Donald Trump’s annual financial statements ‘should no longer be relied upon,’ says accounting firm

The accounting firm that prepared former President Donald Trump’s annual financial statements said the documents, used to secure lucrative loans and boost Trump’s image as a wealthy businessman, “should no longer be relied upon” after the New York Attorney General said they routinely misrepresent the value of trumps.

In a letter to the Trump Organization’s lawyer on February 9, Mazars USA LLP advised the company to advise anyone who obtained the documents not to use them when assessing the company’s financial health. and the former president. The company also said it was cutting ties with Trump, its most high-profile client.

Mazars’ letter, made public Monday in a court filing, came just weeks after New York Attorney General Letitia James said her civil investigation uncovered evidence that Trump and his company had used assessments ” fraudulent or deceptive” of its golf clubs, skyscrapers and other properties to obtain loans and tax advantages.

Former President Donald Trump holds up papers as he speaks about the coronavirus in the James Brady Press Briefing Room of the White House on April 20, 2020 in Washington, DC (Associated Press)

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“Although we have not concluded that the various financial statements, taken together, contain material differences, based on the totality of the circumstances, we believe that our advice to no longer rely on these financial statements is appropriate. “, said Mazars General Counsel William J. Kelly wrote to his Trump Organization counterpart, Alan Garten.

Kelly told Garten that Mazars could no longer work with Trump due to a conflict of interest and urged him to find another tax preparer. Kelly said several Trump-related tax returns still need to be completed, including those for the former president and first lady.

The Trump Organization said in a statement it was “disappointed that Mazars chose to separate” but viewed Kelly’s letter as positive because the accounting firm did not find any material misstatements in the financial statements. of Trump.

The letter “confirms that after having carried out a subsequent review of all previous statements of financial position, the work of Mazars has been carried out in accordance with all applicable accounting standards and principles and that these statements of financial position do not contain any material misstatement,” the Trump Organization said. noted. “This confirmation effectively renders the investigations conducted by the DA and AG moot.”

Kelly said Mazars had done his work on Trump’s financial statements “in accordance with professional standards,” but he could no longer stand by the documents in light of James’ findings and his own investigation. Kelly said Mazars’ findings applied to Trump’s 2011-2020 financial statements. Another firm handled Trump’s 2021 financials.

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James’ office included a copy of Kelly’s letter in a court filing as she seeks to enforce a subpoena for Trump and his two oldest children, Donald Jr. and Ivanka, to testify under oath. A state court judge, Arthur Engoron, is scheduled to hear arguments Thursday in the subpoena dispute.

James, a Democrat, said Monday that given the evidence, “there should be no doubt that this is a legal investigation and that we have legitimate reasons” to question Trump, a Republican, and his children, both of whom have been leaders of the Trump Organization. .

Trump’s lawyers have argued that any testimony they give could be used against them in a parallel criminal investigation overseen by the Manhattan District Attorney’s Office – an investigation that led to tax evasion charges last year. against the Trump Organization and Allen Weisselberg, its longtime chief financial officer. officer.

Trump gave his financial disclosure statement – ​​an annual overview of his holdings – to banks to secure hundreds of millions of dollars in loans on properties such as a Wall Street office building and a golf course in Florida, and to financial magazines to justify his place among the world’s billionaires.

In a court filing last month, James’ office detailed several instances in which Trump misstated the value of assets on financial statements given to banks.

A woman walks past the Trump Building in New York’s Financial District on January 13, 2021. (AP/Mark Lennihan)

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Deutsche Bank accepted Trump’s financial statements without objection as part of a $300 million loan deal for three of its properties and, in internal memoranda, pointed to Trump’s stated financial strength as a lending factor , James’s office said.

Another bank said it received financial statements in 2014 showing Trump had a net worth of $5.8 billion and cash of $302 million. A bank official involved in that deal told James’ office that if he had known of any inaccuracies in Trump’s statement of financial position, he would have canceled the deal.

James’ office said its investigation began after Trump’s former personal attorney, Michael Cohen, told Congress in 2019 that Trump had a habit of misrepresenting the value of assets to obtain loan terms and concessions. favorable tax advantages.

Cohen gave copies of three of Trump’s financial statements to the House Committee on Oversight and Reform. Cohen said Trump gave the statements to Deutsche Bank to inquire about a loan to buy the NFL’s Buffalo Bills and to Forbes magazine to back up his claim to a spot on his list of the world’s richest people. .

Cohen served time in federal prison after pleading guilty in 2018 to tax crimes, lying to Congress and campaign finance violations, some of which involved his role in orchestrating payments to two women to stop them from talk about alleged business with Trump.

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Trump’s lawyers described Cohen as having a vendetta against Trump and said in a recent court filing that it “extends any credibility in believing that” James’ office put “any legitimate value” into his testimony.

James’ office responded Monday that it not only relied on Cohen’s testimony, but that his testimony was “substantiated by the evidence obtained to date and Mazars’ notice that these statements should not be relied upon.”

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