Speaker 1: Welcome to Crash Course, a podcast about business, political, and
Speaker 1: social disruption and what we can learn from it. I'm
Speaker 1: Tim O'Brien. Today's Crash Course. Trump versus his first big
Speaker 1: fraud verdict. Donald Trump's civil fraud trial in New York
Speaker 1: is drawing to a close. Testimony recently ended, and sometime
Speaker 1: in early twenty twenty four, a state judge will rule
Speaker 1: on the case. It's within the judge's power to impose
Speaker 1: a fine of as much as two hundred and fifty
Speaker 1: million dollars on Trump and permanently ban him and his
Speaker 1: company from ever doing business in New York again, the
Speaker 1: state where Trump grew rich, may send him into financial exile.
Speaker 1: State prosecutors alleged that Trump arbitrarily inflated the value of
Speaker 1: his assets to secure bank loans and deceive insurers, while
Speaker 1: deflating the value of those same assets whenever he wanted
Speaker 1: to lower his tax bill. Trump, his two eldest sons,
Speaker 1: and their lawyers all say they never misled anyone and
Speaker 1: nobody suffered any financial damages. They say, no harm, no foul.
Speaker 1: The New York case is one of several lodged against
Speaker 1: the former president. He also faces criminal fraud charges in
Speaker 1: New York state election fraud chargers in Georgia, and two
Speaker 1: federal cases involving the January sixth insurrection at the US
Speaker 1: Capital and the misappropriation of classified documents. All of this
Speaker 1: is landing while Trump appears to be well on his
Speaker 1: way to securing the Republican nomination for the presidency next year.
Speaker 1: It's serious, it's a mess, and the rule of law
Speaker 1: is being severely tested. So I am jazz to discuss
Speaker 1: all of this with Andrew Wiseman. Andrew, a professor at
Speaker 1: NYU Law School, spent many years as a federal prosecutor
Speaker 1: and investigator. He tackled organized crime cases with the US
Speaker 1: Attorney's Office and fraud cases at the Department of Justice.
Speaker 1: President George W. Bush appointed him as the FBI's lead
Speaker 1: investigator in the infamous Enron case. Special Counsel Robert Muller
Speaker 1: recruited him to be the lead prosecutor in his probe
Speaker 1: of Team Trump's intersection with Russia before and during the
Speaker 1: twenty sixteen presidential election. And Andrew, the author of Where
Speaker 1: Law Ends, knows a lot. Welcome to Crash course, Andrew.
Speaker 2: So great to be here.
Speaker 1: You know you had this reputation as a pit bull prosecutor.
Speaker 1: That's what they said during the Enron prosecution. And I'm
Speaker 1: sure that Trump team were freaked out when Robert Muller
Speaker 1: recruited you to join in his effort. And I've always
Speaker 1: found you to be an absolute sweetie, you know, easy
Speaker 1: to talk with, articulate, judicious. I would never call you
Speaker 1: a pit bull. But I actually haven't ever been prosecuted
Speaker 1: by you either, so.
Speaker 2: I haven't had that pleasure yet.
Speaker 1: I haven't had that pleasure yet. Would you describe yourself
Speaker 1: as a pitbull?
Speaker 2: A friend of mine on the Mueller's Special Council team said,
Speaker 2: you know what the secret is, You're really squishy. So
Speaker 2: I think some of that has probably deserved. When I
Speaker 2: started at as a young prosecutor and I was doing
Speaker 2: organized crime work here in New York, I think, like
Speaker 2: a lot of young prosecutors, probably a bit over the
Speaker 2: top and impurious, So I think that that may have helped.
Speaker 2: But I think it then just becomes in some ways,
Speaker 2: it's kind of a useful thing for defendants to fear you,
Speaker 2: because you know, you're trying to get people to cooperate,
Speaker 2: and if they think that you're really tenacious and you're
Speaker 2: going to find everything out. That's not a bad thing
Speaker 2: for defendants and their counsel to think. I do think
Speaker 2: it's a bit undeserved, but you know what it is
Speaker 2: what it is, and people make their own judgments as
Speaker 2: to what they'd like to think.
Speaker 1: I mean, that's very much the way I think about it.
Speaker 1: When I think about you. You know, we're not friends,
Speaker 1: we're acquaintances. We've done some TV together, we recently chatted
Speaker 1: over a couple of glasses of wine at a party
Speaker 1: of Manhattan. But interacting with you in these situations and
Speaker 1: then watching your professional life, I do see these sort
Speaker 1: of dualities. You're a very normal, judicious man personally, and
Speaker 1: you take your role very seriously, and you were prosecuting
Speaker 1: people like John Gotti, I would mention, and the Enron
Speaker 1: folks boy scouts as we all know, but in a
Speaker 1: broader way. Tell me how you think about the role
Speaker 1: of prosecutors in our society, Like, what is their fundamental
Speaker 1: role in terms of ensuring that the rule of law
Speaker 1: is a viable and stable thing.
Speaker 2: Well, I think that prosecutors have enormous amount of power
Speaker 2: and they also have a lot of discretion where there's
Speaker 2: spec to who gets charged and who doesn't. So there's
Speaker 2: an ineffable quality that I think you look for when
Speaker 2: you're hiring people to be a prosecutor, which is maturity
Speaker 2: and judgment. But exactly what that means in any particular
Speaker 2: case can vary, and it's also hard to articulate that.
Speaker 2: But I think it's really important to understand how weighty
Speaker 2: that power is and the dual function of a prosecutor,
Speaker 2: which is to do justice, and that means it doesn't
Speaker 2: mean just winning the case. It is adherence to the
Speaker 2: rule of law, even if it's not going to help
Speaker 2: you win. I won't say there's nothing worse, but it
Speaker 2: is incredibly upsetting to people who've been in the department
Speaker 2: when you see prosecutors who are not scrupulously adhering to
Speaker 2: that dual role of what it means to be a prosecutor.
