New York Attorney General Letitia James’ civil lawsuit filed Wednesday for “persistent fraud” by the Trump Organization is devastating Donald Trump’s fabricated self-image as a billionaire businessman.
It stings. Not only has Trump been accused of lying about his wealth and business success, but the considerable wealth he has acquired, according to James, was also obtained by deceiving banks and insurance companies.
A voter doesn’t need to understand the intricacies of top secret document classifications or presidential voter selection to grasp James’ claims that Trump’s corporate and political brand is a scam game.
While the whirlwind of criminal and congressional investigations has seemingly done little to shake Trump’s political standing, the massive fraud allegations undermine the core of Trump’s brand as a businessman and potential presidential candidate. of 2024.
A voter doesn’t need to understand the intricacies of top secret document classifications or presidential voter selection to grasp James’s claims that Trump’s corporate and political brand is a scam game rooted in years of fraudulent reviews.
The 214-page complaint alleges a decade of inflated real estate values used to fabricate a facade that Trump was a hugely successful businessman. James’ civil lawsuit hits Trump in the two places where he is most vulnerable: his ego and his money.
When Trump launched his presidential bid in 2015, he claimed he was worth $8.7 billion. “I’m not doing this to brag. … I do this to say this is the kind of thinking our country needs,” he said.
Trump pointed to his net worth as a qualification for his presidential bid, saying, “I’m proud of my net worth. I did an amazing job. … We need a leader who wrote ‘The Art of the Market’.
A few weeks later, he dumped that value and issued a statement increasing his wealth to “more than TEN BILLION DOLLARS”.
Trump’s assertion of business success has drawn voters.
In a May 2019 Politico/Morning Consult national poll of registered voters, when asked whether they “generally” thought Trump was successful or unsuccessful in business, 54% said they thought Trump was “very” or “fairly” successful. Thirty-six percent said he was “very” or “somewhat” unsuccessful.
But that same poll found that Trump supporters might change their minds if confronted with financial information undermining his narrative. After learning that Trump reported $1 billion in losses on his federal tax returns from 1985 to 1994, those who thought he was a successful businessman dropped to 43%.
James’ detailed complaint cites dozens of inflated ratings. Specifically, the complaint alleges that the defendants engaged in “an overall scheme to fraudulently and falsely inflate Mr. Trump’s assets in order to comply with Mr. Trump’s instruction to increase his net worth.”
To be clear, Trump has already been accused of financial misconduct. In 2019, James announced a settlement of his Trump Foundation investigation. Trump admitted his personal misuse of charity funds. He was ordered to pay $2 million to the foundation, which donated its assets to other charities and was closed.
After the 2016 election, Trump agreed to pay $25 million to settle a civil class action lawsuit alleging students enrolled at Trump University were defrauded.
While none of these fraud allegations appear to erode Trump’s political support, the new lawsuit could inflict significant damage to Trump’s political brand for six main reasons.
First, unlike allegations of fraud related to peripheral activities such as Trump University or the Trump Foundation, the most recent lawsuit argues that the entire Trump Organization – the core of Trump’s claimed wealth – has given over to massive fraud for a decade. James’ lawsuit meticulously catalogs fraudulent appraisals of Trump Tower, Mar-a-Lago, 40 Wall Street, numerous Trump golf courses and, most importantly, Trump’s cash.
Second, James sued not only Donald Trump, but also Donald Trump Jr., Eric Trump, Ivanka Trump, Allen Weisselberg (the former Chief Financial Officer of the Trump Organization) and several Trump business entities. All are accused of engaging in a criminal conspiracy to defraud lenders and insurers by inflating Trump’s net worth.
Third, James’ lawsuit seeks damages of $250 million, or 10 times the settlement of the Trump University lawsuit.
Fourth, if successful, James’ lawsuit would bar Trump and his three named children from running the Trump Organization and would require the company to prepare audited financial statements in accordance with generally accepted accounting principles that would disclose Trump’s true net worth.
Fifth, unlike his previous lawsuit, James shows no intention of settling this case. According to the New York Times, she rejected a settlement overture from Trump before filing a lawsuit. A lawsuit would draw even more public attention to these allegations of fraud.
Sixth, while some of the fraud allegations relate to the intricacies of proper asset valuation methods, others can be grasped by a third-year math student. Take the claim about Trump’s New York apartment in Trump Tower. Apparently the apartment was rated at 30,000 square feet, but it was actually just under 11,000 square feet. This led to it being appraised at $327 million ($29,738 per square foot) in 2015. In the suit, James said the price was “absurd” and that “in the 30-year-old Trump Tower , the 2015 record sale was just $16.5 million at a price below $4,500 per square foot.
The former president’s approval ratings with voters and his grip on the Republican Party have remained steady despite investigations related to the January 6, 2021 insurrection attempt, the scheme to discredit the legitimacy of the presidential election. President Joe Biden and Trump’s retention of classified documents. .
But James’ civil suit is public, detailed, and goes to the heart of Trump’s brand and self-image. Her reaction to James’ inquiry was telling. After a losing battle to avoid being deposed, Trump reportedly asserted his Fifth Amendment privilege to decline to answer more than 440 times in August.
It’s the clearest indication that James’ lawsuit is a potential game-changer.