Engoron, in agreeing to appoint a monitor, barred the Trump Organisation from selling or transferring any noncash assets without giving the court and James’ office 14 days’ notice. The to-be-named monitor will be charged with ensuring the company’s compliance and will immediately report any violations to the court and lawyers for both sides.
The Trump Organisation must also grant the monitor access to its financial statements, asset valuations and other disclosures must provide a full and accurate description of the company’s structure and must give the monitor at least 30 days’ notice of any potential restructuring, refinancing or asset sales, Engoron said.
It’s just the latest ruling Engoron has made against Trump or Trump-related interests.
While presiding over disputes over subpoenas issued in James’ investigation, the judge, a Democrat, held Trump in contempt and fined him US$110,000 ($190,000) after he was slow to turn over documents, and he forced him to sit for a deposition. In that testimony, Trump invoked his Fifth Amendment protection against self-incrimination more than 400 times.
Messages seeking comment were left with lawyers for Trump and the Trump Organisation.
James’ senior enforcement counsel, Kevin Wallace, said at a hearing preceding Engoron’s decision that they were seeking “limited” oversight and wouldn’t want the monitor involved in intricacies, such as how many rounds of golf or hotel rooms they were booking in a given year.
“Our goal in doing this is not to impact the day-to-day operations of the Trump Organisation,” Wallace said.
“The Trump Organisation has a persistent record of not complying with existing court orders,” Wallace said.
“It should not be incumbent on the court or the attorney general to spend the next year looking over their shoulder, making sure assets aren’t sold or the company restructured.”
Trump sued James in Florida on Wednesday, seeking to block her from having any oversight over the family trust that controls his company. Trump’s 35-page complaint rehashed some claims from his previously dismissed lawsuit against James in federal court in New York, including that her investigation of him is a “political witch hunt”.
Wallace said at the hearing that James’ office is seeking to stop “fraudulent activities that are ongoing at the Trump Organisation” and wants safeguards in place so that the company can’t just sell off assets, such as Trump Tower and an office building at 40 Wall Street, that could eventually be used to pay a potential lawsuit judgment.
Trump Organisation lawyer Christopher Kise responded the company has “no intention” to divest those properties, which together he says conservatively have a value of at least US$250 million. The “Trump entities are not going anywhere”, he added.
Kise argued that James’ lawsuit was much ado about common, good-faith disagreements in the real estate industry. If banks that loaned Trump money felt he or the company had acted improperly, they would have spoken up, Kise said.
“There’s no problem. There’s no case here,” Kise said.
“It’s mind-numbing that we’re going to have a receiver insert himself or herself into these complex transactions instead of the owner of this real estate.”
Engoron took issue with at least one aspect of Kise’s reasoning, asking him if there was really a “good-faith disagreement” when Trump claimed his Trump Tower penthouse was three times its actual size, and US$200m more valuable.
As for the new Trump entity that drew concern from James’ office, Kise said the company — listed in a New York corporate filing as Trump Organisation II — had nothing to do with dodging potential penalties from James’ lawsuit, but rather “consolidation of payroll issues that have arisen in other contexts”.
Kise didn’t offer additional details. The Trump Organisation’s payroll practices are among the issues being raised at the company’s Manhattan criminal fraud trial, which was halted Tuesday and is expected to resume Monday after a witness tested positive for Covid-19.