Speaker 1: So let's spend a minute and talk about the Muller
Speaker 1: probe and the Attendant Muller Report, which you wrote about
Speaker 1: in your book How Law Ends. I read your book
Speaker 1: and I found it to be poignant in a way
Speaker 1: in that you were surrounded by great people. Robert Muller
Speaker 1: an admirable and legendary prosecutor and investigator himself, taking on
Speaker 1: a seminal political and national security issue involving Donald Trump's
Speaker 1: intersection with Russians, whether they helped them in the election
Speaker 1: or did other things to thwart Hillary Clinton. And you
Speaker 1: got a lot of results out of that. Paul Mannifort
Speaker 1: and Michael Flynn were indicted, thirty four individuals and three companies,
Speaker 1: char you got eight guilty. Please. At the end of
Speaker 1: the day, Muller decided not to charge Donald Trump with
Speaker 1: obstruction of justice, which is one thing I wanted to
Speaker 1: talk with you a little bit about. He also chose
Speaker 1: not to follow the money trail, which always perplexed me.
Speaker 1: And then you know, William Barr, donald Trump's attorney general,
Speaker 1: in a four page statement, got to redefine a four
Speaker 1: hundred and forty eight page report in the popular imagination.
Speaker 1: I think you refer to the report in your book
Speaker 1: as mealy mouth, if I'm quoting you correctly, and that
Speaker 1: Muller might have been overly confident himself in Barr's own
Speaker 1: respect for the rule of law or how he was
Speaker 1: operating as a political player. So that's a lot of
Speaker 1: preamble from me to kind of ask you about how
Speaker 1: you think about that experience, you know, in the Muller probe.
Speaker 2: Well, that was a lot of different aspects. So let
Speaker 2: me just go back over a couple things in that
Speaker 2: I'll go back to the big picture of your question.
Speaker 2: I think that I did in my book describe certain
Speaker 2: conclusions in the book as mealy mouth. Particularly the conclusions
Speaker 2: of Volume two of the Mellow Report was about the obstruction,
Speaker 2: and you know, it had famously the line about if
Speaker 2: we could conclude that he did it, we would not
Speaker 2: say this. It would have like three double negatives, and
Speaker 2: it was just very hard to follow, and I always thought,
Speaker 2: who are we kidding? Volume one said essentially that the
Speaker 2: proof didn't rise to the level of being able to
Speaker 2: say that there was actual coordination as opposed to a
Speaker 2: lot of people on both sides who wanted to coordinate,
Speaker 2: and there was active assistance from Russia, but we didn't
Speaker 2: see enough evidence of actual coordination.
Speaker 1: To prove it criminal conspiracy. There was certainly cooperation, but
Speaker 1: not enough evidence to say it.
Speaker 2: We're doing that in volume one, who's going to really
Speaker 2: be fooled? In volume two, where we're not saying that
Speaker 2: it's like so obvious that we're saying there is it
Speaker 2: turns out it turns out I was wrong. It's like
Speaker 2: that kind of double negatives had people going, Gee, what
Speaker 2: are they saying? So I thought that was merely matt
Speaker 2: that I thought we should have just said it. The
Speaker 2: other thing that's really important to note is we could
Speaker 2: not charge the then president of the United States with
Speaker 2: a crime because the DOJ policy was that a sitting
Speaker 2: president could not be charged by the Department of Justice.
Speaker 2: There were two Office of Legal Counsel opinions on that,
Speaker 2: and even though we're in the Special Council's Office, the
Speaker 2: Special Council is part of the Department of Justice. We
Speaker 2: had to adhere to Department of Justice rules, so we
Speaker 2: did not have that authority. So, you know, one of
Speaker 2: the things that I talked about in my book is
Speaker 2: that I thought of being really great if, like Rob Rosenstein,
Speaker 2: when he appointed us, had made it clear to people
Speaker 2: what our purview was and what we could and could
Speaker 2: not do. You know, we were all very aware that
Speaker 2: people in the public were thinking, oh, day, now there
Speaker 2: could be an indictment of the sitting president, and we
Speaker 2: were like, that's not even remotely on the table. We
Speaker 2: cannot do that, we would have rightly been fired. I'm
Speaker 2: not saying that the policy is necessarily a good one.
Speaker 2: I'm not even sure that the law requires that a
Speaker 2: sitting president cannot be charged. I have a whole theory
Speaker 2: as to why I actually think a sitting president could
Speaker 2: be charged by the federal government. I think the States
Speaker 2: raised a very separate issue, but we didn't have that
Speaker 2: luxury because we just couldn't make up DOJ policy. We
Speaker 2: had to adhere to it or be fired.
Speaker 1: Also, remember it was in the context of Trump having
Speaker 1: fired Jim Comey as the head of the FBI after
Speaker 1: he was probing some of these issues himself.
Speaker 2: Yeah, well that, and you know, it was just a
Speaker 2: very hard investigation to do. I remember feeling very much
Speaker 2: the same feeling I had when I worked on the
Speaker 2: Enron Task Force, which is, you feel an enormous amount
Speaker 2: of pressure that's coming from within you to be thorough,
Speaker 2: not make any mistakes, and to work as hard and
Speaker 2: as fast as you can because the time clock that
Speaker 2: you feel the pressure of that is that you feel
Speaker 2: like the public deserves an answer, the political system deserves
Speaker 2: an answer, as fast as humanly possible. So that it
Speaker 2: was a very intense twenty two months, and a lot.
Speaker 1: Of the dynamics you encountered during that probe are the
Speaker 1: ones that still exist around all of the current Trump prosecutions.
