Pages
from an
exhibit
filed by
New York
state
attorney
general
Letitia
James in
accusing
former
President
Donald
Trump
and
three of
his
adult
children
of
padding
his net
worth by
billions
of
dollars
and
habitually
misleading
banks
about
the
value of
prized
assets.
are
photographed
Thursday,
Sept.
22,
2022.
(AP
Photo/Jon
Elswick) |
|
|
|
|
|
|
|
|
|
|
|
|
|
The
numerous
investigations
and
lawsuits
swirling
around
former
President
Donald
J. Trump
are
creating
new and
significant
financial
pressures
on him.
Credit...Todd
Anderson
for The
New York
Times |
|
As
Trump’s
Legal
Woes
Mount,
So Do
Financial
Pressures
on Him
By
Maggie
Haberman,
Ben
Protess,
Matthew
Goldstein,
and Eric
Lipton
nytimes.com
The
lawsuit
filed by
New
York’s
attorney
general
is the
latest
indication
of how
an array
of
investigations
is
affecting
the
former
president’s
business
and
personal
wealth.
NEW YORK
-
The New
York
attorney
general’s
fraud
lawsuit
that was
filed on
Wednesday
against
former
President
Donald
J. Trump
seeks to
recover
$250
million
from his
company
and
essentially
run him
out of
business
in the
state.
Next
month,
Mr.
Trump’s
company
will go
on trial
in
Manhattan
on
criminal
tax
charges
in a
separate
case
that
could
cost
millions
of
dollars
in
penalties
and
legal
fees.
And on
the
horizon
are
civil
suits
from
people
seeking
to hold
the
former
president
responsible
for
injuries
and
trauma
inflicted
during
the Jan.
6
assault
on the
Capitol
by his
supporters,
a
possible
wave of
litigation
that
some of
his
advisers
fear
could
prove
extremely
costly
to him.
Together,
the
numerous
investigations
and
lawsuits
swirling
around
Mr.
Trump
are
creating
new and
significant
financial
pressures
on him.
There is
no
evidence
that he
faces
any
immediate
crisis.
In an
interview
on
Thursday,
Eric
Trump,
his son,
said the
Trump
Organization
was in a
strong
position,
noting
that it
had
recently
paid off
some
outstanding
debts
and seen
a
windfall
from the
sale of
the
Trump
International
Hotel in
Washington.
But when
stacked
up
altogether,
the
potential
costs
that the
former
president
faces
show
that his
challenges
extend
beyond
the
courtroom
and into
the
maintenance
of his
wealth
even as
he
continues
to
signal
that he
plans
another
run for
the
White
House.
At a
minimum,
Mr.
Trump’s
hopes
for new
moneymaking
ventures
are
sputtering:
The deal
that had
the
potential
to reap
perhaps
the
biggest
profits
for him
— a
merger
involving
his
upstart
social
media
company
— is
hanging
by a
thread,
as
regulatory
and law
enforcement
scrutiny
threatens
to
unravel
it.
Mr.
Trump
remains
a
formidable
political
fund-raising
force,
but even
there
his
situation
is
complex.
Should
he
become a
presidential
candidate,
he could
face
tight
new
restrictions
on the
personal
use of
money he
has kept
in his
main
political
action
committee
and used
for
legal
fees,
Trump
properties
and even
Melania
Trump’s
designer.
John A.
E.
Pottow,
a
professor
of
commercial
law at
University
of
Michigan,
said the
sort of
legal
cases
that the
Trump
Organization
faces
can hurt
any
corporation.
“You
have a
company
that has
some
serious
litigation
risks,”
he said.
“They
have
major
liability
on the
horizon.”
Several
experts
in real
estate
and
commercial
law said
that Mr.
Trump
and his
business
would be
able to
weather
the
storms.
The
Trump
Organization
generated
hundreds
of
millions
of
dollars
from the
sale of
its
Washington
hotel
this
year, as
well as
from
other
recent
deals,
and it
has
either
refinanced
or paid
off a
sizable
portion
of its
loans.
The
company
also
continues
to
collect
revenue
from
some of
its
commercial
real
estate
projects,
while
many of
Mr.
Trump’s
hotels
have
rebounded
from
deep
losses
incurred
in the
early
days of
the
coronavirus
pandemic,
according
to a
person
with
knowledge
of the
company’s
performance.
