Many of Mr. Trump’s financial statements, the filing argued, were “generally inflated as part of a pattern to suggest that Mr. Trump’s net worth was higher than it otherwise would have appeared.” The filing cited what Ms. James’s office believes were misleading statements about the value of Mr. Trump’s golf clubs in Westchester County, N.Y., and Scotland, his flagship commercial property at 40 Wall Street in Manhattan and his penthouse triplex in Trump Tower.
The company provided these statements to lenders and insurers, the filing said.
Her case against him could be hard to prove. Property valuations are often subjective, and if Ms. James ultimately sues Mr. Trump, his lawyers would be likely to point toward the disclaimer in his financial statements saying that his accountants had not audited the valuations.
They also might argue that the Trump Organization submitted the statements to sophisticated financial institutions that conducted their own due diligence. In recent months, he paid off some of those loans, an outcome that funneled hundreds of millions of dollars into the coffers of his banks, making them an unsympathetic victim.
Mr. Trump also famously does not use email, so any instructions he might have given his employees about the financial statements are most likely not in writing. The lack of a damning email — or witness currently inside his company willing to testify against him — might make it somewhat difficult to show that he used his financial statements to defraud anyone.
But in a June podcast appearance, Ms. James expressed confidence that she would prevail.
“We all know that he used funny numbers in his financial documents,” she said, adding, “And he got caught.”
The preliminary settlement talks between Ms. James’s office and Mr. Trump’s lawyers began early this summer and have yet to gather much momentum, the people with knowledge of the matter said. Ms. James’s office turned down the offer from Mr. Trump’s lawyers, though they are expected to continue to try to negotiate in the coming days.
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