The McDonnell line of Supreme Court cases isn't likely to save Bob Menendez; Hunter Biden sues Rudy Giuliani and Robert Costello, who is suing Rudy Giuliani; Judge Tanya Chutkan isn't going anywhere
I do think it's fair for the government to prosecute fraud that doesn't result in loss, because it's exposing the banks to risks they'd be otherwise unwilling to take, and ultimately the act is the same whether or not the gamble ends well.
Also, bank funds aren't unlimited - $100 million loaned to Trump Org is money that can't be lent to McGuffin Inc, who might have a portfolio better than the true Trump Org portfolio and now can't get the loan or has to find one with worse terms.
So fraud in getting bank loans does have harms - to the market that everybody seeking capital operates in - so it is fair for a state to ensure that their marketplaces, including for capital, are aboveboard and go after wrongdoers.
A reasonable counter argument would be that the banks were well aware of the overvaluation of the properties. One assumes they would do their due diligence on the properties as part of the transaction, as opposed to just taking one person's word. And even after the due diligence, they voluntarily entered into the agreement.
That assumes omnicompetence on the bank's behalf, that their due diligence is one hundred percent reliable and able to find all information available to Trump. They may well have made errors performing their due diligence, particularly as they were working from a deliberate misrepresentation to begin with.
I'd also expand my statement to say the government has an interest in prosecuting people for trying to commit fraud in order to discourage it in general. Even if the banks didn't fall for it in this particular instance it is possible a bank would.
I agree with the idea that the government has an interest in prosecuting people for fraud, even if there were no damages. There's a solid public policy argument to be made. My comment was directed at the idea that the banks were indirectly harmed by the fraud. The counter party to the loan was a sophisticated investor capable of determining an approximate value of the properties involved. Even in the face of misrepresentation. They chose to ignore the signs and make the loan anyway
It took a while to figure out which argument goes where.
Showing that the banks were harmed would be difficult. It would be like the many shareholder vs. Elon Musk lawsuits.
The government has a policy goal to step in even if the loan didn't go bad, the same way drunk drivers should be stopped even if they don't cause an accident.
As to question of "fairness" I have to ask, how much of the catastrophic consequences of the judgment are because of "trial penalty"/"f*ck around and find out"? In an alternate universe where Trump Org IPO'ed via SPAC before 2016, the incoming team got its first look at the books in 2017 and went running to the NY AG crying "we don't want to commit crime", just how bad would it get for the hypothetical public company?
This is one of Trump's defences; I heard one of his lawyers pitch this on the Lawfare Podcast. It is an argument that fraud is just the cost of doing business and that there is no victim. Yet in the same way that you don't know that the banks were aware of it, you also don't know that they would find it acceptable, nor that their shareholders or regulators would be happy about it. But we do know that the latter were not because Trump is being prosecuted for fraud. His defence is, yet again, a nonsense.
I hope his lawyers have deep pockets because they are surely aware that Trump will bilk them. What price this argument then? Will they just shrug and carry on representing him? I doubt it.
It's also important to recognize that banks don't actually have an infinite pool of money to lend from. Taking a risk at more favorable terms on large loans for one entity decreases the likelihood they will take a risk on another loan, so there are other perspective borrowers who unable to obtain financing or favorably rates because they were telling the truth.
My wife is mortgage. Trump is arguing (again) for two systems of justice, favoring him (again). If you lie on your mortgage application, it's bank fraud. Example: You say this will be an owner-occupied house but you're really buying it as a rental property. It doesn't matter that you don't default. Enforcement is admittedly poor, but that doesn't make it legal.
Regarding Josh's question, "Is the Trump organization trial in NY fair?" I think "systematic risk to the system" is the issue that is being overlooked. This is just the sort of risk the AG SHOULD be acting to mitigate even if there isn't any individual victim. Perhaps all of the lenders are happy. Perhaps it is common to exaggerate the value of property or the square footage, but what happens to the value of real estate in a crisis? What happens when the underlying value, in the entire loaned market, is overestimated? What happens to the larger economy as a result? What sort of contagion or systematic risk does this create? It isn't just the banks who have something to lose - we will all be on the hook to bail those banks out - AGAIN! The point isn't that the banks were harmed in some way, but the entire interrelated financial system relies on collateral being real. When you have one prominent player engaging in fraud on this scale, how does that influence the choices of other similarly situated actors, as well as the valuation of other properties?
