Kara Scannell | CNN
New York Attorney General Letitia James says it needs testimony from former President Donald Trump and his two adult children to determine their knowledge of what investigators say they have identified as numerous “misleading statements and omissions” in tax filings. declarations and used financial statements. to receive loans.
In a court document filed late Tuesday evening, investigators said the office “intends to make a final decision as to who is responsible for these misrepresentations and omissions,” adding that “the OAG requires the testimony and evidence sought here to determine whether which employees and affiliates of the Trump Organization—and which other entities and individuals—may have assisted the Trump Organization and Mr. Trump in its creation, or may have relevant knowledge of the misrepresentations and omissions in question.”
They write that “witnesses closest to the top of the Trump organization asserted their Fifth Amendment rights against self-incrimination. Some others have claimed erroneous memories or claimed to have followed instructions from more senior staff.”
“But Mr. Trump’s factual knowledge of — and intent to do — the multiple misrepresentations and omissions made by him or on his behalf are essential components to completing the OAG’s investigation in a proper and fair manner,” the document says. “Similarly, Donald Trump Jr. and Ivanka Trump have worked as agents of Mr. Trump, acted on their own behalf, and controlled others in connection with the deals discussed here; their testimony is also necessary for the proper completion of the OAG investigation.”
A spokesman for the Trump Organization said Wednesday that “James’s allegations are baseless and will be vigorously defended.”
Ivanka Trump has been a key liaison with the Deutsche Bank lender, while Donald Trump Jr. has been involved in several properties, including 40 Wall Street, and has been confirming the accuracy of financial statements since 2017, the Attorney General’s Office said.
In lengthy court documents, investigators said that about a dozen current and former employees of the Trump Organization testified and that Trump personally authorized his tax returns.
“In light of the pervasive and recurring nature of misstatements and omissions, it appears that estimates in the statements were generally inflated as part of a model to suggest that Mr. Trump’s net worth was higher than it might otherwise appear,” investigators wrote.
They added that when Eric Trump and Allen Weisselberg, a former CFO, testified in 2020, they both asserted their Fifth Amendment right against self-incrimination by answering more than 500 questions each.
Specifically, the New York Attorney General’s Office said it was focusing on several specific alleged misrepresentations, including:
The size of Trump’s penthouse at Trump Tower;
Misclassified assets not controlled by Trump or the Trump organization as “cash”, thereby inflating its liquidity;
misrepresented the process by which Trump or his associates arrived at the estimates, including deviations from generally accepted accounting principles in ways not disclosed in the reports;
Failed to use fundamental valuation methods, such as discounting future income and expenses to their present value, or choosing only similar properties as “comparables” for imputing valuations based on public sales data;
Misrepresented the alleged involvement of “outside experts” in the assessments; and
It failed to report that certain valuation amounts were inflated by an undisclosed amount of brand value.
One of the allegations from James’s office is that Trump failed to comply with the subpoena to obtain the tapes. As an example, they claim that while Trump did not use email, they learned from witnesses that Trump kept paper copies of documents and used sticky notes to communicate with employees. They said the file cabinet related to Trump’s records was never searched in connection with a subpoena.
“This file was never searched because the Trump Organization determined that it is unbelievable that Mr. Trump was not involved in the preparation of his own financial statements,” they wrote.
James’s office said the alleged misleading statements were passed on to creditors, with insurers claiming that “virtually all of the benefits of the misleading estimates went to Donald J. Trump.” The office also said it has evidence that Trump may have received more than $5 million in federal tax credits as a result of allegedly misleading estimates resulting from tax credits received at a New York City family compound known as Seven. Springs, and at the Trump National Golf Course in Los Angeles. Angeles.
James’s office has been conducting a civil investigation into the Trump organization and the accuracy of its financial records since 2019, which Trump called a political witch hunt.
The former president sued James, alleging she violated his constitutional rights, and asked the judge to grant a preliminary injunction to block or remove her from the investigation.
James’s office subpoenaed Trump and his adult children in court to testify in December, prompting Trump’s lawyers to drop the subpoena earlier this month, alleging that the attorney general, whose office is conducting the civil investigation and whose lawyers have joined the criminal investigation. by the Manhattan District Attorney’s office, tried to “skip the whole grand jury process.”
They wrote that the testimony in the civil case is “virtually the same as that of DANY, but without the constitutional protection afforded to every witness in a grand jury process.”
Witnesses called before a New York State grand jury receive immunity from transactions for their testimony and cannot be prosecuted unless they lie under oath. They argued that James was trying to circumvent these rights by seeking civil testimony that could then be used by criminal prosecutors. If they do not testify, in a civil case, the jury may bring this against the defendants or reach an unfavorable conclusion.
In a filing Tuesday, James’ lawyers dismissed that argument, arguing that the Trumps can defend their Fifth Amendment defense against self-incrimination.
“Each witness may exercise his Fifth Amendment privilege against self-incrimination. The exercise by a witness of this right in a civil investigation (or any other civil or administrative process) is neither uncommon nor a denial of a constitutional right,” the lawyers wrote.
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