Speaker 1: He's an unusual person to prosecute or investigate because he
Speaker 1: inveighs willy nilly against law enforcement officials, judges. He's threatening. Often,
Speaker 1: he calls up his troops. You know that Trump's supporters
Speaker 1: across the country to get on his side in these matters.
Speaker 1: So you've lived already through what other prosecutors and investigators
Speaker 1: are dealing with right now. I want to come back
Speaker 1: to one thing. On the Russia part of the probe.
Speaker 1: Was always curious to me that money as a reason
Speaker 1: for Trump's intersection with Russians beyond just his own interest
Speaker 1: in a political victory or defeating Hillary Clinton. But he, obviously,
Speaker 1: you know, came into the twenty sixteen race with a
Speaker 1: long history of voracious deal making, and if you put
Speaker 1: a bag of cash on Donald Trump's desk, he would
Speaker 1: bark and bark and bark again. It seemed to me
Speaker 1: like a good and useful evidentiary path for Mahler's team
Speaker 1: to go down.
Speaker 2: You are, there many things that I totally agreed with
Speaker 2: what my boss, Director Miller, was doing and the calls
Speaker 2: he made. It Obviously it's his decisions. It wasn't mine
Speaker 2: or anyone else who reporting to him. But there's somewhere
Speaker 2: I disagreed. This is one where I understood initially why
Speaker 2: we did not investigate the financial aspect of the case initially,
Speaker 2: but disagreed why we didn't come back to it. And
Speaker 2: the reason I say that I wrote about this in
Speaker 2: the book, which is if you were remember early on
Speaker 2: we were just sort of up and running. In June
Speaker 2: of twenty seventeen, Donald Trump had said that sort of
Speaker 2: essentially a kids relationship with Deutsche Bank, the financial stuff
Speaker 2: was sort of off limits in a red line, And
Speaker 2: when we were just starting out, I could see saying, look, well,
Speaker 2: there's so much else to do. Let's get a toe hold,
Speaker 2: let's get our feet wet and see where these cases
Speaker 2: are going, and then be able to figure out how
Speaker 2: the financial piece could play into any particular part of
Speaker 2: the investigation. I was doing sort of manifort and all
Speaker 2: things manifort related, and so my remit did allow for
Speaker 2: a financial investigation with respect to them. Remember, we had
Speaker 2: to follow Rod Rosstein's parameters with respect to what we
Speaker 2: could look at. It was not like being in the
Speaker 2: US Attorney's office, where it's like any federal crime. So
Speaker 2: I had that luxury. But my colleague Gene Ree, who
Speaker 2: headed up Team r which was Team Russia, I was
Speaker 2: Team M which is we were not very creative. M
Speaker 2: was Manafort, So she didn't have that sort of broad remit.
Speaker 2: And I think what the thought was in the beginning,
Speaker 2: like why cross a line that we didn't necessarily need
Speaker 2: to cross at that point we didn't even understand at
Speaker 2: the moment we now learned that Don McGahn had been
Speaker 2: approached by the President to fire US, and you know,
Speaker 2: there was just a few weeks into the investigation. So
Speaker 2: I think that that is a more justifiable time period
Speaker 2: to have said there's no reason to do it now.
Speaker 2: My issue is I thought that, for instance, as Michael
Speaker 2: Cohen came in and talked about the Moscow project, that
Speaker 2: gave some more impetus for doing a financial investigation.
Speaker 1: Then, just for our listener's sake, the Moscow project was
Speaker 1: a real estate project in Moscow to build a Trump
Speaker 1: tower in Moscow. Trump was actively trying to make real
Speaker 1: both during the campaign and then the run up to
Speaker 1: the campaign, it wasn't a past issue, and it obviously
Speaker 1: you don't build anything in Moscow unless Vladimir Putin wants
Speaker 1: to let you build something in Moscow. And that always
Speaker 1: seemed to me like a very clear evidence of a
Speaker 1: presidential candidate who could get played by a foreign power.
Speaker 2: Yeah, and remember, people think of the Michael Cohen case
Speaker 2: as one that was solely prosecuted by the Southern District
Speaker 2: of New York, and in fact that isn't the case.
Speaker 2: We were looking at Michael Cohen saw the Moscow piece
Speaker 2: of it, we retained that because it was within our remit.
Speaker 2: But when we saw that there were personal crimes and
Speaker 2: sort of other crimes unrelated to our remit, those we
Speaker 2: spun out to the Southern District of New York. And
Speaker 2: obviously there was coordination of that, and he ultimately pleaded
Speaker 2: guilty to both sets of charges. So that's why you
Speaker 2: sort of have the different pieces, And that's a very
Speaker 2: good way of understanding that we had limited jurisdiction because
Speaker 2: we had to stay within what Rod Rosenstein said was
Speaker 2: something we were allowed to investigate. If we had just
Speaker 2: been in the US Attorney's office, we would have done everything.
Speaker 1: So, in other words, none of this was arbitrary. The
Speaker 1: reason the money trail wasn't pursued was because the remit
Speaker 1: had reasonable and narrow boundaries.
Speaker 2: That's true. But I do want to say I do
Speaker 2: think that as our case progressed, there were grounds that
Speaker 2: we could have used to do more. And so that
Speaker 2: is an area where I do think that we could
Speaker 2: have revisited it and could have made the arguments about
Speaker 2: doing more on the financial front as our case got
Speaker 2: deeper and we had more factual predication for that type
Speaker 2: of investigation. So I don't think I can blame the
Speaker 2: limited remit entirely for why we didn't do the financial
Speaker 2: piece as broadly as you would if you were in
Speaker 2: these turn office.
Speaker 1: Since we've talked about the money trail, this brings us
Speaker 1: to Leticia James's case, which is all about the money.
