Former President Donald Trump and his co-defendants in his New York civil fraud case posted a bond of $175 million following a judge’s ruling that they had misrepresented the value of his properties. The bond is underwritten by an insurance company run by Don Hankey, a billionaire who built his fortune through car dealerships and providing subprime auto loans. Hankey’s company, Knight Speciality Insurance, provided both cash and bonds as collateral for Trump’s appellate bond, which will guarantee payment if the judgment against Trump is upheld on appeal.
Don Hankey, 80, got started in the auto industry when his father bought a stake in a Ford dealership in Los Angeles in 1958. Hankey began by washing cars as a teenager and later became a salesman. He studied finance at the University of Southern California and later expanded into the car loans business by providing loans to subprime borrowers that other car sellers rejected. This led him to establish Westlake Financial Services, which provides auto loans to people with poor credit histories.
Hankey’s businesses expanded beyond auto dealerships to include financial services companies such as Knight Insurance Group, which provided Trump’s bond. Although Hankey reportedly voted for Trump, he claims his support for the former president did not influence his decision to extend the bond. Hankey’s Axos Bank provided funding to refinance Trump Tower and take out a $100 million loan in 2022. Hankey stated that he was not aware of the deal until after it was completed.
Appeal bonds are used when a defendant appeals a court ruling, freezing enforcement of the financial judgment while the legal process continues. Insurers like Knight Insurance provide the bond after receiving proof of collateral and charge a fee ranging from 1% to 2% of the bond amount. Trump could be paying up to $3.5 million annually for the bond guarantee. If Trump wins his appeal, he won’t have to pay the state anything and will get his money back. Trump’s lawyer, Alina Habba, stated that Trump looks forward to vindicating his rights on appeal and overturning the unjust verdict.
Aimee Picchi, the associate managing editor for CBS MoneyWatch, covered the business and personal finance aspects of Donald Trump’s bond posting. The Associated Press also contributed to the reporting. The bond posted by Trump and his co-defendants is a significant amount, reflecting the gravity of the fraud case against them. Hankey’s background in the auto industry and subprime lending gave him the financial means to underwrite the bond, showcasing his business acumen and resources. Trump’s legal team is preparing to appeal the court’s ruling and overturn the judgment against him. Hankey’s involvement in the bond deal brings attention to his business empire and connections in high-stakes financial transactions.
