The lawsuit seeks to remove Trump and his children from their roles in the Trump Organization and bar them from future leadership roles in New York.
Here's how the lawsuit came to be and what it means for Trump, his family, and his business.
What the lawsuit is
After Trump's former lawyer, Michael Cohen, testified under oath that Trump had inflated assets in financial statements in 2019, James opened up a civil investigation into the Trump Organization finances.
The civil suit comes as the Manhattan district attorney is also conducting a criminal suit.
“For too long, powerful, wealthy people in this country have operated as if the rules do not apply to them. Donald Trump stands out as among the most egregious examples of this misconduct,” said Attorney General James said in a statement.
\u201cJUST IN: New York AG Letitia James has filed a civil fraud lawsuit against former President Donald Trump and others, according to court records.\u201d
After three years of investigation through subpoenas and testimony, James' office is alleging that Trump, his children, Ivanka, Eric, Donald Jr., as well as senior management committed fraud to benefit themselves and the company financially.
James says Trump and his organization 'grossly inflated' the value of several properties by billions of dollars by ignoring the advice of outside appraisers.
The New York Attorney General cited 40 Wall Street an as example. The building was initial appraised at $200 million but in Trump's annual financial statements he valued it over $500 million.
According to the lawsuit, there were more than 200 false and misleading asset evaluations in 11 of Trump’s annual financial statements.
\u201cOne example: Trump falsely claimed his own triplex apartment in Trump tower was worth $327m, three times what it was actually worth. "To this date no apartment in New York City has ever sold for close to that amount." He claimed apartment was 30k square feet - it was actually 11k\u201d
James also alleges that the Trump organization gave bank lenders and insurances falsified statements to obtain lower interest rates and premiums.
As a result, Trump benefitted financially.
\u201cNY AG Letitia James announces a lawsuit against Donald Trump, Eric Trump, Don Jr, Ivanka, & others: "Trump & the Trump Organization repeatedly & persistently manipulated the value of assets to induce banks to lend money to the [them] on more favorable terms... to pay lower taxes"\u201d
1. To 'permanently' ban Trump and his three children from "serving as an officer or director in any New York corporation or similar business entity registered and/or licensed in New York state".
2. To bar Trump and his organization from acquiring any New York real estate for five years.
3. Force Trump and his business to give New York $250 million, the estimated amount that Trump obtained through the alleged fraudulent practices.
\u201cWHAT AG JAMES SEEKS:\n\n-- Cancelation of Trump's business certificates, in move known as NY's "corporate death penalty."\n-- A permanent ban on Trump and his kids serving on any corporate board.\n-- A 5-yr ban on Trump buying commercial real estate in NY.\n-- $250 mil in restitution.\u201d
Alina Habba, Trump's lawyer called the lawsuit “an abuse of authority” and said “we look forward to defending our client against each and every one of the attorney general’s meritless claims" according to the New York Times.
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