Trump business empire under threat as civil fraud trial opens in New York

New York Judge Arthur Engoron has already ruled that Trump and his sons Eric and Don Jr committed fraud by inflating the value of the real estate and financial assets of the Trump Organization for years.

New York Attorney General Letitia James is now seeking $250 million in penalties and the removal of Trump and his sons from management of the family empire.

James accused the former president on Monday of "persistent and repeated fraud" and said "justice will prevail."

"No matter how powerful you are, no matter how much money you think you may have, no one is above the law," she said.

Trump, arriving in court, denounced the case as a "scam" and a "witchhunt."

"It's a sham," the 77-year-old Trump said. "My financial statements are phenomenal."

In addition to this civil case, Trump also faces several major criminal proceedings in the months ahead.

He is scheduled to appear before a federal judge in Washington on March 4 on charges of trying to overthrow the results of the 2020 presidential election won by Joe Biden.

Trump will then be back in New York state court, this time on criminal hush money charges, and later in a Florida federal court, where he is accused of mishandling classified documents after leaving office.

Finally, he will also have to answer to state charges in Georgia, where prosecutors say Trump illegally tried to get the southern state's 2020 election results changed in his favor.

In the New York civil case, Engoron ruled that Trump, his two eldest sons and other Trump Organization executives lied to tax collectors, lenders and insurers for years in a scheme that exaggerated the value of their properties by $812 million to $2.2 billion between 2014 and 2021.

'Major blow'

As a result, the judge revoked the business licenses that allowed the Trump Organization to operate some of its New York properties.

Actually enforcing such penalties would be "a major blow to Donald Trump's ability to do business in the State of New York going forward," Will Thomas, a professor of business law at the University of Michigan, told AFP.

Under that kind of pressure, Trump -- who made his reputation and fortune as a real estate mogul in the 1980s and had promised to bring his cut-throat industry tactics to the Oval Office -- could eventually lose control over many of his company's flagship properties, such as his 5th Avenue Trump Tower in Manhattan.

According to Attorney General James, a Democrat, Trump's own apartment in that building is among the spaces that were fraudulently overvalued -- it was listed as three times bigger than its true size.

Another Manhattan building, at 40 Wall Street, was overvalued between $200-$300 million in financial disclosures, James alleges.

Trump's luxury Mar-a-Lago resort in Florida -- the site of the classified documents drama -- and several other Trump Organization golf clubs also appear in James's complaint.

High-profile witnesses

Trump has repeatedly dismissed the New York civil allegations, calling James, who is Black, "racist," and labeling Engoron "deranged."

On Truth Social, Trump claimed there was no "wrongdoing" in his actions of "fully paying back sophisticated Wall Street Banks in full, with interest, with no defaults, and with no victims."

There are likely to be dozens of witnesses called to testify at the trial, including Trump himself, and former financial director of the Trump Organization Allen Weisselberg, who served time in prison after pleading guilty to tax fraud in a separate case brought against the business.

Trump's children Eric, Don Jr and his oldest daughter Ivanka -- who was initially also targeted by James's complaint but ultimately not prosecuted -- are also likely to present their own testimony.

Trump's former lawyer Michael Cohen -- now an outspoken critic of the former president -- and officials from certain Trump-linked financial institutions are also expected to appear.

(AFP)