New York AG says $175 million Trump fraud bond isn't properly backed, should be voided

[LetMyPeopleVote]

Source: CNBC

The New York Attorney General’s office on Friday asked a judge to effectively void a $175 million bond posted by former President Donald Trump to secure a much larger monetary damage award in his civil business fraud case.

The AG’s office in a filing said that Trump and other defendants in the case had failed to show there is enough identifiable collateral to back the bond for the judgment in Manhattan Supreme Court.

The filing notes that the surety Trump used to obtain the bond, Knight Specialty Insurance Company, is “a small insurer that is not authorized to write business in New York and thus not regulated by the state’s insurance department, had never before written a surety bond in New York or in the prior two years in any other jurisdiction, and has a total policyholder surplus of just $138 million.”

The filing opposes a joint motion by Trump and KSIC to justify the insure as the surety company holding the bond.

Lawyers for AG Letitia James asked Judge Arthur Engoron to require Trump and other defendants to put up a replacement bond within seven days of ruling on the issue.

Read more: https://www.cnbc.com/2024/04/19/new-york-ag-says-175-million-trump-fraud-bond-isnt-properly-backed-should-be-voided.html

[Irish_Dem]

1. Trump produces a fake bond.

Tries to pull a fast one, in keeping with all of his other business fraud.

He hoped he could pull a fast one on the court, it didn't work,
but he was able to buy himself some time.

[pandr32]

2. Smoke and mirrors backing.

No real money.

[LetMyPeopleVote]

3. This will be fun to watch

New York AG asks for the judge in Trump's civil fraud case to REJECT the Knight surety and declare the bond to be "without effect."

Link to tweet

Here is a link to the filing
https://www.documentcloud.org/documents/24558931-452564_2022_people_of_the_state_of_v_people_of_the_state_of_memorandum_of_law_i_1738

[onetexan]

4. Isn't that forgery or lying to court?

[riversedge]

13. Could be just stupid lawyers who thought they could get away with it.

[onetexan]

19. Sounds like purposely defrauding the court to me

[onenote]

23. Neither. Its just relying on an argument that the court may, or may not, reject.

My guess is that the court will reject it, but that's just speculation on my part.

[intrepidity]

24. Reject "it" --- being the bond or the James request?

Ambiguous.

[onenote]

25. Sorry. The bond. He'll give them 7 days to come up with a different bond.

Last edited Sat Apr 20, 2024, 01:45 PM - Edit history (1)

After that James could start the process of taking Trump's property. However, I'm guessing that if the bond is rejected by the court, Trump will appeal and ask the appellate court to stay any action by James until that appeal is decided.

In other words, I don't expect James to be able start doing much immediately.

[intrepidity]

29. Ty. nt

[EarthFirst]

5. Gonna have to start a can koozie fundraiser soon... nt

[Justice matters.]

6. Another 7-days delay... (if granted by the Court)

What's next? Bond reduced to 50??

[returnee]

7. Might I suggest...

…charging him with fucking perjury for his under-oath statement regarding his cash holdings.

[riversedge]

8. BREAKING: New York Attorney General Letitia James drops a Friday bombshell on Donald Trump and formally asks the judge

BREAKING: New York Attorney General Letitia James drops a Friday bombshell on Donald Trump and formally asks the judge to void his $175 million bond.

This is the nightmare scenario for MAGA...

In her filing, James' office stated that Trump and the other defendants in the case (including his sons Eric and Don Jr.) have failed to prove that there is enough collateral to back the bond.

She further notes that Knight Specialty Insurance company, which provided the bond, is "a small insurer that is not authorized to write business in New York and thus not regulated by the state’s insurance department, had never before written a surety bond in New York or in the prior two years in any other jurisdiction, and has a total policyholder surplus of just $138 million."

Lawyers for James have asked Judge Arthur Engoron to force Trump and the other defendants to secure a replacement bond with a week of ruling on the issue.

Link to tweet

[bluestarone]

18. Thank God for HER, but

I just gotta ask here, is it HER job to see this? WTF? Day one it should have been REJECTED!!

[catbyte]

9. Oh, The Donald is going to have a nice, relaxing weekend...

[moniss]

10. It is also important to note

that, while a non-admitted company can issue a bond or policy under certain circumstances, you would be on your own regarding any enforcement in the case of a default. Meaning the state of NY would have to look at many millions in legal expenses and perhaps many years only to end up with nothing. Knight could have that subsidiary file bankruptcy the minute a claim for that NY bond came in and then face a nightmare scenario of trying to get any money.

Move against the properties and maybe find there is little value beyond the leverage along with having umpteen different other creditors hitting you with lawsuits trying to hamstring you while trying to preserve their "interests". Even if they would all be unsuccessful you might still be looking at millions in litigation and many years.

It's a bad situation without a true escrow of the bond amount. The house of cards Knight and the Orange Ruski constructed is worse than worthless. It's a potential money trap of legal costs.

[twodogsbarking]

11. There's nothing left. Chubb has it all tied up.

[Novara]

12. Indict him on anouther count of fraud and reinstate the FULL amount of the judgment

It's gotta be close to half a billion by now.

