Cy Vance’s Devastating Brief — In The Second Circuit: “Facts, On Trump Financial Frauds” Edition…

This Second Circuit brief is a gem.

It sets out why in fact we have criminal procedure laws, at the state and federal levels. To catch. . . crooks — whether their address is listed at Wall and Broad, Mara-Lago. . . or 1600 Penn.

Do go read all 53 pages, but here is just a small sampling — of what Trump is trying to hide by tying Mazars LLP up in knots:

. . . .By way of a snapshot, the reports have included, among other things, the following allegations:

✿ The Washington Post reported that Appellant routinely sent lenders multipage “Statements of Financial Condition” purporting to describe his “properties, debts and multibillion-dollar net worth” that in fact “were deeply flawed” in that they “overvalued” assets, “omitted properties that carried big debts” and included “key numbers [that] were wrong.” David A. Fahrenthold & Jonathan O’Connell, How Donald Trump Inflated His Net Worth to Lenders and Investors, WASH. POST, Mar. 28, 2019, https://wapo.st/2DsxZyo.

✿ As just one example, the same report detailed how Appellant’s financial statements, starting in 2011, overstated real estate assets by hundreds of millions of dollars. Id. In particular, Appellant’s 2011, 2012, and 2013 financial statements are reported to have valued a property known as the “Seven Springs” estate in Westchester, New York, at between $261 and $291 million, while local authorities were alleged to have valued the same property at approximately $20 million. Id. Then, in 2018, Appellant’s financial disclosure form classified the value of this property as between $25 million and $50 million. Donald J. Trump, Executive Branch Personnel Public Financial Disclosure Report (OGE Form 278e) (2018).

✿ Similarly, Appellant’s 2011 financial statement claimed that he had 55 home lots to sell at a golf course in Southern California, for at least $3 million each. Fahrenthold & O’Connell, How Donald Trump Inflated His Net Worth to Lenders and Investors. But according to city records, the public report alleged, at the time Appellant had only 31 lots available to sell there. The report concluded that Appellant had claimed credit for 24 lots (and over $72 million in expected revenue) that he did not actually have. The report made similar allegations of misrepresentations, again with supporting documentation, concerning claims about the size of a Virginia vineyard (overstated by 800 acres). Id. . . .

✿ Cohen subsequently made Appellant’s financial statements public and testified to Congress that it was common for the Trump Organization to submit falsified financial records when the company applied for loans (testimony that investigative reporting tended to corroborate). Hearing with Michael Cohen, Former Attorney to President Donald Trump: Hearing Before the H. Comm. on Oversight and Reform, 116th Cong. 1 (Feb. 27, 2019). According to public reports, between 2012 and 2016, a lender called Ladder Capital extended loans worth over $250 million to the Trump Organization, and those loans were secured by properties located in New York County whose value was potentially overstated. Wendy Siegelman, Trump’s Two Largest Creditors — Ladder Capital Finance & Deutsche Bank, MEDIUM, Dec. 2, 2017, https://bit.ly/32zRkrM.

✿ The Washington Post reported that, between 2004 and 2014, Appellant faced billions of dollars in debt liabilities and yet somehow had enough money to purchase “five houses, eight golf courses and a winery,” including land in Scotland, for $400 million in cash rather than through mortgages. David A. Fahrenthold & Jonathan O’Connell, After Selling Off His Father’s Properties, Trump Embraced Unorthodox Strategies To Expand His Empire, WASH. POST, Oct. 8, 2018, https://wapo.st/35iWaId. This same report suggested Appellant’s liquidity was facilitated by “unconventional” borrowing practices beginning in 2012. Id.

✿ Still other public reports alleged that, in 2012, Trump Organization-related entities paid $48 million in full satisfaction of $130 million of outstanding debt related to the Trump International Hotel and Tower in Chicago. Id. The forgiven portion of that debt would generally be considered income for which the Trump Organization would owe taxes. See generally 26 U.S.C. § 61(a)(11). The reporting, however, indicates that the Trump Organization claimed publicly that it purchased the outstanding portion of the debt, and that it remains listed on Trump Organization books as a debt from one Trump Organization subsidiary to another. Fahrenthold & O’Connell, After Selling Off His Father’s Properties, Trump Embraced Unorthodox Strategies To Expand His Empire. Yet the same subsidiary who purchased the debt is listed as being “practically worthless” on Appellant’s financial statements, despite supposedly holding a multimillion dollar loan. Susanne Craig, Trump Boasts of Rapport With Wall Street, but the Feeling Is Not Quite Mutual, N.Y. TIMES, May 23, 2016, https://nyti.ms/32DETeF; Donald J. Trump, Executive Branch Personnel Public Financial Disclosure Report (OGE Form 278e) (2015). Accordingly, it is possible that the Trump Organization may not have treated the forgiven debt as taxable income. . . .

Now you know — and I’ve omitted the older Stormy Daniels allegations, since those are widely known, and Trump regularly waives them off — as being “a mere FEC technicality”. So let’s just forget them, shall we? Trump claims that Stormy payment is all Cy Vance has. As we see from the bit above, here’s just a portion of the truth, put to his endless minimizing lies. Out.

नमस्ते

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