New York , August 22(HS): A New York appeals court has struck down the $500m penalty imposed on President Donald Trump in a landmark civil fraud case, ruling the amount “excessive” and potentially unconstitutional — though affirming that Trump and his company committed fraud.

The decision, handed down Thursday by the New York Supreme Court’s Appellate Division, reversed Judge Arthur Engoron’s earlier order that Trump pay $355m plus interest, which had ballooned to over $500m. Judge Peter Moulton, writing for the panel, said the state had not demonstrated the kind of catastrophic harm that could justify such a staggering fine.

Despite tossing the monetary penalty, the court left intact non-financial sanctions, including a three-year ban on Trump serving as a company director or securing loans from New York banks — restrictions that also apply to his adult sons. The ruling underscored divisions among the five-judge panel, with some members questioning Attorney General Letitia James’ sweeping lawsuit, while others viewed it as lawfully pursued.

Both sides claimed victory. Trump hailed the ruling on Truth Social as a “total victory” and denounced the original fine as a “political witch hunt.” Meanwhile, the attorney general’s office pointed out that the judges reaffirmed Trump’s liability for fraud, vowing to appeal the reduction of penalties to New York’s highest court.

The 323-page decision, described by one legal analyst as “the judicial version of kicking the can down the road,” effectively punts the final outcome of James v. Trump to the Court of Appeals. Legal experts say the case highlights the extraordinary challenge of adjudicating unprecedented fraud claims against a sitting US president.

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Hindusthan Samachar / Jun Sarkar