Trump has been a crooked businessman and con-man for decades. I don't know that a state AG has a lot of choice when the activities clearly cross over into fraud.
Note on the political context of Trump's gun store visit: according to Lucian Truscott, the store in question (Palmetto State Armory) is known for selling Boogaloo Boys merchandise, and is where the Jacksonville shooter purchased the guns he used in his massacre.
And, just to bring things back full circle, Lucian Truscott has also written a tribute to Wayne Barrett: the Village Voice journalist who first exposed Trump's scams more than forty years ago.
And we should never forget the journalists at ProPublica, the NYT, and WNYC who did the digging that first exposed Trump's fraud. It led directly to Tish James opening her investigation. If you've ever wondered how far Trump's corruption extends or if it is fair that he's being prosecuted, go to their 'Trump, Inc.' podcast. It will boggle your mind.
Trump's got the racist vote tied down. Now he's trying to cement his reputation with the violent crazies. Just like Reagan's state's right speech in Mississippi.
Off-topic but this is an update for those fascinated by the goat-killing, ballot-bankrupting, vaccine-averse antics of Shasta County, California in its bid to become Florida West.
As reported in The Guardian, the supervisors of 'Florida West' have "appointed Jon Knight, a hydroponics store owner and prominent figure in the local far-right movement, to serve on the board of the public health agency responsible for managing (mosquitoes), instead of the county’s former public health director, an epidemiologist."
Knight said; "“I know a lot about this stuff. I know a lot about some of these Bill Gates programs. This is not a conspiracy, this is a fact. There’s Japanese scientists who have created flying syringes that will mass vaccinate populations." He then added; “We live in an interesting sci-fi time. With my understanding of what’s going on with mosquitoes and my knowledge of pesticides, I think I could do a pretty darn good job.”
Your point that Trump drawing attention to himself ultimately resulted in trouble for his companies reminds me a lot of the Giudices on Real Housewives of New Jersey. Granted, the cases might not be that similar -- they're both fraud, but I don't follow the legal troubles of the reality TV stars closely -- but it seems like if you're committing crimes, maybe don't go on TV a lot. Come to think of it, this also applies to Chris Chrisley, and probably applied to other investigations of Trump.
I'm now idly curious if the financial fraud prosecution rate among reality TV stars is higher than their cohorts of similar net worth individuals.
So Apple has iCloud backups. You backup your device to the cloud. If someone hacks your password, they can clone your device by downloading all your info to a phone or laptop. I have suspected for a long time that someone set up two Hunter Biden laptops this way and left them at that computer shop. You know, the laptop with the Joe Biden sticker. This would explain 'laptop' appearing in quotes in the lawsuit.
So two questions: If it's not Biden's laptop, could he just be hesitant to claim the device, especially if there is manipulated evidence, (or of course shady/criminal evidence no one has realized yet). Isn't there a difference between claiming an original device is yours, and only claiming the data MIGHT be yours on someone else's planted device? What implications are assumed by the owner of the device?
Also, Apple has iCloud servers in Alameda. And a lot of other cities. Could Biden be gambling for the California server to be the one that held his data (or could his attorney find out for sure?), and would that allow California laws to apply?
This is my thinking as well. It seems clear that at least some of the data on the laptops in question is real and that it's quite possible it came from his icloud account.
I'm not sure what Josh is up to with these assertions that Tish James is going after Trump because of Trumps insurrection activities. Trump has been on a decades long biz crime spree in NY.
People have been predicting this for years -- "Why would Trump run for president? He's just going to attract attention from people who can prosecute him."
