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Trump's longtime accounting firm recants a decade of his financial statements

Judge to decide if Trumps have to testify
Judge to decide if Trump family members have to testify in fraud investigation 05:32

The accounting firm that has for years prepared annual financial statements for Donald Trump and his businesses is cutting ties with his company and says a decade's worth of the reports "should no longer be relied upon."

The firm, Mazars USA, wrote to the Trump Organization's chief legal officer Alan Garten on February 9 to inform him of its decision. The letter was included as an exhibit in a filing Monday by the New York attorney general's office, which is seeking depositions from Trump and two of his children, Donald Jr. and Ivanka Trump, as part of an ongoing fraud probe.

In the letter, a Mazars executive cites revelations from the attorney general's investigation as among the reasons the accounting firm is no longer standing by its financial statements for the years ending June 30, 2011 to June 30, 2020, and dropping the Trump Organization.

"This conclusion (is) based, in part, upon the filings made by the New York Attorney General on January 18, 2022, our own investigation, and information received from internal and external sources," wrote Mazars general counsel William Kelly.

In the letter, Kelly wrote that Mazars "performed its work in accordance with professional standards" and compiled the statements based on information provided by the Trump Organization.

A spokesperson for the Trump Organization said in an email, "While we are disappointed that Mazars has chosen to part ways, their February 9, 2022 letter confirms that after conducting a subsequent review of all prior statements of financial condition, Mazars' work was performed in accordance with all applicable accounting standards and principles and that such statements of financial condition do not contain any material discrepancies."

"This confirmation effectively renders the investigations by the DA and AG moot," the spokesperson said.

Ronald Fischetti, an attorney who represents Trump, declined to comment. A spokesperson for Mazars USA did not immediately reply to a request for comment. 

The financial statements were used to secure loans for the Trump Organization, and are a focus of at least two investigations. An ongoing criminal probe into Trump and the company last year led to charges against the company and its chief financial officer, Allen Weisselberg. New York Attorney General Letitia James is leading a parallel civil investigation. Her office has indicated in court filings that the investigation is trying to determine whether the statements of financial condition were used to defraud lenders.

James' office subpoenaed Trump, Donald Trump Jr. and Ivanka Trump in December 2021, according to court filings, prompting a furious response from attorneys for the Trumps, who are fighting James' demand that they sit for depositions.

The subpoenas seek "testimony and documents 'in connection with an investigation into the valuation of properties owned or controlled by Donald J. Trump or the Trump Organization, or any matter which the Attorney General deems pertinent,'" according to a court filing.

Trump and his attorneys have repeatedly accused James of pursuing the investigation against him as a political ploy. That accusation is at the heart of a lawsuit filed by Trump on December 21. In a phone call with CBS News that day, he called himself an "aggrieved and innocent party" and called James' probe "a hoax."

James said in a statement Monday that "evidence continues to mount showing that Donald J. Trump and the Trump Organization used fraudulent and misleading financial statements to obtain economic benefit."

"There should be no doubt that this is a lawful investigation and that we have legitimate reason to seek testimony from Donald J. Trump, Donald J. Trump, Jr., and Ivanka Trump," James said.

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