Former U.S. President Donald Trump speaks to the media as he arrives at a Manhattan courthouse trial in a civil fraud case brought by state Attorney General Letitia James against him, his adult sons, the Trump Organization and others in New York City, U.S., October 4, 2023.
Mike Segar | Reuters
Donald Trump should have pledged real estate he owns as collateral against a $464 million business fraud judgment if he were “truly unable” to get an appeal bond for that amount, the New York attorney general’s office said in a court filing Wednesday.
Trump “at a minimum” should have let the courts hold those properties while he appealed, a lawyer for Attorney General Letitia James wrote.
The attorney, Dennis Fan, argued that Trump had not provided any evidence this week to support his claim that it was “impossible” to obtain an appeal bond using his real estate holdings as collateral.
“Defendants supply no documentary evidence that demonstrates precisely what real property they offered” to potential insurers, wrote Fan, in the filing to Manhattan appeals court judges.
Nor did they report “on what terms that property was offered, or precisely why” bond insurers “were unwilling to accept the assets,” according to the filing.
The office made these points as part of a broader argument that Trump hasn’t really exhausted all his options to get a bond that would stop the massive fraud judgment from coming due.
Instead, they suggested Trump and his lawyers are trying to make it sound impossible to get a bond in the hopes that this helps convince appeals judges to “put the brakes” on the judgment — before Trump has to either produce the whole amount or risk default.
Unless a court intervenes, James could start collecting on the judgment — by seizing Trump’s assets — as soon as next week.
Attorney General Letitia James arrives for the civil fraud trial of former President Donald Trump and his children at New York State Supreme Court on November 08, 2023 in New York City.
Michael M. Santiago | Getty Images
As this deadline nears, Trump is growing more and more furious.
“KEEP YOUR FILTHY HANDS OFF OF TRUMP TOWER!” the presumptive Republican presidential nominee wrote Wednesday in a fundraising appeal.
“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,” he wrote the day before. “Does that make sense?”
In fact, it does: Anyone who loses a civil case in New York is required to post a bond to avoid paying the full judgment while he or she appeals.
Conflicts of interest alleged
The account of Trump’s struggle to obtain a bond came entirely from two people who, Fan alleged, have serious conflicts of interest and credibility problems.
Gary Giulietti, the bond broker who claimed 30 different insurers had turned him down, is also a personal friend of Trump’s who has a long-running business relationship with the Trump Organization.
Not only that, said Fan, but Giulietti also served as an expert witness for Trump in the very same fraud case Trump is now trying to appeal.
Giulietti did not reply to a request for comment Wednesday from CNBC.
The other person who backed up Giulietti’s claims to the appeals judges was Alan Garten, a lawyer for the Trump Organization. Garten said that Trump was facing “insurmountable” difficulties getting an appeal bond.
Fan argued that Garten is conflicted because he works for Trump, and that Garten was “personally involved in the fraudulent and illegal conduct” at the heart of Trump’s fraud case.
Garten denied this. “The court found no such thing, the AG’s statement is reckless and completely untrue,” he said in a statement to NBC News Wednesday.
Fan also noted that Garten’s claims about how hard it was to get a bond relied mostly on things Giulietti had said.
A lawyer for Trump also responded to the AG’s filing Wednesday in a separate statement.
Chris Kise, attorney for former President Donald Trump, enters the courtroom after a break at New York State Supreme Court in New York, US, on Wednesday, Oct. 11, 2023.
Alex Kent | Bloomberg | Getty Images
“This continued abuse of power will continue until some judicial officer musters the courage to say ‘enough,'” said attorney Chris Kise. “Until then, the damage to the New York business community and to the rule of law is irretrievable.”
A split bond
The other questionable part of Trump’s argument that his judgment should be paused, Fan wrote, is that it relies on the premise that the former president must somehow get only one bond from only one company.
Under the law, people facing large cash fines “may bond large judgments by dividing the bond amount among multiple” insurers, essentially spreading around the risk, Fan wrote.
Still, pursuing a multiple bond strategy would not solve Trump’s basic problem.
These companies are “also going to have the same collateral requirements,” said JD Weisbrot, president and chief underwriting officer at JW Surety Bonds.
Collateral, he said, that is “simply not available.”