Former President Donald Trump might not be very good at math. He spent his presidency claiming his poll numbers were great when they were among the lowest on record for a first-term president. He claimed that Covid-19 infection rates were so high because public health officials ran too many tests for the virus. He even still thinks he won the 2020 presidential election, where he received seven million fewer popular votes and 74 fewer Electoral College votes than President Joe Biden.
The latest evidence of Trump’s innumeracy has arrived in the form of a late-night court filing by New York Attorney General Letitia James. In the 115-page document, James laid out the clearest depiction yet of the Trump Organization business practices that have drawn scrutiny and indictments from state and local investigators. What James has documented is a pattern of behavior by the Trump family business to mislead banks, tax collectors, and business partners by giving false valuation rates for his properties. Either Trump and everyone around him just happen to be counting wrong, or something more nefarious is afoot.
The filing came as part of a lawsuit filed by the former president and two of his adult children, Donald Trump Jr. and Ivanka Trump, to block James’s investigation and quash her efforts to depose the three Trumps. Eric Trump, who also works for the family business, sat for a deposition last year, as did Allen Weisselberg, the Trump Organization’s longtime chief financial officer. According to James’s filing, the two men each invoked the Fifth Amendment more than 500 times in response to her questions.
James’s office is conducting a civil investigation, not a criminal one, into the Trump family business. But she is reportedly working in tandem with the Manhattan district attorney’s criminal probe into the Trump Organization. That inquiry was opened by former District Attorney Cy Vance Jr. and is currently helmed by his successor, Alvin Bragg, who took office on January 1. In July, local prosecutors charged Weisselberg and the Trump Organization with tax fraud and falsifying business records as part of the ongoing investigation. Weisselberg’s funny numbers are a consistent theme throughout the court filing on Tuesday night.
One of the most egregious examples involves Trump’s triplex apartment in Trump Tower. The residence’s real size is 10,966 square feet—a spacious abode for a Manhattanite by virtually any metric. But that apparently wasn’t enough for the real estate businessman, who claimed in financial disclosure forms that his apartment was actually 30,000 square feet, or roughly a half-acre. That threefold increase in size allowed him to claim that it was valued at roughly $327 million in 2016. Under questioning from James’s office, Weisselberg allegedly conceded that it was worth roughly $200 million less than Trump had claimed.
So what if he inflated his apartment size? If Trump was trying to impress someone on a date or brag to his associates, then it wouldn’t be a matter for state and local investigators. But Trump happened to list the inflated value on a series of annual financial statements that he signed. Those statements, in turn, were given to “financial institutions, other lenders, and insurers in connection with Trump Organization business transactions,” according to James. And based on the numbers, Trump was able to secure more favorable loans and insurance rates for his property.
Some of his actions were more conspicuous than others. At his Seven Springs property in Westchester County, the company claimed it would be building nine luxury homes to justify inflating its value from $80 million in 2004 to $291 million in 2012. After an appraiser determined in 2016 that the property—including the lots of still-unbuilt houses—was only valued at $56 million, the company removed it as a line item from its financial statements. The Seven Springs process gives some insight into how the Trump Organization comes up with such far-fetched figures—but it also suggests that it may be hard to prosecute him for these particular schemes.
“Evidence indicates that Mr. Trump adopted a practice of preventing the creation of written records with regard to his development efforts at Seven Springs,” the attorney general’s office said in the filing. One witness told the office that Trump told him that “he did not want things put in writing in communications between us.” Sheri Dillon, a tax attorney whose firm worked for Trump at the time, allegedly told people involved in the process to use phones whenever possible to “avoid creating discovery unnecessarily,” referring to the process by which other parties can obtain internal records during lawsuits. When email couldn’t be avoided, some of those involved were instructed to send a new one each time instead of replying in a thread, apparently to make it harder for law enforcement or an opposing litigant to piece together what had happened.
These methods apparently struck some of those involved in the valuation as abnormal. Some of the appraisers involved in the Seven Springs property dealings pushed back against the onerous conditions imposed by the Trump Organization, as well as the apparent pressure it placed on the appraisers to reach more favorable conclusions. “As [the junior appraiser] explained in an email that she drafted—but never sent—to the senior appraiser, ‘I am only resistant to this because it seems like they are hiding something and want to push me to ask about stuff that you were reluctant to change,’” the office said in its filing.
In other instances, Trump and his company misstated local regulatory limits in an apparent effort to get better valuations. Scottish officials had given Trump’s golf resort in Aberdeen permission to build around 1,500 residential properties on the site. “But the supporting data for the 2014 valuation contained a residential parcel valuation based on the development potential of 2,500 homes,” the attorney general’s office said in its filing. “Mr. Weisselberg testified that he could not explain this discrepancy.” When Trump later abandoned his development plans over a clash with local officials about offshore wind farms, he kept the inflated valuation for houses he wouldn’t be building on his financial statement.
And at Trump’s golf club in Los Angeles, the company allegedly “substantially overvalued” a conservation easement by as much as 50 percent. “During the preparation of that appraisal, one appraiser wrote that ‘Trump is fighting for every $1,’” James said in a press release that accompanied Tuesday night’s court filing. “The misrepresentations were incorporated into the final valuation arrived at by appraisers, and ultimately submitted to the IRS in connection with a tax deduction Mr. Trump sought on the property.” According to James, Trump’s accountants claimed that the misleading valuation “resulted in several million dollars of benefit to Mr. Trump” for his federal taxes.
None of this is particularly surprising. Trump’s unscrupulous behavior as president speaks for itself, and more specifically, his former legal fixer Michael Cohen already told Congress in 2019 that the Trump Organization had manipulated property valuations to obtain more favorable tax rates and loans. The only question is whether Trump will face any consequences for it. James told the court that Weisselberg’s refusal to cooperate with the investigation made it all the more necessary to secure the three Trumps’ testimony. It would be a grim day for the rule of law if Trump’s brazen efforts to hide his own mendacity paid off for him in the end.