Legal pressure on Trump increases with judge’s order in fraud inquiry

A New York judge Friday increased pressure on former President Donald Trump’s family business and several associates, ordering them to give state investigators documents in a civil inquiry into whether the company misstated assets to get bank loans and tax benefits.

It was the second blow that the judge, Arthur F. Engoron of state Supreme Court in Manhattan, had dealt to Trump’s company in recent weeks.

In December, he ordered the company, the Trump Organization, to produce records that its lawyers had tried to shield, including some related to a Westchester County, New York, property that is among those being scrutinized by the New York state attorney general, Letitia James.

On Friday, Engoron went further, saying that even more documents, as well as communications with a law firm hired by the Trump Organization, had to be handed over to James’ office. In doing so, he rejected the lawyers’ claim that the documents at issue were covered by the attorney-client privilege.

The ruling was a fresh reminder that Trump — who left office about a week ago under the cloud of impeachment and is headed for a Senate trial on a charge of “incitement of insurrection” after his supporters stormed the Capitol in a violent rampage — faces significant legal jeopardy as a private citizen.

The most serious threats confronting the former president include a criminal investigation by the Manhattan district attorney and the civil inquiry by the attorney general into possible fraud in Trump’s business dealings before he was elected.

James’ investigation began in March 2019, after Michael Cohen, the former president’s onetime lawyer, told Congress that Trump had inflated his assets in financial statements to secure bank loans and understated them elsewhere to reduce his tax bill.

Investigators in James’ office have focused their attention on an array of transactions, including a financial restructuring of the Trump International Hotel & Tower in Chicago in 2010 that resulted in the Fortress Credit Corp. forgiving debt worth more than $100 million.

James’ office has said in court documents that the Trump Organization — Trump’s main business vehicle — had thwarted efforts to determine how that money was reflected in its tax filings, and whether it was declared as income, as the law typically requires.