Oh, come on. If one of us peons lied like he did to get a loan, and got caught, you can bet your law degree the state would come after us. In the instance of a rich and powerful person/family having done so, and the state seeking penalties, everyone saying, "oh, no, this is unheard of!" is just because it is so unusual for the government to actually nail the wealthy guy. My mother worked for the IRS for years. They would pursue the small tax cheats to the end of the earth. The big ones, if pursued at all, might have to pay a fraction of what they owed. The only problem with the case is that it took so long for them to bring it, Trump and his father were probably engaging in those shenanigans for longer than I've been alive, and I'm 60.
If you've ever worked in mortgage, you know people lie all the time. All the time. There is some enforcement but not much. People cheat on their taxes all the time too. It's better since the "stated income" liar loans have gone away, but lots of people are either cheating on their taxes or lying on their mortgage application, or both. If the Republicans really wanted to shrink the deficit, they'd give the IRS more enforcement money.
I'm curious for your thoughts on Rob Blagojevich's conviction as compared with other more recent cases... to me it seems very much like "political bribery" (horse-trading) prosecution, of the sort that couldn't happen today.
Wasn’t trumps alleged fraud in both directions though? Not only overvaluing for the banks, but also undervaluing for tax purposes. In which case the harm would be directly to the state and other taxpayers.
I would guess that the tax matters are a component of the remaining counts in the indictment. The particular fraud at issue on summary judgement was about statements of financial condition he submitted as part of the process of getting or paying off certain loans.
It probably came out too late for y’all to address, but have you had a chance to listen to the Cheese’s lawyers previewing their case on Lawfare? It seems like he has a decent shot at acquittal (or at least mistrial), but I’d like to hear your take.
Oh thank God, I was starting to go into withdrawal
Would you guys be willing to go to 80 episodes a year for a $12/mo sub?
Serious Junkies.
ha ha
I think the moral of the story is that they should have instead bribed Bob Menendez in novelty oversize Toblerone.
I do think it's fair for the government to prosecute fraud that doesn't result in loss, because it's exposing the banks to risks they'd be otherwise unwilling to take, and ultimately the act is the same whether or not the gamble ends well.
Also, bank funds aren't unlimited - $100 million loaned to Trump Org is money that can't be lent to McGuffin Inc, who might have a portfolio better than the true Trump Org portfolio and now can't get the loan or has to find one with worse terms.
So fraud in getting bank loans does have harms - to the market that everybody seeking capital operates in - so it is fair for a state to ensure that their marketplaces, including for capital, are aboveboard and go after wrongdoers.
A reasonable counter argument would be that the banks were well aware of the overvaluation of the properties. One assumes they would do their due diligence on the properties as part of the transaction, as opposed to just taking one person's word. And even after the due diligence, they voluntarily entered into the agreement.
That assumes omnicompetence on the bank's behalf, that their due diligence is one hundred percent reliable and able to find all information available to Trump. They may well have made errors performing their due diligence, particularly as they were working from a deliberate misrepresentation to begin with.
I'd also expand my statement to say the government has an interest in prosecuting people for trying to commit fraud in order to discourage it in general. Even if the banks didn't fall for it in this particular instance it is possible a bank would.
I agree with the idea that the government has an interest in prosecuting people for fraud, even if there were no damages. There's a solid public policy argument to be made. My comment was directed at the idea that the banks were indirectly harmed by the fraud. The counter party to the loan was a sophisticated investor capable of determining an approximate value of the properties involved. Even in the face of misrepresentation. They chose to ignore the signs and make the loan anyway
It took a while to figure out which argument goes where.
Showing that the banks were harmed would be difficult. It would be like the many shareholder vs. Elon Musk lawsuits.
The government has a policy goal to step in even if the loan didn't go bad, the same way drunk drivers should be stopped even if they don't cause an accident.
As to question of "fairness" I have to ask, how much of the catastrophic consequences of the judgment are because of "trial penalty"/"f*ck around and find out"? In an alternate universe where Trump Org IPO'ed via SPAC before 2016, the incoming team got its first look at the books in 2017 and went running to the NY AG crying "we don't want to commit crime", just how bad would it get for the hypothetical public company?
This is one of Trump's defences; I heard one of his lawyers pitch this on the Lawfare Podcast. It is an argument that fraud is just the cost of doing business and that there is no victim. Yet in the same way that you don't know that the banks were aware of it, you also don't know that they would find it acceptable, nor that their shareholders or regulators would be happy about it. But we do know that the latter were not because Trump is being prosecuted for fraud. His defence is, yet again, a nonsense.
