New York State Attorney General Letitia James takes a question from a reporter after announcing that the state is suing the National Rifle Association during a press conference, Thur, Aug. 6, 2020.
( AP Photo/Kathy Willens
Tanzina Vega: As President Trump kicked off the first day of the Republican national convention, the top prosecutor in New York confirmed that her office is investigating the Trump organization. In court filings Monday, New York attorney general, Letitia James said that the civil probe concerns whether the president's business inflated the value of its assets to obtain favorable tax treatment, and the president's son, Eric Trump sits at the very center of the dispute. Here to tell us what this all means for President Trump and the Trump organization is David Enrich, business investigations editor at the New York Times and the author of Dark Towers about Donald Trump's relationship with Deutsche Bank. David, welcome back to the show.
David Enrich: Thanks for having me.
Tanzina: We know attorney general Letitia James has had her eyes set on the Trump administration for a while. What did we know about this investigation before this week?
David: We knew that Tish James was very interested in the way that the Trump organization was valuing its assets ever since Michael Cohen, President Trump's former lawyer testified before Congress last year that Trump routinely inflated the value of his assets with banks and others to try and just make more money for himself. There have been a number of investigations and Tish James last year since subpoenas to a number of entities, including Deutsche Bank, which is the president's longtime lender seeking information about this. That happened, and then things went quiet and there've been so many investigations swirling around the president, and his kids, and the Trump organization over the last year or so that it's easy to forget which ones are still outstanding. I think a lot of people kept their eyes off of Letitia games and either figured that the investigation was over or that it was stalled or there just wasn't happening. The news that it not only is still going on but is active and that she is really fighting to get cooperation from the Trump organization was pretty startling news yesterday.
Tanzina: Help us break down what exactly the attorney general revealed yesterday as part of her investigation.
David: First and foremost, she revealed that the investigation is, not only still ongoing but it's still very active. It looks as if she has successfully received information through subpoenas from quite a few institutions, not just Deutsche Bank but others as well that have allowed her to gather information that extends well beyond what Michael Cohen was testifying about back early last year. It seems like the investigation has actually made quite a bit of progress, which given how many people have been stonewalling in some of these investigations, that in itself is notable. The other thing that she revealed was that the Trump organization all of a sudden has just stopped cooperating with her and that means a number of different things. One of those is that they have refused to comply with the subpoenas that her office has issued seeking documents about a number of the Trump organization's properties and Trump's personal properties as well. The second thing is that Eric Trump, the president's son who is the one who's basically running Trump's businesses while he is president has stopped cooperating as well. It appears that what the Trump organization and Eric Trump are worried about, at least based on the Letitia James's court filings is that they're worried about this going from being a civil investigation and becoming a criminal one.
Tanzina: To that point, David, does the lack of cooperation, doesn't that essentially help move that process along if they're not cooperating? Doesn't that raise more eyebrows at the attorney general's office?
David: My hunch is that the attorney general's office's eyebrows are already in a pretty pronounced arch position at this point based on what they've seen. What the Trump organization has learned over the years dating back way before Trump became president is that it pays to stonewall in court cases.
Tanzina: Now, we know that Michael Cohen, you mentioned Michael Cohen, the president's former personal attorney is also writing a book. What do we expect to learn there?
David: When Michael Cohen testified before Congress, it was in February of 2019, he laid out a bunch of what he said were, I don't want to use the word crimes because I don't think he was that specific, but he said that the Trump organization was very manipulative and dishonest in the way it was presenting Trump's personal and business information, financial information to a whole host of institutions, whether it was lenders, or the IRS, or other tax authorities. What we know from Michael Cohen's book, having read the prologue to it, which went online a couple of weeks ago, there's going to be a lot more detail about exactly what was going on there and how the Trump organization and Trump himself set out to deceive people. This is Michael Cohen's telling. I think from a prosecutor standpoint, clearly, Michael Cohen has been interviewed by a lot of law enforcement authorities already, so it's unclear to me how much, in terms of the actual criminal and civil cases against Trump and his family and his company, how much Michael Cohen's book is really likely to move the needle. From the standpoint of public opinion, it's going to really reinforce, I think, the position of a lot of people on the left that Trump is not fit for office. Who knows whether it's going to move the needle for anyone other than those on the left who already really strongly dislike the president. This is a very polarized country right now and people's beliefs seem to be pretty set in stone.
