Trump Proves Once Again He Is The Worst Possible Client*
I don’t remember which of the now countless scandals prompted the question, but someone asked me how I would defend Trump.
“I wouldn’t,” I said.
This week Trump proved once again he is the worst possible client. It reached the point long ago that no self-respecting professional would represent or associate with him, and not because he doesn’t need capable help. But as with everyone near Trump, his lawyers and accountants must debase and humiliate themselves to advance his egomaniacal agenda and façade, and he is incapable of following competent advice. See @TheRickWilson and Everything Trump Touches Dies.
Trump is thin veneer. Paid professionals purport to legitimize Trump and his business with information material to banks, insurers, taxing authorities, government regulators, investors, and foreign governments. This is information on which they rely — and are expected to rely. That’s the point! Until those professionals conclude their reporting is based on false data, or admit they were in on the fix, Trump preserves some measure of deniability, some defense to allegations of a guilty state of mind: “I relied on other people to know the details and professionals to advise me. I don’t know any of the information you seek. Talk to them.”
Letitia James played Trump’s fragile ego and has now pierced the veneer.
The New York Attorney General sued Trump, The Trump Organization, Don Jr., Ivanka, and others to advance her investigation “into the financial practices of . . . The Trump Organization, its employees, and its affiliates.”
Specifically, the Attorney General
“is investigating whether respondents misstated the value of certain assets on annual financial statements, loan applications, tax submissions, and other official documents, and whether respondents made other material misrepresentations to third parties to secure favorable loan terms and insurance coverage and to obtain tax and other economic benefits.”
In a recent filing the Attorney General claimed she had identified additional facts establishing material misstatements and omissions in thousands of documents the judge had reviewed which are “materially inconsistent,” and that the testimony of Trump, Don Jr., and Ivanka is necessary to “determine who is responsible for the alleged misstatements and omissions.” She had issued subpoenas to Trump, Don Jr., and Ivanka to produce records and sit for sworn questioning.
Trump filed a motion to quash the subpoenas or to stay their enforcement until “the conclusion of the [Attorney General’s] and/or the Manhattan District Attorney’s criminal investigations and/or other prosecutions of the Trump Organization.” February 17, 2022 Ruling in New York v. Trump.
Motions to stay a civil proceeding are common when a parallel criminal investigation or prosecution is pending, so long as the civil/criminal inquiries relate to overlapping information and behavior. Judges have considerable discretion in granting or denying such motions. See With parallel criminal and civil/congressional investigations, Trump sits on the horns of a dilemma
The Attorney General filed a cross motion to compel compliance with the subpoenas.
February 14, 2022
In her bid to compel Trump to produce records and sit for sworn testimony, the Attorney General filed as Exhibit 1 a letter from Trump’s accountants Mazars USA to The Trump Organization. Her Valentine’s Day filing revealed that five days earlier Mazars had severed its relationship with The Trump Organization. In the February 9, 2022 letter, Mazars withdrew its statement that The Trump Organization’s 2011–2020 compiled statements of financial condition were reliable. Mazars also claimed a non-waivable conflict of interest with its now former client under “the totality of the circumstances” prevented it from providing further services.
Mazars directed The Trump Organization to withdraw the financial statements and notify any recipients of the statements they should no longer rely on them. Exhibit 1
How many banks, insurance companies, taxing authorities, government regulators, investors, and foreign governments, were induced to act based on the now retracted statements of financial condition?
The non-waivable conflict of interest was not the typical kind — between two clients of the firm whose interests are not aligned and may be adverse — but rather between the firm itself and its former client The Trump Organization. New York, by the way, does not recognize any claim of privilege or confidentiality between accountants and their clients.
Mazars is cooperating with the investigation(s) and running for cover. I am reminded of the limitations of love and loyalty according to Noccolo Machiavelli: “Love is preserved by the link of obligation . . . Which is broken at every opportunity for their advantage; but fear preserves you by a dread of punishment which never fails.”
