The lawyers representing the New York Attorney General have requested Judge Arthur Engoron to reject the $175 million bond submitted by former President Donald Trump for his civil judgment. They are urging the judge to compel Trump to provide a new bond within a week.
Letitia James argued that the former president did not show evidence that Knight Specialty Insurance Company, the company responsible for his bond, had the financial means to pay the bond in the event that Trump’s appeal was unsuccessful.
In the filing, James argued that Defendants and KSIC have not provided sufficient justification for appointing KSIC as the surety for such a significant project.
In February, it was determined by Engoron that Trump and his co-defendants had been involved in a scheme for over a decade to inflate the former president’s net worth. The purpose of this scheme was to secure better business deals and obtain lower interest rates on loans.
A New York Appellate Court has reduced the amount of money Donald Trump would need to post as a bond for the $464 million judgment, thus preventing the risk of his properties being seized. The initial bond requirement has been lowered to $175 million.
On April 1, Trump and his co-defendants successfully posted a bond of $175 million.
According to the attorney general’s filing, Trump and the company were unable to prove that the bond had collateral worth more than $175 million in cash, which was held in a Charles Schwab brokerage account. The motion also highlighted concerns raised by James regarding KSIC’s use of affiliates in the Cayman Islands to minimize the liabilities shown on their financial records, potentially violating federal laws.
According to James, KSIC, a small insurer that is not authorized to write business in New York and therefore not regulated by the state’s insurance department, has never previously issued a surety bond in New York or any other jurisdiction in the past two years. Additionally, KSIC has a total policyholder surplus of only $138 million.
Judge Engoron has scheduled a hearing on this issue for Monday.
Don Hankey, the chairman of Knight Insurance Group, has chosen not to provide any comment on the matter.