Unlock the Editor’s Digest for free
Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.
Donald Trump is unable to secure the bond needed to postpone the enforcement of a $464mn fraud judgment against him in a New York civil court, his lawyers said on Monday.
The former US president’s team have spent “countless hours negotiations with one of the largest insurance companies in the world”, the lawyers wrote in a filing, citing a broker they hired, but have concluded that “very few bonding companies will consider a bond of anything approaching that magnitude”.
The Trump Organization had approached 30 surety companies via four separate brokers to no avail, they added.
Trump and his businesses were found liable in January for committing “blatant” fraud by vastly inflating the value of real estate assets such as Mar-a-Lago and 40 Wall Street in loan applications. The judgment, which exceeds $464mn with interest, can be collected by the New York attorney-general, who brought the case, unless he posts a bond for the full amount while he appeals.
Trump is asking a panel of judges at a New York appeals court to delay the enforcement without the sum being posted. One appeals judge had already refused a similar request on a temporary basis last month.
The renewed request comes days after Trump posted a $91.6mn bond to stay the enforcement of a separate civil judgment, in which he was found liable for defaming writer E Jean Carroll.
That bond was underwritten by a subsidiary of the Chubb corporation. Its chief executive later explained the company had done so through “the ordinary course of its surety business and is acting as a neutral party”.
In a filing on Monday, Gary Giulietti, the head of brokerage firm Lockton Companies, said he had been hired by Trump to secure the bond for the fraud case, but “despite scouring the market, we have been unsuccessful in our effort . . . for the simple reason that obtaining an appeal bond for $464mn is a practical impossibility under the circumstances presented”.
Giulietti said very few companies would even entertain providing a bond of that size, and the remaining handful will not “accept hard assets such as real estate as collateral”, but “will only accept cash or cash equivalents (such as marketable securities)”.
Most bond companies would also “require collateral of approximately 120 per cent of the amount of the judgment”, Giulietti wrote, which “would require defendants to hand over collateral in the form of cash or cash equivalents of approximately” $557mn.