Donald Trump’s most recent legal defeat hits him where it hurts the most: it targets his fundamental persona.
For decades, he has presented himself as a brilliant business magnate who achieved success in one of the world’s most competitive cities.
That image, inextricably linked to New York deal-making and reinforced by tireless self-promotion, propelled him to international renown, allowing him to remake himself first as a reality TV star and then as President of the United States.
However, Judge Arthur Engoron’s finding in a civil fraud case involving property value inflation and false financial statements to gain better credit conditions contradicts Mr. Trump’s whole story.
Instead, it portrays him as a charlatan, dealing a significant blow to his corporate empire and riches.
Donald Trump famously said that the mind can conquer any impediment. But what a barrier this is!
The ruling dramatically limits the Trump Organization’s capacity to conduct business in New York. He has been barred from having any directorships for three years, and his firm is also unable to get loans from city-registered financial institutions during that period.
He has been punished with a massive financial penalty of $355 million (£282 million; €329 million), which rises to more than $450 million with interest, significantly exceeding the amount of cash he has on hand. His company will continue to be monitored by an independent monitor, with a separate independent director of compliance approving important business decisions.
In what may be the single bright light for the former president and Republican frontrunner, the Trump organization was spared the corporate equivalent of the death penalty: the loss of its business licenses.
For decades, Mr. Trump has appeared to rally and recover from scandals and legal problems that may irreversibly harm others, earning him the nickname Teflon Don, which means nothing clings to him.
The term had previously belonged to mafia leader John Gotti, who was acquitted in a series of high-profile cases in the 1980s. But today’s verdict suggests that Donald Trump’s luck, like Gotti’s, may be running out.
Judge Engoron emphasized Mr. Trump’s and the other defendants’ lack of contrition, as well as their history of repeated and persistent deception. In this case, he stated that examples of deception within the corporation spanning more than a decade “leap off the page and shock the conscience.”
However, he stated that the defendants were unable to recognize their mistakes, stating, “Their complete lack of contrition and remorse borders on pathological.”
Unsurprisingly, Mr. Trump sees things quite differently. He claims to have developed a “perfect company” and denies that he should be penalized for fraud because the banks were paid in full. He continues to allege, without providing proof, that his legal battles are a scheme by elite Democrats to keep him out of the White House.
According to Mr. Trump’s estranged niece, Mary Trump, the judge’s decision marks the end of the Trump family’s heritage. “Today is an emotional day, but one thing is for certain: the Engoron decision is absolutely devastating for Donald,” she said in a Facebook post.
Mr. Trump, the son of a real estate developer whose ventures included middle-class apartment complexes in the outlying boroughs of Brooklyn, Queens, and Staten Island, had long hoped to make his reputation among Manhattan’s skyscrapers.
A seven-year development frenzy from 1976 to 1983, which included the namesake Trump Tower, cemented his status as a New York real estate magnate. “Not many sons have been able to escape their fathers,” he told the New York Times in 1983, implying that he had already done so by the age of 37.
And, yes, the 1980s age of greed and excess was a fruitful moment for a young developer with ambition.
Trump Tower, with its great position on Fifth Avenue, helped put Donald Trump on the map. Once his reputation had been established, he began to put his name on every project he completed.
By the early 1990s, however, Donald Trump had filed for many company bankruptcies and nearly lost everything.
During this period, Rich Herschlag, the Manhattan Borough President’s principal engineer, collaborated with Mr. Trump and his firm on the Riverside South project, which involved redeveloping a disused train yard on the Upper West Side.
He thinks it was “everything or darn close to everything” for Donald Trump to be recognized as a great real estate developer, particularly in building an empire on his father’s heritage.
“To watch it [potentially] gutted and decimated, I can’t imagine that’s anything less than an emotional horror,” he was quoted as saying by the BBC.
It is unclear how Mr. Trump intends to settle the almost half-billion-dollar debt or whether he will sell any properties or enterprises to generate the funds. Forbes values his huge real estate business in New York at $490 million, but he also owns hotels, golf courses, apartments, and a winery around the country.
He plans to appeal the sentence, putting the verdict on hold until a higher court evaluates the issue.
However, if he wants to avoid paying the fine or having his personal assets taken while the appeal procedure is ongoing, he must deposit the entire sum within 30 days or arrange an expensive bail.
Selling any of his magnificent Manhattan real estate would be an act of indignity for the former president, and he would not make the decision lightly.
Whether or not Donald Trump is able to recover from this financial shock, the effect is likely to considerably reduce his wealth.
The ruling in the city where he grew to prominence, while always being an outsider, is clearly a significant loss. And no character in New York real estate has been more reviled by Mr. Trump than the “loser” during the last six decades.
