NEW YORK (AP) — Aggrieved and defiant, former President Donald Trump sat through hours of sometimes testy opening statements Monday in a fraud lawsuit that could cost him control of Trump Tower and other prized properties.
“Disgraceful trial,” he declared during a lunch break, after listening to lawyers for New York Attorney General Letitia James excoriate him as a habitual liar. The state’s lawsuit accuses the business-mogul-turned-politician and his company of deceiving banks, insurers and others by misstating his wealth for years in financial statements.
“They were lying year after year after year,” Kevin Wallace, a lawyer in James’ office, said as Trump sat at the defense table. He looked straight ahead, arms crossed, facing away from a screen that showed details of Wallace’s presentation.
Defense lawyers, in response, said the financial statements were legitimate. Trump’s holdings are “Mona Lisa properties” that can command top dollar, attorney Alina Habba said.
“That is not fraud. That is real estate,” she said, accusing the attorney general’s office of “setting a very dangerous precedent for all business owners in the state of New York.”
Trump voluntarily attended a trial that he called a “sham,” a “scam,” a waste of the state’s time and “a continuation of the single greatest witch hunt of all time.” Currently the Republican front-runner in the 2024 presidential race, he reiterated claims that James, a Democrat, is trying to thwart his bid to return to the White House.
“What we have here is an attempt to hurt me in an election,” he said outside court, adding: “I don’t think the people of this country are going to stand for it.”
Trump sneered at James as he passed her on his way out at lunchtime; she, by turn, left smiling. Meanwhile, his campaign immediately began fundraising off the appearance.
Judge Arthur Engoron ruled last week that Trump committed fraud in his business dealings. If upheld on appeal, the ruling could force Trump to give up New York properties including Trump Tower, a Wall Street office building, golf courses and a suburban estate. Trump has called it a “a corporate death penalty” and insisted the judge is unfair and out to get him.
The non-jury trial concerns six remaining claims in the lawsuit, including allegations of conspiracy, falsifying business records and insurance fraud. Engoron said that neither side sought a jury and that state law doesn’t allow for juries when suits seek not only money but a court order setting out something a defendant must do or not do.
James is seeking $250 million in penalties and a ban on Trump doing business in New York.
“No matter how powerful you are, and no matter how much money you think you have, no one is above the law,” she said on her way into the courthouse.
Trump denies wrongdoing. He says that James and the judge are undervaluing such assets as his Mar-a-Lago resort in Palm Beach, Florida, and he emphasizes that his financial statements had a disclaimer that says they shouldn’t be trusted. The yearly snapshots of his holdings were given to banks to secure loans and to financial magazines to justify his place among the world’s billionaires.
The former president, his two eldest sons, Trump Organization executives and lawyer-turned-foe Michael Cohen are all listed among dozens of potential witnesses.
Trump isn’t expected to testify for several weeks. His trip to court Monday marked a remarkable departure from his past practice.
Trump didn’t go to court as either a witness or a spectator when his company and one of its top executives was convicted of tax fraud last year. He didn’t show, either, for a civil trial earlier this year in which a jury found him liable for sexually assaulting the writer E. Jean Carroll in a department store dressing room.
This time, “I wanted to watch this witch hunt myself,” he said outside court.
In a recent court filing, James’ office alleged Trump exaggerated his wealth by as much as $3.6 billion.
He claimed his three-story Trump Tower penthouse, replete with gold-plated fixtures, was nearly three times its actual size and worth $327 million, far more than any New York City apartment ever has fetched, James said. He valued Mar-a-Lago as high as $739 million — more than 10 times a more reasonable estimate of its worth, James maintained.
“Every estimate was determined by Mr. Trump,” Wallace said in his opening statement. He pointed to pretrial testimony by Trump Organization figures and ex-insiders including Cohen, who said the company estimated assets to get to a predetermined number “that Mr. Trump wanted.”
Wallace said the alleged scheme got the company better loan rates, saving it $100 million in interest.
“They hid their weaknesses and convinced these banks to take on hundreds of millions of dollars in risk,” he said, adding: “While the defendants can exaggerate to Forbes magazine or on television, they cannot do it while conducting business in the state of New York.”
Trump lawyer Christopher Kise said defense experts will testify that assigning values to properties is, by nature, a matter of opinion.
“There is no such thing as objective valuation,” Kise said in an opening statement.
Any discrepancies in values don’t amount to fraud, he said, and disclaimers on the financial statements made clear that these were estimates and that banks would have to perform their own analysis.
Trump and his lawyers have also argued that no one was harmed by anything in the financial statements. Banks that made loans to him were fully repaid. Business partners made money. And Trump’s own company flourished.
Kise blasted last week’s fraud ruling, telling the judge he shouldn’t have made a decision before hearing expert trial testimony on property valuations. Engoron, tiring of the defense’s criticism, shot back: “Respectfully, what’s that expression? You’re stalking the dead horse here.”
Testimony began Wednesday afternoon with Donald Bender, a longtime partner at accounting firm Mazars LLP, describing how he spent 50 to 60 hours a year preparing Trump’s financial statements. Mazars cut ties with Trump last year after James’ office raised questions about the statements’ reliability.
James’ lawsuit is one of several legal headaches for Trump as he campaigns to return to the White House. He has been indicted four times since March, accused of plotting to overturn his 2020 election loss to Democrat Joe Biden, hoarding classified documents and falsifying business records related to hush money paid on his behalf. He has pleaded not guilty to all the allegations.
The New York fraud trial is expected to last into December, Engoron said.