Donald Trump’s real estate empire under threat after New York fraud ruling
Good morning, US politics blog readers. On Tuesday, a judge found that Donald Trump’s business empire was built, at least in part, on rampant fraud. Justice Arthur Engoron of the New York state court in Manhattan said Trump and his adult sons, Eric and Donald Jr, wildly inflated the value of his properties to hoodwink banks, insurers and others.
The ruling came in a civil lawsuit brought by Letitia James, New York’s attorney general, days before the start of a non-jury trial that will hear accusations that Trump, and the Trump Organization, lied for a decade about asset values and his net worth to get better terms on bank loans and insurance.
James has said Trump had effectively engaged in a “bait and switch” operation, inflating his net worth by as much as $2.23bn, and by one measure as much as $3.6bn, on annual financial statements given to banks and insurers.
Assets whose values were inflated include his office buildings and golf courses, his Mar-a-Lago estate in Florida and his penthouse apartment at Trump Tower in New York, which he claimed was 30,000 sq ft, nearly three times its actual size, resulting in an overvaluation of as much as $207m.
The decision will make it easier for James to establish damages at a civil trial due to start next week; she is seeking a penalty of about $250m. Engoron ordered the cancellation of certificates that let some of Trump’s businesses, including the Trump Organization, operate in New York – just possibly the beginning of the end of his empire.
If the judge’s scathing decision withstands an appeal from Trump’s lawyers, it will be the first time a government investigation into the former president has resulted in punishment. It will also deal the biggest blow yet to his persona as a successful tycoon.
Meanwhile, the former president is expected in Detroit today to address autoworkers. His visit comes a day after Biden made a rousing speech, telling striking workers they deserved higher pay.
Here’s what else we’re watching today:
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9am Eastern time: The House convenes. SEC chair Gary Gensler will testify before the financial services committee at 10am. The ways and means committee will meet in an executive session to discuss releasing new Hunter Biden/IRS whistleblower info at 10.30am.
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10am: The Senate meets.
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1.30pm: Joe Biden will convene a meeting with his advisers on science and tech in San Francisco.
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1.30pm: Republican senators Lindsey Graham, John Kennedy, Thom Tillis, Marsha Blackburn, Ted Cruz, Katie Britt and John Cornyn will hold a news conference about the border.
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2pm: Senate majority leader Chuck Schumer will hold his weekly news conference, where he may deliver remarks on embattled New Jersey senator Bob Menendez’s political future.
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8pm: Donald Trump is expected to skip the second GOP primary debate and instead address striking auto workers in Michigan.
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9pm: Republicans will hold their second presidential debate at Ronald Reagan Presidential Library. Seven candidates are set to take part – Florida governor Ron DeSantis, former South Carolina governor Nikki Haley, South Carolina senator Tim Scott, entrepeneur Vivek Ramaswamy, former vice-president Mike Pence, former New Jersey governor Chris Christie and North Dakota governor Doug Burgum.
Key events
Jared Kushner pressured the Washington Post to fire its editor over coverage of the Russia election interference investigation, a new book says.
The Guardian’s Martin Pengelly reports:
Donald Trump’s son-in-law and senior White House adviser, Jared Kushner, tried to persuade the publisher of the Washington Post to fire its editor over coverage of the Russia investigation, that editor, Marty Baron, writes in a new book.
“With no delay and without pause during his four years as president,” Baron writes, “Trump and his team would go after the Post and everyone else in the media who didn’t bend to his wishes.
“In December 2019, Kushner would lean on [Fred] Ryan to withdraw support for me and our Russia investigation.
“… ‘He aims to get me fired,’ I told Ryan.”
Baron’s book, Collision of Power: Trump, Bezos and the Washington Post, will be published next Tuesday. The Guardian obtained a copy.
For the full story, click here:
Joe Biden approves Louisiana emergency declaration
President Joe Biden has approved an emergency declaration in Louisiana due to the emergency conditions resulting from the seawater intrusion that began on September 20.
The White House announced in a statement on Wednesday:
The President’s action authorizes the Department of Homeland Security, Federal Emergency Management Agency (FEMA), to coordinate all disaster relief efforts which have the purpose of alleviating the hardship and suffering caused by the emergency on the local population.
The declaration is also set to “provide appropriate assistance for required emergency measures, authorized under Title V of the Stafford Act, to save lives and to protect property and public health and safety, and to lessen or avert the threat of a catastrophe in the parishes of Jefferson, Orleans, Plaquemines, and St. Bernard”, it added.
Last Friday, New Orleans’ mayor, LaToya Cantrell, signed an emergency declaration after saltwater from the Gulf of Mexico started seeping its way through the Mississippi River in Louisiana.
The concern comes as the saltwater makes its way into the drought-hit river as it could potentially affect thousands of residents’ drinking water in the following weeks.
Interim summary
It is slightly past 1pm in Washington DC. Here is where the day stands:
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The speaker of the House, Kevin McCarthy, said he would not allow a vote on a bipartisan Senate stopgap funding bill that would avert a government shutdown. At a closed-door meeting this morning, McCarthy urged House GOP members to work together to approve their own temporary measure to keep the government open past the Saturday deadline.
