Judge Orders Eric Trump to Testify in N.Y. Fraud Inquiry

By William K. Rashbaum and 

THE NEW YORK TIMES

Sept. 23, 2020

Eric Trump’s lawyers said in court papers last week that he was willing to be interviewed after the election, partly citing his “extreme travel schedule.”Credit...

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A New York state judge on Wednesday ordered President Trump’s son Eric to answer questions under oath before the election in a fraud investigation into his family’s real estate business.

Last week, Eric Trump’s lawyers said he was willing to be interviewed — but would only do so after the presidential election because he did not want his deposition to be used “for political purposes.”

But on Wednesday, a judge in the State Supreme Court in Manhattan, Arthur F. Engoron, ruled that Mr. Trump had to sit for a deposition no later than Oct. 7, rejecting his arguments that a delay was necessary.

“This court finds that application unpersuasive,” Justice Engoron said in his ruling Wednesday afternoon, which he read from the bench after a two-hour hearing earlier in the day. “Mr. Trump cites no authority in support of his request, and in any event, neither petitioner, nor this court, is bound by timelines of the national election.”

The judge also ordered the company and several related entities and lawyers to turn over a variety of records connected to four of the properties under scrutiny.

The attorney general, Letitia James, a Democrat, has been conducting a civil investigation into whether President Trump and the Trump Organization committed fraud by overstating assets to get loans and tax benefits.

Ms. James’s office had asked the judge to compel Eric Trump, the executive vice president of his father’s business, to answer questions under oath, and to turn over a broad range of documents that the office sought under subpoena, court papers show.

In July, Mr. Trump abruptly canceled an interview with the attorney general’s office, days before it was scheduled, and in August, the Trump Organization told the office that the company and its lawyers would not comply with seven subpoenas related to the investigation.

Mr. Trump’s lawyers said in court papers last week that he was willing to be interviewed after the November election, citing his “extreme travel schedule” and his determination “to avoid the use of his deposition attendance for political purposes.”

In a statement released Wednesday night through a spokeswoman, Mr. Trump contended that the investigation was “a continued political vendetta and attempt to interfere with the upcoming election.”

“The New York Attorney General has called my father an ‘illegitimate’ president and pledged to take him down while she was running for office,” the statement said. “That said, since I previously agreed to appear for an interview, I will do so as scheduled.”

In addition to ordering that a broad swath of records be turned over to the attorney general’s office, Justice Engoron also ruled that some other records, which appear to include several tax documents relating to some of the properties, be provided to him for review in chambers so he can determine whether they also should be turned over.

Ms. James, the attorney general, hailed the judge’s decision.

“Justice and the rule of law prevailed today,” she said in a statement. “We will immediately move to ensure that Donald Trump and the Trump Organization comply with the court’s order and submit financial records related to our investigation.”

The request to depose Eric Trump comes as President Trump faces legal actions on other fronts. The Manhattan district attorney’s office has suggested that it is investigating several potential crimes including possible tax, insurance and financial fraud by the president and the Trump Organization, and is fighting in federal court to obtain his tax returns.

During the hearing Wednesday, the attorney general’s office and lawyers representing the Trump Organization and other parties in the case squared off over the organization’s attempt to delay Eric Trump’s deposition and withhold some of the documents being sought.

“We’re happy for him to sit down and be deposed, but we need time to go through these materials, we need time to prepare our client,” said Alan S. Futerfas, a lawyer for Mr. Trump.

“I think as the world knows, there’s an election going on in about four weeks in this country, maybe five weeks,” he added. “Mr. Trump, Eric Trump, is a vital and integral part of that, and he’s traveling just about seven days a week, if not in fact seven days a week.”

Matthew Colangelo, a lawyer in the attorney general’s office, said that “the mere ground of personal inconvenience isn’t a basis to delay compliance with a lawful subpoena for Eric Trump’s testimony, which from what we can tell, he no longer contests.”

“Mr. Trump is asking for a further two-month delay in complying with a lawful subpoena for his testimony to the middle of November in response to a subpoena that was served in May and where the parties agreed in early June on a date for his attendance,” he added.

The sides also battled over documents the attorney general’s office is seeking related to two transactions.

One involves how the Trump Organization valued land that it agreed to preserve in Westchester County, in an effort to get the largest possible tax break.

The other concerns how the Trump Organization reported $100 million in loan forgiveness to tax authorities, related to the Trump International Hotel and Tower in Chicago.

“This $100 million is the 800-pound gorilla in the room,” Justice Engoron said.

Lawrence S. Rosen, a lawyer for the Trump Organization, argued that the $100 million was “not a tax benefit.” Justice Engoron replied, “Well, I’m not sure that I agree with you.”

 

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published this page in News and Politics 2020-09-24 03:21:06 -0700