MANHATTAN (CN) — A New York judge on Friday ordered former President Donald Trump to pay nearly $355 million in disgorgement after finding Trump had fraudulently inflated his net worth on yearly financial documents, stiffing banks and insurers out of millions.
In his 92-page decision, Justice Arthur Engoron cited Trump and his co-defendants’ refusal to admit wrongdoing as a reason for the hefty penalties.
“Their complete lack of contrition and remorse borders on pathological,” Engoron wrote. “Defendants’ refusal to admit error… constrains this court to conclude that they will engage in it going forward unless judicially restrained.”
Trump and his co-defendants now face temporary business bans, while the Trump Organization will be forced to implement new compliance codes and continued monitoring, per the judgment. Trump did manage to avoid getting his business license canceled — Engoron deemed that punishment “no longer necessary” alongside the new oversight requirements.
It’s still a slam-dunk for New York Attorney General Letitia James, who was initially seeking $370 million from the defendants.
“Today, justice has been served,” James said in a statement. “This is a tremendous victory for this state, this nation, and for everyone who believes that we all must play by the same rules — even former presidents.”
James’ office added that Trump will actually have to shell out “more than $450 million in total” after pre-judgment interest is tacked on. The nearly $100 million in interest will continue to increase for every day until it’s paid, so the true total could be even higher.
In his ruling, Engoron agreed with the attorney general’s assessment that Trump's vastly inaccurate statements of financial condition profited him hundreds of millions of dollars more than if the documents had been truthful.
“The frauds found here leap off the page and shock the conscience,” Engoron wrote.
Throughout the trial, Trump’s lawyers claimed it was the responsibility of external accountants, not the Trump Organization, to verify the accuracy of those documents. The judge rejected that defense in his ruling.
“There is overwhelming evidence from both interested and non-interested witnesses, corroborated by documentary evidence, that the buck for being truthful in the supporting data valuations stopped with the Trump Organization, not the accountants,” Engoron wrote. “Moreover, the Trump Organization intentionally engaged their accountants to perform compilations, as opposed to reviews or audits, which provided the lowest level of scrutiny.”
In addiion to the cash penalties, Engoron issued limited industry bans to Trump and co-defendants Allen Weisselberg and Jeff McConney, Trump Organization executives who assisted Trump in the scheme. The judge precluded them from "serving as an officer or director" in the New York real estate business for three years. He also permanently banned Weisselberg and McConney from serving in a financial control capacity at any state organization.
“The evidence is overwhelming that Allen Weisselberg and Jeffrey McConney cannot be entrusted with controlling the finances of any business,” Engoron wrote.
Trump’s adult sons Eric Trump and Donald Trump Jr., who were co-defendants in the case as well, were issued two-year bans. They each owe $4 million for their role in the fraud.
Weisselberg, the former Trump Organization finance chief, is on the hook for $1 million. But the fallout from this trial could be much greater: Earlier this month, The New York Times reported that he was in talks with Manhattan prosecutors for a perjury plea deal stemming from his October testimony.
Friday’s ruling also banned Trump and his companies from applying for loans from any New York bank for the next three years. Additionally, the Trump Organization is forced to implement an “Independent Director of Compliance” role to deter future fraud.
The company’s current independent monitor, which was appointed by the court last year to keep tabs on the Trump Organization’s finances, will continue to do so for at least the next three years, per Engoron’s judgment.
Trump’s lawyer Alina Habba called Friday’s ruling a “manifest injustice,” and one that Trump intends to appeal.
“Given the grave stakes, we trust that the Appellate Division will overturn this egregious verdict and end this relentless persecution against my clients,” Habba said in a statement.
Trump echoed the same sentiment in a brief speech of his own Friday evening.
“We’ll appeal, we’ll be successful I think,” he said. “If we’re not successful, New York State will be gone.”
Engoron’s ruling comes after a 10-week trial that ran from October to December 2023. The parties returned to the New York Supreme Courthouse in mid-January for a dramatic day of closing arguments, which featured an unplanned rant from Trump himself.
“This is a political witch hunt,” Trump said, claiming he was an “innocent man” who was being “persecuted by someone running for office.”
James initially brought the civil fraud suit against Trump and his namesake real estate firm in 2022. Because of the damages sought, the case was brought as a bench trial that gave Engoron the final say on wrongdoing and punishments.
Before trial even began, Engoron found Trump liable for the case’s top fraud count.
“You cannot make false statements and use them in business,” he said, chiding Trump for lying on his yearly finance reports.
Witnesses testified Trump instructed employees to “reverse-engineer” his financial statements to hit a target net worth, which he wanted to see “go up” each year. Trump’s ex-lawyer Michael Cohen, now an outspoken critic of the former president, testified that he was tasked to “increase the total assets” based on a number that Trump “arbitrarily selected.”
“I would sit down with Allen [Weisselberg] and we would make the changes,” Cohen said. “That document would then be photocopied that had all of the changes, at which point in time Allen and I would return to Mr. Trump and demonstrate that we had achieved close to the number that he was seeking.”
Throughout the proceedings, Trump repeatedly called the trial “unfair” and “election interference.” He frequently attended the trial, using the Manhattan courthouse as a de facto campaign stop to attack the attorney general and other political opponents.
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