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New Jersey senator Bob Menendez pleaded not guilty to charges of taking bribes from three New Jersey businessman as he appeared in a federal courthouse in New York on Wednesday. Menendez entered the plea at a hearing before US magistrate judge Ona Wang in Manhattan. His wife, Nadine Menendez, and co-defendants Jose Uribe and Fred Daibes also pleaded not guilty.
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Senate majority leader Chuck Schumer urged House speaker Kevin McCarthy to use bipartisanship to avert a government shutdown that could force millions of federal employees to go without pay. NBC reported Schumer as saying: “The only way out of a shutdown is bipartisanship, and by constantly adhering to what the hard right wants, you’re aiming for a shutdown.”
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A New York judge ruled on Tuesday that Donald Trump committed financial fraud by overstating the value of his assets to broker deals and obtain financing. The ruling is an acceleration of the case the New York attorney general, Letitia James, has been building against Trump since 2019.
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The United Auto Workers president, Shawn Fain, who appeared beside Joe Biden at a picket line in Michigan on Tuesday, said he will not meet with Donald Trump during his upcoming visit to Detroit. In an interview with CNN on Tuesday evening, Fain said it was a “pathetic irony” that Trump would hold a rally for union members at a non-union business.
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US soldier Travis King, who fled to North Korea in July, is in American custody after being expelled by Pyongyang into China, according to US officials. North Korea’s KCNA state news agency said King had been expelled after he confessed to illegally entering the country.
Robert Tait
Donald Trump will attempt to woo blue-collar workers in Michigan in an intensifying political tug-of-war with Joe Biden a day after the sitting president visited a picket line to declare support for a trade union strike against the US’s three flagship carmakers.
Targeting working-class voters in the key battleground, the former president will attempt to upstage Tuesday’s appeal by Biden to union members on the frontline of the United Auto Workers (UAW) strike, which is turning into a proxy struggle for next year’s presidential election.
Trump will address about 500 workers, including UAW members, at Drake Enterprises, a non-unionised car parts maker in Macomb county, a few miles from where Biden spoke to striking employees picketing a Ford facility.
Trump has emitted a sympathetic feeling towards workers striking against Ford, General Motors and Stellantis without explicitly endorsing their demands for a 40% pay rise, shorter working hours and better pensions – which polls show a majority of Americans support.
Instead, he has accused the UAW’s leadership of selling its members “down the river” and attacked Biden’s clean energy policy of incentivizing the three car giants to convert to manufacturing electric vehicles.
David Smith
None of the series of tax revelations or reports about Donald Trump seems likely to shake the Trump faithful ahead of next year’s presidential election against Joe Biden.
Their instant assumption is that politically biased judges are trying to distract attention from Hunter Biden’s troubles and that Trump is merely smarter than others when it comes to gaming the system.
At a campaign rally in Dubuque, Iowa, last week, Mathew Willis, 41, said:
I’ve never seen him be anything but honest. During a debate at one point, they were like, ‘Oh, you don’t pay your taxes,’ and he’s like, ‘Neither do you! I use the legal system to do what I do. The loopholes are there. They put them there for people like you and us. I’m just working the system.’ He’s not doing anything illegal. What’s wrong with that?
Letitia James, New York’s attorney general, released a statement following the judge’s ruling in her lawsuit against Donald Trump on Tuesday.
The statement, reported by CNN, said:
Today, a judge ruled in our favor and found that Donald Trump and the Trump Organization engaged in years of financial fraud. We look forward to presenting the rest of our case at trial.
Trump’s attorney, Christopher Kise, called the ruling “completely disconnected from the facts and governing law”, adding:
While the full impact of the decision remains unclear, what is clear is that President Trump and his family will seek all available appellate remedies to rectify this miscarriage of justice.
Donald Trump’s son Eric Trump insisted his father’s claims about the value of his Mar-a-Lago estate were correct, writing that the Palm Beach estate is “speculated to be worth well over a billion dollars making it arguably the most valuable residential property in the country”.
Judge Arthur Engoron, ruling in a civil lawsuit brought by New York attorney general, Letitia James, found that the former president consistently overvalued Mar-a-Lago, inflating its value on one financial statement by as much as 2,300%.
Posting on X, formerly known as Twitter, Eric Trump called the ruling “an attempt to destroy my father and kick him out of New York”.
In an attempt to destroy my father and kick him out of New York, a Judge just ruled that Mar-a-Lago, in Palm Beach Florida, is only worth approximate “$18 Million dollars”… Mar-a-Lago is speculated to be worth we’ll over a billion dollars making it arguably the most valuable… pic.twitter.com/b0U6J5ykWJ
— Eric Trump (@EricTrump) September 26, 2023
While everyone can see that this case is egregious, the only thing worse than weaponizing the legal system against a political opponent is unfairly going after their family. Both the Attorney General and the Judge know I had absolutely NOTHING to do with this case. Every single…
— Eric Trump (@EricTrump) September 27, 2023
Donald Trump rallied against the ruling by a New York judge that he committed financial fraud by overstating the value of his assets to broker deals and obtain financing.
