Donald Trump's longtime accountants said they will no longer be working with the former US president as 10 years' worth of financial statements could not be relied upon, according to released court documents.
Accounting firm Mazars informed the Trump Organisation in a letter on Wednesday it would no longer work for the company, which is being probed by New York prosecutors for alleged fraud.
The letter was used as evidence in court by New York state attorney general Letitia James as she asked a judge to force Mr Trump to comply with subpoenas seeking testimony in her investigation.
Ms James announced last month her civil inquiry into Mr Trump's family firm had uncovered “significant evidence” of misleading business practices, including the fraudulent valuation of assets.
Mazars wrote that Ms James's findings had contributed towards it deciding accounts for Trump for the years ending June 30, 2011, to June 30, 2020, “should no longer be relied upon”.
The accounting firm said an investigation of its own and “information received from internal and external sources” had played a part in it reaching that conclusion.
“While we have not concluded that the various financial statements, as a whole, contain material discrepancies, based upon the totality of the circumstances, we believe our advice to you to no longer rely upon those financial statements is appropriate,” it said.
The letter said, in part because of the decision regarding the statements, Mazars “are not able to provide any new work product to the Trump Organisation”.
The financial records are at the heart of Ms James's investigation and a criminal probe by the Manhattan District Attorney's office.
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The twin inquiries are investigating whether the Trump Organisation defrauded lenders into providing favourable loans.
Ms James, a Democrat, said in January her continuing inquiry had found the Trump Organisation fraudulently overvalued multiple assets to secure loans and then undervalued them to minimise taxes.
She said the company had “misrepresented” the valuation of assets to financial institutions including the Internal Revenue Service, banks and insurers for “economic benefit”.
If Ms James finds evidence of financial misconduct, she can sue the Trump Organisation for damages, but cannot file criminal charges.
The probe is running alongside a similar criminal investigation by the Manhattan DA for possible financial crimes and insurance fraud. Last July, the Trump Organisation and its long-serving finance chief, Allen Weisselberg, pleaded not guilty to 15 felony fraud and tax evasion charges.
The DA's office in January 2021 finally received roughly eight years of Trump tax returns from Mazars following a marathon legal battle that went to the Supreme Court.
Mr Trump called both probes politically motivated.