Consistent with Trump’s purported preservation of deniability, his lawyers repeatedly told the court that Trump had insufficient knowledge of his company’s finances to give meaningful responses and should therefore be excused from having to sit for the deposition.
February 15, 2022
Trump, however, couldn’t help himself. On February 15, 2022 in response to Mazars’ letter, Trump issued a five-page “Statement by President Donald J. Trump, 45th President of the United States of America,” in which he clearly signaled he knows a lot more than what his lawyers were telling the judge. His statement addressed possible discrepancies, showing he has specific knowledge of the areas the Attorney General is investigating:
“We have a great company with fantastic assets that are unique, extremely valuable and, in many cases, far more valuable than what was listed in our Financial Statements. . . . My company has among the best real estate and other assets anywhere in the world, has significant amounts of cash, and has relatively very little debt, which is totally current. . . . Based on current enthusiasm and transactions which have or will take place, the brand [Trump’s name] value today could be, in my opinion, substantially higher [than $2.8 to $3 billion]. Remember when the Attorney General and or District Attorney say they think my financial statements may be high, I don’t even include these branding numbers in them, which is far more than any discrepancy they may have, if there is a discrepancy at all.”
The statement (1) completely undermined the defense his lawyers advanced the day before in the Attorney General’s case — that Trump was oblivious to the underlying facts relating to The Trump Organization’s valuations and financial condition; and (2) advanced the Attorney General’s investigation by showing Trump himself was aware of and potentially involved in fraudulently misstating and manipulating the numbers depending on the audience.
February 16, 2022
In a letter to the court on February 16, 2022 the Attorney General said:
“It is not unusual for parties to legal proceedings to disagree about the facts. But it is truly rare for a party to publicly disagree with statements submitted by his own attorneys in a signed pleading — let alone one day after the pleading was filed.”
In response to the Attorney General filing the Mazars letter, Exhibit 1, a spokesperson for The Trump Organization released to the media a statement that the Mazar’s letter “confirms . . . Mazars’ work was performed in accordance with all applicable accounting standards and principles and that such statements of financial condition do not contain any material discrepancies. This confirmation effectively renders the investigation by the DA and AG moot.”
February 17, 2022
In his ruling denying Trump’s motion to quash the subpoenas or stay their enforcement until the criminal investigations are complete, Judge Arthur Engoron of the Supreme Court of the State of New York said:
· “For [the Attorney General] not to have investigated the [Trumps] would have been a blatant dereliction of duty. . . . Indeed, the impetus for the investigation . . . was sworn congressional testimony by former Trump associate Michael Cohen that respondents were ‘cooking the books.’”
· “The idea that an accounting firm’s announcement that no one should rely on a decade’s worth of financial statement it issued based on numbers submitted by an entity somehow exonerates that entity and renders an investigation into its past practices moot is reminiscent of Lewis Carroll (‘When I use a word, Humpty Dumpty said . . . it means just what I choose it to mean — neither more nor less’); George Orwell (‘War is peace, Freedom is slavery, ignorance is strength’); and ‘alternative facts.’”
· “To proclaim that the Mazars’ red-flag warning that the financial statements are unreliable suddenly renders the [Attorney General’s] longstanding investigation moot is as audacious as it is preposterous.”
· “In the final analysis, a State Attorney General commences investigating a business entity, uncovers copious evidence of possible financial fraud, and wants to question, under oath, several of the entities’ principals, including its namesake. She has a clear right to do so.”
· “Respondent Donald J. Trump is hereby ordered: (1) to comply in full, within 14 days of the date of this order, with that portion of the . . . subpoena seeking documents and information; and (2) to appear for a deposition within 21 days of the date of this order.”
· “Respondents Ivana Trump and Donald Trump Jr. are also hereby ordered to appear for depositions within 21 days of the date of this order.”
· “Respondents’ argument overlooks the salient fact that they have an absolute right to refuse to answer questions that they claim may incriminate them. Indeed, respondent Eric Trump invoked his right against self-incrimination in response to more than 500 questions during his one-day deposition arising out of the instant proceeding.”