Speaker 1: I want to before we get into that, take a
Speaker 1: quick break so we can hear from one of our sponsors,
Speaker 1: and then we get back. I want to dive into
Speaker 1: that case with you. I'm back with Andrew Weissman, and
Speaker 1: we're discussing the New York Attorney General's prosecution of Donald Trump.
Speaker 1: So Letitia James, the New York State Attorney General, begins
Speaker 1: investigating Donald Trump in twenty nineteen for financial fraud, as
Speaker 1: I noted in the top of the show, and in
Speaker 1: twenty twenty two she sues him, his company, his three
Speaker 1: eldest children, and two officers of the company, his CFO
Speaker 1: and his chief operating officer for financial fraud. Their defense
Speaker 1: really is Trump always exaggerates, no one was harmed, fake issue.
Speaker 1: This is a political prosecution. That's essentially what their defense
Speaker 1: is boiled down to.
Speaker 2: I'm going to complicate that, and you can tell me
Speaker 2: what I'm missing. So I think that the parts of
Speaker 2: the case that seem very strong from the outside. I
Speaker 2: think that the information about Trump Tower and his apartment
Speaker 2: and the fact that it was valued at three times
Speaker 2: the square footage seems like a rock crusher. I don't
Speaker 2: know how you get around that. And it's not just
Speaker 2: that because somebody who would do that, you have to ask, well,
Speaker 2: if they're going to do that, and it's so blatant,
Speaker 2: do you really think that's the only time that they're
Speaker 2: willing to do it. And if you don't have the
Speaker 2: marl fiber to be saying, that's not what I'm going
Speaker 2: to engage in why would you just draw the line
Speaker 2: there when the other things are sort of harder to catch.
Speaker 2: I also think the valuation at mar Lago seems pretty
Speaker 2: not quite as but pretty open and shut, and that
Speaker 2: is that he valued it taking away all sorts of
Speaker 2: restrictions that he'd agreed to on that property. And a
Speaker 2: similar thing happened in other real estates eleven Springs.
Speaker 1: They stayed up exactly where.
Speaker 2: He would, for instance, say well, I'm assuming that this
Speaker 2: was not rent regulated, and you know I live in
Speaker 2: New York City. The idea that I'm going to value
Speaker 2: something is if there weren't rent control departments in the building.
Speaker 2: Just to give you an example, I mean, it's obviously
Speaker 2: there's a really big difference in terms of valuation if
Speaker 2: you have tenants who are rent controlled versus free market.
Speaker 2: So I know that Trump's team put on a defense
Speaker 2: expert to say that that's legit to do that. That
Speaker 2: just seemed really strained to me as accurate.
Speaker 1: Well, but I think I'm sorry to jump in here,
Speaker 1: but I think the thing that we got to get
Speaker 1: clear about is what was he doing with these valuations?
Speaker 1: So you know, we can all say it's bonkers that
Speaker 1: Donald Trump valued this triplex at the top of Trump
Speaker 1: Tower that looks like it was designed by like Louis
Speaker 1: the fourteenth on a drug trip and put on his
Speaker 1: own papers, and what he was saying to the press
Speaker 1: and everyone that yes, this is three times what it
Speaker 1: really should be, and my jet is worth ten times
Speaker 1: and it has golden toilets, and you know, I've got
Speaker 1: these towers everywhere they're ten x what everyone else is
Speaker 1: building is worth. But if he's actually not using that
Speaker 1: exaggeration to either secure loans he shouldn't get and banks
Speaker 1: are duped in the process, or you know the converse,
Speaker 1: which under the top of the shows that he overly
Speaker 1: deflated the values of those some of those same assets
Speaker 1: when it lowers his tax bill, that there's actually a
Speaker 1: consequence of his inflation or deflation, that the act of
Speaker 1: inflating is just so what Donald Trump has spent sixty
Speaker 1: of his seventy seven years doing this kind of stuff.
Speaker 2: Oh yeah, there's a motive for all of that. The
Speaker 2: motive is money. I mean, the motive is either as
Speaker 2: you said, to pay less than taxes or to get
Speaker 2: greater loans.
Speaker 1: But isn't that the thing, though, Isn't that where the
Speaker 1: bar here is for the prosecutors is to show it
Speaker 1: isn't the simple act of him treating valuations like a
Speaker 1: yo yo, It's that he used yo yo to hurt
Speaker 1: someone and to defraud someone.
Speaker 2: Yes, but that's sort of a legal piece, which is
Speaker 2: so there's already been one cause of action which the
Speaker 2: judge found before the trial started, found liability. And that's
Speaker 2: because that first cause of action doesn't require mens rea,
Speaker 2: doesn't require intent to defraud, nor did it require materiality
Speaker 2: or reliance. So it's a very broad cause of action
Speaker 2: under the law. I mean that is New York law.
Speaker 2: I think the judge got that right. The other causes
Speaker 2: of action that were on trial do require materiality and intent,
Speaker 2: and so a lot of the things that we've been
Speaker 2: talking about could go to Donald Trump's intent that he
Speaker 2: wasn't intending to defraud because there was an expert who
Speaker 2: said you could do this, et cetera. And also, remember
Speaker 2: the standard here is not proof beyond a reasonable doubt.
