New York Judge Rules Trump Committed Fraud by Inflating Wealth

NEW YORK — In a significant development within a civil case against former President Donald Trump and his family business, a New York judge has ruled that Trump engaged in fraudulent activities by consistently misrepresenting his wealth by hundreds of millions of dollars. The ruling accuses him of defrauding banks and insurers over an extended period.

The judgment, which comes as a blow to Trump, is expected to have implications for his business activities in the state of New York.

Trump and his co-defendants have consistently denied any involvement in fraud.

The case, brought forward by New York Attorney General Letitia James, alleges that Trump, his two adult sons, and the Trump Organization artificially inflated the value of their properties by over $2 billion to serve their business interests. The accusation includes the issuance of false financial records and statements to secure favorable loan terms, insurance deals, and tax reductions.

Judge Arthur Engoron issued the scathing decision on Tuesday in a New York state court, following James's request for a summary ruling before the trial's commencement. The attorney general argued that settling certain undisputed facts would expedite the trial process.

The judge's findings included:

1. A 2,300% overvaluation of Mar-a-Lago in one financial statement.

2. An exaggerated claim of the penthouse's size at Trump Tower in New York, stating it was three times its actual size.

3. A rejection of Trump's argument that calculating the penthouse's area was subjective, deeming such a discrepancy in valuation "fraud."

The ruling addresses the central fraud claim in the lawsuit, leaving six remaining claims to be examined during the trial, which is scheduled to commence on October 2 and may extend until at least December. Letitia James is seeking $250 million in penalties and a prohibition on Trump conducting business in his home state.

Judge Engoron commented in his ruling that "the documents here clearly contain fraudulent valuations that defendants used in business," adding, "That is a fantasy world, not the real world."

Additionally, the judge ordered the cancellation of business certificates that allow certain Trump entities, including the Trump Organization, to operate in New York. While this action will not dissolve the company, it could impact Trump's control over prominent New York properties like Trump Tower and the Trump Building at 40 Wall Street.

The judge also rejected the Trump team's request to dismiss the case and imposed fines of $7,500 on five Trump attorneys for making "preposterous" arguments that had already been rejected by the court and for fueling what he referred to as their clients' "obstreperous" conduct.

Trump's lawyers criticized the ruling as "a miscarriage of justice" and indicated their intention to appeal.

Former President Trump has consistently denied wrongdoing and characterized the case as a politically motivated "witch hunt" orchestrated by a biased prosecutor. He accused the judge of being "highly politicized."

Trump is currently seeking to delay the trial in New York and has filed a lawsuit against the judge. An appeals court is expected to rule on this lawsuit later this week. If the court rules against him, Trump will be compelled to proceed with the remainder of the case in court.

This legal battle is one of several facing Trump as he campaigns for a potential rematch with President Joe Biden in the next election and the possibility of returning to the White House. He is also confronting 91 felony charges across four criminal cases, to which he has pleaded not guilty.