The $175 million bond in former President Trump’s civil fraud trial is at risk after the New York attorney general’s office questioned the qualifications of the California-based company that posted it.
State lawyers wrote in a brief court notice Thursday that they take “exception to the sufficiency of the surety,” secured from Knight Specialty Insurance Company.
The notice requires Trump or the insurance company to demonstrate that the company is financially capable of paying the bond amount if Trump loses on appeal and that the bond is appropriately collateralized.
“Defendants or (Knight) shall file a motion to justify the surety within ten days of the service of this notice, failing which the Bond shall be without effect, except that the surety shall remain liable on the Bond until a new undertaking is given and allowed,” state lawyers wrote in the filings.
Judge Arthur Engoron, who oversaw the fraud trial, ruled earlier this year that Trump, his business and top executives conspired to alter Trump’s net worth for tax and insurance benefits. He ordered them to pay $464 million, plus interest, in addition to several other penalties.
Trump was ordered to post a $175 million bond in the case after he told a New York appeals court that it would be “impossible” to secure a bond in the full amount of Engoron’s judgment, namely because sureties refused to accept his real estate as collateral.
The bond, from the Knight Specialty Insurance Company, automatically bars New York Attorney General Letitia James (D) from collecting the multimillion-dollar judgment against Trump and pauses other penalties.
Engoron scheduled a hearing for April 22 to discuss the matter — which is expected to be one week into Trump’s criminal trial in Manhattan.
The New York attorney general’s office separately asked Engoron on Thursday to direct the independent monitor he appointed to oversee the Trump Organization’s business dealings — one of the penalties he imposed — to investigate whether the defense “withheld relevant and responsive information” during the trial.
The issue came to state lawyers’ attention after ex-Trump Organization chief financial officer Allen Weisselberg pleaded guilty last month to perjury charges linked to the fraud trial.
As part of his plea deal, Weisselberg conceded that he lied during depositions ahead of the trial and during his trial testimony.
Cited in evidence for the deal was an email exchange between Weisselberg and a Trump Organization employee where the correct size of the former president’s Trump Tower triplex — a key piece of evidence at trial — was confirmed to the ex-CFO. State lawyer Kevin Wallace purported that exchange was never turned over by the defense.
Wallace asked the judge to task the monitor with determining whether the defense had the exchange in its possession, whether it was turned over to the state during discovery, and if it was not, why. He asked the judge to give the monitor two weeks to investigate.