Updated May 19, 2021 at 4:39 PM ET

New York Attorney General Letitia James is investigating former President Donald Trump's business, the Trump Organization, "in a criminal capacity," her office says, ratcheting up scrutiny of Trump's real estate transactions and other dealings.

The state attorney general is joining forces with Manhattan District Attorney Cyrus Vance Jr., who has been conducting a separate criminal inquiry into Trump's business practices and possible insurance or financial fraud as well as alleged hush money payments to two women who said they had affairs with Trump before he became president.

Trump has in the past refused to cooperate with the investigations, calling them instances of "political persecution." Earlier this year, the U.S. Supreme Court cleared the way for Vance to subpoena Trump's tax returns and other financial documents.

Here's a brief recap of where things currently stand:

Prosecutors team up

The new collaboration between the state and local offices is an unusual event in itself: In New York, the attorney general and the district attorney have historically been rivals. But in this case, they're working together.

Two assistant attorneys general have now joined the district attorney's team of prosecutors. They're all trying to unravel troves of complicated information, including millions of pages of tax returns and other documents related to how the Trump Organization operates in the U.S. as well as its sprawling international enterprises.

With the shift in focus from James' office, we now know that both of these prosecution teams are making a determined and coordinated effort to sift through evidence of possible crimes.

Big questions still loom

As of now, it's not clear whether Trump, or members of his family, are potential subjects of the state's criminal investigation.

As for what the investigators might unearth, Tristan Snell, a former assistant attorney general in New York's Bureau of Consumer Frauds and Protection, cited his earlier work helping New York investigate and prosecute Trump's business over fraud allegations at Trump University.

The former prosecutor says the current inquiries could benefit from the way Trump's businesses are set up.

"One of the things that people need to remember about the Trump Organization is that they are a very small operation ultimately, basically run by a tiny handful of people," Snell says.

"They outsourced everything," Snell says, later adding, "That was a boon to us with the Trump University case, because it meant that we were able to go get the documents we needed from third parties, even after the Trump team stonewalled us."

Prosecutors are not providing many details beyond describing the general scope of their inquiries. And while news of the criminal aspect of the state's inquiry emerged late Tuesday, the Trump Organization was notified in April, according to The Washington Post.

The Trump Organization has not responded to requests for comments on this latest development, although Trump has issued a statement calling the criminal inquiry another example of a political witch hunt.

The state investigation

James' office began looking into Trump's business and real estate holdings as part of a civil matter over what it said was a potential pattern of undervaluing properties on certain official forms and grossly overvaluing them on others to avoid paying taxes.

If investigators confirm that practice took place — and that it was done deliberately — it could translate into criminal charges.

As part of her investigation, the attorney general went to court last fall to force Trump's son Eric to testify in a deposition. At the time, James said in court papers that her office wasn't pursuing a criminal case. But since then, the state attorney general has decided otherwise.

"We have informed the Trump Organization that our investigation into the organization is no longer purely civil in nature," Fabien Levy, a spokesman for James, said in a statement to NPR. "We are now actively investigating the Trump Organization in a criminal capacity, along with the Manhattan DA."

The Manhattan investigation

The criminal inquiry based in New York City centers on possible fraud involving banks, insurance and taxes. It has managed to penetrate a veil of secrecy that for years has shrouded Trump's financial dealings.

In August 2019, Vance issued a grand jury subpoena to obtain eight years of Trump's tax filings and related documents as part of a criminal investigation. Trump fought the effort, and the Supreme Court has weighed in twice — including its order in February that backed Vance's subpoena and essentially ended any hopes the former president might have had about an appeal.

"The Supreme Court never should have let this 'fishing expedition' happen, but they did," Trump said as he denounced the order at the time.

Since February, Vance's office has been digging into Trump's business dealings and those of his associates, particularly the Trump Organization's chief financial officer, Allen Weisselberg, and Weisselberg's family. Like Trump, Weisselberg and the Trump Organization have denied any wrongdoing.

The hush money allegations could expose Trump or his entities to a major legal issue — if the Trump Organization labeled them as a legal expense, that could be classified as a false record, a felony in New York.

Trump's response

"There is nothing more corrupt than an investigation that is in desperate search of a crime," Trump said Wednesday in response to the news of the state's shift. "But, make no mistake, that is exactly what is happening here."

The former president accused James of pledging to investigate him and his businesses for her own political gain. And he said that both the attorney general and district attorney "are possessed, at an unprecedented level, with destroying the political fortunes of President Donald J. Trump."

"I have built a great company, employed thousands of people, and all I do is get unfairly attacked and abused by a corrupt political system," Trump said.

What's next?

The first major public step would be an indictment. And if prosecutors decide the evidence warrants criminal charges, they'll need to act quickly, because of the statute of limitations that would come into play for some past transactions.

Vance warned last summer that if the potential case against Trump isn't handled with urgency, the statute of limitations on some charges would effectively give Trump the immunity the former president tried unsuccessfully to claim in court.

In addition to the pressure of conducting a high-profile inquiry, Vance is facing a deadline of his own — he's already said he won't seek reelection, and his current term expires at the end of 2021.

"The key difference between a criminal case and the civil case is that for a criminal white-collar case, you need to show intent, and that's very difficult to prove," according to Snell, the former prosecutor.

The pivot to a criminal inquiry is significant, he says.

"It means that they believe that [the case] already checked off the boxes for one of these civil prosecutions," he says. "And they believe that there is evidence of intent, such that it makes sense to involve the specialized resources of the criminal division."

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