N.Y. Attorney General Asks Judge to Order Eric Trump’s Testimony

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The New York State attorney general’s office has stepped up its inquiry into whether President Trump and the Trump Organization committed fraud by overstating assets to get loans and tax benefits, asking a judge to order Eric Trump to answer questions under oath and the company to hand over documents, court papers show.

Mr. Trump, who is President Trump’s son and an executive vice president of the company, abruptly canceled an interview with the attorney general’s office last month, and last week the Trump Organization told the office that the company and its lawyers would not comply with seven subpoenas related to the investigation.

In court papers made public on Monday, the state attorney general, Letitia James, asked a State Supreme Court judge in Manhattan to compel the company and Eric Trump to cooperate. Ms. James is seeking to determine if President Trump and his business improperly inflated his assets “to secure loans and obtain economic and tax benefits,” the filing said.

The new request comes as President Trump faces legal actions on other fronts. The Manhattan district attorney’s office has suggested in court filings that it is investigating possible bank and insurance fraud by the president and the Trump Organization, and is fighting in federal court to obtain his tax returns.

The court documents released on Monday reflected concerns within the Trump Organization that the attorney general’s civil inquiry could develop into a criminal investigation. Two days before Eric Trump was scheduled to answer questions under oath, the company canceled the session, telling the office it was concerned that investigation was going “beyond the scope” of a civil inquiry, the papers said.

The next day, the attorney general’s office assured the Trump Organization that it had not referred the case to “another criminal law enforcement agency.”

Still, the new documents revealed that the attorney general was not only asking questions about representations Mr. Trump and his company made to banks, but also about how they reported more than $120 million, mostly in forgiven debt, to tax authorities at the city, state and federal level.

If Ms. James finds evidence of criminal offenses, she may refer the case to another law enforcement agency or ask Gov. Andrew M. Cuomo of New York to authorize her office to open a criminal investigation.

Eric Trump appeared defiant on Monday, writing on Twitter several hours after the documents were made public that Ms. James “has pledged to take my father down from the moment she ran for office.”

“This is the highest level of prosecutorial misconduct — purposely dropped on the eve of the Republican Convention for political points,” he said.

For her part, Ms. James wrote on Twitter earlier in the day that Mr. Trump’s company had failed to comply with subpoenas and had obstructed the investigation. “The Trump Organization has stalled, withheld documents, and instructed witnesses, including Eric Trump, to refuse to answer questions under oath,” she said.

The attorney general’s new filings said the Trump Organization had refused to turn over thousands of documents.

The investigation began in March 2019 after President Trump’s former personal lawyer, Michael D. Cohen, told Congress that the president had inflated his assets in financial statements to banks when he was seeking loans and had understated them to reduce his real estate taxes.

The office initially subpoenaed records from two of the Trump Organization’s lenders, Deutsche Bank and Investors Bank, seeking loan records for four of the company’s big projects and a failed effort to buy the Buffalo Bills of the N.F.L. in 2014.

The company initially provided some information and asked the attorney general not to seek a similar court order eight months ago, after it failed to turn over information on a particular property.

The Trump Organization’s chief legal officer, Alan Garten, said in a statement that the company had done nothing wrong and had “tried to cooperate in good faith with the investigation at every turn.”

He accused Ms. James of “continued harassment of the company as we approach the election” and said the timing of motion, just before the Republican National Convention, “once again confirms that this investigation is all about politics.”

The White House declined to comment.

The attorney general’s office is reviewing a number of Trump properties, including several that were raised in Mr. Cohen’s congressional testimony. The Seven Springs estate in Westchester County, N.Y., the Trump International Hotel and Tower in Chicago, 40 Wall Street in Lower Manhattan and the Trump National Golf Club, Los Angeles were the subject of the subpoenas.

The attorney general’s office has also asked the judge to order two lawyers to sit for interviews under oath: Charles Martabano, a land-use lawyer who does work for the Trump Organization, and Sheri A. Dillon, who has represented President Trump and his company on tax matters.

The office asked the judge to order Ms. Dillon’s firm — Morgan, Lewis & Bockius — to comply with a subpoena, along with the Trump Organization, two related entities that own Trump properties, and Seven Springs LLC, which owns the Westchester County estate.

One transaction the attorney general’s office is reviewing is a 2010 debt restructuring for the Trump hotel and tower in Chicago, when the Fortress Credit Corporation forgave debt worth more than $100 million.

The office said the Trump Organization had thwarted its efforts to determine how that money was reflected on its tax filings, and whether it was recognized as income, as the law in most instances requires.

The attorney general’s office also accused the Trump Organization of withholding records related to how a $21.1 million conservation easement at the Seven Springs estate was reported to tax authorities.

Last year, Mr. Cohen told the House Committee on Oversight and Reform that President Trump had knowingly inflated the value of his assets to show a net worth of as much as $8.7 billion in financial documents.

“It was my experience that Mr. Trump inflated his total assets when it served his purposes, such as trying to be listed among the wealthiest people in Forbes, and deflated his assets to reduce his real estate taxes,” Mr. Cohen said in his testimony.

Kitty Bennett contributed research.



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