In a ruling on a months-long civil suit brought against Mr. Trump and his businesses by New York Attorney General Letitia James (D), Judge Arthur F. Engoron ruled that Mr. Trump was a director of any company in New York. or prohibited from serving as a director for three years. He banned Trump's eldest son Donald Trump Jr. and Eric Trump from activities for two years.
Trump Organization, President Trump's namesake company, The company is already operating without a chief financial officer or administrator, according to the ruling.
“There's no one at the financial helm. There's no CFO, there's no management, and now it's not Eric Trump, Donald Trump Jr., Donald Sr. running the company.” said Brian Quinn, a law professor at Boston University.
Whoever takes over the company will face many challenges in the short term.
After it was revealed that Trump Organization executives engaged in a years-long fraudulent scheme of inflating asset values to obtain better insurance and tax rates. Engoron ordered the company to operate under the close supervision of two supervisors, a monitor and an independent compliance director, to ensure compliance with its financial reporting obligations.
In other words, Trump can remain the owner, but he has lost control.
The ruling also prohibits many of the company's divisions directly involved in the ruling from seeking loans from financial institutions registered in New York state for three years. This includes entities associated with the company's office building at 40 Wall Street and its hotel. Chicago, and the Trump Organization itself.
Unless overturned on appeal, he will have to pay hefty fines and fines. Engoron ordered Trump to pay $354 million in penalties for fraudulently obtained real estate transactions, including property sales. The figure, calculated by the attorney general's office at a luxury hotel in Washington, D.C., was nearly $100 million, matching the interest President Trump has earned on those profits since May 2022. Each of his adult sons was ordered to pay more than $4 million, matching the profits. They profited from the sale of a Washington, D.C., hotel, while the Trump Organization's former financial chief was ordered to pay $1 million.
Since Trump entered politics, He's running for the White House again and is closing in on the Republican presidential nomination — He moved some of his assets from real estate development to a more liquid cash position, according to financial filings with the government.
The Bloomberg Billionaires Index recently estimated Trump's net worth at $3.1 billion, with about $600 million in cash.Fines and fines imposed by Engoron It could eat up more than half of its wealth accumulated over the years, and could prompt it to sell more properties if it wants to free up cash. Last year, Forbes lowered its estimate of the former president's net worth to $2.5 billion, $600 million less than its previous estimate.
“The financial sanctions being imposed on President Trump and the Trump Organization are likely to severely strain President Trump's business in an unprecedented way,” said former top official and New York Law School professor Stephen. said Adjunct Professor M. Cohen. New York Attorney General's Office officials said, citing Friday's decision and the recent $83.3 million verdict in the E. Jean Carroll defamation case.
Cohen said that before Trump can appeal Engoron's decision, he must post bail that covers the full amount owed in fines and interest. He added that the recent ruling is a “one-two punch that I think is going to start causing real problems” for Trump's family business.
In response to the ruling, President Trump wrote on his social networking site Truth Social that the fine was “exorbitant” and “based on nothing other than building a great company.” Ta. Clifford S. Robert, a lawyer for President Trump's two eldest sons, called the decision a “grave injustice” and said he was confident it would be overturned on appeal.
Mr. Trump still has the ability to make significant profits from his golf courses, hotels and resorts, as well as speaking engagements and other promotional ventures.A Washington Post investigation last July showed his profits at about $1 billion. since the end of his presidential term. And on Thursday, Truth Social's parent company won a key merger approval that could give President Trump a stake worth nearly $4 billion, based on recent stock prices.
In a silver lining for Trump on Friday, Engoron revoked his previous order revoking all of Trump's business “certificates” in the state. Experts say the order, which is already pending in an appeals court, would have forced President Trump to sell or give away landmark New York real estate, including Trump Tower.
The former president did not say Friday who would lead his company if the Engoron administration's ruling ousts Trump's son Eric, who has run the Trump Organization since 2017. Donald Trump may turn to other Trumps to keep his company in the hands of his family. His daughter Ivanka was a senior real estate executive before leaving politics. Her husband, Jared Kushner, has a background in real estate. Perhaps Donald Trump's wife, former first lady Melania, would want to try it.
Otherwise, Quinn said, the company may have to evolve away from the model that brought success and notoriety for generations.
“This is going to be a completely different business,” Quinn said. “It won't be a family business. It might be a family business, but it won't be a family business for the next few years.”
Shayna Jacobs in New York contributed to this report.
