(Bloomberg) -- Democrats moved a step closer to reviewing President Donald Trump’s financial information after a federal judge ruled U.S. lawmakers have the power to demand records from his accounting firm, Mazars USA LLP.
U.S. District Judge Amit Mehta in Washington said on Monday that the House Oversight and Reform Committee has the authority to examine Trump’s personal and business records going back to 2011. The judge rejected Trump’s claim that Congress isn’t seeking the documents for a legitimate legislative purpose and therefore isn’t entitled to them.
“President Trump cannot block the subpoena to Mazars,” Mehta said in a 41-page ruling. “There are limits on Congress’s investigative authority. But those limits do not substantially constrain Congress.”
If upheld, the ruling would be the first to allow Congress to investigate the president’s finances, including his umbrella business, The Trump Organization. The information could challenge assertions he’s made about the amount and sources of his wealth.
Shortly after the decision was made public, Trump told reporters outside the White House it would be appealed.
“It’s totally the wrong decision by, obviously, an Obama-appointed judge,” Trump said. Mehta was nominated to the bench in 2014 by President Barack Obama.
Trump Organization spokeswoman Amanda Miller didn’t immediately respond to a request for comment.
House Oversight and Reform Committee Chairman Elijah E. Cummings, a Democrat, said in a statement that the ruling was “a resounding victory for the rule of law and our constitutional system of checks and balances.” He urged Trump to “stop engaging in this unprecedented cover-up and start complying with the law.”
Mehta said the accounting firm must comply with the subpoena within seven days. It was the judge’s final word on the issue, skipping the process of issuing an injunction before ruling on the merits. That means the case can move forward more quickly.
The judge also turned down a request from the president’s attorneys to put the ruling on hold while they seek an appeal.
The fact the judge reached a decision so quickly on the merits, “shows the strength of the case, the constitutional case of congressional oversight," said House Intelligence Committee Chairman Adam Schiff, a Democrat from California. “The fact that the decision was not stayed upon appeal also is a recognition by the court that oversight delayed can be oversight denied.”
Trump has been fighting to keep the information private since Democrats took control of the House in November. His lawyers have asked a federal judge to quash subpoenas for financial records from Deutsche Bank AG and Capital One Financial Corp., with a hearing set for May 22 in New York. Treasury Secretary Steven Mnuchin on May 17 refused demands for six years of the president’s tax records from the U.S. Internal Revenue Service, which may also spur a separate lawsuit.
Read More: Trump Lawyer Urges Judge to Nix Accounting Records Demand
Trump has refused to reveal his tax returns since declaring his candidacy almost four years ago. After the 2016 election, rather than shedding assets or relinquishing family control, he placed his holdings in a revocable trust overseen by his sons and the Trump Organization’s chief financial officer, Allen Weisselberg. The president and his businesses sued in April to keep the House committee from obtaining the records from Mazars, which has taken no position on the request.
Mazars has also served as the accounting firm for Trump’s foundation as well as Eric Trump’s foundation, now known as Curetivity.
At a May 14 hearing, Trump attorney William Consovoy had argued that congressional checks on the president were limited, which means oversight powers and enforcement of the Constitution’s emoluments clauses must be closely tied to a legislative function. Otherwise, Congress would take on a law-enforcement function reserved to the executive branch.
Still, the lawyer demurred when asked by the judge how his claim squares with well-documented presidential probes such as Watergate and Whitewater. Consovoy said he’d need to look at the scope of those investigations.
In his ruling, the judge said, “It is simply not fathomable that a Constitution that grants Congress the power to remove a president for reasons including criminal behavior would deny Congress the power to investigate him for unlawful conduct -- past or present -- even without formally opening an impeachment inquiry.”
The committee’s broad investigative power isn’t new, said Mehta. “In each of the four preceding Congresses -- all controlled by the Republican Party, including during the final six years of the Obama administration -- the House Oversight Committee enjoyed the same power at any time [to] conduct investigations of any matter.”
Committee attorney Douglas Letter argued that the president has taken the position that “Congress is a nuisance” and is getting in the way of his running the country. Letter called that notion “a total, basic misunderstanding of the Constitution.”
The committee doesn’t need a specific legislative objective to see the information it seeks from Mazars, Letter said, noting that Trump’s far-flung business holdings made such oversight a necessity. He also cited the Watergate and Whitewater probes as examples of Congress’ power to investigate and inform the public, along with investigations of the terrorist attacks of Sept. 11, 2001, and the justification for the Iraq war.
Asked whether any part of the president’s private life was off limits to Congress, Letter said the limit may lie at a request for something relating solely to Trump, such as a childhood diary or a sample of his blood, but perhaps not a mortgage application from 15 or 30 years ago.
In his ruling, Mehta said “the question for the court” was whether the committee’s request was part of a congressional investigation that “pertains to a subject matter on which legislation could be had.”
He noted that the House has this year passed a bill requiring, among other things, that the president and vice president file new financial disclosure forms within 30 days of taking office and divest all financial interests that would pose a conflict of interest.
The judge also mentioned other bills cited by the Oversight committee, which would strengthen the Office of Government Ethics, and which would prohibit the president and vice president from conducting business directly with the federal government.
The Mazars case is Trump v. Committee on Oversight and Reform, 19-cv-1136, U.S. District Court, District of Columbia (Washington).
(Updates with comment from Adam Schiff.)
--With assistance from Shahien Nasiripour, Steven T. Dennis and Emma Kinery.
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