On Monday opening statements began in the civil bench trial of the State of New York vs. Donald Trump, et al over-inflated assets in fraudulent statements. Judge Arthur Engoron recently ruled for partial summary judgment against Trump and his co-defendants. They were all held liable for “persistent and repeated” fraudulent behavior.
On the second day of this fraud case, Engoron issued an unprecedented gag order after Trump disparaged the judge’s staffer on social media. By the third day of trial Wednesday morning, Trump had already unleashed yet “another attack on ‘corrupt’ attorney general” Letitia James.
While the order barred the former president and other parties from making public comments about Engoron’s staff and threatened “serious sanctions” upon violation, it was clearly intended as a ‘heads up’ for the former president who has “repeatedly pilloried officials” involved in his ongoing civil and criminal cases.
In this lawsuit, there are six “causes for action” including falsifying business records, conspiracy to falsify business records, issuing false financial statements, conspiracy to falsify financial statements, insurance fraud, and conspiracy to commit insurance fraud.
Over the past weekend, the master propagandist and dictator in waiting as he continues to double and triple down on his obstruction of justice was also busy as usual fundraising by email based on a myriad of untruths and distortions of facts and reality.
“According to news reports, I will be attending the civil trial in New York tomorrow where an anti-Trump judge is attempting to bring down the Trump Organization and financially break me,” Trump’s email read. He claimed that this trial will be the first in “the Democrats’ string of witch hunts designed to destroy our 2024 presidential campaign.”
I have been anticipating this lawsuit even more than Trump’s upcoming criminal trials because it is about the rise and fall of the Trump business empire.
More accurately, these illegalities tell the story of the rise and fall of the Trump Organization, which from its inception has operated as “an organized crime organization” or a criminal enterprise engaged in habitual or patterned fraud.
Under New York state’s 1986 version of the federal RICO Act, the enumerated causes of action in this lawsuit constitute “enterprise corruption,” or an array of fraudulent conduct involving both illegitimate and legitimate businesses.
This civil lawsuit is really the only one that Trump is personally invested in, psychologically bothered by or truly cares about for its intrinsic rather than its political value. When all of Trump’s litigation finally comes to a close several years from now, it will be this civil lawsuit among all the other lawsuits that will be the most damaging to the former president.
First, this lawsuit is “personal” for Trump and strikes at his very heart and soul as cold and dark as they are. Second, only this lawsuit comes with the “corporate death penalty” as well as the type of humiliation and accountability that Trump will be incapable of dealing with no matter how hard he tries to project or rationalize or spin for public consumption.
In terms of who Trump thinks he is, has been, and could become, this lawsuit has more meaning for the hypersensitive and insecure former president than the pending criminal lawsuits against him combined. Because it is these schemes or scams or rackets and not his January 6th efforts to defraud the American voters or his conspiring to steal the 2020 election and overturn the government that will determine what he still owns or leases and how much wealth he has left besides his presidential pensions. And most importantly, it will decide whether Donald is a “winner” or a “loser” in the eyes of his deceased father Fred.
This civil bench trial represents the reality of political theater and judicial reality meets one frightened, anxious, and angry Trump doing his best not to explode or to lose it while his bodily contortions and red-faced expressions at the same time suggests it is not easy for him. So I would not expect Trump to attend very many of the remaining days of this three-month trial.
It has been obvious from his Truth Social posts and emails to his supporters that Trump is continuing to do his worst to delegitimize the rule of law and the judicial system.
In an unusual and preempted move, Judge Engoron previously fined Trump’s lawyers on the case $7,500 a piece for their arguments supporting Trump’s “fantasy world.” Kise and Habba made essentially the same arguments in their opening statements that the judge already rejected in reaching his partial summary judgment. Will these attorneys also be sanctioned during the trial or fined at the end of the case?
Despite the forthcoming resolution of the five remaining causes for action against Trump and his co-defendants that should occur before Christmas, the judge has already concluded that on three separate occasions between 2011 and 2021 Trump inflated his net worth by as much as $3.6 billion.
Again, this trial is all about the potential or actual loss of Trump’s personal wealth. It is also about the demystification of Trump’s autobiographical mythology as a self-made billionaire. Regardless of the legal outcome of this bench trial, this fantasy has been exposed as the made-up story and financial fraud it has always been.
Importantly, this bench trial will determine how much Trump’s businesses will have to pay for the habitual fraud committed by Trump and his co-defendants. New York Attorney General Letitia James has sought $250 million, but it could end up costing Trump’s legacy a lot more than that, virtually barring the Trump Organization from the worlds of real estate and high finance.
The Trump Organization will most likely be put out of business in New York and elsewhere for at least 5 years. After all, the judge has already canceled the certifications of the Trump entities, ordered that the businesses be placed into receivership and that within 30 days the defendants must come up with a plan to “manage the dissolution” of 400-500 corporate properties.
My interest here is with Trump’s continued weaponization of his legal troubles, civil or criminal, and with the way in which Trump’s “witch hunt” political narratives are making their way into the New York civil court of law. Although I believe that these political arguments will be of no value in this or any other legal trial of Trump’s, I also believe that neither Trump nor his attorneys think that they have any real winning arguments.
Had Trump and his lawyers thought that any of their arguments could make a difference or that there was a chance for a hung jury, then they would have checked the box off indicating their desire for a jury trial, which they did not do.
Trump’s lawyers continued to insist that the financial statements were perfectly normal, subject to the usual subjectivity in these types of financial matters. Repeating these same arguments that Engoron previously rejected as nothing more than wishful fantasies, they continue to maintain that Trump’s holdings are ‘Mona Lisa properties’ that can command top dollar and argue their valuations are ‘not fraud. That is real estate’.
Lastly, doing what Trump and his fraudulent lawyers do best, they accused their own accountants of not doing their due diligence and the attorney general of ‘setting a very dangerous precedent for all business owners in the state of New York.’”
If Trump’s political arguments held enough legal currency with a jury of 12 where it would have only taken one rogue juror to upend things in his favor, his team would have opted for a jury and taken the risk.
Instead, knowing that Trump is going to lose the lawsuit anyway, they figured it was far better politically to work to delegitimize the guilty verdicts by blaming the evil Democratic Judge Engoron and the “corrupt and terrible” AG James who are, naturally, working on behalf of the Deep State and motivated by a conspiratorial vendetta to take down the perfectly law-abiding and persecuted Trump.
Gregg Barak is an emeritus professor of criminology and criminal justice at Eastern Michigan University, co-founder of the Journal of White Collar and Corporate Crime, and the author of Criminology on Trump (2022) who’s sequel, Indicting the 45th President: Boss Trump, the GOP, and What We Can Do About the Threat to American Democracy will be published in early 2024.
