(RepublicanPress.org) – In February, former President Donald Trump was found liable for fraud in New York and ordered to pay $355 million for his crimes—plus interest. To appeal the verdict, the defendant had to submit a bond for the accrued amount, about $454 million. After failing, an appeals court reduced the amount needed to $175 million, giving him 10 more days to post—he did. However, there’s now a problem with the surety company.
What initially appeared to be a paperwork issue on the part of Knight Specialty Insurance Company, the surety company Trump used to post the bond, has garnered more questions. New York Attorney General Letitia James requested that the California-based company prove it can pay the $175 million if the defendant loses on appeal. The AG relayed concern over Trump’s bond company choice, as the insurer is reportedly not regulated by the state of New York. In response, Judge Arthur Engoron set a hearing for April 22 to discuss the issue.
Attorney Bruce Lederman, who has experience obtaining bonds, stated James’ worries are reasonable, and it makes sense for her to require proof that Knight Specialty is “actually holding the $175 million in cash collateral.” If the company does, that would ensure it could pay that part of the judgment without having to go through the process of “liquidat[ing] pledged assets” if Trump loses on appeal. According to Lederman, the insurance company isn’t supposed to underwrite a bond for over 10% of its surplus cash. The financial statements provided by Knight Specialty stated it only had $138 million in surplus.
Trump’s team thinks the AG is meaning to just looking to “stir up” trouble for Trump to “regain relevance,” calling James’ entire action against his client a “baseless and vindictive political crusade.” Still, if the insurance company can’t provide sufficient proof to the court that it can cover the bond, it could be invalidated, and Engoron would decide the next steps.
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