Yesterday, September 26, 2023, a judge in New York found that Donald J. Trump is unfit to do business in New York. In a civil suit filed by District Attorney Letisha James, the judge found (in a summary judgment) that the Trump Organization (including Don Jr., Eric, Allen Weisselberg, and others) was guilty of fraud.
(An appeals court already removed Ivanka from the case.)
A summary judgment is like a prosecutor’s home run. It means the judge decided without taking the case to court — that’s how strong the evidence is. All the judge did was review the materials the prosecution presented— he didn’t need a panel of jurors to tell him what it meant. The evidence spoke for itself.
However, there is more to this case than fraud, and the remaining charges brought by DA James are set to be part of a trial that could begin as early as Monday. But the fraud charges, which have already been decided, are damning enough.
Trump’s lawyers are sanctioned and fined
Not only is Trump’s New York business in trouble but the lawyers representing him, in this case, have also been sanctioned and fined $7,500 each for continually raising arguments the judge had already dismissed.
At one point, they attempted to claim that the prolific lies and misrepresentations put forth by the Trump Org over many years were excusable because the various entities receiving the phony materials would do their own due diligence anyway. (This reminds me of the story of the white man who said to the Native American people after breaking a treaty: “It’s your fault for trusting us.”)
The judge had little patience for this argument, saying, “You cannot make false statements and use them in business.”
Trump’s lawyers also attempted to convince the judge that the value given for the square footage of his apartment could legitimately be subjective, to which the judge replied, “That is a fantasy world, not the real world.”
The nature of Trump’s fraud
Trump & company created numerous materials based on lies, which were used over many years to support various business dealings and promote their personal financial interests. Among the lies told were:
lies about the company’s net worth
lies about the value of the properties and other assets owned by the company
lies about Trump’s net worth
These were not inconsequential lies. The valuations on property, for example, fluctuated by hundreds of millions — not a few thousand dollars. Trump even lied about the square footage of his Manhattan apartment. He said it was 30,000 — it is closer to 10,000. And when it came to his net worth — he was often off by billions.
The lies were found in various documents used for things like purchasing property insurance, borrowing/raising money, or paying taxes. In other words, they lied about the most critical aspects of the business — repeatedly, on paper — and they did it for years.
What this means for the Trump Organization
When the judge ruled against Trump, he also ordered that some LLCs managed by the Trump Org be dissolved, and the business licenses associated with them rescinded. While the Trump Organization itself will not be shut down (Trump has hundreds of separate business entities under this umbrella), the LLCs affected by this case will be forced to liquidate their assets, putting a severe cramp in Trump’s ability to do business in New York State.
Asset liquidation will not only allow the state to collect the $250m in penalties the DA has requested but also require payment of debts owed by the Trump Organization. Given Trump’s history of failing to pay his bills, this may be the one chance contractors and vendors who’ve done business with Trump will have to collect.
The judge further stipulated that the liquidation of the family business must be turned over to someone not employed by the family business. In other words, Trump will have no control over this project.
Trump will appeal, of course. But even if he does, the chances of this judgment being overturned are nil. This signals the beginning of the end for Trump’s ability to conduct business in New York.
What this case tells us
Even if Trump appeals and somehow prevails (highly unlikely), we still learned something useful. We learned that all the suspicions and all the concerns we’ve had about Trump have been confirmed. Everything he’s ever said to the contrary has been a lie.
We already knew he deceived the victims of the Trump University scam. And we knew he pocketed the money he raised via his supposed charitable organization. Now we know his “successful” business was also based on lies.
As the Guardian said in a recent article, “Trump is a real estate genius only in a fantasy world.”
Why Trump’s lies have worked for him
Trump’s ability to lie so easily — with no hint or “tell” to warn his potential victims separates him from the casual liar who might squirm a little when fabricating lies out of whole cloth. Not Trump. That’s probably why some people still believe him. His unwavering confidence convinces them. But that is precisely what a con man does — he convinces people by demonstrating confidence typically reserved for truthtellers. That’s why the people who do this are called con men. Trump is such an accomplished liar that people who don’t know better think he’s genuine.
It would be wonderful if this verdict could sway his supporters by showing them that Trump is not a successful businessman. (Though he did play one on TV.) But it probably won’t affect them because the people who still support Trump after all the public evidence proving he’s a pathological liar and sociopath are the same people who will stop an actor in a grocery store and yell at them for what they did in last week’s purely fictional episode. The line between reality and fantasy is blurred for them, which is what Trump has always counted on.
Trump’s response to the fraud case
So far, Trump’s response has been typical. The judge is a Democrat and “deranged.” That was yesterday.
Today, Trump hit Truth Social, his failing social media platform, for a more substantial tirade:
“My Civil rights have been violated, and some Appellate Court, whether federal or state, must reverse this horrible, un-American decision,” he wrote on his Truth Social site. He insisted his company had “done a magnificent job for New York State” and “done business perfectly,” calling it “A very sad Day for the New York State System of Justice!”
His lawyers aren’t doing much better. They’ve called the decision “outrageous” and accused the judge of ignoring accounting rules and the law. How rich is that? Lawyers for the party found guilty of fraud say the judge is the one who doesn’t understand basic accounting rules and legal obligations.
As for the rest of the Republican Party, we haven’t heard much yet. But we’re about to have a government shutdown because McCarthy can’t rally his fellow House Republicans around anything but trashing the Bidens. Unfortunately, they are slow learners who fail to realize that making accusations against a political enemy is not a substitute for governing.
So, while Trump is now officially declared unfit to do business in New York, the Republicans still control the House in DC. Let’s hope the elections in 2024 put an end to that debacle as well.