I hope his lawyers have deep pockets because they are surely aware that Trump will bilk them. What price this argument then? Will they just shrug and carry on representing him? I doubt it.
It's also important to recognize that banks don't actually have an infinite pool of money to lend from. Taking a risk at more favorable terms on large loans for one entity decreases the likelihood they will take a risk on another loan, so there are other perspective borrowers who unable to obtain financing or favorably rates because they were telling the truth.
My wife is mortgage. Trump is arguing (again) for two systems of justice, favoring him (again). If you lie on your mortgage application, it's bank fraud. Example: You say this will be an owner-occupied house but you're really buying it as a rental property. It doesn't matter that you don't default. Enforcement is admittedly poor, but that doesn't make it legal.
That sounds like something you'd need evidence to argue :)
The flip side, a shareholder negligence complaint if the bank lost its shirt, would be fascinating to see
This is absurd, and not the law. The banks have both a statutory and contractual right to rely on the information provided by the would-be borrower.
As Lin Manuel Miranda points out in Hamilton "Everything is legal in New Jersey".
Regarding Josh's question, "Is the Trump organization trial in NY fair?" I think "systematic risk to the system" is the issue that is being overlooked. This is just the sort of risk the AG SHOULD be acting to mitigate even if there isn't any individual victim. Perhaps all of the lenders are happy. Perhaps it is common to exaggerate the value of property or the square footage, but what happens to the value of real estate in a crisis? What happens when the underlying value, in the entire loaned market, is overestimated? What happens to the larger economy as a result? What sort of contagion or systematic risk does this create? It isn't just the banks who have something to lose - we will all be on the hook to bail those banks out - AGAIN! The point isn't that the banks were harmed in some way, but the entire interrelated financial system relies on collateral being real. When you have one prominent player engaging in fraud on this scale, how does that influence the choices of other similarly situated actors, as well as the valuation of other properties?
Trump has been a crooked businessman and con-man for decades. I don't know that a state AG has a lot of choice when the activities clearly cross over into fraud.
Note on the political context of Trump's gun store visit: according to Lucian Truscott, the store in question (Palmetto State Armory) is known for selling Boogaloo Boys merchandise, and is where the Jacksonville shooter purchased the guns he used in his massacre.
(Truscott's article on the subject: https://luciantruscott.substack.com/p/the-mainstream-media-completely-missed)
Great link. Thank you.
And, just to bring things back full circle, Lucian Truscott has also written a tribute to Wayne Barrett: the Village Voice journalist who first exposed Trump's scams more than forty years ago.
https://luciantruscott.substack.com/p/new-york-finally-caught-up-with-wayne
And we should never forget the journalists at ProPublica, the NYT, and WNYC who did the digging that first exposed Trump's fraud. It led directly to Tish James opening her investigation. If you've ever wondered how far Trump's corruption extends or if it is fair that he's being prosecuted, go to their 'Trump, Inc.' podcast. It will boggle your mind.
https://www.wnycstudios.org/podcasts/trumpinc
Trump's got the racist vote tied down. Now he's trying to cement his reputation with the violent crazies. Just like Reagan's state's right speech in Mississippi.
Off-topic but this is an update for those fascinated by the goat-killing, ballot-bankrupting, vaccine-averse antics of Shasta County, California in its bid to become Florida West.
As reported in The Guardian, the supervisors of 'Florida West' have "appointed Jon Knight, a hydroponics store owner and prominent figure in the local far-right movement, to serve on the board of the public health agency responsible for managing (mosquitoes), instead of the county’s former public health director, an epidemiologist."
Knight said; "“I know a lot about this stuff. I know a lot about some of these Bill Gates programs. This is not a conspiracy, this is a fact. There’s Japanese scientists who have created flying syringes that will mass vaccinate populations." He then added; “We live in an interesting sci-fi time. With my understanding of what’s going on with mosquitoes and my knowledge of pesticides, I think I could do a pretty darn good job.”
https://www.theguardian.com/us-news/2023/sep/28/california-shasta-county-far-right-mosquito-vaccine
I've been looking into retiring to Europe. We. Are. Doomed. (Although the state of democracy there isn't all rainbows and unicorns either.)
