New York’s AG lays out case against Trump

Donald Trump’s company has been formally accused of “fraudulent or misleading” business practices by New York’s attorney-general. Letitia James set out claims that the value of various Trump assets was routinely inflated to attract loans, favourable conditions and insurance. The inquiry could result in fines, the removal of company officers or business licences. James is seeking to compel the former president, along with his eldest son and daughter, to testify under oath as part of a civil investigation. Issuing the 115-page document, James said: “We have uncovered significant evidence indicating that the Trump Organization used fraudulent and misleading asset valuations on multiple properties to obtain economic benefits, including loans, insurance coverage and tax deductions for years.” James claims, among other things, that the Trump Organization added a “brand premium” of between 15% and 30% to properties carrying the Trump name, even though financial statements acknowledged that there was no brand value. Her report also claims that it valued a Park Avenue tower at $350m based on predicted proceeds from unsold apartments, even though the flats would have to be sold for far less owing to rent stabilisation laws. A lease in an office building, 40 Wall Street, was claimed by Trump to have a value of $525m to $602m – two to three times the estimate made by appraisers working for the lender, Capital One. The value of land donations made in New York and California was also overstated on paperwork submitted to the IRS, to justify several million dollars of tax deductions. If Trump is shown to have exaggerated his financial profile to win favourable terms, his lenders could review or recall those loans, or claim compensation. James said that a section of his annual financial statement for “other assets” was used to disguise changes that the organisation was forced to make. In 2016, when appraisers assessed the value of Trump’s Seven Springs estate in Westchester County at $56.5m – just one-fifth of Trump’s own valuation of $291m – his three-level apartment in Trump Tower increased in value in one year by 64%, from $200m to $327m. He is also accused of fraudulently inflating the value of his Aberdeenshire golf course. It was bought in 2006 for £12.6m, but valued at £161m in 2011 based solely on an e-mail sent to Forbes magazine. By 2014 it was valued at $435.6m, based on an assumption that Trump would be allowed to build 2,500 homes on the estate, for which it did not have permission. The Trump Organization has said: “The only one misleading the public is Letitia James.” The Times (£) and The Times (£) and The Times (£) The FT (£) Photo by MediaPunch/REX/Shutterstock (5551111am)