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R.I.P. The Trump Organization, 1927-2023
Trump loses the company his Father built.
Happy Friday to all who celebrate. I am back from vacation and ready to party even harder. Let’s go over the latest body blow to Donald Trump, while also (briefly) touching on the House’s impeachment inquiry of Joe Biden.
The Trump Organization engaged in fraud for decades.
This is the major takeaway as best I can give it to you, so I guess you don’t have to read any further. But the facts of this case are damning, and that’s not hyperbole: The judge assigned to the case (Arthur F. Engoron), determined that the facts were so overwhelming a formal trial wasn’t even necessary. All that is left to calculate is damages.
Loses its business licenses in New York.
Is placed into a receivership managed by Judge Barbara S. Jones (for now).
Will be divided up and liquidated, along with any subsidiary LLCs.
Trump’s lawyers got sanctioned (lol) for repeating false arguments in court.
On Monday, the court will begin to determine the extent of the damages, which brings me to another thing I want to touch on: A lot of headlines are saying that this is a “$250 million fraud case,” and Trump could be liable for that much. While it is true that is how much Letitia James (New York’s attorney general) sued Trump for, he could actually end up paying much more than that.
The $250 million number is one that was requested by James, but Engoron actually has the final say on how much the damages will be, largely thanks to a mistake made by Trump’s attorneys. Michael Cohen - whose testimony in front of Congress really sparked this whole episode - has suggested the damages could be as much as $700 million. I don’t know if it will reach that high, or if it will even exceed the $250 million requested by James, but it is something I think the headlines are missing.
Another thing people are missing is the valuation of Mar-A-Lago. One of Trump’s defenses after Engoron’s decision dropped was that the judge vastly underestimated how much Mar-A-Lago was worth:
This is false.
I know people generally refer to Donald Trump, Jr., as, “Fredo,” but can a family have two Fredos? In any case, everyone knows Ivanka is the Michael of the family.
On its face, what Trump and his kiddos are saying sort of makes sense: Private homes near Mar-A-Lago are worth a ton of money! But the problem is that Mar-A-Lago is not a private home, and Trump repeatedly sought to value it as one when he was trying to get his loans. Here is the judge:
Note what’s laid out there: It wasn’t the judge who said Mar-A-Lago was worth $18-$27.6 million; it was Palm Beach County. That’s because Mar-A-Lago was zoned as a country club, and not a private home.
Trump himself has made this argument before, as he previously said that Palm Beach’s valuation of Mar-A-Lago at $26 million was too high:
Tax representatives at Marvin F. Poer & Co., acting on behalf of Trump’s property ownership entities, filed petitions this year to the state-authorized Value Adjustment Board challenging the valuations assigned to Mar-a-Lago and the Trump National Golf Club in Jupiter, according to a spokeswoman for the county appraiser’s office. The petition for the Jupiter property was subsequently withdrawn, said agency spokeswoman Becky Robinson. A virtual hearing has been scheduled Dec. 3 to consider Mar-a-Lago’s valuation, which at $26.6 million is unchanged from last year. Under state law, values are assigned as of Jan. 1 each year. “In conversations with the Trump (tax) representative, we’re thinking the Mar-a-Lago one will be withdrawn, too,” before the hearing date, Robinson said Friday (my emphasis).
This is actually a perfect demonstration of Trump’s grift: When he was seeking favorable loan terms from banks, he greatly inflated his wealth and used his ownership of a property like Mar-A-Lago to do it. But when it came time for him to pay taxes on his properties, he said they were worth less.
It is pretty clear cut evidence of fraud. I think there will be some arguments from people that “these are the sorts of things that happen in New York real estate.” I think some of these things do happen, but not on this scale. Normally, someone with the visibility of Donald Trump would attract the attention of authorities and they would be investigated. But the Trump Organization has been investigated before, and largely escaped by the skin of their teeth. Cy Vance, New York’s previous District Attorney, was ready to charge the Trump Organization for shady practices involving the construction of its SOHO hotel, but ultimately passed.
I know that sometimes heady real estate deals make prosecutors squeamish because it’s a lot to explain to a jury. So, maybe the bench trial helped in this case, but it’s also possible that Letitia James is uniquely competent.
So, what now?
We get a hearing on Monday and we will see how much Trump owes. But make no mistake: Trump is going to lose a lot of his properties. 40 Wall Street could be gone. His golf club in Briarcliff Manor could be gone. And the Trump Organization will probably have to give up control of Trump Tower (because it’s a condominium, the units are individually owned).
All in all, Trump’s financial empire is likely coming to an end. He will 100% be a politician going forward. Truly wild to think about.
How does this relate to the impeachment of Joe Biden?
If you weren’t paying attention, the impeachment inquiry into Joe Biden began yesterday and things went…poorly. Even Fox News had dire reviews. And then you get into the statements from Republicans themselves:
A senior Republican staffer told a CNN reporter that the hearing was “an unmitigated disaster.” Punchbowl News’ Jake Sherman, an MSNBC contributor, added that “many” in the GOP leadership agreed that the hearing was a disaster.
Ideally, you do not want your first three witnesses to openly testify that there was no evidence of wrongdoing (yet) by Joe Biden. Even Steve Bannon seemed to understand this point. But ultimately (and I’ve said this before) I don’t think it matters. The people leading the impeachment inquiry - James Comer and Jim Jordan - have reputations for being particularly dopey, but that is the GOP right now.
They are going to go full steam ahead. And the reason they are doing that is best summarized in this image:
Biden’s gotta get impeached folks. That’s all there is to it. Trump cannot credibly argue that his indictments or his previous impeachments were wrong, factless, or biased against him, but he can argue that, “Hey, maybe Joe Biden is just as bad as me?”
Next week, the Jackal will have a special guest on to talk about the economy. I’m pumped for it. See you then.
For journalistic purposes, I should say outright that my brother has indirectly been an attorney for the Trump Organization in the past, through a real estate firm he worked at previously. I haven’t discussed this case with him.