Speaker 2: It's just a preponderance, which is fifty percent and a
Speaker 2: hair anything over fifty percent, this state has establish it's
Speaker 2: a case. And this is where I think that they
Speaker 2: are parts of the case where I think they seem
Speaker 2: stronger than others. And I'm curious as to what you thought, Tim,
Speaker 2: because they did have people from Deutsche Bank, one of
Speaker 2: the main lenders, saying essentially, hey, we did our own work,
Speaker 2: we wanted to do work with him, we did our
Speaker 2: own valuations, so essentially like we weren't really relying on
Speaker 2: what he wrote down. Now, reliance is not actually an
Speaker 2: element of the causes of action, meaning that the state
Speaker 2: doesn't have to prove that Deutsche Bank relied. They just
Speaker 2: have to show that there was an intent to deceive
Speaker 2: Deutsche Bank, and that the kind of information that was
Speaker 2: being put forward would be material. In other words, it's
Speaker 2: not like what's your favorite color, it's something that would
Speaker 2: be relevant, and I think all of this is the
Speaker 2: kind of thing that would be relevant. In my argument,
Speaker 2: it would be if this isn't material, then why even
Speaker 2: have the application? If it really doesn't matter what you
Speaker 2: write down and you can make up the numbers, why
Speaker 2: even have the application? And I think if you were
Speaker 2: to ask the general counsel of Deutsche Bank, they would
Speaker 2: have to say, well, of course we want truthful information
Speaker 2: and we do care what people write down it would
Speaker 2: be pretty unusual for a bank. For the general counsel,
Speaker 2: the chief compliance officers say, we don't really care whether
Speaker 2: or we're giving to customers who are just defrauding people
Speaker 2: all the time. That obviously has to be material. I
Speaker 2: just don't know how good a job this state did
Speaker 2: in the cross examination and the rebutting of that defense testimony.
Speaker 1: Well, I think they did a really weak job, and
Speaker 1: I think they could have come I mean, there's so
Speaker 1: many elements of this case, you know, to bring our
Speaker 1: listeners back in on some of the directives around it.
Speaker 1: You know, New York State prosecutors have a lot of
Speaker 1: freedom to go after financial fraud in an unusual way.
Speaker 1: There's the Martin Act, which essentially allows prosecutors to pursue
Speaker 1: financial crimes without even having They don't have to prove
Speaker 1: in as they don't need to in any civil case.
Speaker 1: But the Martinat redefines that boundary as well, and they
Speaker 1: don't even have to show that someone was damaged necessarily.
Speaker 1: They just have to show that someone tried to pull
Speaker 1: off a fraud. And those are the tools that Letitia
Speaker 1: James was brought to baron Trump. Trump has spent decades
Speaker 1: inflating the value of his wealth. He does it because
Speaker 1: he's insecure, he does it because it keeps him in
Speaker 1: the news, and he does it because it helps him
Speaker 1: get loans. He sued me for three pages of a
Speaker 1: biography I wrote about him, in which he said I
Speaker 1: essentially defamed him because I said he was worth about
Speaker 1: thirty times less than he said he was worth. And
Speaker 1: during the course of that litigation, we got evidence from
Speaker 1: his banks, including Deutsche Bank, And at a time when
Speaker 1: Donald Trump was saying he was worth six billion dollars
Speaker 1: and my sources were saying he was worth two hundred
Speaker 1: and thirty million, we secured an audit from Deutsche Bank
Speaker 1: in which their own examination of his finances said he
Speaker 1: was worth only seven hundred and eighty million. That was
Speaker 1: great for our case because Trump's own bankers knew that
Speaker 1: he was at that time. I'm wildly inflating the valuable.
Speaker 2: I don't understand, tim, which is I used to be
Speaker 2: head of the fraud section at the Department of Justice.
Speaker 2: And my question to a bank, where there know your customer?
Speaker 1: Rules?
Speaker 2: Money laundering regulations require financial institutions to know their customers
Speaker 2: and to know like where they're getting their money and
Speaker 2: who they're dealing with. What is the chief compliance officer
Speaker 2: at that financial institution say in response to if you
Speaker 2: knew that a customer was committing fraud, and the fraud,
Speaker 2: by the way, is directed at you your institution.
Speaker 1: Why would you approve doing business with that client?
Speaker 2: Yeah, exactly, Well, I think.
Speaker 1: It happens all the time. Compliance officers and banks are
Speaker 1: notoriously feckless in a lot of team or they don't
Speaker 1: know right, or they don't know and then they know
Speaker 1: they're lower on the totem poll in an organization. They
Speaker 1: don't really have the authority to kill a deal someone
Speaker 1: higher up than them wants to pursue. You know, in
Speaker 1: the Deutsche Bank case, they went ahead and did a
Speaker 1: deal with Donald Trump, even though he had tried to
Speaker 1: stiff them on loans they'd made to him on a
Speaker 1: Chicago project. The commercial side of the bank wouldn't do
Speaker 1: business with him, They had permanently barred him as a client.
Speaker 1: And Rosemary Vraiblick, who testified in the state Attorney General's
Speaker 1: case here in New York, was with the private bank
Speaker 1: and she decided to go ahead and do business with
Speaker 1: him without getting inside her head, because I can't speak
Speaker 1: for what her own thoughts are, but I think she
Speaker 1: just liked the idea of doing business with the Trumps
Speaker 1: because that led her to the Kushners. She was introduced
Speaker 1: to Donald by Jared Kushner. So there's all of these
Speaker 1: just personal relationships to the average show in Jane don't
Speaker 1: have access to when they walk up to a bank teller,
Speaker 1: and people who are in the news or who are
Speaker 1: celebrities get access to this kind of stuff that others
Speaker 1: don't get, and I think the standards drop. So I
Speaker 1: guess it doesn't feel mysterious to me that they did
Speaker 1: business with him, even if it's reprehensible, which I think
Speaker 1: in some cases professionally it was, and certainly in judicious
Speaker 1: given his track record. He's a serial bankruptcy artist and
Speaker 1: he routinely stiffed banks. I think the issue here is
Speaker 1: was he a criminal in doing that? And you know,
Speaker 1: as a reporter, I didn't have the subpoena power to
Speaker 1: go down that route. I think we kind of stripped
Speaker 1: the bark off of him like an old tree in Quartz.
