Again, I won't reply to you while live-posting multiple accounts. If you want me to see your reply, please wait until AFTER the threads are over and reply to me then.❤️
Kevin Wallace is about to begin for the Attorney General’s office. He says this is deja vu because all of the arguments have been made before. And the law of the case remains that the statements of financial condition were false and misleading for years.
@GottaLaff bingo. In spite of the protestations, including the harangue by lead defendant, nothing has changed. The law is the law and the facts are the facts.
Each defendant acted knowingly and intentionally. In fact, other than the triplex, they did not characterize any of the valuation discrepancies as a mistake. And they tellingly never asked a single question of Donald Trump, Eric Trump, or Allen Weisselberg.
Only McConney was asked about the statements of financial condition—and he has previously acknowledged engaging in unlawful conduct with Weisselberg.
And after McConney and Weisselberg left the organization, who prepares the statements? Not the CFO, who is a CPA. Instead, they use Patrick Birney, who is not, while keeping Mark Hawthorn, the CFO, in the dark.
Adam Klasfeld:
Wallace describes Trump's efforts to shift the blame to accounting firm Mazars as one of the defense's "undead arguments."
And they never asked McConney whether Bender asked him for appraisals; instead, using Jason Flemmons to say it was “professionally implausible” to believe Bender asked for them.
Wallace allows that one of the accounting standards at issue, ASC 274, contains some flexibility, but insists it doesn’t give defendants “carte blanche.”
Wallace also adds that the defense here used expert testimony to fill in the factual paucity of their case.
Engoron now asks about the severance paid to Weisselberg and McConney. Why is it suspicious? Wallace says Weisselberg got his severance after he was convicted and sentenced in a trial where he took the complete fall for the company.
It’s also suspicious because the agreement says don’t go talking to the authorities. The amounts are suspicious because of the timing and the conditions, Wallace says. But he returns to defendants’ experts.
Wallace saves his best for Eli Bartov, who testified there was no fraud but based only on “an extremely limited” section of the record. In essence, he never looked beyond the statements themselves to the work papers that prove the specifics of the fraud.
Wallace is dismantling the testimony of Trump’s 11 (!) expert witnesses, who he argues were not asked to render opinions based on deliberately partial aspects of the factual record.
@GottaLaff NFL
Engoron seems be tired of the Trump lawyers and Trump mouthing off and maybe is allowing the Plaintiff lawyers a little breathing space in fairness to them.
A couple of his retorts to the defense today have seemed to border on “whatever, Sunshine… sit down and be quiet.”
Kise is back on his feet, objecting that there is no evidence to support another of Wallace’s arguments: that the Trump Org. was bleeding cash. “Chris, just stop!” Wallace blurts. Engoron diffuses what could have devolved quickly.
(What Kise is doing is tactical. He is purposefully trying to break Wallace’s flow—and is doing so with some success.)
Wallace arguing that by 2016, Trump’s liquidity was of real concern to Deutsche Bank, & had Trump been honest abt his assets, he would've been close to the liquidity threshold that DB had set. By 2017 Trump had a real “cash crunch”
It was so bad they borrowed $12 mil from Ladder Capital to pay Trump Univ settlement, sold a penthouse in which Ivanka had lived for 60 cents on the $ The interest rates were critical to them; without those savings, there wasn’t enough cash to do it all!
Without the interest rate savings, he would have been below DB’s $50 million required in cash in 2016, and it would have gotten even worse in future years.
Wallace: "They can’t argue that Trump’s triplex was in fact 30,000 square feet… or that unsold units at Park Avenue weren’t rent stabilized... the statements of financial condition were false on every issue from 2011..."
Now we're hearing from AG special litigation counsel Andrew Amer.
He asserts that the state already proved that Trump had "intent to defraud."
Now, Andrew Amer is up for the AG to talk about the testimonial evidence of intent. McConney admitted that he included Trump foundation cash on the spreadsheet one year, only to be blocked by Bender.
But McConney nonetheless included another significant source of cash Trump did not control “year after year,” which Amer says is proof that he knew what he was doing was wrong.
Amer: I wasn’t going to spend more time on materiality because it seems so obvious. But “it clearly is an objective standard in New York; it’s what a reasonable banker would think.”
When Engoron asks how ex-Trump Org exec Jeff McConney knew about rent stabilized units, the state's lawyer Andrew Amer one-lines: "Because he's not an idiot."
