Klasfeld’s reporting is part of Just Security’s Trump Trials Clearinghouse

Former President Donald Trump must pay more than $360 million in “ill-gotten” gains in a civil fraud judgment — plus interest that may spike that tally to above $450 million, a judge ruled on Friday.

The judge also barred Trump from running a New York business as an officer or director for three years.

Referring to the former president, two of his sons, and his business associates, Engoron wrote in a 92-page ruling: “Their complete lack of contrition and remorse borders on pathological.”

“They are accused only of inflating asset values to make more money,” Engoron continued. “The documents prove this over and over again. This is a venial sin, not a mortal sin. Defendants did not commit murder or arson. They did not rob a bank at gunpoint. Donald Trump is not Bernard Madoff. Yet, defendants are incapable of admitting the error of their ways. Instead, they adopt a ‘See no evil, hear no evil, speak no evil’ posture that the evidence belies.”

In a possible silver lining for Trump, the former president has avoided the blow of an earlier order dissolving his New York business empire. Manhattan Supreme Court Justice Arthur Engoron wrote that his prior ruling “is hereby modified solely to the extent of vacating the directive to cancel defendants’ business certificates.” By retracting this more controversial part of his earlier order, Justice Engoron may have also helped insulate his decision from the possibility of a reversal on appeal.

Capping off a years-long saga, the judge’s order finds that the former president fraudulently inflated his wealth by hundreds of millions to billions of dollars a year on financial statements. The Trump Organization sent those statements to banks and insurance companies to win favorable terms on loans and coverage, trial evidence showed.

Trump’s lawyers have long insisted that the case had no victims or damages — and that Deutsche Bank, Zurich, and other entities all profited from the deals at issue in the case. Attorney General James denied that the case was victimless, arguing that Trump effectively cheated Deutsche Bank out of an estimated $168 million by gaining low interest rates though a false portrait of his wealth. James also accused Trump of defrauding New Yorkers and Washingtonians by using fraudulent statements to win contracts for a Bronx golf course and D.C. hotel on public property.

In delivering such a heavy judgment, Engoron agreed with the estimate that Deutsche Bank lost out on nine figures more than they could have made if informed of Trump’s true wealth. The judge also appeared to agree that Trump wrongly made more than $126 million off a deal to transform the government-owned Old Post Office to the former president’s now-shuttered hotel in Washington, D.C. and roughly $60 million from the sale of a golf course in Ferry Point in The Bronx. Each category of “ill-gotten gains” comes with prejudgment interest, at a 9 percent rate determined by statute. That interest grows by the day, and the attorney general calculated it at more than $86.2 million to date.

That heavy financial penalty comes on the heels of a separate $83.3 million defamation verdict a jury ordered Trump to pay writer E. Jean Carroll, heaped on top of an earlier $5 million judgment another panel of jurors awarded her last year.

Combined, these court cases could wipe out a substantial amount of Trump’s liquid assets, which the former president described in a deposition as “substantially in excess” of $400 million, according to an analysis by Bloomberg. The financial publication’s Billionaires Index estimated Trump’s liquid assets at $600 million — adding that the former president’s “exact financial status remains famously opaque.”

Justice Engoron’s ruling is certain to go up on appeal. His earlier order finding Trump liable for fraud is already pending before the Appellate Division, First Department.

During pre-trial proceedings, Engoron remarked that the victim in the case was the integrity of New York markets.

To that end, Engoron appointed former federal judge Barbara Jones in November 2022 to act as a court-appointed monitor to oversee the Trump Organization, while the case progressed.

Earlier this year, Jones summarized her observations in a letter describing the constellation of the former president’s more than 500 corporate entities — and criticizing the company for continuing to provide “incomplete” financial information and “errors” to third parties. On Friday, Justice Engoron extended the monitor’s watch over the companies and their former executives “for a period of no less than three years.”

“However, Judge Jones’s role and duties shall be enhanced from those operative during the preliminary injunction, as her observations over the past 14 months indicate that still more oversight is required,” the ruling states.

In particular, Engoron ordered the Trump Organization to obtain prior approval from Judge Jones before submitting any financial disclosure to a third party. Judge Jones will also submit a report within 30 days “outlining the specific authority she believes that she needs to keep defendants honest,” according to the ruling.

After 18 years on the federal bench, Jones went back into private practice and has assisted courts in multiple high-profile cases involving the former president. She served as the special master assisting judges with issues of attorney-client privilege following FBI searches of the offices of two of Trump’s former lawyers: Michael Cohen and Rudy Giuliani.

When Engoron first ordered monitoring years ago, the former president’s lawyers recommended Jones for the position, but the judge noted that his lawyers “changed their tune” after she released a report slamming the Trump Organization for “errors” in their disclosures.

“Overnight, a universally respected former judge with a stellar resume, nominated by defendants themselves, joined the ranks of all those people and institutions being unfair to defendants and out to get them,” Engoron wrote in a footnote.

Engoron’s latest ruling summarizes the record of a roughly 11-week trial, consisting of 44 days of courtroom sessions. The investigation that preceded the lawsuit kicked off nearly half a decade ago with testimony by Trump’s former attorney Michael Cohen, who told Congress in early 2019 that Trump inflated his assets for financial gain. Years of criminal and civil investigations followed, and both bore fruit.

Manhattan District Attorney Alvin Bragg ultimately indicted and convicted the Trump Organization and its ex-chief financial officer Allen Weisselberg for tax fraud in August 2022. The next month, James followed through with a lawsuit against Trump, three of his adult children, Weisselberg and Jeffrey McConney, the company’s former controller. Bragg and James assisted each other on their investigations, which ran parallel with each other. Eric Trump and Donald Trump Jr remain co-defendants, but Ivanka Trump succeeded in dismissal of the lawsuit, under the statute of limitations.

In 2023, Weisselberg spent months in New York’s Rikers Island jail after pleading guilty to Bragg’s 15-count indictment, accusing him of grand larceny, scheming to defraud, and criminal tax fraud crimes. McConney was granted immunity in a separate criminal case against the Trump Organization, which was separately convicted of several felonies in a separate tax fraud trial.

For Engoron, the trial painted a particularly devastating portrait of those former executives.

“The evidence is overwhelming that Allen Weisselberg and Jeffrey McConney cannot be entrusted with controlling the finances of any business,” the ruling states. “Accordingly, this Court hereby permanently enjoins Allen Weisselberg and Jeffrey McConney from serving in the financial control function of any New York corporation or similar business entity operating in New York State.”

Back in civil court, the former president, Donald Trump Jr., Eric Trump, Ivanka Trump, Weisselberg and McConney ultimately testified in the fraud trial.

There is additional legal pain for the sons. Eric Trump and Donald Trump, Jr. have been banned from serving as an officer of a New York business for two years.

IMAGE: Judge Arthur Engoron presides over the civil fraud trial of former U.S. President Donald Trump at the New York Supreme Court on January 11, 2024 in New York City. (Photo by Jefferson Siegel-Pool/Getty Images)