His golf
clubs,
many of
which
saw a
surge in
business
during
the
pandemic,
have
begun to
attract
new
tournaments
in
recent
months,
including
contentious
ones
like
those
managed
by the
Saudi-backed
LIV
network.
Eric
Trump
said the
family
owned
most of
their
real-estate
assets
“free
and
clear”
and have
“low
debt
relative
to the
value of
our
assets.”
(The
suit
filed on
Wednesday
by
Attorney
General
Letitia
James of
New York
accused
Mr.
Trump
and his
family,
including
Eric
Trump,
of
deliberately
and
systematically
overstating
the
value of
the
company’s
assets.)
Taylor
Budowich,
a
spokesman
for the
former
president,
described
the
various
investigations
as “weaponized
government”
by
Democrats
whose
efforts
“lack
credibility,
they
lack the
facts,
and they
lack the
law.”
Mr.
Trump is
no
stranger
to legal
skirmishes
and
financial
pressures.
He filed
and
defended
dozens
of
lawsuits
over the
years,
and in
the
early
1990s,
faced
near
financial
ruin.
His
current
predicaments
pale in
comparison
to those
challenges.
How
Times
reporters
cover
politics.
We rely
on our
journalists
to be
independent
observers.
So while
Times
staff
members
may
vote,
they are
not
allowed
to
endorse
or
campaign
for
candidates
or
political
causes.
This
includes
participating
in
marches
or
rallies
in
support
of a
movement
or
giving
money
to, or
raising
money
for, any
political
candidate
or
election
cause.
Yet Mr.
Trump’s
mounting
legal
woes
threaten
to roll
back
some of
his
recent
gains
and cast
a pall
over his
presidential
run.
In suing
the
former
president
and
three of
his
children
on
Wednesday,
Ms.
James is
seeking
to bar
the
Trumps
from
ever
running
a
business
in the
state
again.
She is
also
seeking
to
prevent
Mr.
Trump
from
acquiring
real
estate
in New
York for
five
years.
Although
Ms.
James
stopped
short of
trying
to
dissolve
the
Trump
Organization,
her
office
is
trying
to shut
down at
least
some of
his New
York
operations.
Ms.
James’s
case,
which
accuses
Mr.
Trump
and his
family
business
of lying
to
lenders
and
insurers
by
fraudulently
overvaluing
his
assets
by
billions
of
dollars,
had no
immediate
impact
on the
company.
It could
take
years
for the
case to
play out
in the
courts,
and even
then, a
judge
would
have to
grant
the
punishments
Ms.
James is
seeking.
Mr.
Trump
could
also try
to
settle
the case
before a
trial.
More
immediately,
the
Trump
Organization’s
criminal
tax
fraud
trial
will
begin in
Manhattan
next
month.
The
Manhattan
district
attorney’s
office,
working
with Ms.
James’s
office,
accused
the
company
of
conspiring
with its
longtime
chief
financial
officer,
Allen H.
Weisselberg,
to evade
taxes in
a scheme
that
doled
out
off-the-books
perks to
Mr.
Weisselberg
and
other
executives.
Mr.
Weisselberg
recently
pleaded
guilty
for his
role in
the
scheme,
which
included
receiving
a
rent-free
apartment,
leased
Mercedes-Benzes
and
private
school
tuition
for his
grandchildren.
Although
he
refused
to turn
on Mr.
Trump,
he
agreed
to
testify
at the
company’s
trial, a
move
that
could
help
prosecutors
make
their
case.
If the
company
is
convicted,
a judge
could
impose a
relatively
modest
penalty:
less
than $2
million.
But it
also
will
incur a
significant
sum in
legal
fees and
could
face
trouble
with
lenders
and the
local
authorities,
who
might
shy from
doing
business
with a
company
convicted
of a
felony.
(The
specific
Trump
Organization
entities
that are
under
indictment
are not
thought
to hold
any
loans or
liquor
licenses,
so the
fallout
could be
limited.)
At the
same
time,
Mr.
Trump is
facing a
series
of
investigations
and
legal
costs
related
to his
efforts
to hold
onto
office
after he
lost the
2020
election,
as well
as his
taking —
and then
refusing
to
return —
presidential
records
and more
than 300
individual
documents
marked
classified
when he
left
office.
He
recently
paid $3
million
from his
super
PAC to a
lawyer
he hired
to help
defend
himself
in those
cases.