February 17, 2022 Ruling in New York v. Trump
The dominoes are falling.
One government entity paying close attention to Mazars’ retraction is Congress. Trump secured the 2013 lease for the Old Post Office Building for the D.C. Trump Hotel from the General Services Administration (“GSA”) using three years’ worth of statements of financial condition, all compiled by Mazars. In an October 8, 2021 letter, the House Committee on Oversight and Reform informed the GSA that Trump’s bid to win the lease “concealed certain debts from GSA and contained numerous accounting weaknesses and deficiencies.”
In a February 17, 2022 letter to GSA, the House Oversight Committee added:
“New developments have raised additional concerns. Recent court filings allege that former President Trump misrepresented certain financial information to lenders and government entities when seeking loans or other approvals. For instance, as part of a New York State civil investigation, it has been alleged that Statements of Financial Condition that former President Trump and the Trump Organization submitted to Deutsche Bank and the federal government were ‘inaccurate or misleading to a reader when compared with the supporting data and documentation that the Trump Organization submitted to Mazars.’ That investigation has also revealed that several years’ worth of Statements of Financial Condition compiled by Mazars were allegedly deficient in numerous ways, including that they:
· ‘Misstated objective facts, like the size of Mr. Trump’s Trump Tower penthouse;’
· ‘Miscategorized assets outside Mr. Trump’s or the Trump Organization’s control as ‘cash,’ thereby overstating his liquidity;’
· ‘Misstated the process by which Mr. Trump or his associates reached valuations;’
‘Failed to use fundamental techniques of valuation, like discounting future revenues and expenses to their present value;’
· ‘Misstated the purported involvement of “outside professionals” in reaching the valuations;’ and
· ‘Failed to advise that certain valuation amounts were inflated by an undisclosed flat percentage for brand value, despite express language on the Statements asserting that the value of Mr. Trump’s brand was not reflected [in] the Statements pursuant to generally accepted accounted principles (“GAAP”).’
“These allegations cast serious doubt on at least two Mazars Statements of Financial Condition relevant to the Old Post Office Building lease: (1) the 2010 Statement of Financial Condition that former President Trump submitted to GSA as part of his bid for the lease and (2) the 2013 Statement of Financial Condition that former President Trump was required to submit to Deutsche Bank as part of his personal guarantee of the $170 million construction loan for the Trump Hotel.”
Now that Mazars has backed away, the House Oversight Committee asked the GSA Administrator to review a recent request by The Trump Organization to sell the lease to a Miami-based investor group for $375 million, a “significant premium over market rates,” a sale that would net the company approximately $100 million and Trump himself approximately $76 million.
The Committee requested of the GSA:
“Given the longstanding ethical questions and concerning new developments surrounding former President Trump’s lease of the Old Post Office Building, we call on GSA to consider terminating the lease by exercising its authority under Article 27 of the lease. No one should be rewarded for providing false or misleading information to the federal government or for seeking to profit off the presidency.”
Oversight Committee Letter to General Services Administration, February 17, 2022
February 18, 2022
The final insult for Valentine’s week was Judge Mehta’s February 18, 2022 ruling that the three lawsuits under the Ku Klux Klan Act of 1871 against Trump for his behavior leading up to and the Jan. 6 attack on the Capitol can proceed against him.
That Klan Act “proscribes conspiracies that, by means of force, intimidation or threats, prevent federal officers from discharging their duties or accepting or holding office. A party injured by such conspiracy can sue any coconspirator to recover damages.”
Trump had filed a motion to dismiss the lawsuits against him on the claim that “he is absolutely immune from damages liability . . . because his alleged conduct fell within the ‘outer perimeter’ of his official presidential responsibilities,” among other arguments.
The 112-page decision is a carefully crafted and thorough analysis of the facts and law in denying a motion to dismiss based on standards applicable to civil cases. As alleged, the complaints state legitimate claims for conspiracy against the former president and Oath Keepers to prevent by force, intimidation, or threats federal officers from discharging their duties for which immunity does not extend to the former president. The language below is informed by legal principles that bear on whether a president or former president is entitled to the immunity necessary to be free to carry out sometimes difficult and unpopular policies and decisions and whether Jan. 6 fell within the immunity. The decision also addresses Trump’s First Amendment defenses. It also gives us a preview of some of the information to come out of the Jan. 6 Select Committee’s public hearings.
