The longtime accounting company for former President Donald Trump and his family business recently parted ways with him, the New York Attorney General’s Office noted in a Monday court filing.
Legal experts say the news likely does not bode well for the Trumps.
The breakup between the Trump empire and Mazars USA LLP was first revealed in a letter from the accounting firm sent to the Trump Organization’s chief legal officer Alan Garten on February 9, 2022.
“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,” the letter from Mazars general counsel William Kelly begins.
Attorneys and legal experts quickly moved to interpret the missive.
“Mazars has effectively fired the Trump Organization, citing a non-waivable conflict, and determined that Trump’s financial statements from 2011-20 should not be relied on,” tweeted attorney and New York City-based legal writer Luppe B. Luppen, who is widely known as @nycsouthpaw on legal Twitter.
“The determination by Mazars that Trump’s financial statements over a full decade are not reliable, through no fault of its own, amounts to a declaration that it has been repeatedly misled by its client,” he added in another tweet.
Luppen also penned a short analysis of the document on his blog.
“The accounting firm also said it had concluded that its new position casting doubt on the financial statements created a conflict of interest between it and the Trump Organization that could not be waived, and therefore it could do no new work on Trump’s behalf,” the post notes. “Underlining the precipitousness of that decision, Mazars informed Garten that it wouldn’t be able to complete some tax returns on behalf of the former president and his wife that are due tomorrow.”
The Mazars development, though nearly a week old, was highlighted in a Monday court filing by New York Attorney General Letitia James (D) as part of a move to force the Trump Organization, Donald Trump Jr., Ivanka Trump and others to comply with a subpoena for testimony and documents. James has been investigating the Trump Organization for years over claims that the family’s patriarch and eponymous entity inflated certain assets for valuation purposes and then devalued them for tax purposes.
A lawsuit was filed in the summer of 2020 and James’s team deposed Eric Trump last October.
“For more than two years, the Trump Organization has used delay tactics and litigation in an attempt to thwart a legitimate investigation into its financial dealings,” James said in a press release announcing the disclosure. “Thus far in our investigation, we have uncovered significant evidence that suggests Donald J. Trump and the Trump Organization falsely and fraudulently valued multiple assets and misrepresented those values to financial institutions for economic benefit. The Trumps must comply with our lawful subpoenas for documents and testimony because no one in this country can pick and choose if and how the law applies to them. We will not be deterred in our efforts to continue this investigation and ensure that no one is above the law.”
Other lawyers chimed in to suggest that the Empire State’s attorney general had obtained a significant new ally in the accounting firm.
In the filing, James alleged that Trump and his business have misstated several “objective facts” in documentation provided to Mazars, including “the size of Mr. Trump’s Trump Tower penthouse;” “the process by which Mr. Trump or his associates reached valuations, including deviations from generally accepted accounting principles in ways that the statements did not disclose;” and “the purported involvement of ‘outside professionals’ in reaching the valuations.”
[image via Saul Loeb/ AFP/Getty Images]