27 Feb 2024

Trump appeals US$454 million ruling in NY civil fraud case

5:38 am on 27 February 2024
Republican presidential hopeful and former US President Donald Trump gestures as he speaks during a rally in Laconia, New Hampshire, January 22, 2024. (Photo by TIMOTHY A. CLARY / AFP)

Donald Trump. Photo: AFP / TIMOTHY A. CLARY

By Jack Queen, Reuters

Donald Trump on Monday appealed a judge's ruling that the former US president must pay US$454 million (NZD$735m) in penalties and interest for fraudulently exaggerating his net worth and the values of his real estate holdings to secure better loan terms.

Trump asked an intermediate-level state appellate court to overturn Justice Arthur Engoron's 16 February ruling in a civil fraud lawsuit brought in 2022 by New York Attorney General Letitia James. The ruling included a US$354.9m penalty and limits on his ability to do business in New York state.

The penalties, along with sizeable jury awards in two other civil cases, could become a drain on Trump's cash reserves and hobble parts of his real estate empire as he pursues the Republican nomination to challenge President Joe Biden in the 5 November US election.

James, a Democrat, accused Trump in the lawsuit of overstating his net worth by as much as US$3.6 billion in financial statements provided to banks. Trump has accused James and Engoron of political bias against him.

In addition to imposing the monetary penalties, Engoron's decision barred Trump from running a corporation in New York or seeking loans with banks chartered or registered in the state for three years. The judge also enhanced the powers of a court-appointed financial watchdog at the Trump Organization, the umbrella entity for the former president's business ventures.

The appeals court - formally called the Appellate Division, First Department - potentially could put the judge's ruling on hold during an appeals process that could last a year or longer.

Trump denied wrongdoing. He is worth US$2.6b, according to a Forbes estimate, but accounts of his worth vary greatly and it remained unclear how much cash he has on hand. Trump said in a deposition in April 2023 that he had roughly US$400m in liquid assets.

Engoron's ruling followed a contentious three-month trial in Manhattan that began in October. It featured testimony by Trump, who conceded that his property valuations were not always accurate but said his lenders were on notice to independently verify them.

The judge also fined Trump's sons Don Jr and Eric $4m each and barred them from running a New York corporation for two years. Both men have denied wrongdoing and joined in Trump's appeal on Monday.

The payouts from Engoron's judgment total US$464.4m for all defendants. More than US$114,000 of interest will continue accruing daily, mostly for Donald Trump alone. The judgment was made public on Friday.

The case is part of a maelstrom of legal troubles Trump faces - including criminal charges in four separate cases - though none have diminished his commanding lead in the race for the Republican nomination. Trump has used the cases to rally his base and raise money, telling supporters that he is being targeted for political reasons.

In one of the other civil cases, a jury in January found that Trump must pay writer E. Jean Carroll US$83.3m for defaming her by denying her claim that he raped her decades earlier. Trump has vowed to appeal. Another jury last year ordered Trump to pay Carroll US$5m in a separate case.

Trump is separately trying to delay enforcement of the US$83.3m verdict and wants to appeal without posting any security.

US District Judge Lewis Kaplan, who oversees that case, gave Carroll until Thursday to respond.

In one of the criminal cases, a New York judge has set a 25 March trial date for Trump on charges involving falsifying business records to conceal hush money paid to porn star Stormy Daniels ahead of the 2016 election that gave him the presidency.

Trump is also under indictment in Washington and Georgia over his efforts to reverse his 2020 election loss and in Florida over his handling of classified documents upon leaving office. He has pleaded not guilty in all four cases.

This story was originally published by Reuters

Get the RNZ app

for ad-free news and current affairs