11.2 C
New York

New York civil fraud: Donald Trump mulls options to pay penalty

Published:

Former US President Donald Trump is yet to secure a bond for appealing a $454 million ruling against him in a New York civil fraud lawsuit.
Trump is required to either produce the necessary funds or arrange for a bond to stop the state’s officials from confiscating his assets while he contests Judge Arthur Engoron’s February 16 verdict, which demands that he and his fellow defendants pay $464 million in fines and interest for inaccurately valuing properties to mislead lenders and insurers.
On Monday, the attorneys for the Republican presidential hopeful implored an intermediate state appellate court to suspend the execution of the verdict, claiming that the sum demanded was unwarranted.
They disclosed that the defendants had reached out to 30 surety companies via four different brokers in an attempt to acquire a bond.
“Applying an unattainable bond condition as a prerequisite for appeal would cause evident, irrevocable harm to the Defendants,” the lawyers of Trump articulated.
The legal team suggested that he be permitted to post a $100 million bond while the appeal is in progress. In the event that Trump is defeated in the appeal and is found incapable of payment, a bonding agency would be responsible for covering the amount.
Trump weighs bankruptcy
Meanwhile, the former president is reportedly considering a number of financial options. Despite suggestions from financial experts that bankruptcy could offer a clear solution to his monetary woes, Trump is said to be reluctant to take this path.
Trump’s legal team has indicated that he lacks the liquid assets necessary to secure a bond that would postpone the enforcement of the $464 million judgment while an appeal is in progress. With real estate making up the bulk of his wealth, and no bonding company willing to accept it as collateral, the possibility of New York Attorney General Letitia James seizing his assets, including the 40 Wall Street office tower, looms large.
Why it matters
Trump’s brand and political identity are closely tied to his image as a successful businessman. Filing for bankruptcy could undermine this persona. Concerns over potential damage to his image as a successful businessman and the implications for his November presidential campaign against Joe Biden are believed to be factors in his decision-making process, a Washington Post report said.
The situation underscores the unique intersection of business, personal finances, and political strategy, illustrating how each domain impacts Trump’s choices and public perception.
One associate of Trump mentioned, “He’d rather have Letitia James show up with the sheriff at 40 Wall and make a huge stink about it than say he’s bankrupt.” This sentiment underscores Trump’s focus on the political narrative rather than the financial implications of bankruptcy, the Washington Post report said.
Between the lines
Historically, Trump has navigated corporate bankruptcies six times, particularly during his ventures in the Atlantic City casino industry. He has previously defended these decisions as strategic moves employed by astute investors, emphasizing that he never filed for personal bankruptcy.
Bankruptcy attorney Avi Moshenberg commented on the situation, suggesting that if Trump were to file now, he might not have to pay anything until after the bankruptcy proceedings, which could be protracted due to their complexity. Nonetheless, interest on the judgment would likely continue to accumulate.
In a recent statement, Trump spokesman Steven Cheung conveyed the intention to persist with legal challenges. “This is a motion to stay the unjust, unconstitutional, un-American judgment from New York Judge Arthur Engoron in a political Witch Hunt brought by a corrupt Attorney General. A bond of this size would be an abuse of the law, contradict bedrock principals of our Republic, and fundamentally undermine the rule of law in New York,” Cheung said.
What’s next
Trump’s inner circle, including advisers and legal experts, recognizes bankruptcy as a logical financial step, given Trump’s current cash crunch and the escalating daily interest on the judgment.
The dilemma Trump faces is emblematic of the complex interplay between personal reputation, financial health, and political strategy. His reluctance to declare bankruptcy, despite it being a familiar tool in his business practices, highlights the stark differences between corporate and personal bankruptcy, especially when public political personas are involved. Trump’s decision-making in this scenario will reveal his priorities and might set precedents for how financial distress is navigated in the political arena.
Critics and supporters alike are watching closely, as Trump’s financial strategies could redefine his business-savvy image and impact voter confidence.
(With inputs from agencies)

Related articles

Recent articles

spot_img