New York Attorney General Letitia James is questioning whether the surety company covering former President Donald Trump’s $175 million bond is capable of fulfilling its obligation.
On April 1, Trump posted a $175 million bond to prevent James from seizing assets after an appeals court ruled the former president could post the bond amount to cover a civil fraud judgment of $464 million.
The appeals court ruling guaranteed Trump could appeal the judgment.
The firm that underwrote the bond is Knight Specialty Insurance Company. The company essentially promised to cover the $175 million bond if Trump loses his appeal and fails to pay. Trump paid Knight Specialty Insurance Company a fee and pledged cash as collateral to obtain Knight Specialty Insurance Company’s coverage.
James questions the company’s ability to cover the sum of the bond, a Thursday court filing showed. Judge Arthur Engoron, who determined Trump’s civil judgment, tentatively scheduled a hearing for April 22 to discuss James objections, the New York Times reported:
In a court filing on Thursday, Ms. James noted that Knight was not registered to issue appeal bonds in New York, and so she demanded that the company or Mr. Trump’s lawyers file paperwork to “justify” the bond within 10 days. Ms. James is seeking to clarify whether Knight, which had never posted a similar court bond before aiding Mr. Trump, is financially capable of fulfilling its obligation to pay the $175 million if Mr. Trump defaults.
Even if Knight lacks the funds itself, the company should be able to tap the collateral Mr. Trump pledged.
In a statement on Thursday, a lawyer for Mr. Trump, Christopher M. Kise, slammed Ms. James, calling her case a “baseless and vindictive political crusade” and her objections to the bond an effort “to stir up some equally baseless public quarrel in a desperate effort to regain relevance.”
Judge Engoron fined Trump and the Trump Organization in February for more than $350 million and barred him from serving as an officer or director of any New York corporation for three years.
James sought to essentially bankrupt Trump by putting him on the hook for $464 million fine and a lifetime ban from the real estate industry in New York State.
Wendell Husebo is a political reporter with Breitbart News and a former GOP War Room Analyst. He is the author of Politics of Slave Morality. Follow Wendell on “X” @WendellHusebø or on Truth Social @WendellHusebo.