Trump Warns of Exodus of Businesses From New York if He Loses Fraud Case

Former President Donald Trump departs for lunch and speaks to the media during his trial in New York State Supreme Court in New York on Dec. 7, 2023. David Dee Delgado/Getty Images

Former President Donald Trump said Thursday that if he loses the fraud case brought against him by New York Attorney General Letitia James, it will have a deeply chilling effect on businesses in the Big Apple.

“Businesses are watching this case,” President Trump told reporters outside a Manhattan courtroom on Dec. 6. “No business will go back into New York, no business will frankly stay in New York, some businesses are talking about leaving New York because of this action, this very serious action.”

The case centers on allegations that the former president and his company, The Trump Organization, defrauded banks, insurers, and others by allegedly overvaluing his assets and exaggerating his net worth in documents used in deals and to secure loans.

Already, the judge presiding over the case has issued a summary judgment finding President Trump and his company liable for fraud. The current trial is to decide the remaining claims of conspiracy, insurance fraud, and falsifying business records.

President Trump, the frontrunner for the Republican 2024 presidential nomination, has denied any wrongdoing. He has claimed that the case is a politically motivated plot to undermine his run for the White House.

“If you look at the case, we did nothing wrong, there were no victims,” President Trump told reporters on Thursday.

He once again called the case a “witch hunt” and pointed to previous testimony of a Deutsche Bank executive who bolstered the former president’s defense by saying in court that it’s not unusual for there to be differences between a client and the bank about a client’s asset values when they apply for a loan.

Former President Donald Trump attends his trial in New York State Supreme Court in New York City, on Dec. 7, 2023. David Dee Delgado/Getty Images

Bank Executive Testifies

David Williams, a Deutsche Bank executive who worked on at least one of three loans the bank gave to President Trump, testified on Nov. 28 that it isn’t unusual for a bank to cut a client’s stated asset value—even by half—and still approve a loan, just like it did with the former president.

Deutsche Bank provided hundreds of millions of dollars in loans to President Trump for properties in Miami, Chicago, and Washington.

Mr. Williams told the court that it’s standard practice for Deutsche Bank to subject a client’s asset value to an adjustment, saying differences between a client and the bank about a client’s asset values aren’t a disqualifying factor when considering granting loans because “it’s just a difference of opinion.”

Ms. James, the attorney general who brought the case against the former president, has argued that he inflated the value of his assets by as much as $2.2 billion to get better loan terms from the bank. She is seeking to recover about $250 million in the case.

However, Deutsche Bank viewed clients’ reports of their net worth as “subjective or subject to estimates” and took its own view of such financial statements, Mr. Williams said.

“I think we expect clients-provided information to be accurate. At the same time, it’s not an industry standard that these statements be audited. They’re largely reliant on the use of estimates,” Mr. Williams said, noting that bankers routinely “make some adjustments.”

New York Attorney General Letitia James in New York City, on Aug. 3, 2021. David Dee Delgado/Getty Images

More Details

At times, the bank pegged President Trump’s wealth at several billion dollars lower than he did, according to documents and testimony. In 2019, for example, President Trump’s financial statement listed his net worth at $5.8 billion, which the bank adjusted down to $2.5 billion.

However, Mr. Williams said such differences weren’t necessarily unusual or alarming.

“It’s a conservative measure to make these adjustments,“ he testified, characterizing them as “standard” and as a ”stress test” of financial strength.

Ms. James’ office has argued that such adjustments were never intended to account for the fraud that President Trump and his organization are accused of.

President Trump previously argued that no bank was victimized by the stated asset valuations and that lenders—including Deutsche Bank—made considerable amounts of money in interest by extending the loans.

He has also stated repeatedly that, if his brand value is taken into account, his net worth is “much higher” than what was stated on the Trump Organization statements of financial condition.

Earlier in the trial, President Trump attended the proceedings over the course of several days and spent one on the witness stand while the state was presenting its case. Thursday marked the former president’s first appearance since the defense began calling its own witnesses.

During breaks, the former president denounced the lawsuit.

“This is a case that should have never been brought,” President Trump said as he left for the day, calling the trial “a witch hunt,” “election interference,” and “a disgrace to America.”