Former US President Donald Trump holds a news story about New York Attorney General Letitia James while speaking to the media at one of his properties at 40 Wall Street after closing arguments in his civil fraud trial on January 11, 2024 in New York City.
Spencer Platt | Getty Images
Trump's lawyers noted in a lawsuit Monday that he does not have sufficient funds to obtain an appeal bond that would prevent New York's attorney general from seizing his estate assets to satisfy a $454 million civil fraud judgment.
Trump's lawyers said in the lawsuit that it has proven “impossible” for the former president to obtain bail that guarantees the full sentence he faces while appealing the sentence he is ordered to pay.
The lawsuit asks a five-judge panel of the Manhattan Court of Appeals to allow Trump to avoid having to pay bail while challenging the judge's ruling that he, the Trump Organization and other defendants committed business fraud.
If the committee does not approve this request, Attorney General Letitia James could begin a process to seize Trump's property on March 25.
James, who successfully sued Trump in the case, previously said she would take that step if he did not post an appeal bond or pay the judgment.
The lawsuit filed in the Appellate Division of the Supreme Court in Manhattan said that Trump's team contacted about 30 escrow companies but could not find one willing to guarantee the bonds.
Trump's lawyer wrote that obtaining a bond of that size would require “cash reserves approaching $1 billion,” which neither the former president nor the Trump Organization has.
Under New York court rules, Trump must file an appellate bond to avoid James moving to collect a fraud judgment.
“A bond of this magnitude would be an abuse of the law, run counter to the fundamental principles of our republic, and fundamentally undermine the rule of law in New York,” Trump campaign spokesman Stephen Cheung said in a statement.
Manhattan Supreme Court Judge Arthur Engoron in February ordered Trump and the other defendants to pay a total of $464 million in damages and interest for violating New York's anti-fraud law.
Engoron ruled that Trump, his two adult sons, the Trump Organization and senior company executives fraudulently inflated the value of real estate assets for years to boost his net worth and obtain better loan terms and other financial benefits.
Trump ordered the lion's share of the judgment to be paid: $454 million. Post-judgment interest on Trump's share of damages continues to accrue at a rate of approximately $112,000 per day.
Trump, who secured the Republican presidential nomination, claimed in testimony last year that he had “substantially over $400 million in cash.”
Despite this, a nearly 5,000-page court filing filed by his lawyers Monday outlines his inability to obtain bail to secure a full sentence.
The filing includes an assertion from Gary Giulietti, president of the Northeast division of Lockton Companies, which he describes as the world's largest private insurance brokerage.
“Despite our market research, we were unsuccessful in our efforts… under the circumstances presented,” wrote Giulietti, who was appointed by Trump to help him obtain a bond.
The Treasury Department has approved only a few bond underwriting companies to underwrite bonds of this size, Giulietti wrote, and many of these companies will only issue a single bond with a maximum of $100 million.
He also said that none of these companies would accept illiquid assets – such as real estate – as collateral.
“Simply put, a bond of this magnitude is rarely, if ever, seen,” Giulietti wrote. “In the unusual circumstances that bonds of this size are issued, they are being offered to the largest public companies in the world, not individuals or privately owned companies.”
The Trump Organization is privately owned.
Giulietti wrote that it would be impossible for a private company to obtain a bond to secure the total judgment of $464 million unless it had about $1 billion in cash or cash equivalents to offer as collateral, while still being able to meet its other business obligations.
“While I understand that the Trump Organization is in a strong liquidity position, it does not have $1 billion in cash or cash equivalents,” he wrote.
Trump's lawyers also noted in the filing that bond issuers often ask for guarantees totaling 120% of the judgment, which equates to more than $557 million.
These issuers are also likely to require a two-year advance on the 2% annual bond premium, which would require the defendants to pay more than $18 million upfront, the lawyers wrote.
The defendants had previously offered to post a $100 million bond to prevent James from collecting the judgment while Trump appealed Engoron's ruling.
An appeals judge rejected that motion but allowed the defendants to continue doing business in New York and lifted Engoron's three-year ban on Trump seeking loans in New York. This order becomes effective temporarily before the full Court of Appeals panel hears the stay request.
Trump earlier this month obtained a $91.6 million bond from insurance company Chubb to secure a civil defamation judgment against him for writer E. Jean Carroll while he appeals that judgment. According to Monday's filing, Chubb was one of the companies Trump contacted in an attempt to obtain bond for the business fraud case.
Carroll succeeded in filing a lawsuit against Trump in federal court for defaming her after she accused him in 2019 of raping her in the mid-1990s in a Manhattan department store.
