New York Court Reduces Trump Fraud Penalty, Leaves Liability Intact

NEW YORK (AP) — A New York appeals court has thrown out a substantial fraud penalty against former President Donald Trump, ruling Thursday that the punishment was excessive. This ruling comes as part of the civil fraud case initiated by New York Attorney General Letitia James.

The decision, which was not unanimous, maintains Trump’s liability for fraud while eliminating a $500 million penalty imposed by a lower court. The appeals court concluded that the disgorgement order violated the Eighth Amendment of the U.S. Constitution, which prohibits excessive fines.

In their opinion, Judges Dianne T. Renwick and Peter H. Moulton wrote, “While the injunctive relief ordered by the court is well crafted to curb defendants’ business culture, the court’s disgorgement order is an excessive fine that violates the Eighth Amendment.” This ruling allows the case to proceed for further review by the state’s highest court.

The case stemmed from accusations that Trump exaggerated his wealth to secure favorable loans and insurance terms. Judge Arthur Engoron previously ordered Trump to pay $355 million in penalties, which, including interest, totaled over $515 million. This decision was viewed as a significant blow to Trump’s real estate empire.

Trump and his legal team have consistently denied wrongdoing, claiming that financial statements were not deceptive and were reviewed independently by lenders. Trump has characterized the lawsuit as a politically motivated attack by Attorney General James, asserting that he is an innocent man.

The court’s ruling halted collection of the financial penalty, giving Trump a reprieve during his ongoing appeal process. James has argued that Trump’s actions constitute significant fraud, asserting that they had repercussions for other borrowers and the lending industry.

The appeals court deliberated for nearly 11 months before issuing its decision, reflecting the complexity of the case and the issues at stake. As this story develops, further updates will be provided.