(Laughter in the court)
McConney testified that he had a copy of the deed restricting the use of Mar-a-Lago when he valued the property.
Amer is devoting a lot of time to showing McConney’s intent in performing several of the valuations at issue. McConney, he argues, understood the time value of money and that future income had to be discounted to present value—but nonetheless treated unbuilt homes as if they could be sold today.
In the final stretch of their closing argument, NY AG’s office focuses on Trump’s own intent. He testified he reviewed and approved the final versions of the statements of financial condition and occasionally had comments.
After reminding the court that Cohen testified he was tasked with “reverse engineering” valuations based on Trump’s goals for his net worth, Andrew Amer notes the defense never asked Trump (or Weisselberg) to confirm that did not happen.
Trump Org. employee Patrick Birney also confirmed Weisselberg told him Trump wanted his overall net worth to go up.
Trump also knew or easily could have known the valuations of Mar-a-Lago and the triplex were fraudulent, not merely erroneous. He understood the Vornado partnership cash was not his, as reflected by the existence of prior litigation between them.
Trump also had a motive to exaggerate his net worth “to impress potential business partners and financial institutions” and did so by having his subordinates reverse engineer values of his assets from a target net worth number.
As for Don Jr. and Eric, they have now been at the helm of the Trump Org. for 7 years. They clearly have a motive to inflate Trump’s financial condition and exercised their authority to certify Trump’s financial statements.
In partic, they played a critical role in 2021 statements of financial condition. Patrick Birney testified he reviewed those statements & the methods used with both sons during a meeting that yr; that meeting happened after both already knew about the NYAG investigation.
The whole purpose of the meeting was to ensure the sons knew how the values were being determined in the wake of AG’s ongoing investigation. It is not credible, Amer says, that neither recalls attending the meeting
Also not credible? Eric Trump’s testimony that he knew nothing about even the existence of his dad’s statements of financial condition until this case.
Emails going back to 2012 shows Eric was not only aware of those statements, but provided them to members of a Trump-purchased golf club to encourage them to maintain their memberships.
McConney & Weisselberg also communicated with Eric about those statements for various reasons, including the need to seek financing. And confronted with these docs, Eric allowed that he did know about the statements of financial condition at least by 2013.
Amer: “Mr. Trump cannot disavow any knowledge about how the statements were going to be used, because he personally signed certifications to the banks…"
"...he clearly knew the statements were being used to satisfy continuing obligations under his loan guarantees, and he had the motive to keep his net worth as high as possible."
Engoron interrupts to ask about Don Jr. & Eric’s intent. “I don’t see the evidence.”
Amer’s response? They held themselves out to the world as co-CEOs and represented they were fulfilling their legal responsibilities as trustee or CEO and then “put their heads in the sand.” That kind of recklessness is enough from which the court can infer intent
Engoron: “But you are not claiming Don Jr. had actual knowledge of the fraud?” Amer allows Jr’s knowledge is more constructive knowledge.
But with respect to the 2021 statements of financial condition, Don Jr. had actual knowledge, Amer argues, because he approved how the statement would be put together on the call about which Birney testified.
Via Emptywheel:
Engoron is going to rule that the failsons weren't frauds, but their daddy was.
He notes the post-Weisselberg CFO, Mark Hawthorn, was deliberately kept far away from the statements of financial condition. In fact, he learned during this trial that information provided to Scottish auditors included cash belonging to Trump’s partner Vornado, which was not in Trump’s control.
That Eric and Don Jr. did not involve the one employee well versed in GAAP is further evidence of their intent, Amer argues.
This is particularly interesting given the allegation that Egypt gave Trump $10M in September 2016.
Dan Alexander:
AGs office then shows a slide suggesting that, if Trump had been forced to pay higher interest rates, he would have either (a) run out of cash or (b) had to cut back some of his expenditures, like funding a presidential campaign. Super interesting.
Summations return to AG's counsel Kevin Wallace one more time to describe the relief the state is requesting, e.g. the ~$370M disgorgement, lifetime NY real estate industry ban, and other injunctions.
NY AG is detailing what should go into a comprehensive relief order and why they are entitled to it. Notably, the degree of scienter — or intent — is a factor under the legal test they say governs, as is whether the wrongful conduct was an “isolated incident.”
Another factor? Repentance, or the lack thereof, or “whether defendant continues to maintain that his past conduct was blameless.”