And
potentially
hanging
over Mr.
Trump is
an
apparently
unresolved
dispute
with the
I.R.S.,
although
its
status
is
unclear.
The
former
president
is also
facing
no less
than
seven
separate
civil
lawsuits
that are
trying
to hold
him
accountable
— and
seek
damages
from him
— for
the role
he
played
in
inspiring
the
chaos
and
violence
that
erupted
at the
Capitol
on Jan.
6, 2021.
People
close to
Mr.
Trump
anticipate
other
suits
are
likely
to
follow.
In
February,
a
federal
judge in
Washington
ruled
that
three of
the
suits
against
Mr.
Trump
could
move
forward,
brushing
aside
his
arguments
that he
could
not be
held
liable
for
riling
up the
crowd on
Jan. 6
under
the
First
Amendment
and
because
he was
immune
to civil
litigation.
In his
decision,
Judge
Amit P.
Mehta
said
that the
plaintiffs
could
try to
prove
their
case
that Mr.
Trump
had
conspired
with the
mob that
day. The
former
president
has
appealed
the
judge’s
decision
to the
U.S.
Court of
Appeals
in
Washington.
Alan Z.
Rozenshtein,
a former
Justice
Department
official
who is a
professor
at the
University
of
Minnesota
Law
School,
said
that if
the Jan.
6 suits
against
Mr.
Trump
were
successful,
calculating
the
amount
that he
might
have to
pay in
damages
would
depend
on the
individual
ordeals
suffered
by the
plaintiffs.
They
include
members
of
Congress,
Capitol
Police
officers
and
Washington
residents.
“I don’t
think
that a
fine
like
that —
even if
they had
to pay
$250
million
— would
bring
the
company
down,”
said
Phillip
A.
Braun, a
finance
professor
at the
Kellogg
School
of
Management
at
Northwestern
University,
citing
the
demand
from Ms.
James.
“It
would be
painful
for the
family,
but they
probably
could do
it by
liquidating
some of
their
properties.”
When Mr.
Trump
left the
White
House,
money
seemed
unlikely
to be a
concern.
Despite
the
shadow
of Jan.
6, he
appeared
poised
to cash
in on
his
appeal
in
conservative
media
circles,
including
through
his
social
media
venture
— the
merger
of the
parent
company
of Truth
Social,
his
Twitter-like
social
media
platform,
with a
special
purpose
acquisition
company
called
Digital
World
Acquisition
Corp.
But the
deal has
been
stymied
by dual
investigations
by the
S.E.C.
and
federal
prosecutors.
The
original
Sept. 8
deadline
for
completing
the deal
has
passed,
and
Digital
World
could
face the
prospect
of
liquidation
in the
coming
weeks.
The
promoters
of
Digital
World
are
hoping
that the
company’s
shareholders
— most
of whom
are
retail
investors
— will
agree to
give
them
until
next
September
to
complete
the
deal.
But even
with
another
year,
the
prospects
of the
S.E.C.’s
approval
of the
deal
between
Digital
World
and
Trump
Media &
Technology
Group
look
grim.
Regulators
and
federal
prosecutors
in
Manhattan
are
looking
into
potentially
improper
communications
between
representatives
of
Digital
World
and
Trump
Media
before
the
special
purpose
acquisition
company’s
public
offering.
They are
also
examining
unusual
trading
in
Digital
World’s
stock
before
the
merger
announcement
last
October.
Digital
World
not only
raised
nearly
$300
million
in cash
in its
initial
public
offering
last
September.
It also
got
dozens
of hedge
funds to
commit
to
providing
an
additional
$1
billion
in
financing
after
the two
companies
announced
the
merger
in
October.
Mr.
Trump,
who
stands
to
receive
more
than 70
million
shares
if the
merger
is
completed,
got on
the
phone
with
some of
the big
investors
willing
to
commit
at least
$50
million.
But the
inability
to
complete
the
merger
in time
led to
the
termination
of that
$1
billion
financing
deal. It
is not
clear if
Digital
World
and
Trump
Media
can
persuade
those
investors
to sign
onto a
new
agreement,
given
the
legal
uncertainty
surrounding
the
merger
and Mr.
Trump
personally.
Shares
of
Digital
World
have
plummeted
to $17,
from
$97.
Alan
Feuer
contributed
reporting.
|
|
|
|
|
|
|
|
|