Writing on his Truth Social platform, Trump said the decision was “un-American” and part of an ongoing plot to damage his campaign to return to the White House. He wrote on Tuesday:
My Civil rights have been violated, and some Appellate Court, whether federal or state, must reverse this horrible, un-American decision.
He insisted his company had “done a magnificent job for New York State” and “done business perfectly”, calling it “A very sad Day for the New York State System of Justice!”
McCarthy says he ‘doesn’t see the support’ in House for Senate stopgap bill to avert shutdown
The speaker of the House, Kevin McCarthy, said he would not allow a vote on a bipartisan Senate stopgap funding bill that would avert a government shutdown.
At a closed-door meeting this morning, McCarthy urged House GOP members to work together to approve their own temporary measure to keep the government open past the Saturday deadline.
McCarthy set up a test vote on Friday, a day before the shutdown deadline, on a far-right bill, AP reported. It would slash federal spending by 8% from many agencies and toughen border security but has been rejected by Joe Biden, Democrats and his own right-flank Republicans.
McCarthy, speaking to reporters after the meeting, rejected outright the Senate’s bipartisan bill, which would fund the government to 17 November, adding $6bn for Ukraine and $6bn for US disaster relief while talks continue. He said he didn’t “see the support in the House” to pass the Senate’s bill.
Speaker Kevin McCarthy says he had a “good conference” with House GOP, and hopes the House will pass 4 appropriation bills “by Thursday.”
“The next 5, we’re gonna need more time. So, we will pass a CR — bring that rule up hopefully on Friday — that would keep government open.” pic.twitter.com/XQIqTtgujC
— The Recount (@therecount) September 27, 2023
Carter Sherman
Abortion rights supporters and foes will square off in the Ohio supreme court on Wednesday over whether the state should be allowed to ban abortion as early as six weeks into pregnancy, before many people even know they are pregnant.
Arguments in the case arrive just weeks before Ohio will become the only state in the United States to vote directly on abortion in 2023. On 7 November, voters will have the chance to decide whether to enshrine abortion rights in the state’s constitution.
If the Ohio supreme court rules to reinstate the state’s six-week ban, which is currently paused, it could throw the election – and abortion providers across the midwest – into chaos.
First passed in 2019, before the US supreme court overturned Roe v Wade and abolished the national right to abortion, the six-week ban was put on hold. But once Roe fell last year, the ban snapped into place.
In court documents, Ohio abortion providers spoke of encountering patients who could not get cancer treatments while pregnant, people who threatened suicide if they could not get abortions, and women whose pregnancies had fetal anomalies so serious that they would never result in healthy babies.
As the ban does not have exceptions for rape or incest, multiple children also had to flee the state for abortions after being raped, according to court records. One 10-year-old rape victim’s case continues to make national headlines.
Senator Bob Menendez pleads not guilty to corruption charges
New Jersey senator Bob Menendez pleaded not guilty to charges of taking bribes from three New Jersey businessman as he appeared in a federal courthouse in New York on Wednesday.
Menendez entered the plea at a hearing before US magistrate judge Ona Wang in Manhattan. His wife, Nadine Menendez, and co-defendants Jose Uribe, and Fred Daibes, also pleaded not guilty. A third businessman, Wael Hana, pleaded not guilty on Tuesday.
Julian Borger
Travis King, an American soldier who fled across the border from South Korea to North Korea in July, is back in US custody, US officials have confirmed.
According to senior administration officials, King crossed the Chinese border on Wednesday, and Chinese authorities handed him to the US embassy, who then arranged for the army private to be flown to a US military base.
US officials briefing the press on Wednesday did not comment on his motivations but insisted he had returned willingly. A senior US official said:
We can confirm that Private King was very happy to be on his way home. That has been quite clear as we have resumed our contact with him, and he is very much looking forward to being reunited with his family.
On the issue of any legal or disciplinary action King might face on the return to the US, a US official said that would be considered after a medical and psychological assessment.
“When he arrives on US soil, he will be evaluated by [a] very talented, experienced team that are going to guide him through a reintegration process,” the official said.
They’ll address any medical and emotional concerns and ensure we get him in a good place to reunite with his family…and we’ll work through all those administrative status questions following completion of his reintegration.
California congressman Ted Lieu accused House speaker Kevin McCarthy of having gone back on his word over the funding deal outlined in the Fiscal Responsibility Act, which passed the House and the Senate with bipartisan support earlier this year.
That agreement, brokered between Joe Biden and McCarthy, suspended the debt ceiling and outlined modest spending cuts for fiscal year 2024, but those cuts were deemed insufficient by members of the hard-right House Freedom Caucus.
That deal “wasn’t just a handshake agreement,” Lieu said at a news conference with House Democratic leadership.
Democrats, Republicans disagree on many issues. We work together on various issues but in this town, your word still matters. How do we, the American people, trust Kevin McCarthy if he simply goes back on a deal that was put into law?
He urged the speaker to “simply honour the deal that he made” and to “start taking steps to rebuild his integrity”.