Donald Trump gained more than $1 billion by lying about the value of his assets to banks and insurers, lawyers for the New York state attorney general told a judge on Monday in a civil fraud case that could deal a major blow to the former president’s real estate empire.
Kevin Wallace, a lawyer in state Attorney General Letitia James’ office, said in his opening statement in a downtown Manhattan courtroom that Trump described his finances to banks and insurers in a “materially inaccurate way” for a decade.
Wallace said Trump did this to get better loan terms and lower insurance premiums, illegally generating more than $1 billion of financial benefits.
“This isn’t business as usual, and this isn’t how sophisticated parties deal with each other,” Wallace said. “These are not victimless crimes.”
Christopher Kise, a lawyer for Trump, countered in his opening statement that the financials for Trump and the Trump organization were entirely legal.
“It is one of the most highly successful brands in the world, and he has made a fortune literally being right about real estate investments,” Kise said. “There was no intent to defraud, there was no illegality, there was no default, there was no breach, there was no reliance from the banks, there were no unjust profits, and there were no victims.”
Trump, the frontrunner for the 2024 Republican presidential nomination, is accused by James of inflating his assets and his own net worth from 2011 to 2021.
James is seeking at least $250 million in fines, a permanent ban against Trump and his sons Donald Jr and Eric from running businesses in New York and a five-year commercial real estate ban against Trump and the Trump Organization.
Before entering the courtroom, Trump called the case “a continuation of the single greatest witch hunt of all time.
“We have a great company. I built a great company. It’s tremendous,” he continued. “It’s got some of the greatest real estate assets in the world. And now I have to go in before a rogue judge.”
Trump wore a dark blue suit, a brighter blue tie and an American flag pin on his lapel.
He again called James, who is Black, “racist,” and said the Democrat had a vendetta against him.
James said her office was ready to prove its case.
“The law is both powerful and fragile,” she said before entering the courtroom. “No matter how much money you think you may have, no one is above the law.”
Trump’s trial is overseen by Justice Arthur Engoron, who will hear evidence without a jury.
It largely concerns penalties that Trump, his adult sons and 10 of his companies must face after Engoron last week found them liable for fraud.
Before opening arguments, Engoron described himself as a generalist on the law. “One thing I know a lot about is the definition of fraud,” he said.
In his Sept. 26 decision, Engoron described in scathing terms how the defendants made up valuations.
That included Trump calculating the value of his apartment in Trump Tower as if it were three times its actual size.
Engoron canceled business certificates for companies controlling pillars of Trump’s empire, and said he would appoint receivers to oversee their dissolution.
The ruling covers some of his most valuable properties Trump Tower, his Mar-a-Lago estate in Florida, his family estate in Westchester County, New York, and various office buildings and golf clubs.
Specifics for implementing the order have not been decided, but the loss of those prized assets would be a major blow to Trump’s finances.
James accused Trump of “grossly” inflating the values of his assets, and inflated own net worth by as much as $2.2 billion.
She said that inflated financials included listing Mar-a-Lago as being worth up to $739 million though deed restrictions capped it at $28 million.
Wallace played an excerpt from a deposition where Michael Cohen, who had been Trump’s personal lawyer and fixer but has since turned against his former boss, said the goal was “to attain the number that Mr. Trump wanted.”
The trial is scheduled to run through early December. While more than 150 people could testify, much of the trial may be a battle of experts opining on financial documents.
Trump, the first sitting or former U.S. president to be criminally charged, is under indictment in four separate cases.
He has been charged in Florida over his handling of classified documents upon leaving office, in Washington over his efforts to undo his loss in the 2020 presidential election, in Georgia over moves to reverse election results there, and in New York over hush money payments to a porn star.
Trump has denied wrongdoing and pleaded not guilty in all four cases.