The misrepresentations and fraud here are at the Donald Trump, personal or Trump organization, corporate level as guarantor’s, or some other secondary source of repayment for individual loans that the banks made to LLCs on individual pieces of property. For loans secured by individual pieces of property where the primary source of repayment is that piece of property banking refs require independent appraisals.
The requirements when dealing with guarantors are far less rigid. I’ve certainly had customers with net worth approaching $1 billion and vast holdings in many LLCs. The protocol is to dig into cash flows as thoroughly as possible, and simply discount the represented values of properties, and LLCs, that the guarantor owns all or a part of. of course even if you apply a 50% discount factor, if the presenter has inflated values 10 X it’s still 5X inflated. So at the end of the day, know your borrower, be sure you can trust your borrower , it’s a fundamental aspect of the credit decision.
So the only aspect that I am in somewhat agreement with law over is in my opinion, the banks fucked up. They trusted Donald Trump and they should’ve known better.