Donald Trump Jr. was the first of the Trump children to take the witness stand in the fraud case brought by New York Attorney General Letitia James against Trump Organization executives.
“I should have worn makeup,” he said on Nov. 1 as pool photographers snapped multiple shots of him.
At the center of the case are the statements of financial condition (SFC) for the Trump Organization, which list the family’s assets and President Trump’s total net worth each year. When Donald Trump took office in 2017, he transferred ownership of the Trump Organization to a trust, and Mr. Trump served as a trustee.
Prosecutors asked Mr. Trump about his positions and responsibilities within the “Trump Organization,” which he described as an umbrella term for the family’s businesses. He also was questioned about documents and accounting standards used by the firm.
Mr. Trump said he didn’t have knowledge of the accounting standards and relied on the expertise of the accountants hired by the Trump Organization to prepare the SFCs.
“These people had incredibly intimate knowledge. I relied on them,” he said. “The accountants worked on it. That’s what we paid them for.”
Mr. Trump said that while he wasn’t involved in compiling the SFCs, he could have been involved in discussions that led to coming up with particular numbers, without knowing it was for an SFC.
Mr. Trump was indicted alongside his father, former President Donald Trump, in the multimillion-dollar case that may prohibit them from holding executive business positions in New York state for five years.
New York Justice Arthur Engoron is presiding over the trial, which began on Oct. 2, and has already ruled in a summary judgment that President Trump is liable for fraud because he had submitted “fraudulent valuations” for his assets.
Ivanka Trump
Ivanka Trump, the former president’s daughter, was ordered to testify by Justice Engoron, but on Nov. 1, her attorney, Bennet Moskowitz, filed a notice of appeal.Mr. Moskowitz had argued in a court hearing before Justice Engoron that Ms. Trump doesn’t transact business at Trump Tower, contrary to her subpoena, and New York is no longer her primary residence.
“Since 2018, she’s been there once or twice a year, never for business, to say hello, to people including family members for 15 minutes, 30 minutes, things like that.
“So there is no basis to say a service on an entity at Trump Tower is service on her individually. That’s just wrong,” he said, according to a transcript of the hearing.
Justice Engoron denied the motion, ordering Ms. Trump to appear in person for testimony but scheduling her appearance later than her brothers’ so that the decision could be appealed.
“Plaintiff’s papers make abundantly clear documentary evidence that Ms. Trump owns property in New York and has done business in New York,” he said.
If she testifies, it will be on Nov. 8, after her father’s testimony—which is expected on Nov. 6 and possibly will continue into a second day.
On Nov. 1, President Trump blasted the judge for the order.
Expert Testimony
Earlier on Nov. 1, banking expert Michiel McCarty testified as an expert witness for the attorney general’s office.Relying on Mr. McCarty’s calculations, the prosecutors had determined that banks lost out on millions of dollars in interest that could have been charged if President Trump’s SFCs had different numbers.
Defense attorneys had sought to prevent Mr. McCarty’s testimony, arguing in a filing that expert witnesses are allowed to opine on facts, but Mr. McCarty’s report addresses “what actions might, theoretically, have been taken by lenders as to loan transactions.”
He was allowed to testify, and during questioning, Mr. McCarty testified that several factors, including debt and equities, would have increased the risk of, and therefore interest rate on, loans to the Trump Organization.
Defense attorneys objected, arguing that there is no basis to say that the banks would have acted differently had the numbers on the SFCs been different, and therefore, the gains were not “ill-gotten.”
They argued that Mr. McCarty was testifying as to the “mathematics” of his analyses, “not to the ill-gotten nature of the gain.”
During cross-examination, Mr. McCarty confirmed that he wasn’t familiar specifically with the credit policies of Deutsche Bank, which lent the Trump Organization money for several developments.
He said he had looked at the Deutsche Bank lending and credit policies before submitting his report to the attorney general’s office.
Mr. McCarty added that he “didn’t think it was relevant” that President Trump was in the “top tier of verifiable net worth” in the regional market he was developing, and he noted earlier that banks have historically been willing to lend to people with high net worths because they repay the loans.
He also said that Deutsche Bank did market to President Trump and wanted his business.
