New York’s attorney general has requested the state’s highest court reinstate Donald Trump’s large civil fraud penalty, appealing a lower-court decision that slashed the potential half-billion dollar penalty to nothing.

Attorney general Letitia James’s office filed a notice of appeal with the state’s court of appeals, seeking to reverse the mid-level appellate division’s ruling last month that the penalty violated the US constitution’s ban on excessive fines.

James, a Democrat, had previously said she would appeal.

Trump, the US president, declared “TOTAL VICTORY” after the appellate division wiped away his fine, but the five-judge panel left other punishments in place and narrowly endorsed a trial court’s finding that he committed fraud by padding his wealth on financial paperwork given to banks and insurers.

Trump, a Republican, filed his own appeal last week, asking the court of appeals to throw out those other punishments, which include a multiyear ban on him and his two eldest sons, Eric and Donald Trump Jr, from holding corporate leadership positions in New York.

Those measures have been on hold during the appellate process and the appellate division judges said Trump can seek a court order to extend the pause pending further appeals.

James’ appeal is the latest twist in a lawsuit she filed against Trump in 2022, which alleged that he inflated his net worth by billions of dollars on his financial statements and habitually misled banks and others about the value of prized assets, including golf courses, hotels, the Trump Tower skyscraper in Manhattan, and his Mar-a-Lago estate in south Florida.

After a trial the judge, Arthur Engoron, ruled last year that James had proved Trump engaged in a years-long conspiracy with executives at his company to deceive banks and insurers.

Engoron ordered Trump to pay $355m – payback of what the judge deemed “ill-gotten gains” from his puffed-up financial statements. That amount soared to more than $515m, including interest, by the time the appellate division ruled.

The five-judge appellate division panel was sharply divided on many issues in Trump’s appeal, but a majority said the monetary penalty was “excessive.”