Manhattan prosecutors target Trump's financial statements to outside accountants and lenders: Fraud probe zeroes in on potentially false or misleading statements ex-president made about his property value
Manhattan prosecutors in the Southern District of New York are reportedly narrowing their investigation into Donald Trump and his family business to focus on whether he mislead lenders and accountants outside of his company with bloated evaluations of his financial assets.
The office led by District Attorney Cyrus Vance is looking specifically at Trump's financial documents that he used to obtain loans and reflect his wealth, sources told the New York Times in a Tuesday report.
Vance's team is working alongside New York Attorney General Letitia James, who reportedly looking for Trump's testimony in a separate civil probe she's also running.
The report claims investigators are looking at the possibility that Trump and his deputies 'cherry-picked' more positive data and ignored bleaker information in statements used to obtain loans.
Trump ripped James and 'other highly partisan' investigators in a Wednesday morning statement ridiculing the New York AG for dropping out of the governor's race.
The ex-president lamented 'how unfairly and viciously she and other highly partisan New York Democrat prosecutors were treating President Donald J. Trump,' adding that 'it’s called Prosecutorial Misconduct.'
'New York is dying before our very eyes, and all the Democrat Prosecutors are focused on is how we can get and punish Donald Trump, who many would say has done, over the years, a spectacular job for New York!' Trump declared.
An employee of top accounting firm Mazars USA, which has long handled the ex-president's corporate and private tax returns, appeared in front of a grand jury assembled by DA Vance earlier this year.
Mazars accountant Donald Bender had been responsible for handling the Trump Organization's financial information for years.
He came before the grand jury for a brief testimony in recent weeks, sources told the Washington Post, and could be called to testify again as prosecutors look for someone to provide context to the myriad of documents they've already obtained about the Trump Organization.
Mazars handed over Trump's tax returns and other data to the SDNY in February after a lengthy court battle delayed investigators' subpoena for about a year and a half.
Prosecutors have also recently summoned the former managing director at Deutsche Bank, which used to be Trump's biggest lender, for an interview, the Post reported yesterday.
Attorneys at Manhattan DA Cyrus Vance's (left) office spoke with two people linked to Trump's financial reporting but are not part of the Trump Organization, reports claimed. Vance's team is working alongside New York Attorney General Letitia James (right), who is also conducting her own separate civil probe into the ex-president
Rosemary Vrablic had a hand in loaning Trump millions of dollars on Deutsche Bank's behalf over the years. She reportedly spoke to prosecutors directly rather than giving grand jury testimony.
Both Bender and Vrablic were summoned to give statements to help prosecutors gain a clearer picture of the documents they've already obtained, the reports note.
Financial statements like those Trump provided to obtain loans on golf courses, offices or other real estate are common for businesses to be able to keep track of their assets.
With information provided by Trump Organization employees, Mazars would assemble those statements, which reportedly began with a page-long list of Trump's various assets from homes to cash to pageants he ran next to their dollar value.
Valuations involved looking at comparable assets like the recent selling prices of similar real estate.
One of the people recently summoned was Donald Bender, an accountant at Mazars USA, a top firm that's worked with Trump for years
But prosecutors are reportedly looking at whether Trump's people discarded estimates and sales on the lower end of the spectrum and only focused on his most valuable properties.
A copy of his 2012 financial statements includes a cover letter from Mazars which ends with: 'Users of this financial statement should recognize that they might reach different conclusions about the financial condition of Donald J. Trump.'
Though he didn't prepare the information Trump also allegedly would add his own notes and disclaimers in addition to Mazars', including referring to his valuations as just 'estimates.'
And while the cover sheets to Trump's statements make clear that they're his responsibility, language inserted by Mazars accountants further hedge their data.
'Donald J. Trump is responsible for the preparation and fair presentation of the financial statement in accordance with accounting principles generally accepted in the United States of America,' the letter reportedly reads.
They also add a common disclaimer that the company had not 'audited or reviewed' the data and 'do not express an opinion or provide any assurance about' it.
According to the Times the accountants also flagged that they'd 'become aware of departures from accounting principles generally accepted in the United States of America.'
A statement from the year before omits his Chicago hotel altogether along with significant debts Trump held at the time.
But while the numbers could give prosecutors ammunition to argue Trump intentionally misled lenders, the numerous addendums and disclaimers could help his case, the report claims.
Trump's lawyers could argue that no seasoned lender would take his statements at face value, and even if they were misleading, subsequent assessments made by the lenders themselves would have deemed him worthy of the loans.
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