New York Judge Engoron’s ruling on ex-President Trump’s civil fraud trial could entail substantial fines and constraints on his family business.
The legal battle, driven by a little-known 70-year-old law, Section 63(12), empowers the state Attorney General Letitia James to target corporate giants like Exxon Mobil, Juul, and Martin Shkreli.
In this case, James accused Trump of inflating his net worth to secure favorable loans, alleging fraud against lenders. Despite testimony from lenders expressing satisfaction with Trump as a client and no explicit evidence proving Trump’s intent to deceive banks, Section 63(12) allows James to establish fraud without the need for such specifics.
Judge Engoron previously ruled that Trump engaged in a pattern of fraud by exaggerating asset values in statements to lenders.
The law’s broad scope enables James to pursue punishments even if specific harm isn’t demonstrated, allowing her to seek the forfeiture of money obtained through fraud.
Trump’s Legal Battle Shaped by Section 63(12)
James aims to recover around $370 million from Trump, including $168 million representing the amount Trump saved on loans through inflating his net worth. Section 63(12) gives Judge Engoron wide discretion in determining penalties and imposing new restrictions on Trump and his family business.
Possible punishments include a lifetime prohibition on Trump leading any New York-based company, a five-year ban on the Trump Organization obtaining loans from New York banks, and restrictions on Trump’s adult sons’ involvement in a New York company.
Section 63(12) also allows for punitive measures such as canceling business certificates and dissolving operations. The law’s importance in the case prompted Trump to express concern about the broad authority it grants to the attorney general’s office.
Section 63(12) has played a pivotal role, enabling James to conduct a comprehensive investigation for almost three years before filing the lawsuit in 2022. As the legal battle unfolds, the law continues to shape the potential penalties and restrictions facing the former president and his family business.
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