Donald Trump is heading for a “world of hurt” unless he can come up with a $175 million bond by next Monday, a financial consultant has said.
Jon Gabrielsen, an Atlanta-based market economist, told Newsweek that New York Attorney General Letitia James could easily claim cash in Trump’s accounts if the former president fails to post the bond.
A court has rejected the paperwork for Trump’s $175 million bond because it could not verify the financial backing of the posting insurance company posting.
The court has given Trump and the insurance company, Knight Speciality Insurance, until Monday to show financial backing for the bond.
If not, James can begin enforcement proceedings against Trump’s property.
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Newsweek sought email comment from Knight Specialty Insurance and Trump’s attorney on Tuesday.
Trump posted a $175 million bond on April 1 in order to prevent James from seizing his assets while he attempts to appeal the civil fraud ruling against him. New York Judge Arthur Engoron previously found Trump, his adult sons Donald Jr. and Eric, and The Trump Organization liable for a scheme in which the value of Trump’s net worth and assets were unlawfully inflated in order to obtain more favorable business deals. Trump, the presumptive 2024 GOP presidential nominee, has maintained his innocence in the matter.
Trump was hit with a penalty that came to around $454 million after interest, and would have had to pay a bond slightly higher than that amount to stave off the state from seizing assets, such as his many real estate holdings, to cover the penalty. An appeals court later ruled that he could instead pay a lower bond of $175 million.
The bond was then rejected by the court’s filing system shortly after it was posted due to missing paperwork, including a “current financial statement.” James, whose office led the fraud case against Trump, later raised questions about the “sufficiency” of the bond and noted that the surety backing it, Knight Specialty Insurance Company (KSIC), is not admitted in New York, meaning it’s ineligible to obtain a certificate of qualification from the Department of Financial Services. KSIC has refiled its paperwork as a result in an effort to get the process moving again.
Gabrielsen said that Trump’s companies would not be financially solvent if the “float” required by all companies for daily expenses is seized by James.
“If his bank balances are of an amount that would cover the $175 million I doubt [James] cares about the impact of her seizing them upon his company. And seizing cash is quick and easy compared to seizing properties, finding a buyer and doing all the procedures involved,” he said.
Gabrielsen said that the reduction in the bond amount could make it harder for Trump to negotiate if he cannot post the $175 million.
“The judge can just say: ‘look, I already cut your bond in half, what more do you want from me?'” Gabrielsen said.
James seizing cash from Trump’s bank accounts would be “putting him in a world of hurt trying to remain a going concern,” Gabrielsen added.
“I honestly don’t know what he has to do that would get him another bond.
My sense is that he is already scraping the bottom of the bottom in terms of availed willing and capable sources.”
Uncommon Knowledge
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Newsweek is committed to challenging conventional wisdom and finding connections in the search for common ground.