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Source: New York Daily News / Getty

New York Attorney General Letitia James has rebuffed a settlement offer from former President Donald Trump and is now considering a lawsuit against him and one of his children for fraud.

According to sources close to the office, lawyers on behalf of Trump and the Trump Organization have made more than one settlement offer in the civil case against it by the state of New York. Each of those has been turned down, although both sides are still in discussion.

The decision is “setting the stage for a lawsuit that would accuse Trump of fraud,” and it has also led James to consider also pursuing a lawsuit against one of his adult children. This could apply to Eric, Ivanka or Donald Trump Jr., as both have been senior executives at the organization.

A potential lawsuit would seek to further prove what James and her office have alleged – that the Trump Organization’s annual financial statements were configured to falsely inflate the value of its assets (which include Trump’s golf courses, commercial real estate, and hotels) to receive better loans and other financial benefits.

Trump lost a battle to prevent himself from having to testify in the case in March. When he sat for a deposition with the attorney general’s office, he insulted James calling her “racist” and a “renegade prosecutor” all while invoking his Fifth Amendment rights over 400 times. Only his son Eric bested him in that regard, having invoked his Fifth Amendment rights close to 500 times in a 2020 deposition with James’ office. Ivanka and Donald Jr. did answer questions in their own separate sessions this summer.

So far, the Trump Organization is due in court in Manhattan next month to face criminal tax charges. The former chief financial officer, Allen Weisselberg recently pleaded guilty to his part in a payroll-tax scheme and agreed to testify against his former company when proceedings begin on October 24. This case, which has been overseen by Manhattan District Attorney Alvin Bragg, is separate from the case pursued by James’ office but has major implications for it based on what Weisselberg’s testimony will bear out.