New York AG asks court to increase monitoring of Trump’s business as fraud suit proceeds

New York Attorney General Letitia James’s (D) office on Thursday urged a state judge to appoint an independent party to monitor the Trump Organization’s upcoming financial submissions, suggesting the Trumps cannot be trusted to honestly submit the information to its lenders as James’s fraud lawsuit proceeds.

James filed a civil suit in the New York Supreme Court’s Manhattan division last month against members of the Trump family and their business, alleging they misleadingly inflated property values for years for tax and loan benefits.

Thursday’s motion also asks the judge to prevent the Trump Organization from restructuring its business or moving assets without court approval, raising concerns that Trump executives are already doing so to shield the business from an unfavorable decision in the case.

“Our investigation uncovered the fact that Donald Trump and the Trump Organization engaged in significant fraud to inflate his personal net worth by billions of dollars to illegally enrich himself and cheat the system,” James said in a statement. 

“Since we filed this sweeping lawsuit last month, Donald Trump and the Trump Organization have continued those same fraudulent practices and taken measures to evade responsibility,” she continued. “Today, we are seeking an immediate stop to these actions because Mr. Trump should not get to play by different rules.”

The filing alleges that on the same day James’s office announced the fraud suit, the Trump Organization registered a new business entity in New York that was incorporated in Delaware about a week prior.

“Beyond just the continuation of its prior fraud, the Trump Organization now appears to be taking steps to restructure its business to avoid existing responsibilities under New York law,” the suit states.

Trump attorney Alina Habba called James’s filing “another stunt” in a statement to The Hill.

“The [Office of the Attorney General’s] filing is nothing more than a thinly-veiled attempt to keep this case with Justice Engoron rather than have it transferred to the Commercial Division where it belongs,” Habba said. “We have repeatedly provided assurance, in writing, that the Trump Organization has no intention of doing anything improper. This is simply another stunt which Ms. James hopes will aid her failing political campaign.”

The attorney general’s filing said that assurances from Trump’s attorneys about the new entities were not “concrete” enough.

James’s office also argued that ongoing misconduct at the Trump Organization is likely “given the centrality of a particular cast of characters in the fraudulent conduct … and the continued role of many of them in the closely held Trump Organization.”

Thursday’s motion also accuses the former president and Eric Trump of refusing service of the complaint filed last month, asking the judge to allow the attorney general’s office to serve them electronically.

The former president and other members of his family have denounced James’s suit as politically motivated, pointing to her past promises to go after the Trump family’s business practices.

James’s filing of the suit last month marked the culmination of her office’s three-year investigation into the Trump Organization.

She is seeking $250 million in financial penalties and an order permanently barring Trump and three of his children — Donald Trump Jr., Ivanka Trump and Eric Trump — from serving as an officer or director in any New York corporation.