Manhattan prosecutors advance probe into Trump’s estate in Seven Springs
Manhattan prosecutors are stepping up investigation into
Donald trump, targeting an area in Westchester County, NY that the former president tried unsuccessfully to develop, according to people familiar with the matter.
In recent weeks, according to the population, the Manhattan District Attorney’s Office has issued new subpoenas and requested tapes of local government meetings related to the Trump Organization’s unsuccessful attempt to create a luxury housing estate in Seven Springs, a 213-acre property the former president bought for $ 7.5 million in 1995.
Mr Trump valued the property for up to $ 291 million in financial statements that the New York attorney general’s office, which is also investigating Seven Springs, said were handed over to financial institutions. Inflating assets to help obtain loans or other financial benefits may be a state criminal offense, legal experts have said.
The scrutiny of Seven Springs is part of a larger criminal investigation into Mr. Trump, his company and its executives, which also includes financial transactions at properties such as Mr. Trump’s flagship Trump Tower in Manhattan, has previously reported to the Wall Street Journal. Outside New York, prosecutors are also reviewing a loan for the Trump International Hotel and Tower Chicago, people familiar with the case said, CNN reported earlier.
Manhattan District Attorney’s Office Cyrus Vance has said in court records it is investigating possible tax, insurance and bank fraud. Investigators now have Mr. Trump’s tax returns and other financial records after an 18-month court battle, allowing prosecutors to compare Mr. Trump’s statement to lenders with his statements to tax authorities.
Prosecutors in recent weeks sent subpoenas to land use lawyer Charles Martabano and engineer Ralph Mastromonaco, both involved in planning the Trump Organization’s proposal for Seven Springs, the people said.
Mr Mastromonaco confirmed that he had received a subpoena and said he handed over documents to the district attorney’s office, including communications with others involved in the project.
The district attorney’s office also requested tapes of planning council meetings in Bedford, NY, one of three towns where the Seven Springs estate is located, people familiar with the matter said. MM. Mastromonaco and Martabano appeared before the board of directors with Mr Trump’s son Eric Trump in 2012 and 2013, according to meeting minutes.
Lawyers for Mr. Trump and the Trump Organization did not respond to requests for comment. Last month, after the U.S. Supreme Court denied Mr. Trump’s efforts to prevent Mr. Vance, a Democrat, from obtaining his tax returns, Mr. Trump, in a written statement, called the ‘investigation of the biggest political witch-hunt in the history of our country.
Prosecutors’ interest in the local planning process could be linked to the property’s valuation and incorrect inflation in financial documents, lawyers said. Mr. Trump valued the property at $ 291 million in 2012, according to what he called his “statement of financial position,” a collection of financial information compiled but not audited by his accountants. Mr. Trump valued the property between $ 25 million and $ 50 million on financial disclosure documents filed when he was president.
Local tax assessment rolls show the property’s market value at approximately $ 19 million.
The new subpoenas add to the picture of what is known about Mr. Vance’s investigation. Prosecutors have already sent subpoenas to some of Mr. Trump’s lenders and a long-time insurance broker.
The district attorney’s office hired Mark Pomerantz, a former federal prosecutor now on leave from Paul, Weiss, Rifkind, Wharton & Garrison LLP, to work on the investigation, according to people familiar with the matter. A spokesperson for Mr Vance said Mr Pomerantz was sworn in as a special deputy district attorney last month.
The office also hired
FTI Council Inc.
do forensic accounting work on the case, people familiar with the matter said. An FTI spokesperson declined to comment.
Manhattan prosecutors’ interest in Seven Springs dates back to at least December, when they sent a different batch of summons to the three cities, the Journal reported. The subpoenas asked officials at Bedford, North Castle and New Castle to provide information on tax assessments, city communications and town planning council minutes, local officials said.
Cities have since returned the materials, local officials said.
The information sought by prosecutors focuses on a multi-year effort to secure the local approvals needed to build a luxury home subdivision after Mr. Trump’s initial plan to build a golf course in Seven failed. Springs in the early 2000s. The subdivision effort dates back to at least 2004 and continued until 2013, according to planning and zoning council documents.
In 2015, the Trump Organization abandoned development plans, choosing instead to place 158 acres of land in a conservation easement, or land that an owner agreed not to develop.
The final appraisal, sent to Mr. Trump in 2016, values the property at $ 56.5 million and the conservation easement portion at $ 21.1 million. Seven Springs LLC, part of the Trump Organization, claimed a tax deduction of $ 21.1 million for the easement in the 2015 tax year, attorney general’s office attorney said in court .
New York Attorney General Letitia James, who in 2019 opened a civil fraud investigation against Mr. Trump and his company, said her office was investigating the conservation easement at Seven Springs. The Trump organization called the politically motivated Democrat Ms James’ investigation.
Write to Corinne Ramey at [email protected]
Copyright © 2021 Dow Jones & Company, Inc. All rights reserved. 87990cbe856818d5eddac44c7b1cdeb8