Donald Trump in Waco, Texas, March 25, 2023. (AP Photo/Evan Vucci)
Former President Donald Trump finds himself in a financial bind as he grapples with the aftermath of a civil fraud judgment in New York. A New York judge ruled that Trump and his companies, sons Eric and Donald Trump Jr. and other executives, must pay a staggering $355 million in damages after finding them guilty on Feb. 16 of engaging in a fraudulent scheme to deceive banks and insurers. With interest, Trump now owes the state $456.8 million. He is appealing the judgement and, in the process, must post a bond. Bond companies require collateral covering 120 percent of the judgment, or about $557.5 million, Trump’s lawyers said.
Trump’s lawyers wrote in a court filing that “obtaining an appeal bond in the full amount” of the judgment “is not possible under the circumstances presented,” This, even though Trump claimed last year that he has “fairly substantially over $400 million in cash.”
Here are five things to know why Trump can’t post a $454 million bond in the New York case.
Trump faces a daunting $355 million civil fraud judgment in New York, which, with interest, amounts to $456.8 million. Despite Trump’s claims of significant wealth, recent legal defeats have exacerbated his financial predicament, leaving him with staggering legal debt. According to Trump’s camp, his legal debt is more than a half-billion dollars. Trump is facing four criminal indictments and a civil lawsuit, AP reported.
Trump’s lawyers have not secured a bond covering the full amount of the judgment. Over 30 bond underwriters have rejected Trump’s requests, citing “insurmountable difficulties” in meeting the stringent collateral requirements.
Trump claims that his net worth amounts to several billion dollars; however, a substantial portion of his assets are invested in various real estate ventures, including skyscrapers, golf courses, and other properties. Despite his assertions of wealth, securing a sizable bond has proven challenging, as few underwriters were willing to take on such a significant risk. Moreover, none of them were willing to accept Trump’s real estate holdings as collateral. Instead, they demanded liquid assets such as cash, stocks, or bonds as security for the bond, AP reported.
Trump’s financial constraints highlight his limited liquidity. While Trump boasts of his real estate holdings, bond companies typically require cash and liquid assets as collateral, which Trump lacks in sufficient quantity to meet the bond requirements.
With an enforcement deadline coming up on March 25, Trump faces the prospect of asset seizures and other legal consequences if he fails to secure a bond or successfully appeal the judgment, The New York Times reported.
Although Justice Engoron’s ruling permitted New York Attorney General Letitia James to initiate collection proceedings immediately, she granted a grace period until March 25th. Whether she will extend this timeframe or proceed with enforcement remains uncertain. Additionally, it’s unclear if the appellate court will address Trump’s appeal plea before the impending deadline.
Trump’s financial future hangs in the balance as he seeks to stave off enforcement of the judgment and protect his assets. With few options available and mounting legal liabilities, Trump’s ability to navigate his legal challenges and preserve his wealth remains uncertain.
His New York judgement will continue to go up until he posts bond. The amount is increasing nearly $112,000 daily, The New York Times reported.
Donald Trump in Waco, Texas, March 25, 2023. (AP Photo/Evan Vucci)
