Court Battles

Accounting firm retracts financial statements, cuts ties with Trump Org amid NY AG probe

Former President Trump’s longtime accounting firm said it could no longer vouch for the financial statements it prepared for the Trump Organization following accusations from the New York attorney general that the company had been fraudulently misrepresenting the value of its assets.

In a letter that was submitted in new court filings on Monday, William Kelly, the general counsel for the accounting firm Mazars, told the Trump Organization that it would be terminating their business relationship and that the former president’s company should inform any recipient of the financial statements that they can no longer be relied upon. 

“We write to advise that the Statements of Financial Condition for Donald J. Trump for the years ending June 30, 2011 — June 30, 2020, should no longer be relied upon and you should inform any recipients thereof who are currently relying upon one or more of those documents that those documents should not be relied upon,” Kelly wrote in the letter, which is dated Feb. 9. “We have come to this conclusion based, in part, upon the filings made by the New York Attorney General on January 18, 2022, our own investigation, and information received from internal and external sources. 

“While we have not concluded that the various financial statements, as a whole, contain material discrepancies, based upon the totality of the circumstances, we believe our advice to you to no longer rely upon those financial statements is appropriate,” Kelly added.

The move comes after New York Attorney General Letitia James (D) made surprising allegations in the midst of her office’s investigation into Trump’s business practices. James’s office said in state court last month that it has found “significant additional evidence indicating that the Trump Organization used fraudulent or misleading asset valuations to obtain a host of economic benefits, including loans, insurance coverage, and tax deductions.”

According to the attorney general, those misrepresentations came on Trump’s regularly prepared statements of financial condition which the company provided to tax officials, potential investors and creditors. 

In a statement a spokesperson for the Trump Organization expressed disappointment with Mazars’ decision, while saying its work was in accordance with accounting standards. 

“While we are disappointed that Mazars has chosen to part ways, their February 9, 2022 letter confirms that after conducting a subsequent review of all prior statements of financial condition, Mazars’ work was performed in accordance with all applicable accounting standards and principles and that such statements of financial condition do not contain any material discrepancies,” the statement said. “This confirmation effectively renders the investigations by the DA and AG moot.”

 

James has not brought legal action alleging wrongdoing by Trump or his business as part of her civil investigation, which she has said is still ongoing.

Trump is fighting the investigation in state and federal court as the attorney general’s office seeks to depose him and his adult children.

This story was updated at 5:17 p.m.

Tags Donald Trump New York New York AG investigation Trump business Trump finances Trump Organization

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