November 27, 2022


Donald Trump’s real estate empire engaged in a “staggering” level of fraud and deceptive business practices for more than a decade, during which the former president and his associates “grossly and fraudulently” inflated the value of his properties to obtain taxes, loans and insurance, a New York attorney said. According to Gen. Leticia James, time incentives fueled her financial ambitions.

The 222-page civil suit alleges that Mr. Trump “inflated his net worth to defraud the banks and the people of the great state of New York,” Ms. James told reporters on Sept. 21.

He described multiple “statements of financial condition” prepared by his former accounting firm for nearly all of Mr Trump’s marquee properties as “excessive, grossly inflated, objectively false, and therefore fraudulent and invalid”.

The lawsuit follows a three-year civil investigation into at least 23 of his properties and assets, from his Mar-a-Lago resort home in Florida to his namesake tower in Manhattan and a golf course in Scotland.

Ms. James’ office found that at least 11 of Mr. Trump’s annual financial statements included more than 200 false and misleading asset valuations.

“The total inflated asset value numbers are staggering, affecting most if not all real estate holdings in any given year,” according to the lawsuit.

The attorney general is seeking to permanently bar Mr. Trump, as well as his children, Donald Trump Jr., Ivanka Trump and Eric Trump, from holding any business offices in New York, and bar Mr. Trump and his businesses from entering into any real estate deals. State for five years, and to forfeit a quarter of a billion dollars in alleged ill-gotten gains obtained through his “relentless” fraud.

These are the properties and assets that the attorney general’s office said were the focus of a fraudulent scheme orchestrated by Mr. Trump and his business associates.

Trump Park Avenue

According to the attorney general’s office, the property was valued in Mr Trump’s financial statements with values ​​between $90.9m and $350m from 2011 to 2021.

“Reported values ​​of unsold residential units in the Trump Park Avenue building were significantly higher than internal valuations used by the Trump Organization for business planning, and many of the units failed to account for being rent-stabilized,” Ms. James’ office said.

In July 2020, the Trump Organization received an appraisal that valued the property at $84.5 million. But the property is valued at $135.8 million in 2020 financial statements.

Trump Tower

According to Mr. James’ office, Mr. Trump’s assessment of the tower’s name relied on “cherry-picked” data and inflated figures that did not match internal security. In 2015, using a different formula, the property was valued at $170m more than the previous year’s value, and about $250m more than the next year’s value, and $75m more than the value obtained in any other year using the previous formula. used

Triplex apartments in Trump Tower

The former president’s private triplex apartment in Manhattan was valued at 30,000 square feet, but is less than 11,000 square feet, according to the attorney general’s office.

In 2015, the apartment was valued at an “unreasonable” price of $327m, at $29,738 per square foot, according to Ms James’ office.

“At the 30-year-old Trump Tower, the record sales at the time were just $16.5 million for less than $4,500 per square foot,” according to his office.

40 Wall Street

According to Ms James’s office, the property was appraised by a bank in 2012 at $220 million, “yet in statements that year and the following year … 40 Wall Street was valued at $527m and $530m – more than double that calculated by independent, professional appraisers. price.”

Seven Springs, Westchester County, New York

Mr. Trump bought the 212-acre estate property in 1995 for $7.5 million but has valued it up to $291 million over the past decade on claims that the property was zoned for nine mansions that could be sold for a profit of more than $161 million, a “fictional, complete by development history.” Unsupported,” according to Ms. James’ office.

Niketown, New York

On “multiple occasions” from 2011 to 2019, Mr Trump provided “false and misleading representations” of property values, while assessments from 2013 to 2018 (excluding 2015) omitted “key variables”, including rental costs.

“When increased fixed rental costs were factored into Niketown’s 2020 and 2021 valuations, despite increased revenue projections, the property’s reported value dropped from the mid-$400m range to the $225-$250m range,” according to Ms James’ office.

Letitia James announced her lawsuit against Donald Trump on September 21.

