Legal AF by MeidasTouch - Judge Gets Final MISSING LINK to Drop the Hammer on Trump

Episode Date: January 29, 2024

Judge Engoron in the up to $500 million dollar civil fraud case against Trump will issue his ruling this week, and now has a new Grade F report card from the court appointed monitor over Trump finances to use to rule against Trump. Michael Popok of Legal AF breaks down the new findings in the court ordered report about Trump’s NEW CONDUCT that will be used by Judge Engoron to establish that Trump knew he was committing fraud in his personal financial statements. Get up to 40% off for a limited time when you go to https://shopbeam.com/LEGALAF and use code LEGALAF at checkout! Remember to subscribe to ALL the MeidasTouch Network Podcasts: MeidasTouch: https://www.meidastouch.com/tag/meidastouch-podcast Legal AF: https://www.meidastouch.com/tag/legal-af The PoliticsGirl Podcast: https://www.meidastouch.com/tag/the-politicsgirl-podcast The Influence Continuum: https://www.meidastouch.com/tag/the-influence-continuum-with-dr-steven-hassan Mea Culpa with Michael Cohen: https://www.meidastouch.com/tag/mea-culpa-with-michael-cohen The Weekend Show: https://www.meidastouch.com/tag/the-weekend-show Burn the Boats: https://www.meidastouch.com/tag/burn-the-boats Majority 54: https://www.meidastouch.com/tag/majority-54 Political Beatdown: https://www.meidastouch.com/tag/political-beatdown Lights On with Jessica Denson: https://www.meidastouch.com/tag/lights-on-with-jessica-denson On Democracy with FP Wellman: https://www.meidastouch.com/tag/on-democracy-with-fpwellman Uncovered: https://www.meidastouch.com/tag/maga-uncovered Learn more about your ad choices. Visit megaphone.fm/adchoices

I'm Rob Gronkowski and last year I missed a fan duel kick of Destiny during the Super Bowl I spent the last year reflecting Meditating hanging out in Himalayan salt caves anything to get the image of that hook kick out of my head So when Fan Duel called and asked if I give it another go I jumped at the chance to lace them up for a shot at redemption. What's this? He's going to try again. And this year, I won't miss. The kick of Destiny 2 is here.

And this time, you get to pick if Gronk will make it or miss. Make your free pick now in the FanDuel Sportsbook Gap and watch the FanDuel Kick of Destiny live on Super Bowl Sunday. Make every moment more with FanDuel, North America's number one sportsbook. 19 plus and physically located in Ontario. If you have questions or concerns about your gambling

or the gambling of someone close to you, please contact Connex Ontario at 866-531-2600 to speak to an advisor free of charge or go to connexontario.ca. Please play responsible. Crypto is like finance, but different. It doesn't care when you invest, trade or save. Do it on weekends, or at 5 a.m. or on Christmas Day at 5 a.m.

Crypto is finance for everyone, everywhere, all the time. Kraken, see what crypto can be. Not investment advice. Crypto trading involves risk of loss. Kraken's registration details at kraken.com. legal.ca.pru.claimer. This is Michael Popak, Legal AF. Crypto trading involves risk of loss. Kraken's registration details at kraken.com. legal.ca.pru-clamer. This is Michael Popak, Legal AF.

The long wait is over. Judge Enguaron is going to be issuing his judgment, his decision in the 11-week New York Attorney General civil fraud case against Donald Trump this week, this upcoming week by Wednesday. We'll report on it right here on the Midas Touch Network. But in the interim, I want to tell you what's happened since the closing arguments in January till now that will obviously influence the judge's ultimate decision. Sure, as I've said in prior, legal AFs and hot takes, Judge Ngoran, who's the trier of fact without a jury, along with his principal law clerk,

