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Trump Organization to have independent monitor, judge rules

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A state judge has granted a request by the New York attorney general for an order appointing a monitor to oversee the finances of the Trump Organization, and prohibited any proposed transfers of substantial assets without prior notice to the court, the AG and the monitor, while a state lawsuit against the company moves forward.

New York Attorney General Letitia James’ office was seeking a preliminary injunction, alleging in a court filing that the company “appears to be taking steps to restructure its business to avoid” liability and payment of any damages in a massive lawsuit filed by her office in September. The suit alleges a widespread effort to manipulate property valuations by former President Donald Trump and his eponymous company. It seeks $250 million and an end to the company’s operations in the state.

The day the lawsuit was filed, the company incorporated a new entity with the state, called Trump Organization II LLC. The entity was registered days before in Delaware. James’ office claimed that was possible proof the company planned to move its assets.

“Defendants are hereby ordered to provide the monitor with a full and accurate description of the structure and liquid and illiquid holdings and assets of the Trump Organization, it subsidiaries, and all other affiliates, no later than two weeks after the monitor’s appointment,” Judge Arthur F. Engoron wrote in his ruling.

James’ office called the decision “a major victory.”

“Time and time again, the courts have ruled that Donald Trump cannot evade the law for personal gain,” James said in a statement. “Today’s decision will ensure that Donald Trump and his companies cannot continue the extensive fraud that we uncovered and will require the appointment of an independent monitor to oversee compliance at the Trump Organization. No number of lawsuits, delay tactics, or threats will stop our pursuit of justice.”

Trump posted a statement saying, “Today’s ridiculous ruling by a politically-motivated, hand-picked judge makes it even more vital for courts in both New York and Florida to do the right thing and stop this inquisition.”

Chris Kise, an attorney for the Trump entities, said in a statement: “This unprecedented Order effectively seizes control of the financial affairs of a highly successful private corporate empire based on nothing more than gross exaggeration of standard valuation differences common in complex commercial real estate financing transactions. … The New York Attorney General has stretched the bounds of her authority to set a very dangerous precedent.”

Trump filed a lawsuit against James and her office Wednesday night in a Florida state court. The suit claims James, a Democrat, is pursuing Trump, a Republican, for political gain, and claims her office lacks authority to demand documents related to Trump’s revocable trust, through which he owns the company. He claims James’ demand for trust documents violates his “right to privacy and property” and his rights in the trust.

A similar federal suit filed in the Northern District of New York in December 2021 was dismissed in May. The judge in the case said there was little proof James’ office was motivated by political animus, and “no evidence” subpoenas in the attorney general’s investigation had “been conducted in such a way as to constitute harassment.”

A spokesperson for the New York attorney general called Trump’s new lawsuit “baseless.”

The New York attorney general’s lawsuit is seeking $250 million and punishments including the revocation of the Trump Organization’s business certificate, effectively barring it from doing business in New York. It also seeks to permanently prohibit Trump and three of his children, Ivanka, Eric and Donald Trump Jr., from serving as officer or director of any business in New York, including their family’s company.

Attorneys for Donald Trump Jr., Eric Trump and Ivanka Trump did not immediately reply to a request for comment.

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