(Getty Images)

Trump International Hotel & Towers, Las Vegas, Nevada

Prior to 2013, financial statements excluded Mr. Trump’s 50 percent interest in the property “because, for tax purposes, Mr. Trump asserted that the property had no value,” according to Ms. Gem’s office. Meanwhile, Mr. Trump “repeatedly submitted lower property assessment estimates to Nevada tax authorities and higher property assessments in his statements.”

Vornado

Mr. Trump owns a minority stake in the business, but his financial statements often include cash held by the entity. “In some years these restricted funds accounted for nearly one-third of all of Mr. Trump’s reported cash,” according to Ms. James’ office.

Mar-a-Lago

The former president’s Florida resort property was valued at $739m but “in reality, the club generated less than $25m in annual revenue and should have been worth closer to $75m.”

Trump’s golf club

Ms. James’s office outlined various schemes often used to increase the value of Mr. Trump’s golf clubs.

He did not itemize each club but instead “presented their value as an aggregate line item,” according to the lawsuit.

At Trump National Golf Club Westchester in Briarcliff Manor, New York, the property’s valuation depended on expected revenue from inflated memberships, according to the suit. In 2011, it relied on paying new members about $200,000 in fees, though most did not. According to Mr. James’ office, Mr. Trump “specifically directed” employees to “reduce or eliminate” initiation fees to increase membership.

Other schemes allegedly inflated the value of former presidents’ clubs in North Carolina, New York, New Jersey, Philadelphia and Virginia, according to the lawsuit.

Mr. Trump bought his Trump National Golf Club Jupiter in Jupiter, Florida, for $5 million, but a year later in 2013 the property was valued at $62 million less — a 1,100 percent markup, according to the suit.

Pictured on September 21 is Trump’s Mar-a-Lago residence in Florida.

(EPA)

The Trump Organization “falsely inflated the value” of Trump National Golf Club Los Angeles by inflating the value of a substantial number of potential lots for sale in the area surrounding the golf course and, from 2013 to 2020, by applying an undisclosed 30 percent brand premium that inflated the value of the golf club,” According to Ms. James’ office.

The premium scheme allegedly increased the golf club’s valuation by about $50 million in a 2013 statement.

The Trump Organization also donated 16 lots, reaching a value of $25 million that “through tactics that fraudulently manipulated appraisals, including ignoring a report prepared by an engineer to estimate the cost of building the lots” and failing to account for cost savings of about $1 Millions of liabilities that the company avoided by not developing affordable housing units there.

Trump International Golf Links Scotland (Aberdeen)

The golf course was valued at $327 million in 2014, based on the Trump Organization’s claim that 2,500 homes could be built on the property, although the company only received zoning approval to build fewer than 1,500 units, according to the lawsuit. The units offered by the Trump Organization account for 80 percent of the company’s total valuation.

Trump International Golf Links Scotland (Turnbury)

The course has operated at a loss since opening in 2017, with values ​​between $123m and $126.8m in subsequent years after it was bought for $60 million in 2014, according to the lawsuit, which alleges the Trump Organization relied on a “false and misleading” assessment and should have been assessed at a much lower figure.

Trump International Hotel & Towers, Chicago

The property has not been included in Mr. Trump’s financial statements since 2009 because “according to sworn testimony, Mr. Trump did not want to take a position that would conflict with his contention with tax authorities that the property had become worthless, and thus formed basis. Under the federal tax code A significant loss.”

But in 2012, Mr. Trump and the Trump Organization secured a $107 million loan from Deutsche Bank for the building. The loan received a $45 million extension in 2014, and “Mr. Trump’s $4 billion net worth reflected in his statement was used to personally guarantee the initial loan” at a lower, more favorable interest rate, according to Ms. James’ office.

Trump National Doral, Miami, Florida

A loan agreement required for the property through Deutsche Bank requires Mr. Trump to “certify the truth and accuracy” of his statements as a condition of the loan.

Trump Old Post Office, Washington DC

The Trump Organization obtained a $170 million loan from Deutsche Bank to turn the property into a luxury hotel, then sold the property in 2022 for $375 million – resulting in a “net profit of over $100 million, which was the result of his loan. Using his false and misleading statements to obtain able,” according to the Attorney General’s Office.



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