New York Attorney General Letitia James announced Wednesday that she filed a civil lawsuit against former President Donald Trump and his three eldest children over his long-running alleged tax-dodging scheme.
James hopes to convince a court to take steps to bar Trump, Donald Trump Jr., Ivanka Trump and Eric Trump from conducting business in the state of New York, along with making them pay some $250 million in restitution and limiting their access to loans.
“Donald Trump falsely inflated his net worth by billions of dollars to unjustly enrich himself and to cheat the system, thereby cheating all of us,” James said at a press conference outlining Trump’s alleged misconduct.
Prosecutors in New York have been looking into Trump’s real estate business practices for several years following reports that he routinely undervalued and overvalued assets to avoid paying his fair share of taxes. James said that “a comprehensive three-year investigation” involved a review of millions of documents and interviews with 65 witnesses. Along with members of the Trump family, the suit names Allen Weisselberg, the Trump Organization’s former longtime chief financial officer, alongside his right-hand-man Jeffrey McConney.
James’ office is also making criminal referrals to federal prosecutors and the IRS, believing the Trumps to have violated federal law.
By shifting the valuation of his assets, Trump was allegedly able to convince banks to lend money to the Trump Organization on more favorable terms, to secure more favorable insurance arrangements and to pay less tax.
“White collar financial crime is not a victimless crime. When the well-connected break the law to take in more money than they are entitled to, it reduces resources to working people, to regular people, to small businesses and to all taxpayers,” James said.
She gave several examples: One asset in New York City had been listed as being worth over 60 times what an appraiser had valued it. Mar-a-Lago, Trump’s South Florida golf resort, was estimated to be worth $75 million, but James said it had been “valued as high as $739 million” on documents her office reviewed.
“All told, we uncovered more than 200 examples of false and misleading asset valuations that were used on his statements,” James said, calling the pattern an “astounding” one.
She added: “It was a scheme that by its very nature became more profitable over time.”
The hefty lawsuit is around 280 pages long and contains details on 23 assets that were misvalued at various times.
Trump and his eldest children had all been deposed as part of James’ investigation, although Trump invoked his Fifth Amendment right to avoid self-incrimination more than 400 times.
The Trump camp was anticipating civil legal action against them, Bloomberg reported shortly before the announcement.
Trump responded by saying the investigation was “another Witch Hunt by a racist Attorney General,” and by shifting focus to crime in New York City.
“Attorney General Letitia ‘Peekaboo’ James, a total crime fighting disaster in New York, is spending all of her time fighting for very powerful and well represented banks and insurance companies, who were fully paid, made a lot of money, and never had a complaint about me, instead of fighting murder and violent crime, which is killing New York State,” Trump wrote on Truth Social, the platform he launched after being permanently kicked off Twitter. (Major financial institutions that did business with the Trump Organization have cut ties in recent years.)
The suit comes at a perilous time for Trump, who is dealing with several other investigations relating to his conduct during and after his presidency and having difficulty retaining lawyers capable of defending his interests.
Attorney General Merrick Garland has not ruled out possible criminal charges against him for spiriting highly classified government documents away from the White House, but any such charges would not be announced until after the midterm elections, if they come at all.
Manhattan District Attorney Alvin Bragg could choose to file criminal charges, but appears unwilling to do so; two prosecutors resigned their positions earlier this year over differing opinions on the case against Trump. Bragg’s office said in a short statement Wednesday afternoon that its investigation was still ongoing.
Trump’s taxes have been a point of contention since his days campaigning for the presidency, when he started claiming that his lawyers had advised him not to release any tax return documentation. A damning New York Times investigation in 2020 found that Trump paid a staggeringly small sum in federal income taxes, just $750, the year he won the election. He reportedly paid no federal income taxes for many years before that because he was telling the government he was losing a great deal of money.