Your point that Trump drawing attention to himself ultimately resulted in trouble for his companies reminds me a lot of the Giudices on Real Housewives of New Jersey. Granted, the cases might not be that similar -- they're both fraud, but I don't follow the legal troubles of the reality TV stars closely -- but it seems like if you're committing crimes, maybe don't go on TV a lot. Come to think of it, this also applies to Chris Chrisley, and probably applied to other investigations of Trump.
I'm now idly curious if the financial fraud prosecution rate among reality TV stars is higher than their cohorts of similar net worth individuals.
Ken has brought this up in the podcasts. Prosecutors can't just 'let it go' when public figures break the law.
Is Alina Habba a good lawyer?
So Apple has iCloud backups. You backup your device to the cloud. If someone hacks your password, they can clone your device by downloading all your info to a phone or laptop. I have suspected for a long time that someone set up two Hunter Biden laptops this way and left them at that computer shop. You know, the laptop with the Joe Biden sticker. This would explain 'laptop' appearing in quotes in the lawsuit.
So two questions: If it's not Biden's laptop, could he just be hesitant to claim the device, especially if there is manipulated evidence, (or of course shady/criminal evidence no one has realized yet). Isn't there a difference between claiming an original device is yours, and only claiming the data MIGHT be yours on someone else's planted device? What implications are assumed by the owner of the device?
Also, Apple has iCloud servers in Alameda. And a lot of other cities. Could Biden be gambling for the California server to be the one that held his data (or could his attorney find out for sure?), and would that allow California laws to apply?
This is my thinking as well. It seems clear that at least some of the data on the laptops in question is real and that it's quite possible it came from his icloud account.
Does anyone know what happened to Trump's tax case that was tied up for so long in the Joint Committee on Taxation? (107 mill or so)
I'm not sure what Josh is up to with these assertions that Tish James is going after Trump because of Trumps insurrection activities. Trump has been on a decades long biz crime spree in NY.
People have been predicting this for years -- "Why would Trump run for president? He's just going to attract attention from people who can prosecute him."
Oh, come on. If one of us peons lied like he did to get a loan, and got caught, you can bet your law degree the state would come after us. In the instance of a rich and powerful person/family having done so, and the state seeking penalties, everyone saying, "oh, no, this is unheard of!" is just because it is so unusual for the government to actually nail the wealthy guy. My mother worked for the IRS for years. They would pursue the small tax cheats to the end of the earth. The big ones, if pursued at all, might have to pay a fraction of what they owed. The only problem with the case is that it took so long for them to bring it, Trump and his father were probably engaging in those shenanigans for longer than I've been alive, and I'm 60.
Well, no. Like perjury, lying in a loan application very rarely gets prosecuted when there's no loss.
If you've ever worked in mortgage, you know people lie all the time. All the time. There is some enforcement but not much. People cheat on their taxes all the time too. It's better since the "stated income" liar loans have gone away, but lots of people are either cheating on their taxes or lying on their mortgage application, or both. If the Republicans really wanted to shrink the deficit, they'd give the IRS more enforcement money.
I'm curious for your thoughts on Rob Blagojevich's conviction as compared with other more recent cases... to me it seems very much like "political bribery" (horse-trading) prosecution, of the sort that couldn't happen today.
Wasn’t trumps alleged fraud in both directions though? Not only overvaluing for the banks, but also undervaluing for tax purposes. In which case the harm would be directly to the state and other taxpayers.
I would guess that the tax matters are a component of the remaining counts in the indictment. The particular fraud at issue on summary judgement was about statements of financial condition he submitted as part of the process of getting or paying off certain loans.
It probably came out too late for y’all to address, but have you had a chance to listen to the Cheese’s lawyers previewing their case on Lawfare? It seems like he has a decent shot at acquittal (or at least mistrial), but I’d like to hear your take.
Huge missed opportunity for the feds to have a Cheese n' Crackers trial