Left: Former President Donald Trump (AP Photo/Mary Altaffer, File). Right: New York Supreme Court Justice Arthur Engoron (Photo by Meir Chaimowitz/NurPhoto via AP).
The court-appointed monitor of the Trump Organization quietly updated Donald Trump’s civil fraud trial judge last Tuesday on the results of the last 19 months, writing that an external auditor which previously found “significant deficiencies” in the company’s “internal controls” surrounding financial statements is painting a rosier picture now — and the monitor is inclined to agree.
Along with the massive civil fraud judgment that came down in February, New York Supreme Court Justice Arthur Engoron decided that Barbara Jones, a retired judge who served as a special master in Michael Cohen and Rudy Giuliani’s attorney-client privilege reviews, would continue on in her role as court-appointed monitor of Trump business activities for at least three years to “ensure compliance with financial reporting obligations and to establish internal written accounting and financial reporting protocols.”
When Jones was appointed in November 2022, Engoron ordered that the monitor “shall immediately report to this Court and the parties any unusual and/or suspicious and/or suspected or actual fraudulent activity.”
Over the 19 months that followed, the Trump Organization has cooperated with the monitorship by providing “access to sufficient information to assess its internal controls,” and Jones told Engoron that while her “assessment” of the protocols “is now complete” she has several recommendations moving forward. One of those recommendations is appointing an accounting firm to serve as an “Independent Director of Compliance” to make certain that financial “disclosure review protocols” are followed, particularly when involving third parties.
“[T]he Trump Organization maintains adequate internal control over its current financial reporting obligations. With respect to certain financial disclosures to third parties, however, the Trump Organization has agreed to further develop and implement revised or additional internal control and financial reporting processes to further reduce the risk for potential misstatements, errors, or omissions,” the report said. “To ensure the Trump Organization’s financial disclosures to third parties are accurate and complete, this report makes specific recommendations for the Court’s consideration that account for, and address, these risks.”
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According to Jones, the Trump Organization “has implemented, and is in the process of further enhancing its framework of adequate internal controls governing its financial disclosures to third parties” after she noticed that “certain disclosures […] were either incomplete, inconsistent, or otherwise contained errors.”
Saying that she now has a “thorough understanding of the Trump Organization’s accounting and financial disclosure practices and has observed improvements to its internal control practices,” Jones wrote that her recommendations should make “material misstatement, errors, or omissions […] less likely” in the future.
The monitor added that over the course of the investigation her team has interviewed top “accounting, finance, legal, and compliance staff” for Trump hotels, properties, and golf courses to “assess the internal controls over the preparation, validation and presentation of financial disclosures to third parties.”
Trump’s appeal of the judgment in the civil fraud case has yet to run its course.
Read the report here.
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