Donald Trump lost a bid to halt a $454.2 million civil fraud judgment against him for inflating his net worth and real estate values to deceive lenders. He now needs to raise the funds or secure a bond to prevent New York authorities from seizing his assets during his appeal. Associate Justice Anil Singh granted Trump’s request to temporarily stop part of Justice Arthur Engoron’s Feb. 16 ruling, which prohibited the ex-president from leading any New York corporation or obtaining loans from the state’s banks for three years.
The judgment, which stems from accusations of fraudulent business activity over a decade, has raised questions about Trump’s financial liquidity and his ability to satisfy the court’s demands without liquidating assets. Defense attorneys, representing Trump, argued that the amount of the judgment is “unprecedented and punitive,” noting the challenges in securing a bond without resorting to selling properties. Despite their efforts, the judge did not grant a stay for a lower bond amount but did agree to pause the enforcement of sanctions barring Trump and his sons from running their family business.
The court’s decision highlights the gravity of the situation, with Trump’s lawyers stating, “In the absence of a stay on the terms herein outlined, properties would likely need to be sold to raise capital under exigent circumstances.” They also emphasized the impossibility of recovering any property sold following a successful appeal or recouping financial losses from the Attorney General.
Singh’s decision allows Trump to apply for a loan to post a bond. James opposed a stay in a separate filing on Wednesday, deeming it “especially inappropriate” as the defendants essentially admit that Trump lacks sufficient liquid assets to fulfill the judgment.
“These are precisely the circumstances for which a full bond or deposit is necessary, where defendants’ approach would leave (the attorney general’s office) with substantial shortfalls once this court affirms the judgment,” James wrote.
Both sides are expected to submit more written arguments in the coming weeks, and a decision could come after March 18.
James also expressed concerns about the “significant risk” of Trump potentially evading payment or transferring assets out of reach in case he loses the appeal. She pointed out that the defendants had covertly hidden a $40 million transfer from the monitor, and highlighted Trump’s recent announcement about relocating some of his businesses to Florida.
While Trump’s net worth is estimated to be in the billions, a large portion of it is tied up in real estate rather than liquid assets.
Engoron issued a penalty of $354.9 million against Trump, along with daily interest that started accruing in 2019. As of February 22, the total amount owed had increased to $454.2 million with interest, and additional interest continues to accumulate each day.
Trump, who is the Republican presidential front-runner, now has limited time to secure a bond or pay the penalty. His options include further legal appeals, which he is set to pursue, with the next step being a panel of judges at New York’s Appellate Division, First Department, followed by the state’s Court of Appeals if necessary.
Meanwhile, the New York Attorney General has made it clear that she is prepared to act decisively if Trump cannot meet the court’s demands. “If he does not have funds to pay off the judgment, then we will seek judgment enforcement mechanisms in court, and we will ask the judge to seize his assets,” James told ABC News.
Relevant articles:
– Trump cannot line up fullbond in New York fraudcase, offers to post $100 mln
– Court denies Trump’s bid to freeze $464M judgment, after his lawyers say he’d have to sell properties to pay, ABC News, Wed, 28 Feb 2024 21:45:00 GMT
– Judge declines to pause Trump’s $454 million fraud penalty, but halts some sanctions, CBS News, Wed, 28 Feb 2024 21:06:36 GMT
– Donald Trump can’t post full bond in New York fraud case, offers US$100 million, South China Morning Post, Wed, 28 Feb 2024 22:06:57 GMT