There are many questions about Donald Trump’s business practices. In a matter days, it could be decided whether the former president is required to answer any of these questions.
The New York attorney general will appear in court on Thursday to seek to enforce a subpoena to Trump’s testimony. She claims that Trump’s company used false or misleading valuations of skyscrapers, golf clubs and other properties to obtain loans and tax benefits.
The next stage in a legal battle has been unfolding in Manhattan court papers over the past few weeks. This includes the revelation Monday that Trump was recently fired by his long-standing accounting firm after it warned that the financial statements it had prepared could not be trusted.
Trump’s lawyers argued that the financial statements were true and that any attempts to separate them over minor errors or omissions was politically motivated.
Mazars USA LLP, however, urged Trump Organization to send a court docket letter as evidence on February 9 asking for anyone who had received his Statement of Financial Conditions, such as banks or insurers, to tell them that they should not be relied on those documents.
According to the accounting firm, while there weren’t any “material discrepancies” when reviewing the documents it found that they were not relevant, the “totality” of the circumstances made it impracticable to use them moving forward.
The Associated Press reached out to several of Trump’s lenders in order to determine the effect of the Mazars Letter on his financial arrangements. This included the hundreds of millions of dollar worth of loans that were secured with the Statements of Financial Condition.
Trump’s banks declined to comment or didn’t respond, citing policies that prohibited them from discussing individual clients.
In a preview of Thursday’s arguments, Attorney General Letitia Jam stated that, given the evidence (including Mazars’ findings), “there should not be any doubt that this investigation is lawful and that we have legitimized reason” to question Trump.
Trump’s lawyers cited Mazar’s declaration that it had not found any significant discrepancies within the documents as further evidence that Trump’s company was innocent.
This legal battle also includes subpoenas James issued to Trump Jr.’s two oldest children, Ivanka, and Donald Trump Jr., both of whom are trusted allies of their father, who was an executive in the Trump Organization.
Lawyers for Trump argue that any testimony in James’ civil investigation could be used against them in a parallel, sometimes overlapping criminal investigation. However, they could still invoke their Fifth Amendment right of silence, just like others in Trump’s orbit.
James’ investigation is civil in nature. She could file a lawsuit against Trump and his company to seek financial penalties or a ban on their involvement in certain businesses. This would be similar to what happened last month when Martin Shkreli, ex-drug company CEO, was barred from the pharmaceutical industry for ever. According to court documents, James has until April to decide whether or not to pursue legal action.
Judge Engoron heard Thursday’s arguments and previously sided alongside James on other matters related to the probe. This included making Eric Trump, a Trump Organization executive, testify after his lawyers cancelled a scheduled deposition.
According to court papers, Eric Trump and Trump Organization finance chief Allen Weisselberg invoked the Fifth Amendment over 500 times each when they were questioned by James during separate depositions in 2020.
The Manhattan district attorney’s Office brought Weisselberg and his organization to trial for tax fraud. They were motivated by the evidence from James’ civil investigation. Weisselberg was accused of collecting more than $1.7million in off-the-books damages, including car payments, school tuition, and apartment rent. Weisselberg, along with the company, pleaded not guilty.
Trump responded to the New York probes by calling them a “partisan witch hunt.” Alvin Bragg, Manhattan District Attorney, and James are both Democrats.
Trump lost a long-running battle to stop the DA’s from obtaining his tax returns last year. He sued James in federal court to stop her investigation.
Trump’s lawyers reaffirmed his claim that James was after him to get political reasons. They wrote that Trump’s wife had “relentlessly targeted” Trump and his family “because she disliked his speech and political opinions.”
