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The New York attorney general's lawsuit against the Trumps and their company — breaking it down

The Trumps and their company are accused in a 221-page civil complaint filed Wednesday of engaging in a yearslong scheme to enrich themselves by inflating the values of a wide swath of properties, stretching across their international real estate empire. 

The complaint accuses the company of more than 200 instances of false asset valuations, described as being derived from "objectively false assumptions and blatantly improper methodologies with the intent and purpose of falsely and fraudulently inflating Mr. Trump's net worth to obtain beneficial financial terms from lenders and insurers."  

"The number of grossly inflated asset values is staggering, affecting most if not all of the real estate holdings in any given year," New York State Attorney General Letitia James' office wrote in its complaint. James said the valuations helped inflate Trump's net worth "by billions of dollars."

What were some of the "grossly inflated asset values"?

The state asserts  that Trump's own triplex apartment in Manhattan was valued based on the claim that it was 30,000 square feet. But it's actually 10,996 square feet. The former president reported on his 2015 and 2016 financial statements that the apartment in Trump Tower was worth $327 million, based on its 30,000 square feet. Trump Organization CFO Allen Weisselberg admitted to the state attorney general that the value had been overstated by $200 million, "give or take."

Donald Trump Meets With NY Attorney General Letita James For Deposition
FILE: People walk by Trump Tower in Manhattan on August 10, 2022 in New York City. According to a recent report, the FBI was looking for nuclear-related documents aming other things when they searched Mar-a-Lago. / Getty Images

The New York attorney general's office also questions the valuation of Mar-a-Lago, the former president's Florida home. It was valued as high as $739 million, the state said in its lawsuit, based on the idea that the property was unrestricted and could be developed for residential use. However, Trump signed deeds "donating his residential development rights, sharply restricting changes to the property, and limiting the permissible use of the property to a social club." 

Aerial view of Mar-a-Lago, the estate of Donald Trump, in Pa
FILE: Aerial view of Mar-a-Lago, the estate of former President Donald Trump, in Palm Beach, Florida. John Roca/NY Daily News Archive via Getty Images

The state's lawsuit notes that Trump made an agreement with Palm Beach that stated, "that '[t]he use of the Land shall be for a private social club' and that '[t]he Land, as described herein, shall be considered as one (1) parcel and no portion thereof may be sold, transferred, devised or assigned except in its entirety, either voluntarily or involuntarily, by operation of law or otherwise.'"

Further, the golf club's revenues, according to the attorney general's office, were under $25 million annually, and the state asserts that Mar-a-Lago's proper valuation was nearly 10 times less, "closer to $75 million."

Judge Orders Michael Cohen Released From Prison
FILE: A general view of 502 Park Avenue, the residence of President Trump's former attorney Michael Cohen, on July 24, 2020 in New York City.  Yana Paskova / Getty Images

The state also claims Trump's company said a dozen rent-stabilized apartments in Trump Park Avenue, also in Manhattan, were listed on corporate paperwork as being worth more than $49.5 million. In fact, the suit says, they had been appraised at a combined $750,000.

In an interview with Fox News' Sean Hannity Wednesday, Trump claimed that "we had a disclaimer right on the front — it basically says, 'Get your own people. You're at your own risk. This was done by management; it wasn't done by ... it was done by management, so don't rely on the statement that you're getting.'" Trump also said the disclaimer, which he said was "about a page and a half," advised lenders that "if you're going to loan money, you have to go out and make sure you get your own lawyers. These are banks that have the best lawyers in the world."

Why are Donald Trump Jr., Ivanka Trump and Eric Trump named in the lawsuit?

The complaint claims that the three Trump children "had familiarity with, responsibility for, and made use of" fraudulent statements of financial conditions in order to benefit the company. It claims they oversaw many of the deals central to the lawsuit.

How much is New York seeking in damages (also known as disgorgement)?

James' office is seeking $250 million to be turned over to New York's state coffers. The complaint describes that figure as an estimate of the company's benefits from the alleged scheme.

What other punishments does New York want to impose on Trump and his company?

James' office is asking a judge to revoke the Trump Organization's business certificate, effectively barring it from doing business in New York. 

Her office is seeking to permanently bar Trump, Donald Trump Jr. and Ivanka Trump, from serving as officers or directors of any business in New York, including their family's company. 

The state is also requesting a five-year ban on Trump and the company from acquiring real estate in New York or applying for loans from any New York-based company.

Can't the company just re-incorporate outside of New York?

Asked this at a press conference Wednesday, James replied that doing so would not affect her office's lawsuit, filed while New York was central to the companies' operations.

"Mr. Trump, the Trump Organization, as well as his family, will still have to deal with this complaint. They will have to respond," James said. "They will have to respond to the allegations therein. If he decides to move to Florida, the reality is, he still has to deal with the great state of New York."

Can Trump or others go to prison for this?

No, at least not directly from Wednesday's action. James' office filed a lawsuit seeking only  civil penalties. However, she said at her press conference that the investigation had uncovered "criminal conduct," which her office is referring to federal law enforcement in the Southern District of New York and the Internal Revenue Service.

Did Trump respond?

On his social media site, Trump called James a "failed" attorney general and accused her of driving businesses out of New York. "Bye bye," he wrote.

Alina Habba, an attorney for Donald Trump, said in a statement to CBS News that "today's filing is neither focused on the facts nor the law – rather, it is solely focused on advancing the Attorney General's political agenda." 

"It is abundantly clear that the Attorney General's Office has exceeded its statutory authority by prying into transactions where absolutely no wrongdoing has taken place," Habba said. "We are confident that our judicial system will not stand for this unchecked abuse of authority, and we look forward to defending our client against each and every one of the Attorney General's meritless claims." 

Trump Jr. tweeted, "Letitia James doesn't care about the law. She's a Dem activist, who only cares about politics." He added, "This is ALL politics, nothing more."

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