Speaker 1: But you know, all we had to prove was I
Speaker 1: didn't act with malicious intent that I went about my
Speaker 1: job and I tried to get as much information as
Speaker 1: I could, and I was fortunately confronted with a guy
Speaker 1: who was a bloviator and an exaggerator. And then in
Speaker 1: our deposition, you know, we proved that he had lied
Speaker 1: more than I think two dozen times on valuing different
Speaker 1: assets that he had said were worth more than they were.
Speaker 1: It's exactly what's in the attorney general's case right now,
Speaker 1: the state attorney general's case. But I think they have
Speaker 1: a high bar if they're going to prove he's a criminal.
Speaker 1: You know, the idea of relying on Donald Trump's statements
Speaker 1: of financial condition, which tiss James's office is as demonstrations
Speaker 1: of an attempted to fraud his tricky because he gave
Speaker 1: those things to the press as kind of marquee statements
Speaker 1: of how Richie was, and they were cartoons basically, they
Speaker 1: were like cartoon books, highlights for children. His own accountants
Speaker 1: wouldn't sign off on those documents. Said that, I think
Speaker 1: under New York law, they don't need to prove that
Speaker 1: the banks were harmed. That actually isn't a standard in
Speaker 1: this case. I think Trump has latched onto that because
Speaker 1: he has a reptilian sensibility about what plays in the
Speaker 1: popular imagination, and he can say I'm being prosecuted, but
Speaker 1: no one was hurt. Wise, this is happening to me,
Speaker 1: when the real issue is you've been doing great inflation
Speaker 1: for your entire career, buddy, and someone is holding you
Speaker 1: to account for it, and under New York law, that
Speaker 1: in itself is enough to prosecute you.
Speaker 2: In their main case. That's the state's main case. They
Speaker 2: did have an expert witness who testified about the harm,
Speaker 2: even though you don't have to prove it. It goes
Speaker 2: to the amount of damages because the state is seeking
Speaker 2: essentially disgorgement, which is the amount that Donald Trump unjustly received.
Speaker 2: And the theory is that he either wouldn't have gotten
Speaker 2: the loan or that the rate that was charged be different,
Speaker 2: because I mean, it's kind of common sense, which is
Speaker 2: like if you and I go to a bank. Oh,
Speaker 2: I don't say you, but if I go to a bank,
Speaker 2: they're certainly going to look at my risk profile, and
Speaker 2: the riskier I am, they may decide not to loan
Speaker 2: me the money at all, or to loan at a
Speaker 2: higher rate to account for the risk factors. So they
Speaker 2: had an expert talk about that and sort of assess
Speaker 2: what it would be. And obviously that's why part of
Speaker 2: the battle here is not just on liability, but on
Speaker 2: what would the damages be if the rate would have
Speaker 2: been different. And that's where the defense case, which is
Speaker 2: to say, oh, we were just happy to do business,
Speaker 2: is important, because even if it doesn't defeat liability, it
Speaker 2: could go to damages. I have to say, I think
Speaker 2: one thing, and I don't know how much the state
Speaker 2: made of this, having somebody from the private wealth group testifying.
Speaker 2: I mean, they had their own interests, and I didn't
Speaker 2: assess her credibility on the stand. I didn't see her testify,
Speaker 2: but I would be very interested in private wealth management.
Speaker 2: As happens a lot of times in large institutions, different
Speaker 2: parts of a bank can have very different interests that
Speaker 2: don't necessarily align with what the bank overall wants to see.
Speaker 2: So a bank, for instance, a well run bank, could
Speaker 2: be very concerned about what's happening at the sales level,
Speaker 2: are people saying and doing things that would help them
Speaker 2: get commissions, but that the bank overall does not want
Speaker 2: to see people doing. And so I did have a
Speaker 2: sense that at least, I was curious as to whether
Speaker 2: that was going on with the spect to private wealth management,
Speaker 2: where they would be like, hey, we were kind of
Speaker 2: cheerleading this because this was going to be good for us,
Speaker 2: even if it wasn't necessarily what the bank overall would
Speaker 2: want to do.
Speaker 1: Well. In fact, that's very true about Deutsche Bank. I
Speaker 1: think the private Wealth group was cheerleading to get business
Speaker 1: at all costs from Donald Trump, even though another major
Speaker 1: part of the bank that he's not somebody will do
Speaker 1: business with again ever, and then gave the business him
Speaker 1: on very favorable terms. But now oral arguments have ended,
Speaker 1: testimony has ended, the judge in the case is going
Speaker 1: to rule sometime next month, and I think the issue
Speaker 1: here is what does he do with all this information.
Speaker 1: He's already pulled the business licenses on Trump and some
Speaker 1: of the related operating entities. He can, I think, impose
Speaker 1: bigger damages potentially than two fifty but I think that
Speaker 1: seems to be a cap two hundred and fifty million.
Speaker 1: How do you think about where this will land come January?
Speaker 2: I just don't know. I mean, this is the one
Speaker 2: thing that we know for sure. There is liability on
Speaker 2: the first cause of action. So in some ways it's
Speaker 2: already a bit of a game over, and it's really
Speaker 2: a question of what are the remedies for that first
Speaker 2: cause of action. Yes, there may or may not be
Speaker 2: liability of damages for the rest, but in some ways
Speaker 2: that may be icing and I don't know how the
Speaker 2: judge will come out on those issues. I don't know
Speaker 2: how he will assess credibility. One thing that is I
Speaker 2: think kind of interesting is the judge is entitled to
Speaker 2: make fact finding based on the credibility of the witnesses.
