New York: The Manhattan Attorney General’s office has summoned a New York City property tax agency as part of a criminal investigation into Donald Trump’s company, the agency confirmed Friday, indicating that prosecutors are studying the former president’s efforts to lower commercial property taxes. To obtain evidence of potential fraud.
The subpoena is the latest indication that Manhattan County Attorney Sai Vance Jr. is looking into the values that Trump has assigned to several commercial properties in tax returns and loan documents.
Besides information already summoned from creditors, the tax agency documents will help investigators determine whether Trump’s actions inflate the value of his holdings to secure favorable terms on loans while shrinking those values to lower tax bills for that property.
Francis Hain, chair of the New York City Tax Committee, confirmed the subpoena in response to an inquiry from Reuters.
The subpoena would likely force the agency to provide detailed data on income and expenses that the Trump Organization was to provide as part of an effort to cut tax assessments on some of its business properties, according to people familiar with the commission’s operations. Trump’s holdings include the Trump Tower and Trump Plaza.
They added that those filings would typically include appraisals that the company submits to challenge market values assigned to Trump’s property by tax assessors in the city.
Subpoenas were also issued to at least two of the creditors who helped fund Trump’s real estate holdings, Deutsche Bank AG and Walder Capital Finance, Reuters previously reported.
Vance’s office declined to comment on the tax commission’s subpoena. Deutsche Bank also declined to comment.
Ladder Capital did not respond to a request for comment. A representative for Trump and a lawyer for the Trump Organization also did not respond to requests for comment.
Vance did not comment specifically on the focus of his investigation, but indicated in court files that his office is exploring “possibly widespread and prolonged criminal behavior” in the Trump Organization, including possible falsification of records as well as insurance and tax fraud.
The Vance investigation is the only known criminal investigation into Trump’s real estate business. New York State Attorney Letitia James is leading a separate civil investigation into whether the Trump company has erroneously reported property values to secure loans and obtain economic and tax benefits.
The Tax Commission is New York City’s forum for adjudicating appeals to tax assessments set by the City’s Department of Finance, which administers property tax bills and collections.
A spokeswoman for the New York City mayor’s office said the department had not been summoned.
Tax assessments are based on the market value of the property, as determined by management, so challenges require detailed documentation to show that the assigned value is not accurate, including revenue and occupancy data.
If Trump’s actions claim much less value for a property in their tax returns than in documents they filed with creditors, the discrepancy could help support the fraud charge, according to Daniel J. Horowitz, a white-collar defense attorney who previously filed the trial cases. Tax fraud complex during more than eight years in the Manhattan District Attorney’s office.
If there is a “material difference” between the claimed property values on the tax returns and the claimed values in the loan documents, I added, “This is somewhat convincing.”