I'm sure much to the chagrin of Donald Trump and Alina Haba and Chris Kice, the lawyers, who don't like the role of the principal law clerk. But those two people have worked tirelessly to sift through 11 weeks of witness testimony, expert testimony, thousands of pages of exhibits in order to render their decision. Now, for those that are new to this particular suit against Donald Trump, the cake was already half baked leading into the trial. In fact, the judge granted 11 weeks ago, it's actually now closer to 15 weeks ago, a motion for summary judgment brought by the New York Attorney General arguing that as a matter of law, the Trump Organization, Donald Trump, and his

executive children should be found to have committed persistent fraud, as that term is used under a unique body of law in New York called Executive Law 63-12, and the judge granted that, finding persistent fraud and granting certain remedies already, holding other remedies in abeyance until the ultimate trial, along with six more counts of fraud, insurance fraud, business record fraud, financial statement fraud, and conspiracies around that that are at the heart of the trial. That's what we're waiting on. And the ultimate money penalty, which we call discouragement in the law, because when you rip away from somebody ill-gotten gains and take it out of their bank accounts and claw it back, we call that discouragement, not damages. We're waiting on all that. So what's happened since? Well, we've got a report card in from the former federal judge

monitor, Barbara Jones, retired, who was in not so glowing terms, has said that effectively that she can't determine and hasn't been hired to determine whether there's continued fraud in the operation of the Trump Organization. But she did note dozens of instances of lack of controls that continue to exist errors in financial statements Into the tunes of tens of millions of dollars Phantom loans that never existed for up to 50 million dollars and a number of other very deficient

control and financial data issues within the company to this moment while they've been under a monitor ship, a monitor ship estate, if you will, imposed by the very judge that's about to enter the order. The judge 14 months ago, because he granted the summary judgment and found, I'm sorry, he determined as a matter of law that it was more likely

than not that persistent fraud was being perpetrated within the company installed a monitor. Now the monitor, in this case Barbara Jones, former federal judge who's been a federal, who's been a monitor in cases involving Rudy Giuliani and Michael Cohen, whenever you need a monitor or a receiver to take over control of a company, Barbara Jones is on the very top of your shortlist

related to that. She gets hired for these things because of her impeccable credentials and attention to detail and having been a former federal judge. So she's been in there with her team for 14 months, by the way, at the expense of the Trump Organization. They pay the freight for her, and I'm sure it's several hundred thousand dollars a month to monitor. Now she's not a day-to-day operational monitor. She made that clear in the new report that just came out on January 26th.

But let me give you some eye-popping comments and observations by a monitor, which is exactly what you don't want if you're Donald Trump and his organization as you're trying to convince a judge not to dissolve you, not to dissolve your companies, not to ban your senior executives, including Donald Trump, from lifetime involvement with the real estate industry and other remedies like that and take a half a billion dollars off you with interest, you don't want this barely see C minus report card. And let me read to you some pertinent things.

And then I'll end the hot take with another recent development that came out of the Second Circuit Court of Appeals, which will also bolster the powers of the New York Attorney General as the Judge Angoron works, I'm sure, a feverish weekend to complete his order, which he's announced will be issued on Wednesday. So let me just read you some things that I think are fascinating within the monitorship,

what I'll call the report card, or the report that's required to go to the judge. First of all, I don't think that the Trump Organization has done a couple of things, what we call remedial measures, since the New York Attorney General has started her investigation, which I believe is further evidence of the fraud. Let me repeat that. started her investigation, which I believe is further evidence of the fraud. We repeat that.

