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Donald Trump overinflated the value of his golf courses to a financial company even while under court scrutiny, an independent monitor's report has found.
Monitor Barbara Jones wrote that Trump put zero depreciation on equipment at his golf courses, thereby giving his properties an inflated value.
Her findings, submitted to the judge in Donald Trump's New York fraud trial, drew an angry response from Trump's lawyer, Chris Kise, who wrote in a court filing that Jones' findings were "shameful" and that she was exaggerating the importance of tractors, lawn mowers and other machinery needed to maintain golf courses.
Jones, a retired federal judge, submitted a report on the companies to Judge Arthur Engoron ahead of his decision this week how much in penalties to impose on Trump for fraudulent asset evaluation that predated Jones' role as monitor.
In September, Engoron issued a partial summary judgment in the case brought by New York Attorney General Letitia James, ruling that Trump and top executives at the Trump Organization committed fraud. Engoron held that Trump grossly inflated the value of his assets to obtain more favorable terms from lenders and insurers. He then stripped the companies of their business certificates and appointed Jones to monitor them.
Engoron will rule on how much the front-runner for the 2024 Republican presidential nomination will pay in damages, as well as rule on six other accusations—including falsifying business records, insurance fraud and conspiracy claims. James is seeking the return of $370 million in profits Trump made.
Jones noted in her report that "in 2022 and 2023, income statements provided to a finance company for certain golf course properties with material fixed assets did not include depreciation or presented depreciation as $0."
"In my discussions with the Trump Organization, it acknowledged that such disclosures could be relevant to the recipient and that it would consider including such information on subsequently prepared internal financial statements," she wrote.
She also struggled to get information from the Trump real estate companies about Trump's sale of the license to operate the Ferry Point golf resort in the Bronx. The sale followed a two-year legal dispute after New York Mayor Bill de Blasio tried to force Trump out of the Ferry Point golf course following the January 6 riots at the Capitol.
"The Trump Organization sold its right to operate Ferry Point to Bally's in September 2023. In connection with the transaction, certain financial information was provided to Bally's between June and August 2023. I did not receive this information until August 28, 2023," Jones wrote.
She said that the Trump Organization accepted that the February and March 2022 monthly unaudited trial balances provided to Bally's were "improperly prepared" and were not in line with balances shown for other months.
Newsweek sought comment from Trump lawyer Kise, who pointed to his court submissions as a detailed explanation of his position.
In a response filed in Engoron's court on January 29, Kise dismissed Jones' complaints as going far beyond her mandate and disputed her finding on depreciation at Trump golf courses.
"Given that the depreciation line has no impact on the finance company, there is absolutely no issue with sending that company these internal financial statements, which indicated that depreciation was $0," he wrote.
He said the statements with no depreciation were only provided to one party, John Deere Financial.
"This issue relates to golf course maintenance equipment (i.e., lawn mowers, tractors, etc.). The notion that the Defendants must pay millions to a Monitor so she can review such minutiae is truly untenable. It is shameful that the Monitor has charged the Defendants millions in fees to identify such a ridiculous item!" he wrote.
Kise also wrote that Jones was completely wrong on claiming that the Trump Organization has given incorrect information to Bally's, the purchases of Trump's license to the Ferry Point golf course.
"This statement is false. The Trump entities never informed the Monitor that these trial balances were improperly prepared. Rather, on November 21, 2023, the Trump entities provided the Monitor a complete explanation of the monthly unaudited trial balances and reiterated the complete irrelevance of these "observations".
"These property-level internal, unaudited monthly operational trial balances were sent to Bally's as a sample solely for the purpose of Bally's gaining insight into the operations of the golf course (cash balances, inventory levels, etc.). They were not meant to be comprehensive or all-inclusive," Kise added.
About the writer
Sean O'Driscoll is a Newsweek Senior Crime and Courts Reporter based in Ireland. His focus is reporting on U.S. law. ... Read more