The New York Attorney General’s Office on Monday mentioned that it’s investigating President Donald Trump and his firm over how they valued a number of Trump assets on annual monetary statements that had been used to acquire loans, in addition to to get financial and tax advantages.
The disclosure of the civil probe by Letitia James’ workplace got here as after it filed courtroom paperwork in search of to compel the Trump Organization, Trump’s son Eric Trump, and Trump entities and legal professionals to adjust to investigative subpoenas issued by James as half of the probe.
“The action seeks to compel the testimony of Trump Organization Executive Vice President Eric Trump, who was intimately involved in one or more transactions under review, as well as the production of thousands of documents wrongly withheld,” James’ workplace mentioned in an announcement.
James opened the probe final 12 months after Trump’s former lawyer, Michael Cohen, “testified before Congress that Trump’s annual financial statements inflated the values of Trump’s assets to obtain favorable terms for loans and insurance coverage, while also deflating the value of other assets to reduce real estate taxes,” her workplace mentioned in an announcement.
James’ workplace mentioned that Eric Trump “Was scheduled for an [Office of Attorney General] interview last month to discuss his role in certain Trump Organization projects.”
“Despite earlier agreeing to be interviewed by the OAG, Eric Trump now refuses to appear,” James’ workplace mentioned.
The workplace additionally mentioned that one other one who has didn’t adjust to a subpoena is a land use attorney who labored with the Trump Organization on the so-called Seven Springs Estate, a 212-acre property in Bedford, in Westchester County, New York.
“One particular focus of this inquiry, as relevant here, is whether the Trump Organization and its agents improperly inflated, or caused to be improperly inflated, the value of the Seven Springs Estate,” courtroom information mentioned.
“Valuations of Seven Springs were used to claim an apparent $21.1 million tax deduction for donating a conservation easement on the property in tax year 2015, and in submissions to financial institutions as a component of Mr. Trump’s net worth,” the submitting mentioned.
But James’ workplace in an announcement additionally mentioned it was eyeing different properties, together with 40 Wall St., “a mixed use building in lower Manhattan that the Trump Organization owns an interest in.”
“In 2010, the Trump Organization entered into a note and mortgage in connection with the property that was modified to have a total principal loan amount of $160 million — $20 million of which was personally guaranteed by Donald Trump,” James’ workplace mentioned.
The probe is also trying on the Trump International Hotel and Tower Chicago, “a hotel and residential complex in Chicago that was absent from Donald Trump’s ‘Statement of Financial Condition’ in 2009 and in subsequent years” the workplace mentioned.
And James’ workplace is eyeing the Trump National Golf Club – Los Angeles.
That golf course and clubhouse are owned by the Trump Organization, which “donated a conservation easement over part of the property in 2014 and received a tax deduction for it,” in accordance with a press launch by the attorney general.
James’ workplace “has not concluded its investigation and has not reached a determination regarding whether the facts identified to date establish violations of law,” in accordance with the submitting, which was made within the New York state Supreme Court in Manhattan.
Trump Organization spokesman Alan Garten in an announcement mentioned, “This is simply a discovery dispute over documents and the like.”
“As the motion papers clearly state, the NYAG has made no determination that anything was improper or that any action is forthcoming. We will respond to this motion as appropriate,” Garten mentioned.
The Financial Times final 12 months famous that Trump, who purchased Seven Springs for simply $7.5 million in 1996, valued it in 2012 at a whopping $291 million.
But Forbes journal simply two 12 months later reported that the property was price lower than $19.5 million “based on recent property sales and advice from local realtors and assessors.”
Forbes’ valuation was practically 15 occasions lower than what Trump valued the property at.
After buying the property, the Trump Organization looked for a number of years to subdivide and develop Seven Springs into a couple of dozen particular person heaps, however the venture stalled.
An affidavit filed by James’ workplace mentioned that the attorney general “has kept this investigation confidential to avoid prejudice to the investigation and to avoid undue reputational harm to witnesses and the subjects of the investigation.”
James’ workplace “has not concluded its investigation and has not reached any determination regarding whether the facts identified to date establish violations of any applicable laws,” in accordance with the affidavit, which was filed by an assistant attorney general.
The affidavit additionally says that in the course of the investigation, James’ workplace “has obtained information … from numerous individuals and entities whose identities it has sought to keep confidential.”
“Premature public disclosure of their identities or the evidence they have provided could impair [the office’s] ability to seek further testimony and documents from those and other witnesses and entities.”
Because James’ workplace “has not yet reached a determination regarding whether the facts identified in this investigation establish violations of any applicable laws, premature public disclosure of the witnesses and evidence collected to date could result in undue reputational and other harm to witnesses and subjects of the investigation,” the affidavit mentioned.
James, in a ready assertion, mentioned: “Nothing will stop us from following the facts and the law, wherever they may lead. For months, the Trump Organization has made baseless claims in an effort to shield evidence from a lawful investigation into its financial dealings.”
“They have stalled, withheld documents, and instructed witnesses, including Eric Trump, to refuse to answer questions under oath,” James mentioned.
“That’s why we’ve filed a motion to compel the Trump Organization to comply with our office’s lawful subpoenas for documents and testimony. These questions will be answered and the truth will be uncovered, because no one is above the law.”
— Additional reporting by CNBC’s Jim Forkin.