On Monday, former President Donald J. Trump faces a looming $454 million judgment from a civil fraud case brought against him by New York Attorney General Letitia James. Ms. James now has the power to freeze Mr. Trump’s bank accounts and begin seizing some of his properties to collect the judgment. Although she could enforce the judgment immediately, she has provided a 30-day grace period that expires on Monday. Mr. Trump is now racing against the clock to block the attorney general from collecting the monetary penalty and avoid financial crisis.
To avoid the embarrassing outcome of having his assets seized, Mr. Trump must secure a half-billion dollar bond promising to cover the judgment if he loses his appeal and fails to pay. However, finding a company willing to post such a large bond has proven to be difficult, as much of Mr. Trump’s wealth is tied up in real estate, which bond companies typically do not accept as collateral. His lawyers have called their chances of securing a bond a “practical impossibility” after being rejected by more than 30 bond companies.
Mr. Trump is now banking on an appeals court pausing the judgment or accepting a smaller bond. The court is expected to rule on this matter soon, with Ms. James possibly waiting for the court’s decision before moving to collect on the judgment. Mr. Trump is exploring last-minute options such as seeking a quick sale of property or seeking a loan from a bank or private equity firm. He may also benefit from a windfall when the shares of his social media company start trading on the stock market.
If all else fails, Mr. Trump could have the corporate entities implicated in the fraud case file for bankruptcy, which would temporarily prevent Ms. James from collecting the judgment against them. However, this move would be seen as a political liability and would not discharge the fraud claims against Mr. Trump himself. Ultimately, Ms. James would likely hold him accountable for his company’s debts, leading to a lengthy court battle over property seizure.
Throughout this legal battle, Mr. Trump has denied any wrongdoing, claiming that the judgment imposed on him is “grossly disproportionate and unconstitutional.” He has accused the NY Attorney General and the trial judge of leading a witch hunt against him for political reasons. Despite these claims, Mr. Trump must obtain a large bond that covers the judgment and accruing interest while his appeal is pending. Failure to do so could result in Ms. James freezing his bank accounts and moving forward with seizing his properties as part of collecting the monetary penalty.
