In an attempt to fend off the New York Attorney General’s efforts to destroy his family company, former President Donald Trump and his army of lawyers saved the best for last at his bank fraud trial—and it failed miserably.
The three-month civil trial neared its conclusion on Tuesday when Trump’s team ended the presentation of its defense with testimony from a highly paid New York University accounting professor. Except the testimony backfired, showing the gaping holes in the billionaire’s excuses for lying to banks for years about his net worth.
It cost Trump’s business and his 2024 presidential campaign treasure chest some $877,500 to hear from finance academic Eli Bartov at trial. In return, the Trump family got to watch their expensive expert get torn apart by an AG attorney who pointed out contradictions in his testimony, get repeatedly interrupted by the judge, and finally be discredited as a failed voice of authority.
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“There's no contradiction at all,” Bartov kept repeating on Tuesday, to the point where it almost became humorous.
Trump’s team hoped Bartov’s credentials at the NYU Stern School of Business would add weight to their argument that Trump couldn’t possibly have fooled the banks that lent him money—chief among them, the massive German financial institution Deutsche Bank.
In Bartov’s view, banks rely on their own assessments. No client applying for a loan is trusted anyway. People are expected to fudge a little. The opposite, he testified in court, would be preposterous.
“You have to believe Deutsche Bank... is not aware of every accounting textbook, every scientific paper says again and again and again: you cannot rely on the numbers as reported in the financial statement... you have to make your own independent analysis, come up with your own numbers,” Bartov said on Tuesday.
But that point quickly ran into three problems. First, Justice Arthur F. Engoron already determined in September before the trial ever started that Trump did indeed commit bank fraud by routinely faking the value of his properties. Second, AG Letitia James’ investigators keep asserting in court that it doesn’t even have to prove the banks were truly tricked, only that Trump broke the law by lying—an idea the judge keeps endorsing. And third, even Trump’s own star expert had to acknowledge that any lying by Trump didn’t exist in a vacuum.
That last point was made apparent as Bartov answered questions from Louis Solomon, the chief of enforcement at the AG's real estate finance bureau. Although Bartov kept insisting that the banks in no way relied on Trump’s fanciful numbers, his previous assessment said otherwise. The state lawyer pointed to Bartov’s own sworn expert statement in court filings, using a red underline to highlight places where the professor used particular language to hedge around Trump’s financial shenanigans.
“Mr. Trump's [statements of financial condition] for 2011 through 2021 did not impact significantly Deutsche Bank's decisions to extend loans to defendants or to set these loans' interest rates,” Bartov wrote.
Elsewhere in his sworn expert statement, Bartov also insisted the bank’s “reliance on the information in the [statements of financial condition] was marginal in deciding whether to extend the subject loans and what interest rate to require.”
Solomon questioned Bartov about the way the professor chose to use the words “significantly” and “marginal,” noting those language choices implied that the banks didn’t simply ignore Trump’s inflated assessment of his own golf courses and buildings in California, Florida, Illinois, New York, and the District of Columbia.
Former President Donald Trump sits at the defense table with his attorneys Christopher Kise and Alina Habba
Eduardo Munoz Alvarez/ReutersBartov demurred, blaming himself for maybe using the wrong term—but still asserting that the banks gave no consideration whatsoever to Trump’s personal financial statements.
The Trumps’ pricey expert quickly ran into trouble, however, when the AG’s office pointed out that Deutsche Bank had a policy in place that would routinely cut down certain Trump assessments by half, a clean and simple calculation that vastly reduced the billionaire’s fantasy finances. So in 2014, when Trump reported a $3.8 billion value in real estate net equity, the bank’s “DB adjusted” value was half that, at $1.9 billion. It was the same across the board, year after year. As the bank officer Nicholas Haigh had previously testified at this trial, it was essentially an automatic adjustment for real estate assets.
And yet, Bartov quizzically asserted that the bank didn’t have to rely on Trump’s original numbers to reach that conclusion.
Solomon repeatedly asked him how in the world a bank could cut a number in half without relying on that number to begin with.
“If I take the number in the statement of financial condition and apply half of that... is it your testimony that I’m not relying on that number in the first instance?” he asked.
Bartov stuck to his guns, rejecting even the notion that Trump would or could somehow lie in a way that mattered.
Things took a strange and personal turn toward the middle of the day, when the AG’s team finally confronted an uncomfortable situation that had been simmering in the background: the fact that Bartov had once served as their own office’s expert in a previous, unrelated case. (Bartov was called as a state expert when AG James’ predecessor sued Exxon Mobil for allegedly defrauding investors by downplaying climate change risks, a case it lost at trial.)
But the government lawyers eviscerated any inkling of an endorsement of Bartov’s credentials head-on by making a startling turn, essentially disavowing his expertise entirely. During his cross-examination of the witness, Solomon pointed at his own office’s failure to win the Exxon trial to show that the other judge had serious reservations about the academic too.
Solomon noted how Justice Barry R. Ostrager in 2019 wrote, “the Court rejects Dr. Bartov’s expert testimony as unpersuasive and, in the case of his testimony about the Mobile Bay facility, finds Dr. Bartov' s testimony to be flatly contradicted by the weight of the evidence.”
That line suddenly cast new light on Bartov’s repeated assertions Tuesday that he wasn’t contradicting himself now about Trump. Although the former president wasn’t in the courtroom this week, one of his sons who is a defendant in the case, Eric Trump, was in the pews during Bartov’s testimony.
The nearly three-month trial essentially wrapped up this week and will take an extended break over the holidays. Both sides are expected to return for a single day in mid-January for closing arguments, after which the judge will conclude whether Trump also committed insurance fraud and faked business records—and how much he’ll have to pay as punishment.
The judge has already ruled that the Trump Organization should be stripped of its business licenses, but there’s a messy road ahead as lawyers duke it out over exactly what that means—and if the massive corporate umbrella of businesses will be forcefully yanked from the family’s control.
