https://www.newsweek.com/donald-trump-exec-notes-doom-fraud-trial-defense-1846112
Donald Trump Executive's Handwritten Notes Could Doom Fraud Trial Defense
Nov 22, 2023 at 12:41 PM EST
A former Trump Organization executive's handwritten notes on draft financial documents could be detrimental to former President Donald Trump's defense in his civil fraud trial, legal experts told Newsweek.
The trial, now in its eighth week, stems from New York Attorney General Letitia James' lawsuit that alleges Trump and executives at his company fraudulently inflated his wealth on his financial statements, which were used to secure loans and insurance.
Judge Arthur Engoron, who will decide the verdict in the non-jury trial, has already ruled that Trump and other defendants engaged in fraud. The trial is to decide remaining claims of conspiracy, insurance fraud and falsifying business records.
James is seeking more than $250 million in penalties and a ban on Trump doing business in New York. Trump, who is the front-runner in the race for the 2024 Republican presidential nomination, has denied wrongdoing and characterized the case as a political witch hunt by James, a Democrat.
Trump has denied involvement in preparing the annual financial documents, claiming they actually underestimated his net worth and emphasizing that disclaimers on the statements insulated him from liability for discrepancies or misstatements.
But on Tuesday, the Trump Organization's former corporate controller, Jeffrey McConney, testified it was his understanding that Trump reviewed the financial statements before they were finalized.
Trump earlier testified that he "would see them, and I would maybe, on occasion, have some suggestions," according to the Associated Press. His son, Donald Trump Jr., a Trump Organization executive vice president, testified this month that he signed off on statements as a trustee of his father's trust but left the work to outside accounting firm Mazars USA and the company's then-chief financial officer, Allen Weisselberg.
On the stand on Tuesday, lawyers for James' office presented McConney with a draft of Trump's net worth statement for 2014 which had a note in blue ink on the first page that said: "DJT TO GET FINAL REVIEW."
McConney, who worked at the Trump Organization from 1987 until February, said he had written the note. In a pretrial deposition, Trump said he did not know who had written the note on the 2014 draft document.
According to Business Insider, his testimony on Tuesday directly contradicted his testimony a day prior that he would review each year's draft net worth statement with Weisselberg, who would then provide it to Mazars. The firm cut ties with Trump last year.
McConney's handwritten notes on documents indicate it was Trump and other top executives who made final edits to the documents.
McConney's testimony "will permit Engoron to find that Trump himself approved the financial report," Stephen Gillers, a law professor at New York University, told Newsweek.
"Trump is careful to leave no written or recorded trail of what he knows. That has allowed him to blame errors on others, including employees of his organization and outside accountants, for any unlawful conduct. Even now, we can expect Trump to argue that despite McConney's sentence, in fact he did not see the report."
Neama Rahmani, an attorney and former federal prosecutor, told Newsweek that McConney's handwritten notes "impeached his own testimony and contradicted the Trump family argument that the accountants were solely responsible for preparing the financial statements.
"Impeaching witnesses with their prior inconsistent statements can be a highly effective strategy, and that is what the Attorney General's Office did with this witness. Despite his bizarre crying, the state made him one of their witnesses."
The draft documents with handwritten notes were handed over to the attorney general's office by Mazars, not by the Trump Organization, which could further harm Trump if Engoron draws an adverse inference about why the documents were not turned over as required by state subpoenas.
"The defense seems to have goofed here," Gillers said. "It appears to have been unaware that the attorney general had received a copy of McConney's report, with his handwritten sentence, from Mazars.
"Now not only can that sentence, along with other evidence, support a finding that Trump personally approved the inflated report, Trump's failure to produce the report with McConney's sentence will also support a finding that the report was withheld in order to avoid the true inference of Trump's knowledge and culpability. When a party to a lawsuit lies or withholds evidence in discovery, the court can find that they did so because the truth would implicate them in wrongdoing."
Rahmani said that Engoron may "draw an adverse inference from the Trump Organization's failure to produce to documents in discovery.
"That inference or instruction would matter more in a jury trial, though, where a judicial instruction could sway undecided jurors. Here, Engoron is the finder of fact."
