LAS VEGAS (KLAS) — The New York Attorney’s General’s civil lawsuit filed against former President Donald Trump, the Trump Organization and three of the former president’s children includes allegations of undervaluing or overvaluing properties across the country, including the Trump hotel in Las Vegas.
The lawsuit filed Wednesday accuses the former president and senior management at the Trump Organization of purposely misleading the value of assets to obtain more-favorable loans and business deals from 2011 to 2021. It details dozens of instances of alleged fraud, many involving claims made on annual financial statements that Trump would give to banks, business associates and financial magazines.
The filing includes Trump’s Las Vegas property, the Trump International Hotel and Tower, which is partly owned by Phil Ruffin. The tower, which includes hotel rooms, timeshare units and condominiums, opened in 2008.
Before 2013, business statements omitted the former president’s interest in the property, the lawsuit said, adding “Mr. Trump asserted that the property had no value.” After 2013 and until 2021, the statements listed misleading values, the lawsuit said.
“Mr. Trump repeatedly submitted lower property valuation estimates to Nevada tax authorities and higher property valuations on his statements,” a statement from the office said.
“From 2013 through 2021, the statements listed an inflated value for the property using some of the same deceptive techniques Mr. Trump and the Trump Organization used to fraudulently inflate valuations of Mr. Trump’s other properties, including failing to discount future cash flows and projecting future income from the sale of residential units that assumed prices well in excess of what the units were actually selling for in the marketplace, while ignoring the values derived and methods used in earlier appraisals that were never disclosed,” the lawsuit said.
The lawsuit specifically mentions Eric Trump in regard to the Las Vegas property and his comments after an appraiser found the value of unsold residential units in the tower was about $111 million, less than the outstanding loans payable at the time.
“After receiving this appraisal from outside tax counsel, Eric Trump wrote, ‘I take it you are happy with the work?’ [An] attorney replied, ‘I am happy with the work and think the [Clark County Board of Equalization and the Nevada State Board of Equalization] will buy the value… I am optimistic,’” the lawsuit said.
An outside tax attorney also emailed Eric Trump, saying, “Here is the appraisal of the hotel unit at just under $25 million. I had asked [the appraiser] to come in around $20 million but you were making too much money for him to get that low,” the lawsuit said.
“By using the fraudulent valuation methods and assumptions described above, the Trump Organization was able to inflate the value of Trump Vegas in each of the years from 2013 to 2016,” the lawsuit said.
In the filing, prosecutors said Eric Trump invoked his Fifth Amendment right regarding “his participation in the drafting of each of the 2013 through 2016 statements.”
Another example, according to the lawsuit, the former president claimed his Trump Tower apartment, a three-story penthouse replete with gold-plated fixtures, was nearly three times its actual size and valued the property at $327 million.
The Trump Organization is set to go on trial in October in a criminal case alleging that it schemed to give untaxed perks to senior executives, including its longtime finance chief Allen Weisselberg, who alone took more than $1.7 million in extras.
Weisselberg, 75, the Trump Organization’s former chief financial officer, pleaded guilty Aug. 18. His plea agreement requires him to testify at the company’s trial before he starts a five-month jail sentence. If convicted, the Trump Organization could face a fine of double the amount of unpaid taxes.
Trump’s previous refusal to answer questions in testimony could be held against him if a lawsuit ever reaches a jury. In civil cases, courts are allowed to draw negative inferences from such Fifth Amendment pleadings.
Ruffin is not named in the lawsuit and there are no allegations against him. The lawsuit only mentions him as a co-owner of the property.
The Associated Press contributed to this report.