The twin legal blows undermined former President Donald Trump’s fight to avoid criminal prosecution for collecting classified documents and exposed him to potential civil penalties targeting the business wealth on which his political mystique is built.
Trump’s lifelong ability to thwart accountability is facing its toughest test yet as investigations and evidence pile up against him. Trump has not been charged with any crime, but the legal and court proceedings that he is a master of delaying and twisting are now moving forward.
On Wednesday, two major events rocked Trump’s legal teams, who were already battling several serious investigations.
- New York Attorney General Letitia James filed a stunning 200-page civil lawsuit alleging that the Trump family’s empire was essentially built on years of embezzlement and self-enrichment, defrauding lenders, insurers and tax authorities and evading laws that apply to all Americans. James is seeking settlement of $250 million in allegedly ill-gotten funds that would severely curtail the Trump Organization’s ability to do business and drive the former president and his family out of the city that made his name. However, the case is civil and although James submitted evidence to the Internal Revenue Service and the Department of Justice, he was unable to press criminal charges. Trump responded with vehement denials of wrongdoing and claimed he was the victim of a “witch hunt.”
- In a landmark ruling in the case of highly sensitive material that Trump brought to his Mar-a-Lago resort, an appeals court gave a victory to the Justice Department, allowing it to review classified documents seized in a raid by the FBI. agent last month. Three judges, including two Trump appointees, ruled that the public has a strong interest in ensuring that the retention of the material does not cause “extraordinarily serious harm to national security.” Given that Trump has sought to delay the investigation against him as long as possible, he may try another legal maneuver, but his options are running out, with one of the only remaining options being an emergency petition to the US Supreme Court.
Both developments appear to have increased Trump’s potential legal exposure, and he now figures prominently in at least three dramas involving an investigation into the 2020 election in critical Georgia. The former president has denied all accounts.
But it also came on a day when Trump’s crisis is escalating, as the House Select Committee investigating Jan. 6, 2021, officially announced the first hearing of the fall next week. The panel has not yet decided whether to recommend criminal action against the former president. The Justice Department already has its own grand jury investigation into the events surrounding his claims of fraudulent election fraud and the attack on the US capital by groups of his supporters.
Trump’s murky legal storm raises the prospect of a former president facing potential criminal action and serious civil penalties that could significantly threaten his fortunes. Much of Trump’s initial political appeal rests on the idea that he is a successful tycoon who built a highly profitable business and amassed a personal fortune. If it all turns out to be a hoax and his career a house of cards built on illegal activities, his narrative will take a serious hit, though it’s unlikely it would ever be enough to shake his appeal to his core voters.
Trump’s latest legal rebuke comes as he considers his 2024 presidential campaign likely, he has already indicated that he would build on claims that Democrats are politically harassing him, and he has already implicitly warned of violence if he is formally indicted.
The civil suit filed by New York state against Trump is the most extensive catalog of the former president’s business practices and also targets his three grown children, Don Jr., Ivanka and Eric, who are deeply involved in the Trump Organization.
It alleges an egregious pattern of overvaluing properties and assets in Trump’s real estate portfolio, his hotel and golf club empires. The alleged purpose of the multiple schemes was to mislead lenders, insurance brokers and tax authorities into giving them better loan terms and reducing their tax liability. James alleged that each certificate was personally signed by Trump and had direct value in falsifying the ratings. In one instance of his claim, James said Trump inflated the size of his Trump Tower apartment from less than 11,000 square feet to more than 30,000 square feet to come up with a value of $327 million. In another case, Trump repeatedly inflated the value of an office building the organization owns at 40 Wall Street.
“It’s a huge complaint, it’s a strong complaint, it’s full of facts and it’s very serious. And so Donald Trump and others named in the complaint will have their day in court to answer that and try to challenge it,” Geoffrey Berman, a former U.S. attorney for the Southern District of New York, told CNN’s Erin Burnett.
James said that any ordinary citizen who allegedly committed such acts would have thrown the book away. He argued that not pursuing the case would mean that there would be two systems of justice, one for the workers and one for the rich and powerful.
“There can’t be different rules for different people in this country or in this state,” James said.
His remarks were aimed at the conceit behind Trump’s entire political narrative: that he’s an outsider fighting for everyday Americans against a system that favors elites.
The sanctions that James is seeking against Trump in what is likely to be a lengthy case have the potential to severely limit the ability of business to operate, especially in the US financial capital.
“He’s seeking what corporate lawyers call a corporate death penalty, which would be to decertify the Trump Organization so they can’t even do business in New York,” CNN legal analyst Paul Callan told Anderson Cooper.
“It’s a very, very serious penalty if the AG wins the case.”
In a sign that Trump’s defense may be an uphill task, James said he repeatedly asserted his Fifth Amendment right against self-incrimination. In a civil case, unlike in a criminal case, the prosecutors have the right to attribute an adverse effect to this step.
James, a Democrat, insisted there was no political motivation behind his case and that other corporations have faced similar censorship.
But James has created some openings for Trump to blame the political party. Before taking office he said publicly that he believed the then president could be impeached. And Trump’s almost mocking use of the slogan in his presentation to publicize the case came across as somewhat triumphalist. “Claiming money you don’t have won’t do ‘the art of the deal,'” he said. “It’s the art of stealing.”
Trump quickly responded by calling the lawsuit a witch hunt — his usual tactic to deflect any attempt to force him to face accountability. Trump may try to argue that his business engaged in the same business practices as others in New York and that he is being unfairly singled out as a former president and future candidate.
However, the evidence presented in the case could have unexpected directions in other jurisdictions, even leading to criminal charges against the Trump Organization, which could threaten the financial viability of the business.
The Justice Department’s victory in the 11th Circuit represents another legal blow for Trump, who believes he is immune from rules on classified information.
The appeals court did not partially stay a lower court’s ruling to stop the DOJ’s review of 100 classified documents seized from Mar-a-Lago, which officials say are government property and could reveal US intelligence sources and methods as well as covert US assets. danger abroad The ruling also eliminated an argument by Trump’s legal team that the former president had declassified the documents as presidential.
“The hand has no evidence that any of these records were declassified. And before the special master, the plaintiff refused to provide any evidence that he had declassified any of these documents,” says the ruling, referring to the third official appointed by a lower court to review the documents seized in the search.
Nick Akerman, a former assistant US attorney for the Southern District of New York, said on CNN on Wednesday that the 11th Circuit had botched Trump’s case, and expressed doubt that the Supreme Court would ever take the case.
“Donald Trump had no interest in classified documents; there is no right to obtain or view such information. That is really the basis of this opinion”, he said.
As always, when Trump faces a legal threat, the question becomes whether he will face a political price.
The former president has spent years trying to ignore any institution he takes over, including the courts. He sees them as biased, corrupt, and a tool of liberal persecution. He has also targeted James in particular, accusing him of racism. This demagoguery is now a critical tool of his political brand. At rallies, he tells supporters he’s willing to be bullied to protect them.
There is little chance that the former president’s base will turn on him. Still, damaging allegations about Trump’s behavior are unlikely to help his already strained standing with voters in the 2020 general election. And he can’t let the pressure of another serious legal threat weigh on his mind as he considers another one. The White House Run.
However, the reality that sitting presidents have protections against criminal activity may be even more attractive to Trump now. And if he does not run in 2024, it would be more difficult for the former president to claim that he is being politically victimized.