Wallace says it’s hard to imagine how someone could be more insistent on their blamelessness—and when someone is saying they did nothing wrong, they’re telling you they’ll do it again.
Today, Wallace says the company has no CFO or comptroller. (Hawthorn is not, in fact, the CFO.) It has virtually no internal controls, and the monitor has found ongoing financial irregularities. Kise is on his feet, accusing Wallace of “making the record up as he goes along.”
Wallace moves on to point out that despite the preliminary injunction, the Trump Org. made a $40 million transfer without notice to the court or the monitor. The AG argues the monitorship should be extended.
Now we’re talking about lifetime bars. The AG’s office cites the case of Martin Shkreli, who has been barred from the pharmaceutical industry in a case involving a claim under the same law at issue here.
“There is at least a hope,” by contrast, that a five-year bar would be enough for Eric and Don Jr., who are “grown men in their 40s,” have made millions from their roles and are “fully responsible for their actions.”
Jr., in particular, as trustee, signed certifications and representation letters attesting to the truth of his dad’s financial conditions. Even if he didn’t know, that kind of recklessness “has no business being an officer or director in a New York corporation.”
It’s a fed crime to misrepresent your assets as part of credit application, Wallace says. We didn’t allege bank fraud, but the existence of that crime—which does not depend on reliance by the bank or any injury to that bank—shows that their “no victim, no prob” argument falls apart.
Wallace is now thanking lawyers & staff members who never got to the podium or counsel table. After calling it a “Herculean effort” by all involved, he is wrapping up. (Shout out to the court reporters!)
@GottaLaff
Whew. Just caught up with your thread. You have been busy! Thank you for your work. This was very informative. I appreciate this because I don't have to rely on msm for their version. .👍 😀
"I will do my best… to issue a final decision in this case by January 31st. Not a promise, not a guarantee, but I'm reasonably confident I’ll be able to do that. You’ll all know about it," he says smiling.
@GottaLaff Your clarifications / interpretations of the flow of words from others I believe qualifies as explanation in this effort. Regardless, a masterful job once more.
@GottaLaff@MichelleRNCHPN I know you’ve declined in the past, but I bet you’d have lots of supporters willing to chip in if you were on one of those “buy me a coffee” platforms. (hint, hint)
It’s difficult for us out here who appreciate you but have no other way to express it than with lousy words. Won’t you take pity on us??
@GottaLaff Brava and thank you, Laffy. I particularly liked the aside about the "Murderers' Row" incident. My mind went straight to the '27 Yankees as well.
@GottaLaff When I want funny memes and a painless echo chamber, I go to FB. When I want to know what the heck's going on, I come here. As usual, fabulous job. Thank you so much.
@GottaLaff don't forget to demagnetize! Remember the desalinated, dehydrated water. And have your Jewish Space Laser remagnetized so your house gets properly packed with 5G
@GottaLaff ROTFL !!! Take a good rest, fresh cup of covfefe, and carry on with the packing. And then get a long hot bath when that moment comes. Cheers. You did herculean work today - and you know I love it, when you include those jokes. Haha on Engoron's 10 minute joke for 15 minutes
@thepoliticalcat Hear, hear!! I’ve had the honor of seeing Laffy’s bright light and acumen shine since the Bush years, and I’ve never been more awed by her prowess than here at Mastodon—we are damned lucky Musk fucked up. Here she doesn’t have to garrote trolls and suffer their MAGA stench every ten minutes.
@GottaLaff you are so very welcome, Laffy! Perhaps a little early on the West Coast, but I do hope you get to enjoy a glass of wine tonight :)
Have a wonderful afternoon and evening
Thank you. I rarely read 55 post threads but this one was well done and the subject is important to our country as a whole. Can hardly wait three weeks to hear the verdict.
@GottaLaff On behalf of the greater Laffyverse, thanks so much for all your hard work collating all these feeds and listing them for use. You did a phenomenal job!
What strikes me most is that Trump is such a coward. The minute after he got to play his little violin he was outta there.
Why? Because he got exposed. This entire thread from Laffy is all about exposure and Trump couldn't stand it. He was a lousy businessman, nothing like his brand. He is a loser. I bet that stings more than being called a crook. His identity is totally wrapped up in the scent of 💰. Loser.
A shame, really, that he slunk out. It would have been nice to see Trump's head implode.
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