New York’s Attorney General, Letitia James, is raising doubts about the ability of the surety company tasked with covering the $175 million bond for former President Donald Trump.
Trump posted this bond on April 1 to forestall James from seizing assets, following a court decision permitting him to post the bond amount to address a civil fraud judgment of $464 million. The court’s decision allowed Trump to lodge an appeal against the judgment.
Knight Specialty Insurance Company underwrote the bond, essentially committing to cover the $175 million if Trump’s appeal fails and he cannot pay. Trump paid a fee to Knight Specialty Insurance Company and provided cash collateral to secure their coverage.
.@RealDonaldTrump: "I greatly respect the decision of the Appellate Division, and I’ll post either $175 million in cash or bond for security, whatever is necessary very quickly within the 10 days." https://t.co/8zB02YeFuc
— Breitbart News (@BreitbartNews) March 25, 2024
James has expressed doubts regarding the company’s capacity to cover the entirety of the bond, as indicated by a court filing on Thursday. Judge Arthur Engoron, responsible for Trump’s civil judgment, tentatively scheduled a hearing for April 22 to address James’ concerns, as reported by The New York Times.
In the Thursday court filing, Ms. James pointed out that Knight was not registered to issue appeal bonds in New York. Consequently, she requested the company or Mr. Trump’s legal representatives to submit paperwork within 10 days to “justify” the bond. Ms. James aims to ascertain whether Knight, which had no prior experience in posting such court bonds before assisting Mr. Trump, possesses the financial capability to fulfill its obligation of paying the $175 million in case of Mr. Trump’s default.
Even if Knight lacks sufficient funds, it should be able to access the collateral pledged by Mr. Trump.
In a statement on Thursday, Christopher M. Kise, a lawyer representing Mr. Trump, criticized Ms. James, describing her case as a “baseless and vindictive political crusade.” He characterized her objections to the bond as an attempt “to stir up some equally baseless public quarrel in a desperate effort to regain relevance.”
In February, Judge Engoron imposed fines exceeding $350 million on Trump and the Trump Organization and prohibited him from holding any officer or director position in any New York corporation for three years.
James aimed to financially cripple Trump by holding him liable for a $464 million fine and a permanent ban from the real estate industry in New York State.
