New York attorney general investigating whether Trump inflated his assets to get loans

President maintains ownership over his vast business empire, though he has entrusted day-to-day operations to his sons Eric and Donald Jr

New York's state attorney general is investigating whether Donald Trump illegally inflated the value of his business assets on annual financial statements to help secure bank loans and other financial windfalls, the office revealed in a lawsuit filing on Monday.

The filing, from the office of New York AG Letitia James, is seeking to compel Mr Trump to comply with the state's subpoenas of financial records that he used to summarise his assets and debts when propositioning lenders.

Ms James' office told Reuters the subpoenas were issued as part of an “ongoing confidential civil investigation into potential fraud or illegality.”

The lawsuit from the state AG's office asks a New York state judge to force the Trump Organisation to comply with its subpoenas. One of those is an order demanding testimony from the president's son Eric Trump.

Mr Trump maintains ownership over his vast business empire, though he has entrusted day-to-day operations to his sons Eric and Donald Jr.

Mr Trump has spent the duration of his presidency fending off accusations of corruption, including campaign finance crimes, financial crime and ethical mismanagement related to his business empire, and ties between his campaign and Russia, to name just a few.

His former personal lawyer Michael Cohen, who is roughly halfway through a prison sentence after pleading guilty to lying to Congress about an ultimately unsuccessful bid to build a Trump Tower in Moscow in 2016, has accused Mr Trump under congressional oath of inflating the value of his various properties in business and bank loan negotiations — only to deflate them on his tax returns.

“It was my experience that Mr Trump inflated his total assets when it served his purposes, such as trying to be listed amongst the wealthiest people in Forbes, and deflated his assets to reduce his real estate taxes,” Mr Cohen told the House Oversight Committee last year.

Mr Cohen submitted to the committee parts of those documents listing Mr Trump's asset valuations, known as “statements of financial condition,” for the years 2011, 2012, and 2013. Those statements showed how he selectively inflated the value of his assets on documents for bank loans but later sought to deflate them for other purposes, Mr Cohen said.

The New York state attorney general's office is pursuing those same documents and other similar ones, according to the heavily redacted lawsuit filing from Monday.

This is not the first time Mr Trump has been the subject of a New York investigation.

In 2018, the president shut down the Donald J Trump Foundation amid a state AG investigation into accusations he had used the charitable organisation to cover legal expenses for his businesses, purchase expensive art, and to boost his 2016 presidential campaign. Mr Trump was ordered to pay $2m in damages last year.

And in 2016, Mr Trump's namesake business school programme, Trump University, was forced to pay $25m to settle a fraud case brought by former New York Attorney General Eric Scheiderman.

Another top prosecutor in New York, Manhattan district attorney Cyrus Vance, is investigating the president for "alleged bank and insurance fraud," he revealed in a court document filed earlier this month.

In 2019, Mr Vance's office subpoenaed Mr Trump's accounting firm, Mazars USA, for eight years of personal and business tax filings — which the president has refused to make public — following a criminal investigation into “hush money” payments arranged by the president’s former attorney, Michael Cohen.

Mr Trump has denied the accusations against him as "just a continuation of the witch hunt" against him.

"They failed with Mueller, they failed with everything. They failed with Congress. They failed at every stage of the game," Mr Trump said at a press conference earlier this month of Mr Vance's probe.

"This has been going on for three and a half, four years, even before I got in," he said.