Donald J. Trump appeared in court as lawyers for New York’s attorney general, Letitia James, painted him as a fraudster. His lawyers said she was out to get the former president.
The trials of Donald J. Trump began Monday in a New York courtroom, where the former president arrived to fight the first of several government actions — a civil fraud case that imperils his company and threatens his image as a master of the business world.
The trial’s opening day brought Mr. Trump face-to-face with one of his longest-running antagonists: the attorney general of New York, Letitia James, who filed the case against him, his adult sons and their family business. If her office proves its case, the judge overseeing the trial could impose an array of punishments on Mr. Trump, including a $250 million penalty.
Outside the courtroom, Mr. Trump fired a fusillade of personal attacks on Ms. James and the judge, Arthur F. Engoron. He called the judge “rogue” and Ms. James “a terrible person,” even suggesting that they were criminals.
Inside, Mr. Trump sat in uncomfortable silence as Ms. James’s lawyers methodically laid out their case. The attorney general’s office accused the former president of inflating his riches by more than $2 billion to obtain favorable deals with banks and bragging rights about his wealth.
“Year after year, loan after loan, defendants misrepresented Mr. Trump’s net worth,” Kevin Wallace, a lawyer for Ms. James, said during opening statements. Exaggerating for a television audience or Forbes Magazine’s list of the richest people is one thing, he said, but “you cannot do it while conducting business in the state of New York.”
Mr. Wallace cast doubt on the value of some of Mr. Trump’s signature properties, including Trump Tower in Manhattan, laying the groundwork for a reckoning of the former president’s net worth.
Understand New York State’s Civil Case Against Trump
An empire under scrutiny. Letitia James, New York State’s attorney general, has been conducting a yearslong civil investigation into former President Donald Trump’s business practices, culminating in a lawsuit that accused Trump of “staggering” fraud. Here’s what to know:
The origins of the inquiry. The investigation started after Michael Cohen, Trump’s former personal lawyer and fixer, testified to Congress in 2019 that Trump and his employees had manipulated his net worth to suit his interests.
The findings. James detailed in a filing what she said was a pattern by the Trump Organization to inflate the value of the company’s properties in documents filed with lenders, insurers and the Internal Revenue Service.
Fraud lawsuit. In September 2022, James’s office rebuffed a settlement offer from Trump’s lawyers. Days later, she filed a lawsuit against Trump and his family business, accusing them of a sweeping pattern of fraudulent business practices.
Two key rulings. The civil trial against Trump began on Oct. 2, after a New York appeals court rejected the former president’s attempt to delay it. The decision came after the judge overseeing the case found that Trump persistently committed fraud by inflating the value of his assets and stripped him of control over some of his signature New York properties.
Possible penalties. James has argued that Trump inflated the value of his properties by as much as $2.2 billion and is seeking to recover about $250 million. The former president and his sons could also be barred from running any business in New York.
The trial, expected to last more than a month and to include testimony from Mr. Trump, coincides with the former president’s latest White House run. After Ms. James’s civil case ends, Mr. Trump will face four criminal trials that touch on a range of subjects: hush-money payments to a porn star, the handling of classified documents and his efforts to remain in power after losing the 2020 election.
Ms. James’s case, which will be decided by the judge rather than a jury, has struck a nerve with the former president. Her claims portray him as a cheat rather than a captain of industry and undercut an image he constructed while he catapulted from real estate to reality television fame and ultimately the White House.
For now, though, government scrutiny has only bolstered Mr. Trump’s political fortunes. He is polling far ahead of his Republican rivals and has used the cases against him to make fund-raising appeals, casting himself as a martyr under attack from Democrats like Ms. James and Justice Engoron.
The trial will enable Mr. Trump to bring the campaign to the courthouse steps, where he can deliver impassioned defenses and pointed attacks while his lawyers inside the courtroom grapple with accounting and financial arcana.