Judge Mehta said:
“To deny a President immunity from civil damages is no small step. The court well understands the gravity of its decision. But the alleged facts of this case are without precedent, and the court believes that its decision is consistent with the purposes behind such immunity. Subjecting a president to potential liability for the acts described in the Complaints will not ‘diver[t] . . . the President’s attention during the decision-making process’ with ‘needless worry as to the possibility of damages actions stemming from any particular official decision.’ After all, the President’s actions here do not relate to his duties of faithfully executing the laws, conducting foreign affairs, commanding the armed forces, or managing the Executive Branch. They entirely concern his efforts to remain in office for a second term. These are unofficial acts, so the separation-of-powers concerns that justify the President’s broad immunity are not present here. ‘If the Judiciary may severely burden the Executive Branch by reviewing the legality of the President’s official conduct, and if it may direct appropriate process to the President himself, it must follow that the federal courts have power to determine the legality of his unofficial conduct.’ The court therefore may ‘determine the legality’ of President Trump’s acts that are alleged to have given rise to Plaintiffs’ injuries on January 6th.”
“According to Plaintiffs, in the months leading up to January 6th, President Trump and his allies created conditions that would enable the violence that happened that day. The President’s role during the period was multifaceted. It included regularly issuing false tweets insisting, among other things, that the elections in those states and localities where he had not prevailed were rampant with voter fraud; that he actually won in those places when in truth he had lost; that ‘big city . . . crooks’ had plotted to ‘steal votes’; that if certain Republican governors had done more he would have won; and that a voting machine vendor had helped rig elections. President Trump also directly contacted state and local election officials in places where he had lost to convince them to take steps to reverse their election results. And, he invited supporters to come to Washington, D.C., for a rally on January 6th, the day of the Certification of the Electoral College vote. President Trump directly participated in rally planning, and his campaign committee provided substantial funding and organizational assistance. Giuliani and Trump Jr. aided the President in the foregoing efforts. They coordinated with him, spread similar disinformation, contacted state and local election officials, and agreed to speak at the January 6 Rally.
“According to the Complaints, President Trump convinced his supporters that the election had been stolen from him and, importantly, them. These supporters included organized groups, such as the Proud Boys and the Oath Keepers. Some supporters, responding to President Trump’s tweets, engaged in acts of intimidation toward state and local election officials. For example, after President Trump said that a Georgia election official was an ‘enemy of the people,’ that official received threats of violence and assassinations. When another Georgia official asked President Trump to condemn these actions, urging him to ‘Stop inspiring people to commit acts of violence,’ and warned that ‘Someone is going to get shot, someone is going to get killed,’ the President remained silent. Another state election official had armed protesters descend on her home.
“Some supporters organized and attended rallies, including two in Washington, D.C., on November 14, 2020, and December 12, 2020. The Proud Boys and the Oath Keepers attended these District of Columbia–based events. At the December 12 rally, an Oath Keepers leader said that President Trump ‘needs to know from you that you are with him, [and] that if he does not do it now while he is Commander in Chief, we’re going to have to do it ourselves later, in a much more desperate, much more bloody war.’ Violence also broke out in connection with these rallies. Police clashed with some of the President’s supporters. Dozens were arrested, persons were stabbed, police were injured, and property destroyed.
