Thread by @lawofruby

NEW: Kevin Wallace is about to begin for the Attorney General’s office. He says this is deja vu because all of the arguments have been made before. And the law of the case remains that the statements of financial condition were false and misleading for years.

Each defendant acted knowingly and intentionally. In fact, other than the triplex, they did not characterize any of the valuation discrepancies as a mistake. And they tellingly never asked a single question of Donald Trump, Eric Trump, or Allen Weisselberg.

Only McConney was asked about the statements of financial condition—and he has previously acknowledged engaging in unlawful conduct with Weisselberg.

And after McConney and Weisselberg left the organization, who prepares the statements? Not the CFO, who is a CPA. Instead, they use Patrick Birney, who is not, while keeping Mark Hawthorn, the CFO, in the dark.

But going back to Weisselberg, he acknowledged he — not Mazars — was responsible for the accuracy of the statements of financial condition.

And they never asked McConney whether Bender asked him for appraisals; instead, using Jason Flemmons to say it was “professionally implausible” to believe Bender asked for them.

Wallace allows that one of the accounting standards at issue, ASC 274, contains some flexibility, but insists it doesn’t give defendants “carte blanche.”

Wallace also adds that the defense here used expert testimony to fill in the factual paucity of their case.

Engoron now asks about the severance paid to Weisselberg and McConney. Why is it suspicious? Wallace says Weisselberg got his severance after he was convicted and sentenced in a trial where he took the complete fall for the company.

It’s also suspicious because the agreement says don’t go talking to the authorities. The amounts are suspicious because of the timing and the conditions, Wallace says. But he returns to defendants’ experts.

Wallace saves his best for Eli Bartov, who testified there was no fraud but based only on “an extremely limited” section of the record. In essence, he never looked beyond the statements themselves to the work papers that prove the specifics of the fraud.

Wallace is dismantling the testimony of Trump’s 11 (!) expert witnesses, who he argues were not asked to render opinions based on deliberately partial aspects of the factual record.

Chris Kise just interrupted Wallace, who described the 11 experts as a “murderer’s row,” which Kise screamed was “outrageous.” Engoron is unmoved; Wallace notes Lawrence Moens’s valuation of Mar-a-Lago is only possible if one ignores the legal restrictions on the use of Mar-a-Lago.

Kise is back on his feet, objecting that there is no evidence to support another of Wallace’s arguments: that the Trump Org. was bleeding cash. “Chris, just stop!” Wallace blurts. Engoron diffuses what could have devolved quickly.

(What Kise is doing is tactical. He is purposefully trying to break Wallace’s flow—and is doing so with some success.)

Wallace is arguing that by 2016, Trump’s liquidity was of real concern to Deutsche Bank, and had Trump been honest about his assets, he would have been close to the liquidity threshold that DB had set. By 2017, Trump had a real “cash crunch.”

It was so bad that they borrowed $12 million from Ladder Capital to pay the Trump University settlement, sold a penthouse in which Ivanka had lived for 60 cents on the dollar. The interest rates were critical to them; without those savings, there wasn’t enough cash to do it all!

Without the interest rate savings, he would have been below DB’s $50 million required in cash in 2016, and it would have gotten even worse in future years.

Now, Andrew Amer is up for the AG to talk about the testimonial evidence of intent. McConney admitted that he included Trump foundation cash on the spreadsheet one year, only to be blocked by Bender.

But McConney nonetheless included another significant source of cash Trump did not control “year after year,” which Amer says is proof that he knew what he was doing was wrong.

Amer: I wasn’t going to spend more time on materiality because it seems so obvious. But “it clearly is an objective standard in New York; it’s what a reasonable banker would think.”

The banks put significant weight on Trump’s liquidity, as reflected in the evidence. McConney knew fraudulent cash amounts were presented to the underwriters, and still, he allowed those figures to stand.

McConney also knew that the valuations of Trump Park Avenue assigned market value to rent-stabilized units as if they had no restrictions, says Amer.