Tanzina: David, remind us again which Trump properties are the focus of this investigation because, again, it's not the president himself, it's the Trump organization.
David: What we know from the court filings yesterday is that Letitia James is looking at Trump's property, the Seven Springs estate in Westchester County, which is something that Trump bought for about $7 million, and then suddenly claimed in filings with Deutsche Bank and others that it was worth nearly $300 million, so quite a gain on that. She's also said that she's looking at the valuation of Trump's big development in Chicago, as well as his golf club in Los Angeles, and the tower that he bought in the late 1990s on Wall Street. It's a cluster of properties that Trump has borrowed money to buy or refurbish and that the evaluations that he has assigned to those assets have been, at times, wildly inflated. It appears in an effort to either get more money out of banks or to affect his tax liabilities either at a state or federal level.
Tanzina: David, Trump himself never fully divested from his businesses, right?
David: He never really divested at all. He's claimed to not be involved in the operation of any of his businesses anymore. Although his sons are the ones running it and his sons are clearly quite close to the president and in times politically involved as well, but he divested little if anything of his actual assets. You can look at his annual financial disclosure forms, the most recent one, which was filed a couple of weeks ago, and it is really clear that he just has this wide range of assets all over the world. Some of which it's clear what they are, but others are just these LLCs that are very opaque and you just can't even tell what they're holding. His business empire remains wide range and the transparency around it is very limited at best.
Tanzina: As you mentioned at the top of the segment here, it's been a while since we've talked about this and some people might assume that these investigations are either not going on or long forgotten about them. How does the New York Attorney General current investigation relate to other inquiries into the Trump organization? There were other inquiries from the Manhattan District Attorney's Office, for example.
David: The main difference between those two investigations is that the attorney General's investigation, at least right now, is a civil investigation, not a criminal one. Whereas the Manhattan district attorney's investigation is a criminal one and the DA's investigation, it appears to be looking at a lot of the same things that the attorney general's investigation is looking at. The bottom line though is that we just do not know the full scope of either of these investigations. What we know about them is limited to what has come out in court filings very recently. The Manhattan DA, Cy Vance, his office has fought with Trump to get his tax returns over the past year. That's a case that went all the way up to the Supreme Court, and the Supreme Court sided with Cy Vance and affirmed his authority to conduct a criminal investigation into the president, but Cy Vance's office is still fighting with Trump and with Trump's accounting firm, Mazars, to get the president's tax returns, which could be very important in a case that is trying to prove that there was some sort of fraud committed by the president or his company to reduce their tax bills to overstate their asset values and
Tanzina: You said the magic word, David, taxes. The president took these efforts to shield his tax returns all the way to the Supreme Court, do we expect the New York AG's investigation is going to follow a similar path?
David: That's a good question and I don't know. Clearly, she doesn't seem to have yet. The reason I say that is because whenever someone subpoenas Trump's tax returns, Trump seems to go to court to fight that, and we have not seen that happening yet. It's a little unclear to me why she wouldn't have sought the tax returns. Look, it's possible that that is one of the things she has subpoenaed from the Trump organization and the Trump organization is now refusing to turn over. Getting the tax returns is essential because it could provide crucial evidence as to whether Trump has accurately and properly disclosed the true state of his finance to tax authorities and to the government at the state or federal level.
Tanzina: David Enrich is the business investigations editor at the New York Times and the author of Dark Towers, which explores Donald Trump's relationship with Deutsche Bank. David, thanks so much.
David: Thanks for having me.
Tanzina: In response to a request for comment, a Trump organization spokesperson told The Takeaway, "The NY AG's continued harassment of the company as we approach the election and filing of this motion on the first day of the Republican National Convention once again confirms that this investigation is all about politics." You can read the full statement online at thetakeaway.org.
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