“President Trump first promoted the January 6 Rally on December 19, 2020, announcing on Twitter: “Statistically impossible to have lost the 2020 Election. Big protest in D.C. on January 6th. Be there, will be wild!” Some of the President’s supporters interpreted the President’s tweet as a call to violence. Some followers on the message board TheDonald.win openly talked of bringing weapons to Washington, D.C., and engaging in acts of violence. Some on Twitter and Facebook posted about ’Operation Occupy the Capitol’ and used hashtags such as #OccupyCapitols. The Proud Boys and the Oath Keepers, for their part, began active planning for January 6th, including reaching an agreement to work together. Oath Keepers leaders announced on Facebook ‘an alliance’ and ‘a plan with the Proud Boys.’ Tarrio posted on the social media site Parler that the Proud Boys would ‘turn out in record numbers on Jan 6th” but would be ‘incognito’ and ‘spread across downtown DC in smaller teams.’ The Proud Boys and the Oath Keepers prepared for the January 6 Rally by obtaining tactical equipment, communications equipment, and bear mace.
“On the eve and the morning of the January 6 Rally, the President tweeted yet again that the election had been rife with fraud and insisted that the Vice President could send ballots back to the states for recertification. He also tweeted that Washington, D.C., ‘is being inundated by people who don’t want to see an election victory stolen by emboldened Radical Left Democrats. Our Country has had enough, they won’t take it anymore!’ Supporters, including the Proud Boys and Oath Keepers, arrived at the Ellipse for the January 6 Rally before 9:00 a.m. They heard from various speakers, including Giuliani and Trump Jr., both of whom repeated false claims about the election being stolen and asserted that the Vice President could block the Certification. President Trump spoke last. He gave a 75-minute speech based on the false premise that he had won the election and that it had been stolen from him and those gathered. At the start, he said that ‘Our country has had enough. We will not take it anymore and that’s what this is all about. And to use a favorite term that all of you people really came up with, we will ‘stop the steal.’ Early in the speech he alluded to rally-goers marching to the Capitol building. The President told the assembled crowd that ‘Mike Pence is going to have to come through for us. And if he doesn’t, that will be a sad day for our country because you’re sworn to uphold our Constitution. Now it is up to Congress to confront this egregious assault on our democracy.’ He continued:
And after this, we’re going to walk down — and I’ll be there with you — we’re going to walk down. We’re going to walk down any one you want, but I think right here. We’re going to walk down to the Capitol, and we’re going to cheer on our brave senators, and congressmen and women. And we’re probably not going to be cheering so much for some of them because you’ll never take back our country with weakness.
You have to show strength, and you have to be strong. We have come to demand that Congress do the right thing and only count the electors who have been lawfully slated, lawfully slated. I know that everyone here will soon be marching over to the Capitol building to peacefully and patriotically make your voices heard. Today we will see whether Republicans stand strong for integrity of our elections, but whether or not they stand strong for our country, our country.
“The President’s call for a march to the Capitol was not, however, authorized. It was something that he and his campaign had devised. The Rally’s permit said: ‘This permit does not authorize a march from the Ellipse.’
“As the President’s speech continued, the crowd grew increasingly animated. The President told them that if the Vice President did not send ballots back for recertification, ‘you will have a President of the United States for four years . . . who was voted on by a bunch of stupid people who lost all of these states. You will have an illegitimate president. That is what you will have, and we can’t let that happen.’ At some point after, the crowd began shouting ‘Storm the Capitol,’ ‘Invade the Capitol Building,’ and ‘Take the Capitol Right Now.’ They also began to chant ‘Fight Like Hell’ and ‘Fight for Trump.’ At the conclusion of his speech, the President told the rally-goers: ‘I said, “Something’s wrong here. Something’s really wrong. Can’t have happened.” And we fight like hell and if you don’t fight like hell, you’re not going to have a country anymore.’ Almost immediately after, he told the crowd:
So, we’re going to walk down Pennsylvania Avenue . . . and we’re going to the Capitol and we’re going to try and give — the Democrats are hopeless. They’re never voting for anything. But we’re going to try to give our Republicans, the weak ones, because the strong ones don’t need any of our help, we’re going to try and give them the kind of pride and boldness they need to take back our country. So, let’s walk down Pennsylvania Avenue.
