5 things that could happen if Trump misses deadline to post $454M bond in civil fraud case
5 scenarios that could happen if Trump fails to post $454M bond in civil fraud case before deadline
Former President Donald Trump has failed to secure a bond to cover the $454 million New York civil fraud verdict with a looming deadline on March 25. In a court filing on March 18, his attorneys wrote that "obtaining an appeal bond in the full amount" of the ruling "is not possible under the circumstances presented." In light of this, Trump sought to get out of posting the bond, which adds $ 112,000 in interest each day. The attorneys stated that despite approaching more than 30 firms, the GOP presumptive nominee had "insurmountable difficulties" in securing the total bond. In February, Manhattan Supreme Court Justice Arthur Engoron hit Trump with the eye-popping penalty in the lawsuit brought by New York Attorney General Letitia James, accusing him of fraudulently inflating the price of his properties in the state for favorable back loans. Here are five scenarios of what could happen if Trump fails to pay the entire bond amount before the deadline on March 25.
1. Trump's bid to block enforcement while he appeals
In February, a judge approved to pause a part of the judgment that blocked Trump from borrowing money. According to the court filings, his attorney requested this relief, allowing the ex-president to secure a bond while he appeals the verdict. His legal team is now asking a state appellate court to temporarily suspend the financial aspect of the ruling that would halt collections while Trump appeals the entire judgment.
2. Trump can keep trying for financial loans
A surety bond is a paid guarantee to stop the enforcement while Trump appeals the judgment. However, his legal team said that the companies they approached were "unwilling" to take his properties as collateral as Trump was found liable for illegally inflating the price of his real estate assets. The companies would only accept "cash or cash equivalents" that would "require collateral of approximately 120 percent of the amount of the judgment." However, Trump's civil case will reach around $560 million by then. In addition, sureties would potentially charge around 2% per year bond premium "with two years in advance – an upfront cost over $18m," which could not be recovered even if Trump wins the appeal.
3. Selling or mortgaging Trump's properties
Trump can mortgage any real estate asset to post the huge bond amount. However, his attorneys claimed such a move could cause irreparable losses because the properties would be sold at low prices. His legal team also argued that the sold properties couldn't be brought back at the same price even if Trump won the appeal against the verdict.
4. Letitia James can seize Trump's assets
Suppose Trump's bid to halt the March 25 deadline for the bond fails. In that case, NY Attorney General James can start seizing his assets, including 40 Wall St (also known as the Trump Building), the Trump International Hotel and Tower, Trump Park Avenue, and 1290 Avenue of the Americas in New York City. According to New York real estate lawyer Melissa Levin, if the ex-president is forced to pay the total amount by Monday, he will " have to start selling off his properties himself to get the rest of the money to pay the bond." She added, "If he doesn't do that, nothing would stop Letitia James and New York State from asking the court to seize certain assets to pay off the judgment amount that way," as per the New York Post. Last month, James had said that her office would target his assets if Trump fails to pay the massive penalty.
5. Trump continues raising money amid campaign
Trump's campaign fundraising arms are the one remaining way to fund his penalty. Over the last two years, his fundraising organizations, including the Save America political action committee, have collected $76.7 million to cover his legal fees. Though the federal election law forbids the use of campaign funds for personal purposes, the rules regarding the use of PAC funds are not that clear. Meanwhile, Trump is attempting to bring together the entire GOP financial apparatus to aid his campaign by wooing billionaire donors.
