removed from his control and dissolved. An appeals court put that decision on hold.

In that earlier ruling, the judge found that, among other tricks, Trump’s financial statements had wrongly claimed his Trump Tower penthouse was nearly three times its actual size and overvalued his Mar-a-Lago estate in Palm Beach, Florida, based on the idea that the property could be developed for residential use, even though he had surrendered rights to develop it for any uses but a club.

Trump, one of 40 witnesses to testify at the trial, said his financial statements actually understated his net worth and that banks did their own research and were happy with his business.

“There was no victim. There was no anything,” Trump testified in November.

During the trial, Trump called the judge “extremely hostile” and the attorney general “a political hack.” In a six-minute diatribe during closing arguments in January, Trump proclaimed “I am an innocent man” and called the case a “fraud on me.”

Trump and his lawyers have said the outside accountants that helped prepare the statements should’ve flagged any discrepancies and that the documents came with disclaimers that shielded him from liability. They also argued that some of the allegations were barred by the statute of limitations.

The suit is one of many legal headaches for Trump as he campaigns for a return to the White House. He has been indicted four times in the last year — accused in Georgia and Washington, D.C., of plotting to overturn his 2020 election loss to Democrat Joe Biden, in Florida of hoarding classified documents, and in Manhattan of falsifying business records related to hush money paid to porn actor Stormy Daniels on his behalf.

On Thursday, a judge confirmed Trump’s hush-money trial will start on March 25 and a judge in Atlanta heard arguments on whether to remove Fulton County District Attorney Fani Willis from his Georgia election interference case because she had a personal relationship with a special prosecutor she hired.

Those criminal accusations haven’t appeared to undermine his march toward the Republican presidential nomination, but civil litigation has threatened him financially.

On Jan. 26, a jury ordered Trump to pay $83.3 million to writer E. Jean Carroll for defaming her after she accused him in 2019 of sexually assaulting her in a Manhattan department store in the 1990s. That’s on top of the $5 million a jury awarded Carroll in a related trial last year.

In 2022, the Trump Organization was convicted of tax fraud and fined $1.6 million in an unrelated criminal case for helping executives dodge taxes on extravagant perks such as Manhattan apartments and luxury cars.

James had asked the judge to impose a penalty of at least $370 million.

Engoron decided the case because neither side sought a jury and state law doesn’t allow for juries for this type of lawsuit.

Because it was civil, not criminal in nature, the case did not carry the potential of prison time.

James, who campaigned for office as a Trump critic and watchdog, started scrutinizing his business practices in March 2019 after his former personal lawyer Michael Cohen testified to Congress that Trump exaggerated his wealth on financial statements provided to Deutsche Bank while trying to obtain financing to buy the NFL’s Buffalo Bills.

James’ office previously sued Trump for misusing his own charitable foundation to further his political and business interests. Trump was ordered to pay $2 million to an array of charities as a fine and the charity, the Trump Foundation, was shut down.

Trump incorporated the Trump Organization in New York in 1981. He still owns it, but he put his assets into a revocable trust and gave up his positions as the company’s director, president and chairman when he became president, leaving management of the company to sons Eric and Donald Trump Jr.

Trump did not return to a stated leadership position upon leaving the White House in 2021, but his sons testified he’s been involved in some decision making.

Engoron had already appointed a monitor, retired federal judge Barbara Jones, to keep an eye on the company.

National News

Dr. Max Rogers, the obstetrician-gynecologist at Grove Hill Memorial Hospital, poses for a photo Mo...

Associated Press

Alabama birthing units are closing to save money and get funding. Some say babies are at risk

GROVE HILL, Ala. (AP) — One of the last remaining birthing units in southern Alabama will close next month to qualify for federal funding that will save the hospital’s emergency services, but doctors warn the move may cost newborns and pregnant women essential access to obstetric care. Nestled in rural Clarke County, the small, nonprofit […]

21 minutes ago

Jim, left, and Tamara Hamilton watch former President Donald Trump speak on television on Thursday,...

Associated Press

Some GOP voters welcome Trump’s somewhat softened tone at Republican National Convention

For those conservative voters long turned off by former President Donald Trump’s rhetoric, his somewhat softened tone in accepting the Republican nomination Thursday night was a welcome relief. “He’s much improved,” Dave Struthers, a 57-year-old farmer from Collins, Iowa, said as he watched Trump’s speech in the basement of his farmhouse. “The thing I’ve had […]

37 minutes ago

FILE - Former President Barack Obama speaks in Athens, Greece, June 21, 2023. Democrats at the high...

Associated Press

Obama’s dilemma: Balancing Democrats’ worry about Biden and maintaining influence with president

WASHINGTON (AP) — Former President Barack Obama has a delicate balance to strike: how to weigh the mounting opposition to President Joe Biden continuing his campaign with his loyalty to his former running mate. In recent days, Obama has taken calls from congressional leaders, Democratic governors and key donors in which he has shared their […]

1 hour ago

Vice President Kamala Harris arrives for an Asian and Pacific Islander American Vote Town Hall, Sat...

Associated Press

Majority of Democrats think Kamala Harris would make a good president, AP-NORC poll shows

WASHINGTON (AP) — As President Joe Biden faces a growing drumbeat of pressure to drop his reelection bid, a majority of Democrats think his vice president would make a good president herself. A new poll from the AP-NORC Center for Public Affairs Research found that about 6 in 10 Democrats believe Kamala Harris would do […]

1 hour ago

Associated Press

How bootcamps are helping to address the historic gap in internet access on US tribal lands

There’s a home movie theater with orange walls and plush recliners at the top of a steep hill on Matthew Rantanen’s ranch in Southern California. But on a recent afternoon, people weren’t flocking to the room to watch a movie or to escape the scorching heat, they were shining a beam of light through more […]

1 hour ago

Associated Press

Thousands celebrate life of former fire chief killed at Trump rally, private funeral set for Friday

FREEPORT, Pa. (AP) — Thousands of mourners paid their respects at a Pennsylvania banquet hall Thursday to the family of a former fire chief who was shot and killed during the attempted assassination of former President Donald Trump. Trump sent a note of condolence hailing Corey Comperatore as a hero, a copy of which was […]

1 hour ago

Donald Trump fraud verdict: $364 million penalty in civil fraud case