New York attorney general ‘actively investigating’ Trump Organization in a ‘criminal capacity’

President Trump paid little to no federal income taxes in recent years, according to the first series of New York Times stories on his tax returns. USA TODAY

ALBANY, N.Y. – A New York state investigation looking into whether the Trump Organization illegally inflated the value of its properties is now examining whether any criminal misdeeds occurred.

For more than two years, New York Attorney General Letitia James’ office has been investigating former President Donald Trump and his company after former Trump attorney Michael Cohen claimed they fraudulently boosted property values to obtain tax breaks and better terms on loans and insurance.

Until recently, that probe had been strictly civil in nature. But by Tuesday, things had changed.

A spokesman for James acknowledged her office is now investigating the Trump Organization for potential criminality, a major shift that could lead to charges if investigators uncover wrongdoing.

James’ office is now working with Manhattan District Attorney Cy Vance, whose office has been conducting a separate criminal probe and is in possession of many Trump-related tax returns.

“We have informed the Trump Organization that our investigation into the organization is no longer purely civil in nature,” James spokesman Fabien Levy said in a statement first reported late Tuesday by CNN. “We are now actively investigating the Trump Organization in a criminal capacity, along with the Manhattan (district attorney).”

Former President Donald Trump is pictured listening during a “National Dialogue on Safely Reopening America’s Schools” White House event in 2020. The New York attorney general’s office said Tuesday that it is conducting a criminal investigation into Trump’s business empire, expanding what had previously been a civil probe.

 (Photo: Alex Brandon, AP)

Levy declined further comment. The Trump Organization could not immediately be reached for comment late Tuesday.

New York AG’s Trump investigation dates back to 2019

James launched her investigation after Cohen provided documents and testimony to Congress in 2019.

At the time, Cohen — who had a falling out with Trump — claimed Trump regularly inflated the value of his properties and his net worth in order to get better insurance and loan rates.

In August, James’ office filed documents in court signaling the investigation had zeroed in on four properties: the Seven Springe estate; 40 Wall Street in Manhattan; the Trump International Hotel and Tower Chicago; and the Trump National Golf Club in Los Angeles.

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Trump purchased the Seven Springs property for $7.5 million in 1995, trying and failing at various points to develop portions of it into luxury housing and a golf course. The property includes two mansions and cuts through the Westchester towns of Bedford, North Castle and New Castle.

In 2015, Trump agreed to conservation easement that saw him pledge not to develop 159 acres of Seven Springs, a decision that came with significant tax benefits.

According to the August court documents, James’ office was examining whether Trump and his company fraudulently boosted the assessed value of the sprawling Westchester property, allowing one of his limited liability companies to claim the easement was worth a $21.1 million tax exemption on forms submitted to the IRS.

AG, Trump have clashed before

James’ office and the Trump Organization has clashed over the investigation and attempts to wrestle free documents and testimony.

In September, New York Supreme Court Justice Arthur Engoron of Manhattan ordered Eric Trump, the president’s son and executive vice president of the Trump Organization, to sit for testimony under oath as part of the investigation.

At the time, the Trump Organization characterized James’ investigation as political in nature. James, a Democrat, had previously clashed with Trump, a Republican, over the Trump Foundation, which closed under a settlement with the Attorney General’s Office.

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“The Trump Organization has done nothing wrong and, as the motion papers clearly state, the NYAG has made no determination that anything was improper or that any action is forthcoming,” the Trump Organization’s August statement read.

Follow Jon Campbell onTwitter @JonCampbellGAN.

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