They've made some changes in their operations, which indicates that the prior action and the prior conduct was fraudulent, which only proves the point. For instance, the judge said, the monitor said that ever since this case has been started, a case that's all about statements of financial conditions, SFCs of Donald Trump being fraudulent, it looks like they're no longer using SFCs with their outside lenders. First, the big bombshell is they're not doing any business in New York right now other than their current assets

and their current loans. During the last 14 months, the Trump Organization, according to the monitor, has not taken out another loan, has not refinanced, has not acquired any new assets at all. All they've done is dissolve 50 or 60 assets, tried to sell a house, tried to sell a plane, and things like that, and keep up with their current loan obligations. But they have not taken any new loans out. That is fascinating that in 14 months, the New York Attorney General by dint of her lawsuit

has basically ground the Trump Organization to a halt in conducting business. But the part that the monitor, former federal judge Jones doesn't like, is that they are required by their loan documents to continue to submit for active loans, statements of financial conditions. But without permission of the lenders, they have instead, the Trump organization

and the trust that holds all of Donald Trump's assets have started to use a material assets and material liability statement. What we refer to in the business as MAML, M-A-M-L. And the mammals do not listen to this, do not provide an estimate of the property's value, the asset's value, the very thing that got Donald Trump in trouble, which is with his cooked books

and hyperinflated numbers for asset value, the MAMLs that they're using now don't even bother to put an estimated value next to these things. See, I see this as what's called in the law a subsequent remedial measure, which is a term of art in the law. And it means you knew what you were doing was wrong before the fraud in your statements of financial conditions about your asset value and the like. And you've stopped using those, which is another proof, another proof that the judge is gonna be able to use in his order that you knew or should have known

that you were committing persistent fraud related to your statements of financial condition. I don't think this is getting enough media attention. And even though it wasn't part of the trial, because the judge can rely on, as the trier of fact, all data points, including the monitoring report, he'll be able to cite the fact that it is indicative of the intent to defraud that they changed

their method of asset valuation and are submitting a new form that banks have not even allowed them to do in lieu of the prior fraudulent statement of financial conditions. I think that is a sizzling disclosure here made by the monitor. In fact, she says in footnote three of her report, we understand this practice began after the litigation was commenced by the plaintiff. In other words, she's confirming that she believes it's a

subsequent remedial measure that can be taken into account by the judge and try to find fraud in the other six counts that are remaining. But even in the MAML, the mammal, there are errors and control issues within the company. This is a case that's pending before the judge about an entity that the New York Attorney General wants to put out of its misery and put out a business for lack of financial controls in improper financial reporting.

And even as late as January 26th, 2024, the monitor by the judge is finding lack of controls and inconsistent financial information and errors and material errors. Even going so far as to saying there are loans that used to be on the books of the Trump Organization between Donald Trump and some other entity for $50 million that the Trump Organization

had to admit doesn't really exist. It was just a phantom plug. It was a $48 million, we call that in the shop, a plug. That's when you can't balance your balance sheets, you can't balance your general ledgers, right, using double entry accounting methods, using generally accepted accounting principles, gap. So you have to put a 48 million dollar plug to make it work. Well, they put a plug in, but the plug was fake phony phantom. In fact, she noted that the monitor, there's a number of intercompany transactions, intercompany loans that are improperly listed on the balance

sheet. I will tell you having worked in financial services and worked in large companies, you know, 10 times the size of this particular company, Trump Organization, that, you know, these types of issues are a big thing. Intra company loans are important. The Internal Revenue Service likes to look at intercompany loans to see if they're real or they're not real, or if they're being used as improper plugs to make the balance sheet balance or not. And it looks like that's exactly what the Trump organization was doing. And this is 14 months into the establishment of the monitor ship. They've been, they've been in the principal's office for 14 months, right? And they're still cheating on their tests. I mean, it's just mind boggling,

but this again, we'll get baked into Judge Engorron's order. In fact, when we get the order, I will, I'm sure I'll be able to find exactly where the monitor's report from January 26 ended up in the judge's order appropriately. What's more important than sleep? It's the foundation of our mental and physical health, and when you're sleeping well, you can perform it your best in every way. Proper sleep can also increase focus, boost your energy and improve your mood. Introducing Beams Dream Powder. It's a science-backed, healthy hot cocoa for sleep.