Speaker 2: And remember that Don Junior, Eric Vanka, and Donald Trump
Speaker 2: himself have all testified. The judges already found Donald Trump
Speaker 2: not believable with respec to a gag order issue, where
Speaker 2: Trump said that he didn't intend to be referring to
Speaker 2: the judges law clerk, and the judge said, I don't
Speaker 2: believe it. By the way, just because he said that
Speaker 2: doesn't mean he's going to find that he's incredible on everything.
Speaker 2: But he's entitled to make those fact findings. And that's
Speaker 2: very very hard for any party to get reversed on appeal.
Speaker 2: So by testifying those people, I won't say it's there
Speaker 2: one shot, but it is very much putting your hands
Speaker 2: in the fate of the fact finder. So it'll be
Speaker 2: interesting to see what Judge and Gorn says about the
Speaker 2: leiaevability of those witnesses in general.
Speaker 1: Andrew, let's take another break and we'll come right back.
Speaker 1: I'm back with Andrew Weisman, and we're discussing the New
Speaker 1: York Attorney General's prosecution of Donald Trump. Andrew, I wanted
Speaker 1: to ask you about, I guess, extra legal issues of
Speaker 1: all of this, because Trump is an unusual defendant and
Speaker 1: you experienced this during the Muller probe, where you have
Speaker 1: an active, serious investigation going on, and he's openly speaking
Speaker 1: about people you're investigating, like Paul Manafort, and he's tweeting
Speaker 1: about whether or not Paul Manafort is going to sort
Speaker 1: of display omerica and not testify against him. He's going
Speaker 1: to the press, He's talking about all aspects of the
Speaker 1: case without any kind of worry about that having consequences,
Speaker 1: and that had all come to play again in this
Speaker 1: case in New York. You know, you mentioned in the
Speaker 1: earlier segment that the judge in the case had to
Speaker 1: put a gag order on him because he was sought
Speaker 1: of bounds, and he promptly violated the terms of the
Speaker 1: gag order. That's also happened in one of the federal cases,
Speaker 1: the January sixth case. I believe we talked in the
Speaker 1: top of the show of this long and illustrious parade
Speaker 1: of people and entities that you've prosecuted, from John Gotti
Speaker 1: to Enron. Where does Donald Trump fit in that spectrum
Speaker 1: for you when you watch him as a defendant, and
Speaker 1: how his political theater affects the rule of law.
Speaker 2: So it's worth noting a couple of things. One, there
Speaker 2: is a recent decision on the gag order from the
Speaker 2: DC Circuit that is, the Court of Appeals in Washington,
Speaker 2: d C. It's the decision that in large part affirms
Speaker 2: Judge Chukins gag order, where the Circuit court said that
Speaker 2: some of the statements made by Donald Trump, the former
Speaker 2: president of the United States, the former leader of the
Speaker 2: free world, posed a significificant and imminent danger with respec
Speaker 2: to the integrity of the judicial process. That is a stunning,
Speaker 2: just a stunning statement to be said about any elected official,
Speaker 2: let alone the leader of the free world.
Speaker 1: So that's in the nation's top law enforcement official.
Speaker 2: Yes, it is worth just going back to that, even
Speaker 2: though we're so inured to the fact that Donald Trump
Speaker 2: does that, in fact he embraces it, and prosecutors, I
Speaker 2: think are aware of that. Whether it's a public corruption
Speaker 2: case or an organized crime case. Frankly, any sort of
Speaker 2: gang or group case where there is a hierarchy where
Speaker 2: power and money or involved. If you're a prosecutor, you
Speaker 2: worry about undue influence on witnesses.
Speaker 1: From the top of the food chain. Yep. But as
Speaker 1: you've noted, Trump is an unusually powerful defendant. Of course,
Speaker 1: what unusual impacts what's happening to the rule of law
Speaker 1: in this country right now? When you have someone who's
Speaker 1: a defendant in multiple cases that are buttressed by substantive
Speaker 1: charges with long trails of evidence behind them, including recordings
Speaker 1: of his own voice in the Georgia case asking people
Speaker 1: to commit voting fraud for him, or cameras at his
Speaker 1: own estate in mar A Lago showing his own employees
Speaker 1: trying to hide classified documents from federal investigators. And yet
Speaker 1: he keeps pushing forward in the political theater, in the
Speaker 1: public theater. What is the ultimate impact of that on
Speaker 1: the judicial process and the rule of law?
Speaker 2: Well, I think there's sort of a small picture in
Speaker 2: big picture the small pictures. I think that the courts
Speaker 2: by and large have done an incredible job at upholding
Speaker 2: the rule of law. I do think that the slowness
Speaker 2: of the judicial process takes its toll in terms of
Speaker 2: being able to have a trial of the form president
Speaker 2: before the election, so that the public has the benefit
Speaker 2: of that information and the conclusion. But I think that
Speaker 2: in spite of all of the attacks, I think that
Speaker 2: the judges are in general doing it a really good job,
Speaker 2: in the same way that the courts did a really
Speaker 2: good job and response to over sixty challenges to the
Speaker 2: results of the election, where all of the ones that
Speaker 2: went to the merits were denied. So I think that
Speaker 2: the courts are going to be under considerable attack in
Speaker 2: the same way that prosecutors and the media are attacked
Speaker 2: by Donald Trump, because that's what he does when there's
Speaker 2: any sort of institution or people within those institutions who
Speaker 2: are standing up to an authoritarian personality. I think that
Speaker 2: the larger picture, though, is whether the public is going
Speaker 2: to give a damn, whether there are enough people who
Speaker 2: view that as a fundamental problem, And I think that
Speaker 2: was the thing that I found very upsetting about his
Speaker 2: being elected the first time. And this has nothing to
Speaker 2: do with policy choices. It's not about whether degrees or
Speaker 2: disagrees with his view on immigration, or who should be
Speaker 2: judges all sorts of policy implications. It's that I was
Speaker 2: just so surprised that people could overlook what I viewed
Speaker 2: as blatant racism, xenophobia, sexism, the denigration of the rule
Speaker 2: of law, that those were so fundamental that I didn't
Speaker 2: understand that those weren't deal breakers for a much larger
Speaker 2: group of the American public. You know, I'm in the
Speaker 2: middle of reading Liz Cheney's book, and as I think
Speaker 2: many people said, you know, Liz Cheney and I politically
Speaker 2: are probably pretty much polar opposites, but this is one
Speaker 2: where there's a fundamental similarity in terms of how those
Speaker 2: differences are decided and played out and the discussions you
Speaker 2: can have on a policy level within the framework of
Speaker 2: a democratic system and a republic that we have. And
Speaker 2: so what's sad is that that baseline is so important.
