Former President Donald Trump has just been ordered to pay $454 million by a New York judge on Friday. Of the staggering $454 million, $355 million is for disgorgement penalties and $98 million in prejudgment interest penalties, which is accruing everyday it’s not paid.
Along with the massive penalties, President Trump has also been banned for three years from running a business in New York, and applying for loans from financial institutions registered in New York.
Manhattan Supreme Court Judge Arthur Engoron wrote “New York means business in combating business fraud,” in the 92-page ruling.
Trump gave a short speech at Mar-a-Lago after the ruling. During the speech he stated “We’ve employed tens of thousands of people in New York, and we pay taxes like few other people have ever paid in New York.” He claims to have paid over $300 million in taxes to the state of New York.
The Former President said they will be appealing the decision and expects to get it overturned.
This case is based on the idea that Trump and his companies have been overstating the value of their assets to get higher loan amounts and better lending terms. Trump says, “the banks all got their money, 100%.” Trump nor his companies have not defaulted on any of these loans, so it makes you wonder, why is the state going after him? His legal team claims that the judge is politically bias. Trump claims none of this would be happening if he wasn’t running for president. If that is true, this does look a lot like election interference on a large scale.
Trump has not hidden his opinion of New York Attorney General Letitia James who is front running all of these lawsuits against him. “Everyday Americans cannot lie to a bank to get a mortgage to buy a home, and if they did, our government would through the book at them,” stated James while celebrating after the ruling.
I find that statement a little misleading in the context of this case. For example, a homeowner walks into a bank to refinance their house. The homeowner states that they believe the house is worth $400,000. That is the homeowners opinion. Although, the real value would be considered the fair market value. Market value is defined as the most probable price a property should bring in a competitive and open market.
When a bank is giving a loan on a property, they’re not just going to take your word on the value. Typically, the loan process requires the approval of the borrower, and the property. Meaning, the lender will get an appraisal of the fair market value of the property to decide how much to loan against it. This is standard practice. If the bank did not hire a professional appraiser to look over the property, that would be on them, not Trump.
If you’re interested in learning more about Donald Trump’s massive real estate portfolio, I recommend reading this book.
*As an Amazon Affiliate, I may earn a commission from qualifying purchases.