If you know me, you know that dream has been a game changer for my sleep. Sometimes I find myself up at night in bed with thoughts, uneasiness, going on my phone. Well, that was the case until I started drinking Beams Dream Powder prior to this Dream Powder. The poor sleep in late nights staying up, affected my mood and affected my energy, but not anymore. And today, our listeners get a special discount on Beams Dream Powder.

Their science-backed healthy hot cocoa for sleep with no added sugar. It's now available in many different delicious flavors. It's really good like chocolate peanut butter, cinnamon, cocoa, and sea salt caramel with only 15 calories and zero grams of sugar. Better sleep is never tasted better and other sleep aids can sometimes make you feel groggy the next day. Take it for me. I have tried them and they do. But dream it contains a powerful all natural blend of Reishi, magnesium, L-theanine, and melatonin and nano CBD to help you fall asleep, stay asleep and wake up refreshed. The numbers don't lie. In clinical study, 93% of participants reported that dream helped them get better sleep. Beam dream is easy to add to your

nighttime routine, just mix it in hot water or milk, froth, and enjoy before bed. Find out why Forbes and New York Times are all talking about Beam and why it's trusted by the world's top athletes and business professionals. If you want to try Beam's bestselling dream powder, get up to 40% off for limited time when you go to shopbeam.com slash legalaf and use legalaf as a code at checkout. That's shopbeam.com slash legalaf and use legalaf, uh, the code when you check out for up to 40% off. Um, she then listed incomplete disclosures, which she doesn't like about loan documents, about loan information

that's provided to lenders, about certifications, for instance, in a case about fraud and defrauding lenders, the monitor found I'll read to you on page seven of her report. Certain loan agreements require the Trump Organization to provide annual and quarterly certifications attesting to the accuracy and completeness of financial information submitted to lenders. That's what the whole case is about. But as described in previous reports, the Trump Organization has not consistently provided these certifications.

We identified 10 instances where certifications attesting to the accuracy and completeness of financial information was required by a lender, but was either incomplete or not provided in the last 14 months. Since raising this issue by the monitor, we've observed the Trump organization submitting these certifications when required. Again, in a case about cooked and fraudulent statements of financial condition, they either stopped using that form and created a new form that the lenders didn't approve, right, and submitted them to show that they knew what they did in the past was fraudulent

or and or they were required to certify to the accuracy and the compliance with generally accepted accounting principles of their submissions and they didn't do that either. It's just my boggling, you know? That they're doing this in real time live in front of the judge, it's about to sanction them, possibly dissolving them, putting them out of business

and taking half a billion dollars from them. I mean, there's no other way to put this. They needed to be on their best behavior. I'm not saying they needed to get straight A's on this report card, but like, this isn't even a gentleman's C. This is a dunce cap D, for the Trump organization.

An organization that I'll remind everybody on this hot day can still run by Donald Trump, Eric Trump, Don Jr. Yes, the CFO went to jail. I say that like it's normal. Yes, his CFO 50 years went to jail for tax fraud that is involved in tax fraud related to the company. Yes, his controller got fired, who's supposed to be responsible for the controls.

But the rest of the people are there. I'm sure if you go online, people are still getting hired at the Trump Organization, and it's headed by Donald Trump. So with all of this, she might as well, the monitor might as well have just written, Donald Trump, I can't tell if he's committing continued fraud, but I suspect that he is. I mean, that's effectively what she's talking about here. And then she wraps up her order, her report, with a lineup of other inconsistent disclosures that make absolutely no sense to the tune of millions of dollars, millions and millions of dollars

that have been improperly disclosed to third-party lenders. So from my takeaway here, then I'll get to the final, which is her reporting to the judge, the interactions between the Trump organization and trust headed by Donald Trump and her. I'll get to that in a minute. But the takeaway here is she's basically identified subsequent remedial measures that indicate that Donald Trump and his organization knew that they were committing fraud in their statements of financial conditions in the past,

which is at the heart of the case, which the judge will use in his order coming out Wednesday, that they used intercompany loans as improper phantom plugs to balance balance sheets that shouldn't have been balanced that way and didn't properly disclose those intercompany loans between entities owned and controlled by Donald Trump or Donald Trump himself, which is also a form of fraud because you're defrauding either taxing authorities or you're defrauding the IRS, local taxing authorities or the Internal Revenue Service because you're using the intercompany loans to take assets and therefore revenue production off of the balance sheet lowering your taxes.

