Devendra Kumar
Donald Trump’s lawyers and the state of New York have reached an agreement regarding a $175 million bond that Trump posted to prevent the state from seizing his assets to satisfy a civil fraud judgment. The bond was issued as a precaution to prevent the state from seizing Trump’s assets, which total more than $454 million, after he lost a court case brought by New York Attorney General Letitia James. The bond will be maintained in a cash account that earns interest but faces no downside risk, and so far, the account has grown by more than $700,000.
The bond was posted after Trump lost the court case, in which James alleged that Trump, along with his company and key executives, defrauded bankers and insurers by lying about his wealth. Trump denies the claims and is appealing the judgment. During a recent court hearing, Judge Arthur Engoron challenged Trump’s attorney, Christopher Kise, over the availability of the $175 million bond, leading to a testy exchange between the two. Kise claimed that the judge’s hypothetical scenario was “wildly speculative,” while Engoron challenged Kise’s claims about the bond, stating that the money might not be available for collection if the judgment were upheld.
Kise also expressed frustration with the office of the New York Attorney General, stating that it appears that no matter what they do, they will find fault with it. In a surprising turn of events, an attorney for the state proposed the settlement terms shortly after speaking at the hearing. As part of the agreement, Knight Specialty Insurance, a Delaware-based company, will have exclusive control of the $175 million and submit to the jurisdiction of the New York state court, while agreeing not to move the money into mutual funds or other financial instruments.
Trump’s attorney, Alina Habba, spoke to reporters outside the court, claiming that Judge Engoron doesn’t even understand basic principles of finance. “We came to an agreement that everything would be the same,” she said. “We would modify terms and that would be it.” Trump himself accused Engoron of not understanding the case, stating that he challenged the bonding company, implying that they were unreliable. However, Trump insisted that they are good and have $175 million of collateral, which is his own collateral. The agreement seems to be a mutually beneficial arrangement, allowing Trump to continue pursuing his appeals without fear of asset seizure, while the state avoids potential complications in collecting the judgment.