Speaker 1: And because both of you believe that institutions and the
Speaker 1: rule of law and the processes that's around the matter.
Speaker 1: Even if you disagree philosophically and politically that the bedrock
Speaker 1: of civic engagement and communities are respect for those things.
Speaker 1: And I think that that is the tissue that Donald
Speaker 1: Trump is trying to shred, along with the Constitution and democracy.
Speaker 2: So you know, the title of my book, Where Law Ends,
Speaker 2: comes from a John Locke quote, English philosopher who said,
Speaker 2: where law ends, tyranny begins. And that quote is on
Speaker 2: the Justice Department walls on the outside on the limestone
Speaker 2: over the Department of Justice in Washington, d C. Because
Speaker 2: it's so fundamental to what the Department of Justice is.
Speaker 2: And as Loretta Lynch, the former Attorney General of the
Speaker 2: United States, has said that the Department of Justice, unlike
Speaker 2: any other department we have in Caninet level official, is
Speaker 2: founded on an idea, which is the rule of law.
Speaker 2: And to me, that sentiment of where law ends, tyranny
Speaker 2: begins is just so fundamentally appropriate to this time that
Speaker 2: we are in.
Speaker 1: Andrew, I always like to ask guests at the end
Speaker 1: of the show what they've learned, and I wanted to
Speaker 1: ask you, sort of starting with the Mueller probe and
Speaker 1: up into the president, what have you learned about the
Speaker 1: impact of Donald Trump as a president and a former
Speaker 1: president being a defendant, and in the process of being
Speaker 1: a defendant again undermining some fundamental thoughts and respect we
Speaker 1: have for the legal process.
Speaker 2: So when I was a very young man, and I
Speaker 2: think I had not yet gone to law school, and
Speaker 2: I had been an intern at the ACLU, Roger Baldwin,
Speaker 2: who helped found the ACLU, was still alive, and he
Speaker 2: used to say that regardless of what is in the
Speaker 2: Constitution or in congressional statutes, that what's fundamentally important is
Speaker 2: that those values and precepts are in the hearts and
Speaker 2: minds of citizens in the United States. And I remember
Speaker 2: at the time, thinking, what's he talking about, Like, if
Speaker 2: it's in the Constitution, we're done. If Congress has passed
Speaker 2: a lot were done. It didn't resonate with me. And
Speaker 2: I think what I have learned is things that I
Speaker 2: thought were deeply rooted in the United States, and that
Speaker 2: I took as a given and for granted. It's like
Speaker 2: the roots of a willow tree that are very shallow
Speaker 2: and a strong wind can cause it to topple, And
Speaker 2: that what Roger Baldwin was saying is so true that
Speaker 2: they fight and what it means to be or what
Speaker 2: I think it means to be American, is something that
Speaker 2: has to be thought for and upheld and taught in
Speaker 2: every generation.
Speaker 1: Yeah, to stay with your analogy of trees. When you
Speaker 1: were talking about willow trees, I was thinking the happy
Speaker 1: opposite of that are aspens, which are all connected at
Speaker 1: the roots and draw great strength from that fact. And
Speaker 1: as we go into this political year, I think we
Speaker 1: have to think like aspens and not like willows.
Speaker 2: I love it.
Speaker 1: We're also out of time. I could have talked to
Speaker 1: you for another day or two, and I'm glad you
Speaker 1: came on. Thanks for coming on today, Andrew, Oh.
Speaker 2: Thank you so much for inviting me. This was really
Speaker 2: really great.
Speaker 1: Andrew Weisman is a professor at the NYU Law School
Speaker 1: and a veteran prosecutor. You can find him on Twitter
Speaker 1: at a Weisman Underscore. Here at crash Course, we believe
Speaker 1: the collisions can be messy, impressive, challenging, surprising, and always instructive.
Speaker 1: In today's Crash Course, I was reminded that no matter
Speaker 1: how much I go into the weeds on a topic,
Speaker 1: particularly the prosecution of Donald Trump, some of the larger
Speaker 1: truths always have to be recognized, specifically that Donald Trump
Speaker 1: remains a threat to the rule of law and a
Speaker 1: threat to democracy. What did you learn? We'd love to
Speaker 1: hear from you. You can tweet at the Bloomberg Opinion
Speaker 1: handle at Opinion or me at Tim O'Brien using the
Speaker 1: hashtag Bloomberg Crash Course. You can also subscribe to our
Speaker 1: show wherever you're listening right now and leave us a review.
Speaker 1: It helps more people find the show. This episode was
Speaker 1: produced by the indispensable and ever law abiding Anna Masarakis
Speaker 1: and me. Our supervising producer is Magnus Hendrickson, and we
Speaker 1: had editing help from Sage Bauman, Jeff Grocott, Mike Nitze,
Speaker 1: and Christine Vanden Bilart. Blake Maples does our sound engineering,
Speaker 1: and our original theme song was composed by Luis Gara.
Speaker 1: I'm Tim O'Brien. We'll be back next week with another
Speaker 1: Crash Course.