Deadline looms for Trump
PENALTY: FACING BANKRUPTCY UNLESS HE COMES UP WITH BILLIONS
Bond companies won’t take his real estate holdings as collateral.
Donald Trump is up against a fast-approaching deadline to secure a half-billion dollar bond as he appeals his financial fraud case, facing possible bankruptcy or the seizure of his assets if he fails.
The former president, who has clinched the Republican nomination for this year’s presidential election, is appealing his $355 million (about R6.7 billion) penalty, plus interest, after a New York court ruled that he, his sons and his Trump Organisation company lied for years about the value of his assets, deceiving banks and insurers.
But he must put up a guarantee he’ll pay the fine if his legal fight fails.
Trump built a public profile as a property developer and businessman in New York before entering politics. But despite the real estate mogul’s $2.6 billion estimated net worth, his lawyers say that it’s been impossible so far to come up with the $454 million bond, due on Monday.
Typically, such bonds would be underwritten by an insurer or specialised bond company. But Trump’s lawyers say that after approaching 30 such companies, none will take the ex-president’s real-estate holdings as collateral, creating a “practical impossibility” to get a bond, they wrote in court filings.
Former federal prosecutor Andrew Weissmann said “it seems pretty clear to me, based on the filings, that the problem he is having is that whatever assets he has are already leveraged” against other loans.
If Trump cannot pay, said Carl
Tobias, a law professor at the University of Richmond, “he confronts the prospect of humiliation and serious financial harm”.
Multiple appeals are ongoing by the ex-president – who has denounced the judge who issued the ruling as “crooked” and a “Trump Hater” – including one at the New York Supreme Court.
But the 30-day grace period to put up the money expires on Monday, raising the prospect that unless courts intervene or the New York attorney-general gives him more time, Trump might need to “sell his properties or related assets, attempt to secure a bank loan, or even declare bankruptcy,” Tobias said.
Yet even that wouldn’t stop authorities from claiming his money, with Attorney-General Letitia James able to freeze his accounts or even seize certain properties, Tobias said.
“I would be forced to mortgage or sell great assets, perhaps at fire sale prices, and if and when I win the appeal, they would be gone,” Trump said in a post on social media.