That's why you use it. And that's what the judge is identifying here. Remember, the monitor also quite clearly reminded the judge, I can't tell, this is the part that I circled. And another thing before I get to that is that the Trump organization has basically effectively has been shut down for the last 14 months,

hasn't acquired a new piece of property and hasn't taken out a new loan. But she reminded the court that her day-to-day duties are not to monitor the normal day-to-day operations of the Trump Organization. Thus, to quote page three, "'I am not in a position to conclude whether fraudulent activity occurred.'"

So even now, she's not absolving them. So Donald Trump can't wave this around. It hasn't, I don't think. In a social media post, like, we've been absolved. The judge says there's no fraudulent activity. No, that's not what it says. I don't want you to know that right here. And then finally, there's the interactions

with the monitor. She said, they're okay. She said, they've given me information, but there are things that are missing about completeness and timeliness and things where I have to follow up after I find them in the books that they should have been disclosed to me in advance,

including the dissolution of different companies. She said, I have not concluded, this is on page 12, although I've not conducted a comprehensive compliance assessment, the issues identified above may reflect the lack of adequate internal controls and could be remediated with effective processes for review and validation and oversight and training. For example, based on the inconsistencies described above, it does not appear that there are adequate accounting and presentation standards, deadly's deadly for Donald Trump.

Procedures or training associated with the preparation of financial disclosures to the extent adequate standards and procedures do exist, they do not appear to have been followed across the organization. That is deadly for him. And we will see, I don't know about all 12 pages, but we will see a recitation of this rundown to further support Judge Angoran's ruling on Wednesday about the size of it. My prediction, it's gonna be north of $350 million.

I think it's gonna be closer to $500 million with interest running to tack it on another $100 million. It could be $600 million. There'll be attorneys fees and costs of the Attorney General that will be reimbursed here by Donald Trump. I mean this could this could be a five or six hundred million dollar Decision if Donald Trump doesn't like it and he wants to appeal he'll have to post a bond usually it's about 20% more than the amount of the judgment.

So if you're looking at a $500 million judgment, he's gonna have to post another 100 million, so 600 million, he's gonna have to find a bonding company who's gonna rely on his personal financial statements to give him a loan, a bond for $500 million, $600 million. And that's even gonna require him to put at least $60 or $70 million down as a premium. Or he has to come up with the cash.

And this is on the heels of E. Jean Carroll and the $83.5 million that he owes her that he's gonna wanna appeal and put up another bond. So he's gonna have to come up with like $700 million in bonds over the next 30 days or so in order to stop the enforcement of these judgments. Does he have it? Barely, I mean, I don't think he has that much cash on hand.

A lot of it is tied up in real estate that he doesn't seem to be actively liquidating or selling and what bank is going to lend to him right now at this rate. And this is the squeeze that we said that was going to happen. He was going to be between a rock and a New York attorney general and a judge and Goron hard place and be squeezed all at the same time coming to a head right now. We'll follow what happens next, only one place on Legal AF on on the Midas Touch Network, on Wednesdays and Saturdays at 8 p.m. Eastern Time, and then on audio podcast platforms of your choice.

So until my next hot take, until my next Legal AF, this is Michael Popak reporting. Hey Midas Mighty, love this report? Continue the conversation by following us on Instagram, at MidasTouch, to keep up with the most important news of the day. What are you waiting for? Follow us now.