[Diraven]

14. Heh, I called this

I totally predicted he'd try to get away with a bogus bond without real collateral as soon as I heard he was trying to post bond. Though I'm still not sure if this is him trying to get away without paying the judgment, or another delaying tactic to ask for even more time to fix the intentional incompetence.

[jmowreader]

15. Another question comes to mind

I know there are liquidity requirements for these things - in other words, an insurer isn't allowed to put all his eggs in one orange basket. How much surplus would Knight have to be sitting on to legally write a $175 million surety bond? Especially to someone who's as famous for not paying his bills as Trump is?

They might be better off taking their $175 million to Aqueduct Racetrack or Belmont Park and betting on horses. If you're good at predicting horse races you can make quite a bit of money in that pursuit.

[Phoenix61]

16. I read that in New York the bond can only be 10% of their assets.

So, not even close. If the parent company owned by his buddy wanted to write it they would have.

[jmowreader]

22. The parent company is claimed to have $1 billion in assets

At least according to Trump’s filing they do. If it’s true you can only write a bond for 10 percent of your company’s capital, they’re still way short.

[Hermit-The-Prog]

17. Delay achieved.

[republianmushroom]

21. You are correct.

[onenote]

26. Delay in having assets seized? Or delay of the appeal?

[republianmushroom]

20. Huh, who would have though it.

[Think. Again.]

27. I'd suggest adding charge for filing false documents also....

...any defending attorney should know that they must have their paperwork in order as legitimate before even filing it with the court, which is wh they should be licensed in various states to engage in this.

Posting bonds is not a new thing for attorneys, they know the rules, regulations, guidelines etc. of what is an acceptable bond posting or not, so filing this kind of non-compliant paperwork must be considered a deliberate attempt to interfere with the procedings of the court.

[captain queeg]

28. I am so shocked. If you can't trust DJT financially who can you trust?

[Maxheader]

30. Take the yellow haired thief

and sell his real estate.

[LetMyPeopleVote]

31. Letitia James says company that put up Trump's $175 million bond may not have enough funds

New York's attorney general said Knight Specialty Insurance Company has not shown that it has enough collateral to back the bond.

Link to tweet

https://www.msnbc.com/top-stories/latest/letitia-james-trump-fraud-bond-judgment-void-rcna148664

New York Attorney General Letitia James has asked Judge Arthur Engoron to void the $175 million bond in Donald Trump's civil fraud judgment, citing concerns that the bond company doesn't have the funds.

In a filing on Friday, James said Knight Specialty Insurance Company, which underwrote Trump's bond, has not been able to show that it has enough collateral to back it. She described KSIC as "a small insurer that is not authorized to write business in New York and thus not regulated by the state’s insurance department," and said the company had never written a surety bond in New York or in the past two years in any other jurisdiction.

James’ office is seeking to have Trump put up a replacement bond within seven days of a ruling. A hearing is set for Monday.

KSIC is part of the Los Angeles-based Hankey Group of Companies, owned by billionaire Don Hankey. Several of his companies have run into trouble with federal regulators in the past. Hankey is also a major stockholder in a San Diego financial company that had refinanced some of Trump's loans when other banks refused to do so, NBC News reported.

Trump's struggle to secure a bond for his civil fraud judgment was well documented, despite his protests that he had cash in hand. A week before the deadline to post his bond, his lawyers pleaded for a stay in the $454 million judgment, telling Engoron that they’d been rejected by 30 surety companies that would not accept real estate as collateral.

[LetMyPeopleVote]

32. Letitia James says company that put up Trump's $175 million bond may not have enough funds

New York's attorney general said Knight Specialty Insurance Company has not shown that it has enough collateral to back the bond.

Link to tweet

https://www.msnbc.com/top-stories/latest/letitia-james-trump-fraud-bond-judgment-void-rcna148664

New York Attorney General Letitia James has asked Judge Arthur Engoron to void the $175 million bond in Donald Trump's civil fraud judgment, citing concerns that the bond company doesn't have the funds.

In a filing on Friday, James said Knight Specialty Insurance Company, which underwrote Trump's bond, has not been able to show that it has enough collateral to back it. She described KSIC as "a small insurer that is not authorized to write business in New York and thus not regulated by the state’s insurance department," and said the company had never written a surety bond in New York or in the past two years in any other jurisdiction.

James’ office is seeking to have Trump put up a replacement bond within seven days of a ruling. A hearing is set for Monday.

KSIC is part of the Los Angeles-based Hankey Group of Companies, owned by billionaire Don Hankey. Several of his companies have run into trouble with federal regulators in the past. Hankey is also a major stockholder in a San Diego financial company that had refinanced some of Trump's loans when other banks refused to do so, NBC News reported.

Trump's struggle to secure a bond for his civil fraud judgment was well documented, despite his protests that he had cash in hand. A week before the deadline to post his bond, his lawyers pleaded for a stay in the $454 million judgment, telling Engoron that they’d been rejected by 30 surety companies that would not accept real estate as collateral.