New York Attorney General Letitia James will be free to start going after Donald Trump’s prized properties should the former president fail to make the deadline to post the $454 million bond in his civil fraud case.
Trump, 77, on Monday filed papers in an appeal court case seeking to get out of having to post the bond as he fights the massive judgment from February — which accrues $112,000 in interest daily.
The presumptive Republican 2024 presidential nominee had approached over 30 firms to secure the bond — to no avail — and he’s facing “insurmountable difficulties” getting the financial backing, his attorneys wrote in the filings.
Manhattan Supreme Court Justice Arthur Engoron ordered the hefty judgment against the real estate mogul in February after a three-month trial in which the AG’s office argued Trump exaggerated his net worth by billions a year on financial statements to get better loan and insurance terms.
Trump has said he plans to fight Engeron’s decision, but he must either put the full judgment amount in escrow or secure a bond to show he’s good for the money if he loses his appeal.
“If you’re trying to appeal a financial penalty, the courts want to make sure if you lose at the end of the day you can pay the penalty,” said Kevin J. O’Brien, a former prosecutor and current defense attorney in New York, adding it was “standard procedure.”
“This is an attempt to keep appellants honest,” O’Brien explained.
“The real difficulty is the size of the judgment is so huge.”
The bond would require Trump to post 120% of what he owes with collateral — amounting to $557.5 million, according to his lawyers.
Trump previously sought to lower the bond amount to $100 million and is now seeking to get out of paying the bond altogether.
O’Brien said that if Trump can prove to the court that he is likely to ultimately win his appeal, he “might have an argument” to get the bond amount lowered.
Could Trump sell off or mortgage his properties?
Trump’s side argued that he shouldn’t be forced to sell his properties in a “fire sale” in order to come up with the cash because he’d suffer irreparable losses in selling them for cheap and would never be able to get them back at the same price if he won the ultimate appeal of the judgment.
Trump could try to take out a mortgage on any of his properties to make the massive bond — but the move wouldn’t come without a hitch, legal experts said.
He may already be “mortgaged to the hilt” and lenders could be “reluctant to do business with him” given his legal problems, financial problems, and all of the “scrutiny” that is now on him, said O’Brien.
Trump’s lawyers said that he’d been in talks with 30 firms as he attempted to secure the whopping bond but all the negotiations had fallen through as the companies wouldn’t accept his properties as collateral.
O’Brien said, “That’s the way it goes” and it’s “unlikely the appellate division is going to be moved just because he has to sell assets.”
“I don’t think he’s going to have much success,” on appeal, O’Brien said. “The appellate division is not going to overturn Judge Engoron’s decision lightly.”
What happens if Trump doesn’t make the deadline?
If the Appellate Division, First Department doesn’t grant Trump’s bid to pause Monday’s deadline for his bond and if he can’t come up with the money by then, AG James can start going after his assets — a measure she said she won’t hesitate to use.
New York real estate lawyer Melissa Levin said if Trump is forced to cough up the full amount by Monday he is “going to have to start selling off his properties himself to get the rest of the money to pay the bond.”
“If he doesn’t do that, there would be nothing stopping Letitia James and New York State from asking the court to seize certain assets to pay off the judgment amount that way,” she added.
Both Levin and another New York civil lawyer Imran Ansari said that the AG can go after Trump’s properties in the Empire State and in other places too.
And she could go after other types of assets like bank accounts, wages, art, accounts receivable, rent on buildings, and money market accounts, Levin said.
“I believe that the AG would be able to levy on any assets of Trump and the Trump Organization, including its many real estate holdings, both within the state and outside the state, including Mar-a-Lago,” Ansari said.
“The AG can assert a lien against real property, and may file or request a property execution requesting that Trump property be seized and sold with the proceeds being used to pay off the judgment,” he added.
What Trump properties could James seize?
Real estate that Trump either owns or has a stake in includes iconic Big Apple buildings: 40 Wall St., the Trump International Hotel and Tower, Trump Park Avenue and 1290 Avenue of the Americas — of which he owns a 30% profit share.
The Trump Organization has owned the ground lease to the Trump Building at 40 Wall St. since 1995 and rents out space there, making him more of a landlord than an owner.
He has ownership stakes in parts of the Trump International Hotel and Tower at One Central Park West, including the parking garage, room-service kitchens, valet booth, lobby bathrooms, a restaurant space and a single unit.
Trump’s 30% profit share in the 1290 Avenue of the Americas building runs through 2044.
Trump owns the 120-unit 502 Park Ave. building after buying the former hotel in 2001 for $115 million.
His namesake real estate holding company also owns the retail and commercial parts Trump Tower at 724 Fifth Ave., while the ex-president owns the penthouse triplex, according to Curbed.
O’Brien said that if the AG seeks to seize assets in other states, like Mar-a-Lago in Florida, she’d have to make an application with the court where the property is located.
James going after Trump’s prized assets could launch a long legal process that would be “enormously cumbersome,” said O’Brien.
“It’s going to take a long time before Trump loses any of these properties,” the former prosecutor added.
No comments:
Post a Comment