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Judge Arthur Engoron hit Donald Trump with his biggest punishment to date on Friday, in a ruling that fined the former president $355 million for fraudulently inflating the values of his properties.
Combined with the $83 million judgment issued against Trump for defaming E. Jean Carroll, that means Trump has been fined roughly $438 million over the past four weeks.
Friday’s ruling underscored how the civil cases against Trump are still significantly damaging to the former president, endangering his business empire even as he faces four criminal trials, the first of which is set to begin next month.
Engoron found Trump liable for fraud, conspiracy and issuing false financial statements and false business records, and he barred him from serving as director of a company in New York for three years. But while he stopped short of dissolving the Trump Organization altogether, Engoron issued a blistering 93-page opinion that painted the former president as unremorseful and highly likely to commit fraud again.
“Their complete lack of contrition and remorse borders on pathological,” Engoron wrote of Trump and his co-defendants.
Here’s what to know from the decision:
The fines Engoron levied in his ruling against Trump – known as “disgorgement,” or the return of ill-gotten gains – are higher in terms of magnitude than any previous fine levied against the former president and his company.
New York Attorney General Letitia James had asked Engoron to fine Trump and other defendants $370 million, accusing them of engaging in a long-running fraud scheme of inflating Trump’s assets on his financial statements.
It came pretty close. Engoron found that the defendants’ fraud saved them about $168 million in interest, fining Trump and his companies that amount.
Engoron ruled that Trump and his companies were liable for $126 million in ill-gotten profits from the sale of the Old Post Office in Washington, DC, a contract the judge says “was obtained through the use of false SFC (statements of financial condition).”
And the judge ruled that Trump and his companies were liable for $60 million in profits from the sale of Ferry Point in the Bronx.
Engoron also wrote that Trump would be required for interest on those payments, which could potentially add as much as $100 million to the total he’s ultimately required to pay.
In addition, Trump was barred from serving as an officer or director of any New York corporation or other legal entity in New York for a period of three years.
Engoron gets the last word, and then some
Trump repeatedly attacked Engoron and the case throughout the 11-week trial on social media, outside the courtroom – and even to the judge’s face while he testified.
On Friday, Engoron got the last word, painting Trump as a “pathological” fraudster who would not stop unless forced.
“Defendants’ refusal to admit error – indeed, to continue it, according to the Independent Monitor – constrains this Court to conclude that they will engage in it going forward unless judicially restrained,” Engoron wrote.
Engoron acknowledged that the sins Trump committed – which his lawyers frequently argued had no victim because banks were repaid and often eager to do business with Trump’s company – were not as serious as some crimes. But he faulted Trump and his co-defendants for a complete lack of contrition.
“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,” the judge wrote.
Engoron even turned to poetry to make his point: “The English poet Alexander Pope (1688-1744) first declared, ‘To err is human, to forgive is divine.’ Defendants apparently are of a different mind.”
Engoron was critical of Trump’s testimony on the stand, when the former president mostly ignored questions and took the opportunity instead to give political speeches attacking the case, the attorney general and the judge. At first, Engoron tried to rein Trump in – even threatening to remove him as a witness at one point – but he eventually gave up and let Trump rant in response to the questions from the attorney general’s lawyer.
“Overall, Donald Trump rarely responded to the questions asked, and he frequently interjected long, irrelevant speeches on issues far beyond the scope of the trial,” Engoron wrote. “His refusal to answer the questions directly, or in some cases, at all, severely compromised his credibility.”
Believe it or not, it could have been worse for Trump.
The judge banned him from serving as an officer or director of a New York corporation for three years, but did not issue the so-called corporate death penalty.
In September, Engoron issued a summary judgment dissolving Trump’s business certificates in finding that Trump and his co-defendants were liable for persistent and repeated fraud.
But he pulled back from that decision – which had been put on hold pending appeal – on Friday, writing that he no longer felt it was necessary because he was putting in place two different independent monitors to oversee the company going forward.
The independent monitor installed last fall will stay in place for at least three years, Engoron ruled. In addition, he ordered an independent director of compliance should be installed at the Trump Org. at the company’s expense.
“As going forward there will be two-tiered oversight, an Independent Monitor and an Independent Director of Compliance, of the major activities that could lead to fraud, cancellation of the business licenses is no longer necessary,” Engoron wrote.
