The first thing to say is that the case has a very specific legal basis and that if it were not for that, it would be difficult to find locus standi for the Attorney General.
It is clear that there is a criminal case to answer but why is it a civil case?
Cynics would say that the case can be held without a jury so Trump's popularity (and New Yorkers still seem to hold him in high regard) and, perhaps more importantly, the lower burden of proof in a civil case favours the state. The Attorney General alleges that Trump et al, (there is a long list of defendants) overstated the value of properties in documents submitted to lenders and insurers.
The example is given of Trump's own apartment at Trump Tower which he claimed was three times its actual size and, therefore, the value was overstated by a similar ratio.
So, I can see how there was a fraud on the lenders and insurers. But how is the State involved? It is still not clear how the State of New York gets locus standi.
This is how and it's really quite bizarre, on the face of it. Yet, somehow it makes some kind of sense. Put simply, it's the state enforcing private rights, even when the victim does not make a criminal complaint to support a prosecution. In fact, there is no reason for the police to be involved at all.
The A-G "alleges that the individual and entity defendants committed repeated and persistent fraud by preparing , certifying, and submitting to lenders and insurers false and misleading financial statements , thus violating New York Executive Law s63 ( 12)"
12. Whenever any person shall engage in repeated fraudulent or illegal acts or otherwise demonstrate persistent fraud or illegality in the carrying on, conducting or transaction of business, the attorney general may apply, in the name of the people of the state of New York, to the supreme court of the state of New York, on notice of five days, for an order enjoining the continuance of such business activity or of any fraudulent or illegal acts, directing restitution and damages and, in an appropriate case, cancelling any certificate filed under and by virtue of the provisions of section four hundred forty of the former penal law 3 or section one hundred thirty of the general business law, and the court may award the relief applied for or so much thereof as it may deem proper. The word “fraud” or “fraudulent” as used herein shall include any device, scheme or artifice to defraud and any deception, misrepresentation, concealment, suppression, false pretence, false promise or unconscionable contractual provisions. The term “persistent fraud” or “illegality” as used herein shall include continuance or carrying on of any fraudulent or illegal act or conduct. The term “repeated” as used herein shall include repetition of any separate and distinct fraudulent or illegal act, or conduct which affects more than one person.
Notwithstanding any law to the contrary, all moneys recovered or obtained under this subdivision by a state agency or state official or employee acting in their official capacity shall be subject to subdivision eleven of section four of the state finance law. In connection with any such application, the attorney general is authorised to take proof and make a determination of the relevant facts and to issue subpoenas in accordance with the civil practice law and rules. Such authorisation shall not abate or terminate by reason of any action or proceeding brought by the attorney general under this section.
So, the Attorney-General - who for clarity is not a District Attorney, etc. - has authority to bring civil proceedings as a result of persistent malfeasance within the jurisdiction.
The case has been under investigation for years - so long in fact that the court had to find that there was a refreshing of the limitation period.
According to the judgment last week, "On 3 November, 2022, this Court [made a preliminary finding] that [the] defendants had a propensity to engage in persistent fraud by submitting false and misleading Statements of Financial Condition on behalf of defendant Donald J. Trump ( Donald Trump ) ."
Then it got worse "Accordingly , the Court granted a preliminary injunction against any further fraud and appointed the Hon. Barbara S. Jones ( ret .) as an independent monitor to oversee defendants financial
statements and significant asset transfers ." It's not exactly a receivership but it's in that general direction.
The judgment of 26 September (link below) is a fascinating read with the judge displaying anger and contempt for the arguments of Trumps' lawyers. "Defendants glaringly misrepresent the requirements of an Executive Law 63 ( 12) cause of action . "
