Donald Trump's longtime accountants have ditched the former US president as a client, saying a decade's worth of financial statements could not be relied upon, court documents showed Monday.
Mazars informed the Trump Organization in a letter last Wednesday that it would no longer work for the company, which is being probed by New York prosecutors for alleged fraud.
The letter was revealed in court by New York state attorney general Letitia James as she asked a judge to force Trump to comply with subpoenas seeking testimony in her investigation.
James announced last month that her civil inquiry into Trump's family firm had uncovered "significant evidence" of misleading business practices, including the fraudulent valuation of assets.
Mazars wrote that James's findings had contributed towards it deciding that accounts for Trump for the years ending June 30, 2011 to June 30, 2020 "should no longer be relied upon."
The accounting firm added that an investigation of its own and "information received from internal and external sources" had also 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 added that in part because of the decision regarding the statements, Mazars "are not able to provide any new work product to the Trump Organization."
The financial records are at the heart of James's investigation and a criminal probe by the Manhattan District Attorney's office.
The twin inquiries are investigating whether the Trump Organization defrauded lenders into providing favorable loans.
James, a Democrat, said in January that her ongoing inquiry had found that the Trump Organization fraudulently overvalued multiple assets to secure loans and then undervalued them to minimize 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."
- Parallel investigations -
If James finds evidence of financial misconduct she can sue the Trump Organization for damages but cannot file criminal charges.
The probe, however, is running alongside a similar criminal investigation by the Manhattan DA for possible financial crimes and insurance fraud.
Last July the Trump Organization 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.
Trump has slammed both probes as politically motivated.
A spokesperson for the Trump Organization said in a statement Monday evening that they were "disappointed" by Mazars' decision to cut ties.
The firm's "letter confirms that after conducting a subsequent review of all prior statements of financial condition, Mazars' work was performed in accordance with all applicable accounting standards and principles and that such statements of financial condition do not contain any material discrepancies," the spokesperson said, calling both investigations in New York therefore "moot."
In her filing Monday, James repeated her request that the former president, Donald Trump Jr, and Ivanka Trump give evidence under oath. Her office has already questioned Eric Trump.
The legal woes could make a second White House run more difficult for the 75-year-old Trump, who has kept Americans guessing about his plans.