The New York attorney general's office says it is investigating the Trump Organization "in a criminal capacity".

A spokesman for the state's top prosecutor, Letitia James, said the inquiry into Mr Trump's property company was "no longer purely civil".

Ms James has been scrutinising the ex-Republican president's financial dealings before he took office.

The Trumps deny wrongdoing and say the inquiry by a Democratic prosecutor is a political vendetta.

Ms James' spokesman, Fabien Levy, told the BBC on Tuesday: "We have informed the Trump Organization that our investigation into the Organization is no longer purely civil in nature.

"We are now actively investigating the Trump Organization in a criminal capacity, along with the Manhattan DA. We have no additional comment."

The statement did not say what turned the inquiry from civil to criminal in nature, or whether the former president himself might be personally implicated in any allegations.

Civil cases usually have to do with injury to individuals or other private parties, including businesses; criminal law applies in cases where the damage is thought to affect society at large, including the state.

Six legal battles looming for Trump

Ms James launched a civil inquiry in March 2019 into claims that Mr Trump had inflated the value of his assets to banks when seeking loans, and understated them to lower his taxes.

Her office has also been seeking documents on four Trump Organization properties in Manhattan, upstate New York, Chicago and Los Angeles.

Manhattan District Attorney Cyrus Vance Jr said in court documents last August that his office was investigating alleged "protracted criminal conduct" at the Trump Organization.

Mr Vance's legal filing cited newspaper articles about purported bank and insurance fraud at the company.

The Manhattan district attorney has also been investigating whether any of Mr Trump's financial records were doctored to cover up hush-money payments to two women in 2016 who say they had affairs with him.

Mr Vance's office said in February it had obtained Mr Trump's tax returns as part of the investigation, after a long legal battle.

Throughout his presidency, Mr Trump resolutely refused to reveal his tax returns, despite coming under great pressure to do so.

A significant development

Will Grant, BBC News, Washington DC

Throughout his time in office, Donald Trump dismissed any probe into his financial dealings or those of his organisation as a politically-motivated "witch hunt" led by Democrats desperate to see him forced from power.

Yet now that he no longer enjoys protection from prosecution, this latest development will trouble him. That a former US president is facing not one but two criminal investigations is a significant development, one which could have repercussions for his political future.

The New York State Attorney General, Letitia James, clearly believes that there is enough at play to warrant moving the investigation from a civil to a criminal one. When combined with the ongoing examination of the former president's tax returns by the Manhattan District Attorney, Cy Vance, Mr Trump is looking at a complex and tangled legal battle ahead — one which he remains adamant he shouldn't have to face but which he now almost certainly cannot avoid.