Wednesday, December 8, 2021

Manhattan District Attorney Calls New Grand Jury In Trump Case To Weigh Potential Allegations

NEW YORK – The Manhattan District Attorney has convened a second long-term grand jury to hear evidence of the Trump Organization’s financial practices and possibly vote on criminal charges, according to people familiar with the matter.

Earlier, a grand jury convened this spring in Manhattan issued criminal indictments against two Trump companies and longtime Trump chief financial officer Allen Weisselberg, accusing them of tax evasion. It’s unclear if the grand jury is listening to the evidence about the Trump organization.

According to sources familiar with the matter, the new grand jury will meet three days a week for six months. The evidence was expected to be heard Thursday at a Manhattan surrogate court hearing – usually a forum for disputes over the property of the deceased – because criminal court buildings are packed with litigation following the pandemic.

One person familiar with the matter said a second grand jury was to examine how former President Donald Trump’s company valued its assets. Familiar people spoke on condition of anonymity to describe private legal proceedings.

This appears to be a separate issue from the one described in the indictments of the first grand jury, which dealt with allegations that Weisselberg and other Trump executives evaded taxes on their salaries by systematically hiding some of their compensation from the IRS. Both Weisselberg and both companies pleaded not guilty.

The term of the second grand jury shows that it can outlast District Attorney Cyrus Vance Jr., who is leaving office at the end of the year, and renew the term of his successor, Alvin Bragg, D.

Vance declined to comment on Thursday. Earlier, Bragg refused to talk about the Trump case during the election campaign.

Placing a new grand jury does not mean any other Trump organizations or leaders will be indicted. The second grand jury could have ended their term without charging anyone.

No charges have been brought against the ex-president. Neither Trump’s company nor his post-presidential office responded to requests for comment Thursday. Ron Fischetti and Phyllis Malgery, two of Trump’s personal lawyers, declined to comment.

In the past, Trump and his family have criticized the Vance investigation – and the separate civil investigation into his business by New York Attorney General Letitia James, D. – as motivated by politics, not law.

“This type of harassment and persecution violates all ethical norms of the prosecutor. This is wrong, ”the president’s son Eric Trump told The Washington Post last year.

Both Vance and James have previously stated that they are investigating allegations that the Trump Organization has misled banks, insurance companies or tax authorities by manipulating the value of its assets in order to obtain favorable loan rates or reduce its taxes.

James said in court last year that her office was investigating Trump’s appraisal of three properties: his golf course in Los Angeles, an office building in Manhattan, and an estate in a New York suburb called Seven Springs.

James’ filing said she was interested in the “mothballing” Trump received on the Seven Springs property in 2015 – giving him tax breaks in exchange for giving up the right to build homes on portions of the estate. Trump has increased the value of this tax credit by calculating that the land would have earned him $ 21 million if he had sold it.

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James also indicated in the documentation that she is interested in evaluating Trump’s golf course in Los Angeles, where Trump received an easement for security in 2014 that he said lowered the property’s value by $ 25 million, the filing said. James did not say why she was interested in Trump’s office building at 40 Wall Street in Manhattan.

Vance’s office, which is convening a new grand jury, has provided far less detail about its investigation into the valuation of Trump’s property.

Vance’s investigation is aimed at criminal prosecution, and James’s civil investigation may end in a lawsuit. But James’s office also played a role in Vance’s criminal investigation, sharing information and attorneys. James recently announced that she is running for governor of New York in 2022.

The question of whether Trump manipulated the valuation of his property was raised in 2019 by Michael Cohen, Trump’s longtime lawyer, in his testimony to Congress.

“In my experience, Mr. Trump inflated his assets when it served his purposes, such as trying to get on the Forbes list of richest people, and shrinking his assets to lower property taxes,” Cohen said at the time. According to court documents, Cohen’s insider accounts helped initiate investigations of both James and Vance.

Cohen cited documents called the Statement of Financial Position, which were prepared by Trump’s accounting firm. These were descriptions of Trump’s assets and debts, which Cohen said were intended to prove his wealth and his good reputation as a potential borrower.

In some cases, The Post found these statements misleading Trump’s properties.

For example, Trump claimed that his Virginia vineyard had 2,000 acres, when in fact there were about 1,200. He said that Trump Tower has 68 floors. It has 58.

In some cases, The Post found that Trump appeared to have added millions of dollars in value to certain properties by demanding a loan for homes he did not have permission to build.

In 2011, for example, Trump said in a statement that he had 55 lots for sale on a golf course in Los Angeles. The statement said the lots will sell for $ 3 million or more. But at the time, Trump only had 31 lots zoned and ready for sale, according to city data. It looks like he was applying for a loan of 24 lots and at least $ 72 million in future income, which he did not have.

Trump also argued that nine – or, in a later document, even 25 – “luxury homes” were allocated in the Seven Sources area. In the financial statements, Trump included the sale price of these homes in his valuation of the property, concluding in 2011 that it was worth $ 261 million.

But despite years of trying, local officials say Trump has never completed the process required to build homes in the area. Local appraisers have valued the same property at $ 20 million.

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O’Connell and Farenthold reported from Washington.

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