Donald Trump Jr, Ivanka Trump and Eric Trump are named as defendants in the lawsuit. [Photo Credit: BBC News]
Donald Trump and three of his children have been hit with a fraud lawsuit after a New York investigation into their family company – the Trump Organization.
It alleges that they lied “by billions” about the value of the real estate in order to get loans and pay less tax.
Prosecutors say the Trump Organization committed numerous acts of fraud between 2011-21.
Mr Trump has dismissed the lawsuit as “another witch hunt”.
The former president’s eldest children, Donald Jr, Ivanka and Eric Trump, were also named as defendants alongside two executives at the Trump Organization, Allen Weisselberg and Jeffrey McConney.
The lawsuit has been brought by New York Attorney General Letitia James, who is the state’s most senior lawyer, after a three-year civil investigation.
Her office does not have the power to file criminal charges but is referring allegations of criminal wrongdoing to federal prosecutors and to the Internal Revenue Service.
She said Mr Trump’s own apartment in Trump Tower, which was valued at $327m (£288m), was among the properties whose values were allegedly misrepresented.
Ms James is asking a court to bar the former president and his children from serving as officers or directors in any New York business.
She also wants the Trump Organization banned from engaging in real estate transactions there for five years.
The announcement comes after Ms James – a Democrat who is running for re-election in November – rejected at least one offer to settle the long-running civil investigation into the company’s business practices.
Blasting the lawsuit on his Truth Social site, Mr Trump branded Ms James, who is black, a racist.
“Another Witch Hunt by a racist Attorney General, Letitia James, who failed in her run for Governor, getting almost zero support from the public,” he wrote.
The Trumps have previously accused Ms James of pursuing a political vendetta, citing remarks she made before being elected as attorney general in 2018 in which she vowed to sue Mr Trump and branded him an “illegitimate president”.
On Twitter, Donald Trump Jr accused Ms James of “weaponising her office to go after her political opponents”.
While Mr Trump is not on the ballot in November’s midterm elections, he remains the dominant force in the Republican Party – and is stoking speculation about another run for the White House in 2024.
In August Mr Trump declined to answer questions during an interview at the attorney general’s office connected to this civil investigation. Ms James said he repeatedly invoked his Fifth Amendment right to not self-incriminate, confirming only his name.
Ms James said that Eric Trump did the same more than 500 times in a 2020 deposition.
Tristan Snell, a lawyer and former prosecutor who worked on a separate case against Trump University, told the BBC that the lawsuit could take a year to go to trial.
But the potential of such a trial could severely restrict Mr Trump’s ability to do business in New York and profit from his marquee real estate holdings in New York City. It could trigger a series of financial consequences that would make it harder for him to raise capital and maintain credit, Snell said.