Newsweek has reached out to a Trump attorney via email for comment.
Donald Trump Executive's Handwritten Notes Could Doom Fraud Trial Defense
Nov 22, 2023 at 12:41 PM EST
A former Trump Organization executive's handwritten notes on draft financial documents could be detrimental to former President Donald Trump's defense in his civil fraud trial, legal experts told Newsweek.
The trial, now in its eighth week, stems from New York Attorney General Letitia James' lawsuit that alleges Trump and executives at his company fraudulently inflated his wealth on his financial statements, which were used to secure loans and insurance.
Judge Arthur Engoron, who will decide the verdict in the non-jury trial, has already ruled that Trump and other defendants engaged in fraud. The trial is to decide remaining claims of conspiracy, insurance fraud and falsifying business records.
James is seeking more than $250 million in penalties and a ban on Trump doing business in New York. Trump, who is the front-runner in the race for the 2024 Republican presidential nomination, has denied wrongdoing and characterized the case as a political witch hunt by James, a Democrat.
Trump has denied involvement in preparing the annual financial documents, claiming they actually underestimated his net worth and emphasizing that disclaimers on the statements insulated him from liability for discrepancies or misstatements.
But on Tuesday, the Trump Organization's former corporate controller, Jeffrey McConney, testified it was his understanding that Trump reviewed the financial statements before they were finalized.
Trump earlier testified that he "would see them, and I would maybe, on occasion, have some suggestions," according to the Associated Press. His son, Donald Trump Jr., a Trump Organization executive vice president, testified this month that he signed off on statements as a trustee of his father's trust but left the work to outside accounting firm Mazars USA and the company's then-chief financial officer, Allen Weisselberg.
On the stand on Tuesday, lawyers for James' office presented McConney with a draft of Trump's net worth statement for 2014 which had a note in blue ink on the first page that said: "DJT TO GET FINAL REVIEW."
McConney, who worked at the Trump Organization from 1987 until February, said he had written the note. In a pretrial deposition, Trump said he did not know who had written the note on the 2014 draft document.
According to Business Insider, his testimony on Tuesday directly contradicted his testimony a day prior that he would review each year's draft net worth statement with Weisselberg, who would then provide it to Mazars. The firm cut ties with Trump last year.
McConney's handwritten notes on documents indicate it was Trump and other top executives who made final edits to the documents.
McConney's testimony "will permit Engoron to find that Trump himself approved the financial report," Stephen Gillers, a law professor at New York University, told Newsweek.
"Trump is careful to leave no written or recorded trail of what he knows. That has allowed him to blame errors on others, including employees of his organization and outside accountants, for any unlawful conduct. Even now, we can expect Trump to argue that despite McConney's sentence, in fact he did not see the report."
Neama Rahmani, an attorney and former federal prosecutor, told Newsweek that McConney's handwritten notes "impeached his own testimony and contradicted the Trump family argument that the accountants were solely responsible for preparing the financial statements.
"Impeaching witnesses with their prior inconsistent statements can be a highly effective strategy, and that is what the Attorney General's Office did with this witness. Despite his bizarre crying, the state made him one of their witnesses."
The draft documents with handwritten notes were handed over to the attorney general's office by Mazars, not by the Trump Organization, which could further harm Trump if Engoron draws an adverse inference about why the documents were not turned over as required by state subpoenas.
"The defense seems to have goofed here," Gillers said. "It appears to have been unaware that the attorney general had received a copy of McConney's report, with his handwritten sentence, from Mazars.
"Now not only can that sentence, along with other evidence, support a finding that Trump personally approved the inflated report, Trump's failure to produce the report with McConney's sentence will also support a finding that the report was withheld in order to avoid the true inference of Trump's knowledge and culpability. When a party to a lawsuit lies or withholds evidence in discovery, the court can find that they did so because the truth would implicate them in wrongdoing."
Rahmani said that Engoron may "draw an adverse inference from the Trump Organization's failure to produce to documents in discovery.
"That inference or instruction would matter more in a jury trial, though, where a judicial instruction could sway undecided jurors. Here, Engoron is the finder of fact."
Newsweek has reached out to a Trump attorney via email for comment.
