Former U.S. President Donald Trump’s family company is trying to restructure itself to avoid potential consequences from a lawsuit accusing the Trump Organization, Trump and three of his adult children of fraud, New York state Attorney General Letitia James said on Thursday.
James urged a New York state court in Manhattan to appoint an independent monitor to oversee the company before the civil fraud case, which accuses the real estate firm and the other defendants of overvaluing its assets and Trump’s net worth through a decade of lies to banks and insurers, goes to trial.
James said the Trump Organization on the date of the lawsuit registered a new Delaware-incorporated company named “Trump Organization II” with New York authorities. She said the Trump Organization has not provided assurances it will not seek to move assets out of New York.
Trump, a Republican, and his company have denied wrongdoing and call the case a politically motivated “witch hunt.” James is a Democrat and is running for re-election in November.
“We have repeatedly provided assurance, in writing, that the Trump Organization has no intention of doing anything improper,” Alina Habba, a lawyer for Trump, said in a statement, calling James’ request a “stunt” to help her campaign and an attempt to influence which judge gets assigned the case.
Lawyers for Trump’s children and the Trump Organization did not immediately respond to requests for comment.
Faster timeline sought
On Thursday, James asked the court to bar the Trump Organization from offloading its assets while the case plays out, to prevent it from issuing financial statements that do not explain their methodology, and to appoint a monitor to ensure compliance with those conditions, court papers showed.
She also asked to speed up the case and sought a trial date for October 2023.
“Since we filed this sweeping lawsuit last month, Donald Trump and the Trump Organization have continued those same fraudulent practices and taken measures to evade responsibility,” James said in a statement. “Today, we are seeking an immediate stop to these actions.”
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The Trump Organization manages hotels, golf courses and other real estate around the world, and had been under investigation by James for more than three years.
Through the lawsuit, James is seeking to remove the Trumps from power at their company, prohibit Trump and the three adult children named in the case from serving as corporate officers or directors in New York, and to recoup at least $250 million US of alleged improper gains.
The lawsuit said Trump’s scheme was designed to fraudulently induce banks to lend money more cheaply, coax insurers into providing coverage for higher limits at lower premiums, and obtain tax benefits.
James said Trump pretended his Trump Tower apartment was 30,000 square feet, when it was actually 10,996 square feet, and that its $327 million valuation in 2015 was “absurd” because no New York City apartment had sold for $100 million at the time.
Manhattan District Attorney Alvin Bragg has separately charged the Trump Organization with criminal tax fraud, and is preparing for an Oct. 24 trial. The company has pleaded not guilty.
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