In a recent court filing, it was revealed that Donald Trump is facing significant financial challenges when it comes to obtaining an appeal bond to prevent the seizure of his real estate assets in New York. His legal team communicated that they were unable to secure a bond that could cover the full $454 million civil fraud judgment that Trump faces as he appeals a judge’s verdict. This failure to obtain the necessary bond puts Trump at risk of having his properties seized by the New York attorney general on March 25 if he does not comply.
Despite contacting around 30 surety companies, Trump’s team was unable to find a provider willing to underwrite a bond of this magnitude. The court filing indicated that a bond of such size would require cash reserves close to $1 billion, which neither Trump nor his company, the Trump Organization, possess. This inability to secure the necessary financial backing highlights the dire financial situation that Trump finds himself in.
The filing argued that forcing Trump to post such a large bond would be an abuse of the law and undermine the rule of law in New York. The campaign spokesman for Trump, Steven Cheung, stated that the requirement for a bond of this size contradicts fundamental principles of justice and would have severe implications for the legal system. This plea for judicial leniency underscores the severity of the financial burden that Trump is currently facing.
Manhattan Supreme Court Judge Arthur Engoron had ordered Trump and his co-defendants to pay a substantial sum of $464 million in damages and interest for committing business fraud. Trump, along with his adult sons and the Trump Organization, were found guilty of inflating the value of real estate assets to gain financial benefits unlawfully. Trump’s share of the judgment amounts to $454 million, with post-judgment interest accruing daily at a staggering rate.
The affidavit included in the court filing, signed by Gary Giulietti of the Lockton Companies, detailed the challenges faced in the search for a bond issuer. Giulietti explained that only a select few companies hold the necessary approvals to underwrite a bond of this magnitude, making it a near-impossible task. Additionally, the requirement of providing liquid assets as collateral further complicated the process, as most bond issuers do not accept non-liquid assets like real estate.
Giulietti’s affidavit also shed light on the financial standing of the Trump Organization, stating that while the company is in a strong liquidity position, it lacks the $1 billion in cash or cash equivalents needed to secure the bond. This revelation highlights the financial constraints faced by Trump’s businesses, exacerbating the challenge of obtaining the required financial guarantees.
With bond issuers demanding collateral exceeding 120% of the judgment amount and substantial upfront premium payments, the financial burden on the defendants is overwhelming. The offer to post a $100 million bond was rejected, further complicating Trump’s legal battle. The temporary relief provided by a judge allowing the defendants to continue business operations in New York offers a brief respite, but the long-term financial struggle remains unresolved.
Donald Trump’s financial woes have reached a critical juncture as he struggles to secure a bond to prevent the seizure of his assets in a civil fraud case. The legal and financial challenges that Trump faces underscore the significant obstacles in his path as he navigates the complex legal landscape in New York. The inability to obtain the necessary financial guarantees raises questions about the future of Trump’s businesses and his legal battles.
Leave a Reply