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Donald Trump's $250 million civil fraud trial in New York has rattled the former president more than the criminal cases he is involved in because of the potential outcome of the proceedings, according to a legal expert.
Lisa Rubin, an attorney and legal analyst for MSNBC, was reacting to the opening day of the civil case. The case stems from New York Attorney General Letitia James' lawsuit accusing the former president, his sons Eric and Donald Trump Jr. and The Trump Organization of filing fraudulent financial statements that inflated the value of several properties and assets by billions of dollars for financial perks.
The majority of the claims in James' lawsuit have been resolved after Judge Arthur Engoron, who is overseeing the trial, ruled on September 26 that the former president had misled banks and insurers by inflating the value of his properties in his financial statements.
The civil trial will now mainly decide on other allegations from James' lawsuit related to falsification of business records, issuing false financial statements, insurance fraud and conspiracy. It will also determine the size of the penalty, which could see Trump banned from doing business in New York, having his properties removed from his control or being forced to pay a fine totaling hundreds of millions of dollars.
Trump, the frontrunner in the 2024 GOP presidential primary, has denied all wrongdoing in relation to James' suit, and accused Engoron of "interfering with an election" while speaking to reporters outside the New York courtroom on Monday.
In a series of posts on X, formerly Twitter, Rubin suggested that the "smorgasbord" of potential outcomes Trump could face, which could damage his reputation as a savvy businessman, would hurt the former president more than the threat of a custodial sentence in any of the four criminal cases he faces.
"The New York Attorney General's trial has definitely gotten under Trump's skin. Yet he was far calmer at his arraignment on 30-plus counts of unlawfully retaining classified documents. Why is he stressing?" Rubin wrote.
"Part of it is image. Trump's self concept and public persona alike rest on his King of All Real Estate construct. Although the Attorney General has already exposed how much of it is a fiction, the trial will methodically unspool his legend, witness by email by letter."
Rubin added that the threat of a so-called "corporate death penalty"—where a receiver would be appointed to dissolve Trump's properties—is also the type of punishment that Trump cannot "campaign away" during his latest bid for the White House.
"If restored to the presidency, he can pardon himself for his alleged federal crimes," Rubin added. "But the only way out of James's civil suit is through [...] appeals
"And before then, the court could impose serious penalties: bars on acquiring NY real property, borrowing from any NY-registered lender, or serving as an officer or director of any NY company, a monitor to direct (and correct) all financial reporting and controls; even a receiver to oversee the unwinding of his metaphorical trophy cases. And yes, maybe even the liquidation of his properties.
"And that's before we get to any disgorgement of the profits from his fraud, which the AG estimates 'at least $250 million.' Collectively, for Trump, that smorgasbord of potential remedies is worse than any threat of prison," Rubin added.
A similar argument was previously made by New York-based real estate attorney Andrew Lieb, who suggested how beyond "going to jail for the rest of his life," punishing the former president financially and via his businesses will cause him the greatest pain.
"This is the next worst nightmare that Donald Trump must have been having each night as he slept in his club, Mar-a-Lago, which is one of the many properties that the Judge found Trump drastically overvalued by ignoring zoning restrictions when seeking loans," Lieb told Newsweek.
"To make matters worse, there is still a trial happening on six other causes of action that were also levied by the attorney general in this case against Trump where he can still be ordered to pay $250 million plus after the trial."
On Monday, Trump lawyer Christopher Kise argued that Trump's assessment of his properties were not fraudulent and that the former president has "made a fortune literally being right" about real estate investments.
"There was no intent to defraud, there was no illegality, there was no default, there was no breach, there was no reliance from the banks, there were no unjust profits, and there were no victims," Kise said.
About the writer
Ewan Palmer is a Newsweek News Reporter based in London, U.K. His focus is reporting on US politics, and Florida ... Read more