On Monday, Mr. Trump sat at the defense table, arms crossed and scowling, while occasionally rolling his eyes at the judge and yawning during the duller portions of the proceeding. But he came out swinging on his way into the courtroom, telling reporters that Ms. James was out to get him because he is performing so well in the polls.
“You ought to go after this attorney general,” he said, without specifying who or how. He said that Justice Engoron should “be disbarred” and that the case against him was “a witch hunt, it’s a disgrace.”
One of Mr. Trump’s lawyers, Alina Habba, echoed some of his harshest claims during her opening statement, saying that Ms. James ran for her office to “get Trump.”
She argued, as Mr. Trump nodded along, that his company was simply “doing business” and that “there was no intent to defraud, period, the end.” She spoke as though she were addressing a jury, or a television camera, rather than Justice Engoron.
Her statement, which she said he had not planned, altered the tenor of what had begun as a dry proceeding. It prompted squabbles between the defense team and the judge.
The substance of Mr. Trump’s defense is that his annual financial statements were merely estimates, and that valuing real estate is more art than science. The banks to which Mr. Trump submitted his statements, his lawyers argued, were hardly victims: They made money from their dealings with Mr. Trump and did not rely on his estimates.
A Guide to the Various Trump Investigations
Confused about the inquiries and legal cases involving former President Donald Trump? We’re here to help.
- Key Cases and Inquiries: The former president faces several investigations at both the state and the federal levels, into matters related to his business and political careers. Here is a close look at each.
- Case Tracker: Trump is at the center of four criminal investigations. Keep track of the developments in each here.
- What if Trump Is Convicted?: Will any of the proceedings hinder Trump’s 2024 presidential campaign? Can a convicted felon even run for office? Here is what we know, and what we don’t know.
“There was no nefarious intent,” said Mr. Trump’s lead lawyer, Christopher M. Kise. Any difference in valuation “simply reflects the change in a complex, sophisticated real estate development corporation.”
“Banks and insurers know that the statements are estimates,” he added. “They are not designed to be absolutes.”
Mr. Trump is starting the trial at a significant disadvantage. Justice Engoron ruled last week that the former president had persistently committed fraud, deciding that no trial was needed to determine the claim at the core of Ms. James’s lawsuit.
As an initial punishment, Justice Engoron revoked Mr. Trump’s licenses to operate his New York properties, a move that could crush much of the business known as the Trump Organization.
At trial, Ms. James is seeking more from Justice Engoron, asking that he impose the $250 million penalty and that the former president be permanently barred from running a business in New York. The trial will determine what penalty Mr. Trump must pay and whether he will be banished from the world of New York real estate that made him famous.
Ms. James’s witness list includes Trump supporters and critics alike: Mr. Trump and his sons, Eric and Donald Trump Jr., are on the list, as is Michael D. Cohen, his former fixer turned nemesis. During Mr. Wallace’s opening statement on Monday morning he played a video of Mr. Cohen saying that it was his job to reverse engineer the value of each of the company’s assets to arrive at Mr. Trump’s preferred net worth.
In the afternoon, Mr. Trump’s former accountant, Donald Bender, testified that it was the Trump Organization’s responsibility to ensure that the financial statements were in line with generally accepted accounting principles — and that they sometimes did not follow those principles.
Mr. Wallace, in his opening statement, cited inflated values of three key Trump properties in New York: the triplex apartment in Trump Tower on Fifth Avenue; 40 Wall Street in the heart of the financial district; and his Seven Springs estate in Westchester County.
According to Mr. Wallace, Mr. Trump based the value of the triplex on its size, saying it was 30,000 square feet. In reality, the apartment was about 11,000 square feet.
“For years, Donald Trump falsely inflated his net worth to enrich himself and cheat the system,” Ms. James said in a statement Monday, adding, “No matter how rich or powerful you are, there are not two sets of laws for people in this country.”
As he left the courtroom on Monday afternoon, Mr. Trump passed Ms. James in the front row. He glared at her. Soon after, his son Eric walked by and shook her hand.