Trump’s former lawyer and fixer ‘told the truth’
Engoron recapped Michael Cohen’s theatrical trial testimony, acknowledging the credibility issues with Trump’s former lawyer and fixer.
But ultimately, Engoron said, he believed Cohen.
“Although the animosity between the witness and the defendant is palpable, providing Cohen with an incentive to lie, the Court found his testimony credible, based on the relaxed manner in which he testified, the general plausibility of his statements, and, most importantly, the way his testimony was corroborated by other trial evidence,” Engoron wrote.
Engoron pushed back on Trump’s narrative that Cohen was a star witness for the attorney general on whose credibility the case could teeter.
“Michael Cohen was an important witness on behalf of the plaintiff, although hardly the linchpin that defendants have attempted to portray him to be,” Engoron said.
While the testimony from Trump’s former fixer was compromised by his previous perjury plea in another case and some “seeming contradictions” in what he said at this trial, the judge said he believed Cohen when he testified that “Trump did not expressly direct him to reverse engineer financial statements, he ordered him to do so indirectly, in his ‘mob voice.’”
“A less-forgiving factfinder might have concluded differently, might not have believed a single word of a convicted perjurer,” Engoron also wrote. “This factfinder does not believe that pleading guilty to perjury means that you can never tell the truth. Michael Cohen told the truth.”
Trump’s eldest sons – who’ve essentially run the Trump Organization since 2017 – are barred from serving as executives in New York for two years, according to Engoron’s order.
The Trumps will have to navigate the two-year penalty as they sort out the future of the family-run real estate company that also hasn’t filled the chief financial officer or controller positions vacated by former Trump Org. execs Allen Weisselberg and Jeff McConney.
During closing arguments last month, Engoron questioned whether the attorney general presented any evidence that Trump’s eldest sons knew that there was fraud going on at the company — but ultimately found them liable for issuing false financial statements, falsifying business records and conspiracy claims.
“They also served as co-executives running the company from January 2017 to today, in which they had intimate knowledge of the Trump Organization’s business, assets, and were provided with financial updates upon request,” Engoron wrote Friday.
The judge knocked Eric Trump’s credibility in his ruling, pointing out inconsistent testimony he gave at trial.
“Eric Trump’s credibility was severely damaged when he repeatedly denied knowing that his father ever even compiled an SFC that valued his assets and showed his net worth ‘until this case came into fruition.’”
He “begrudgingly” conceded at trial that he actually knew about his father’s statements as early as 2013 “upon being confronted with copious documentary evidence conclusively demonstrating otherwise,” the judge wrote.
Engoron also said Eric Trump unconvincingly tried to distance himself from some appraisals of Trump Org. properties that offered a much lower valuation than reported on Donald Trump’s financial statements.
Eric and Donald Trump Jr. were both ordered to pay more than $4 million in disgorgement, or “ill-gotten” profits, they personally received from the 2022 sale of Trump’s hotel at the Old Post Office building in Washington DC.
Ivanka Trump gets to keep her profits on the building sale because she was dismissed as a defendant in the case by an appeals court ahead of trial. But that didn’t stop Engoron from weighing in on her trial testimony, calling it “suspect.”
“Ivanka Trump was a thoughtful, articulate, and poised witness, but the Court found her inconsistent recall, depending on whether she was questioned by OAG or the defense, suspect,” Engoron wrote. “In any event, what Ms. Trump cannot recall is memorialized in contemporaneous emails and documents; in the absence of her memory, the documents speak for themselves.”
Trump reacts after judge orders him and companies to pay $355 million
Trump’s attorneys have already appealed Engoron’s summary judgment last year that found the former president liable for fraud – and Trump’s attorneys are already planning to appeal this decision, too.
Trump attorney Christopher Kise responded to Engoron’s ruling in a statement on Friday, saying the court “ignored the law, ignored the facts.”
Kise added Trump will appeal and “remains confident the Appellate Division will ultimately correct the innumerable and catastrophic errors made.”
During the 11-week trial, Trump’s attorneys repeatedly criticized Engoron’s handling of the case and raised objections “for the record” and a potential appeal.
Engoron often acknowledged the likelihood of an appeal during the trial, raising his concerns with a reversal with the attorney general’s lawyers when he allowed the testimony of certain witnesses the AG objected to as part of Trump’s defense.
The reality is that the ruling is likely to be tied up in the courts on appeal for a long time, and Engoron’s ruling Friday was written with an eye toward surviving an appellate challenge.
This story has been updated with additional details.
