We’re expecting a ruling this week in Donald Trump’s civil trial in Manhattan over supposedly “fraudulent” business practices. State Supreme Court Judge Arthur Engoron has stated that there would be a ruling and clarification of the potential consequences. Engoron is the one who previously stated that Trump’s businesses should be “dissolved,” effectively running him out of the city. Such a penalty would be the most extreme imaginable and it would go beyond even what anti-Trump Attorney General and Democratic Party activist Letitia James has asked for. The situation is so out of balance that even the Associated Press felt compelled to examine the history of prosecutions under this law in New York, finding Trump’s case would “stand alone” if that were to happen.
Within days, Donald Trump could potentially have his sprawling real estate business empire ordered “dissolved” for repeated misrepresentations on financial statements to lenders, adding him to a short list of scam marketers, con artists and others who have been hit with the ultimate punishment for violating New York’s powerful anti-fraud law.
An Associated Press analysis of nearly 70 years of civil cases under the law showed that such a penalty has only been imposed a dozen previous times, and Trump’s case stands apart in a significant way: It’s the only big business found that was threatened with a shutdown without a showing of obvious victims and major losses.
Lawyers for the state in Trump’s monthslong civil trial have argued that the principles of fair play in business alone are enough to justify a harsh penalty, but even they aren’t calling for the prospect of liquidation of his businesses and properties raised by a judge.
The AP found a grand total of less than 150 times that charges have been brought under the “repeated fraud” law in question. Among those cases, the dissolution of a business was only ordered twelve times. And all twelve of those cases had one thing in common. Each company was found to have defrauded and caused significant losses to victims who requested a resolution from the courts. No such victims of fraud have been identified in Trump’s case.
The primary supposed “victim” highlighted by the state in this case is Deutsche Bank. But even they offered testimony saying that they negotiated the values of various properties with the Trump organization while processing the loans and even made some changes when they disagreed. In any event, the loans were paid back with interest and no complaints were filed.
The entire dissolution idea seems to be the work of Judge Engoron, who seemed to have made up his mind even before all of the evidence had been presented. Even Letitia James hasn’t asked for the businesses to be dissolved, though she has requested a stiff financial penalty. Other prosecutors on her team have recently expressed concerns that such a ruling would make it far too easy for the state to simply shut down a business in the future without any true evidence of wrongdoing. Further, hitting Trump with too heavy of a hand might make it far easier to get the judgment tossed on appeal.
This was a law intended to be used against con artists, swindlers, and organized crime actors. It’s been used against a self-identified financial adviser who was found to have been swindling people out of the deeds to their homes. A breast cancer charity was shut down after soliciting $9 million in donations and using almost all of it for executive salaries and perks rather than offering free services to patients as they had advertised. Many other examples are listed, but they were all businesses and individuals with a repeated history of causing harm, financial and otherwise, to unsuspecting victims. That’s simply not the case with Trump, even if you disagree with his company’s negotiating tactics.
This has been a witch hunt from the beginning. Letitia James ran for office on a promise to “get Trump,” and in Judge Engoron she found a willing coconspirator. But her partner may be preparing to go a very large step too far and this entire clown show could blow up in their faces.