“Meanwhile, before the President’s speech had concluded, the Proud Boys had already breached the outer perimeter of the Capitol grounds. One Proud Boys member shouted, ‘Let’s take the fucking Capitol!,’ to which one responded, ‘Don’t yell it, do it.’ They then broke into smaller groups and began breaking through exterior barricades. By the time the crowd arrived from the Ellipse, those barricades had been compromised. The crowd eventually overwhelmed Capitol police and was able to enter the building. Some rioters told Capitol police officers, ‘[W]e are listening to Trump — your boss’ and ‘We were invited here by the President of the United States.’ Some entered the House chamber, and others, the Speaker of the House’s office. The Oath Keepers entered the building in a military-style formation, dressed in paramilitary equipment, helmets, and reinforced vests. One message exchanged among them said: ‘We have a good group. We have about 30–40 of us. We are sticking together and sticking to the plan.’ As a result of rioters entering and remaining in the Capitol, Congress and the Vice President were prevented from proceeding with the Certification of the Electoral College vote as planned.
“President Trump had not, as promised, joined the crowd at the Capitol. Instead, he was already back at the White House by the time rioters entered the Capitol. He began watching live televised reports of the siege. He first tweeted a video of his Rally Speech. Then, about fifteen minutes after rioters had entered the Capitol building, President Trump tweeted:
Mike Pence didn’t have the courage to do what should have been done to protect our Country and our Constitution, giving States a chance to certify correct set of facts, not the fraudulent or inaccurate ones which they were asked to previously certify. USA demands truth!
“Rioters at the Capitol building repeated the tweet on megaphones. Minutes later, the President called Senator Mike Lee looking for Senator Tommy Tuberville; Senator Lee informed the President that the Vice President was being evacuated by the Secret Service and that he had to go. Later, when House Leader Kevin McCarthy spoke to the President by phone and urged him to call off the rioters, the President responded: ‘Well, Kevin, I guess these people are more upset about the election than you are.’ About a half hour after rioters had entered the Capitol building, the President tweeted: ‘Please support our Capitol Police and Law Enforcement. They are truly on the side of our Country. Stay peaceful!’ Approximately 90 minutes later, at 4:17 p.m., the President tweeted a video in which he again repeated that the election had been stolen but told his supporters to go home. He said to them, ‘I know your pain. I know you’re hurt,’ and added, ‘We love you. You’re very special.’ At 5:40 p.m., law enforcement finally cleared the Capitol building. At 6:00 p.m., the President sent another tweet:
These are the things and events that happen when a sacred landslide election victory is so unceremoniously & viciously stripped away from great patriots who have been badly & unfairly treated for so long. Go home with love & in peace. Remember this day forever!
“Congress would resume the Certification later that night and would complete it at 3:41 a.m. the next day.”
112-page ruling that Trump is not immune from suit for Jan. 6
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*My brother the very talented fiction writer and novelist, Robert Hodgson Van Wagoner, deserves considerable credit for offering both substantive and technical suggestions to https://medium.com/@richardvanwagoner and https://lastamendment.com. Rob’s second novel, a beautifully written suspense drama that takes place in Utah, Wyoming, and Norway, dropped on November 17, 2020. Available on Amazon, Barnes and Noble, Apple Bookstore and your favorite local bookshop, this novel, **The Contortionists**, which Rob himself narrates for the audio version, is a psychological page-turner about a missing child in a predominantly Mormon community. I have read the novel and listened to the audio version twice. It is a literary masterpiece. **The Contortionists** is not, however, for the faint of heart.
**Richard J Van Wagoner is my father. His list of honors, awards and professional associations is extensive. He was Professor Emeritus (Painting and Drawing), Weber State University, having served three Appointments as Chair of the Department of Visual Arts there. He guest-lectured and instructed at many universities and juried numerous shows and exhibitions. He was invited to submit his work as part of many shows and exhibitions, and his work was exhibited in many traveling shows domestically and internationally. My daughter Angela Moore, a professional photographer, photographed more than 500 pieces of my father’s work. On behalf of the Van Wagoner Family Trust, she is in the process of compiling a collection of his artwork. The photographs of my father’s art reproduced in https://medium.com/@richardvanwagoner and https://lastamendment.com are hers.