Donald Trump says a simple disclaimer gives him immunity from fraud. Could he have a point?

Donald Trump, right, sitting with his children, from left, Eric Trump, Donald Trump Jr. and Ivanka Trump at a groundbreaking ceremony outside the Trump International Hotel on July 23, 2014 in Washington. Below is an excerpt from a fraud disclaimer in one of Donald Trump’s annual financial statements.Evan Vucci/AP

Donald Trump leaned in his gold-painted spindle-back chair under the chandeliers of Mar-a-Lago’s glittering grand ballroom and told Sean Hannity why the New York Attorney General, who had indicted him earlier that day, “has no case.” . “

“We have a disclaimer,” Trump told the Fox News host.

“Right on the front. And it basically says, you know, get your own people. You’re at your peril… It could be a long way off.”

Trump described the disclaimer that fills the second and third pages of his annual wealth proclamations – the 20-page “Statements of Financial Condition” that are central to AG Letitia James’ massive lawsuit against the former president, his three oldest children. , and its real estate and golf resort empire.

James calls these statements “fraudulent” and says they are all full of wildly exaggerated math — improbable numbers that have tricked banks into lending Trump and the New York-based Trump Organization hundreds of millions of dollars over the past decade.

But Trump told Hannity that none of that would matter, because every statement of financial condition begins with a warning.

“Be careful,” Trump told Hannity in the disclaimers.

“Because it may not be accurate. It may be far off… take your own people. Use your own lawyers,” Trump added. “Don’t trust us.”

Former financial crimes prosecutor Armen Morian, who worked for the AG’s office from 2006 to 2019 before founding Morian Law, believes Trump has a point.

Of course, annual financial statements can be filled with real whoppers, including all those years — from 2012 to 2016 — when they tripled the actual square footage of Trump’s plywood atop Trump Tower in Manhattan, raising a whopping $200 million a year. was added to the former president’s net worth.

But every year, the disclaimers tell banks to double-check the numbers before relying on them to decide how much to borrow and at what interest rate, Morian said.

And if despite this warning, the banks did get a good deal with Trump — as Deutsche Bank did year after year, pouring hundreds of millions of dollars into his Miami golf club, his Chicago skyscraper and the Old Post Office in DC — then they did. that too. so with eyes wide open, he said.

“What the disclaimers are saying is, ‘Be careful when you read these financial statements,’” Morian said, after statements from a decade ago were unsealed in court files last week.

“That’s all it has to do,” he said of their disclaimers, affixed to the front of each year’s statement by longtime Trump accountants Mazars USA.

“And that doesn’t just apply to Mazars,” added Morian, whose AG financial fraud cases include the 13-year prosecution of insurance mogul Maurice “Hank” Greenberg.

“It covers Trump.”

The opening paragraphs of the disclaimer for the 2012 financial condition of Donald Trump.

The opening paragraphs of Donald Trump’s 2012 financial condition disclaimer (highlights added).Laura Italiano / Insider

Morian noted that these are “robust” disclaimers – drawn up in public, not hidden in fine print.

“We have not audited or reviewed the accompanying financial statement,” say their opening paragraphs, in standard language that has been repeated over the years.

And so, Mazars’ auditors “provide no opinion or assurance as to whether the financial statements are in accordance with generally accepted accounting principles in the United States of America.”

Especially Deutsche Bank — the largest lender to the Trump Organization and Donald Trump in the past decade — is an “advanced counterparty,” Morian said.

They knew Trump’s reputation for puffery very well in an industry — real estate — already known for puffery.

“All that,” Morian said, “essentially makes the disclaimer an absolute defence.”

A license to exaggerate? To lie?

So a company can lie about its value? And get away with it, just by warning, as Trump put it, “Maybe it’s not accurate. It might be far off?”

“There’s something unsatisfying about it,” Morian admitted.

“But I find it hard to take my hat off as a lawyer. This is a legal matter, and it’s about facts and the law. That’s the game we play, and that’s the game the attorney general plays too.” .

“It’s shocking that they brought this case,” Morian added.

But not everyone agrees, especially not Michael Cohen, the fixer-turned-critic of the former president, who handed over Trump’s 2011-2013 Statements of Financial Condition as part of his 2019 Congressional testimony.

“The attorney general did not file a lawsuit of more than 200 pages, after three years of investigative work, to have her case denied by a disclaimer,” Cohen told Insider.

That disclaimer was written and signed by Mazars to protect Mazars, not Trump, Cohen noted.

These aren’t our numbers, Mazars essentially tells potential lenders, and you’re not getting any guarantees from us about their accuracy.

Diana Florence, a former Manhattan prosecutor for complex financial fraud cases, agreed.

“Of course, they are a hurdle,” she told Insider of the disclaimers. “They weaken the case.”

But that’s not the full story, she said.

The AG claims that ten years of Trump’s Statements of Financial Condition contain a total of some 200 false and misleading appraisals of 23 properties.

Deutsche Bank cannot be expected to “literally chase and verify everything in the statement,” Florence said.

And as James’ lawsuit shines its broadest and brightest spotlight on the financial condition, it suggests that other paperwork could put Trump at greater risk.

Over the years, Trump or his children have signed multiple documents personally certifying to Mazars and Deutsche Bank that the financial conditions are correct, or at least “reasonably” represent Trump’s worth, the lawsuit alleges.

And those “boilerplate disclaimers?” James’ lawsuit is aware of them. “The disclaimers… do not license Mr Trump or the Trump Organization to submit fraudulent and misleading asset valuations to their auditors for inclusion in the Statements,” the lawsuit says.

“Trump might say, ‘Yeah, if Deutsche Bank was really concerned, they could have asked for more things or turned us down. They didn’t do any due diligence,'” Florence said.

“But it doesn’t change what the case is about, which is patterns of fraud.”

The AG office and Trump’s attorneys did not immediately respond to requests for comment.

In February, Mazars completely retired from working for Trump — in the midst of preparing his and Melania Trump’s tax returns — and made the ultimate disclaimer by saying that “the last 10 years of the financial condition should no longer be relied upon.” .

Refusing to comment, a spokesperson for Mazars said: “We remain committed to meeting all of our professional and legal obligations.”

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