Former President Donald Trump recently posted a $175 million bond in a civil fraud case against him and his company, allowing him to keep his assets safe as he appeals the judgment. This is one of two high-dollar bonds that Trump has posted, with insurance companies and powerful Trump allies supporting him. The bond only covers part of the amount that Trump and his co-defendants have been ordered to pay, which is over $464 million, but it ensures that his assets are protected while the appeal is pending.
The bond in the civil fraud case was underwritten by Knight Specialty Insurance Company, chaired by billionaire Don Hankey. Hankey, who has supported Trump’s political campaigns in the past, explained that Trump used a combination of cash and investment-grade bonds to secure the bond. Trump also posted a bond in a defamation case brought by writer E. Jean Carroll, after a jury ordered him to pay $83.3 million. This bond was underwritten by Federal Insurance Company, a subsidiary of Chubb, whose CEO previously served on Trump’s trade advisory committee.
Trump’s bond in the civil fraud case means that New York Attorney General Letitia James won’t be able to seize his assets while he appeals the court’s ruling. If Trump and his co-defendants lose their appeal, they will still be responsible for paying the remaining amount, which continues to accrue interest at a rate of nine percent per year. Trump’s net worth, estimated at $5.7 billion, has more than doubled since his media and technology group went public. However, much of his cash is now tied up in bonds, limiting his available liquid assets.
While Chubb CEO Evan Greenberg defended the company’s decision to underwrite Trump’s bond, stating that it was based on supporting the rule of law and not personal feelings, the company initially declined to take on the civil fraud bond. Trump also paid $5.5 million in cash into a court-controlled account for a separate defamation case against him brought by E. Jean Carroll. In that case, a jury ordered Trump to pay $5 million for defamation and sexual assault allegations.
The civil fraud case was brought by Attorney General James, alleging that Trump and his associates misrepresented the value of assets to obtain more favorable business deals. Judge Arthur Engoron ruled in favor of the attorney general, holding Trump liable for fraud and ordering him, his sons, and former CFO Allen Weisselberg to pay significant monetary penalties. The judge also imposed non-monetary penalties, including prohibiting Trump and his sons from running New York businesses for a period of time. Trump has appealed the judgment and successfully had the amount he needed to pay immediately lowered by an appeals court.
Overall, Trump’s recent bond postings in high-dollar cases demonstrate the complex legal and financial challenges he faces as he continues to navigate legal battles. The support of insurance companies and allies has helped him secure bonds to protect his assets while appealing unfavorable judgments, but the ultimate outcome of these cases remains uncertain.
