Letitia James, New York Attorney General, will be free to begin going after former President Donald Trump’s prized properties if the former president fails to make the deadline to post the $454 million bond in his civil fraud case.
On Monday, Trump filed papers in an appeal court case seeking to get out of having to post the bond as he fights the significant judgment from February — which accrues interest of $112,000 per day.
The presumptive GOP 2024 presidential nominee had approached more than 30 firms to secure the bond—none of which would do it—and his attorneys wrote in the filings that he’s facing “insurmountable difficulties” getting the financial backing.
Manhattan Supreme Court Justice Arthur Engoron ordered a significant judgment against the real estate mogul in February following a three-month trial during which the AG’s office argued Trump had exaggerated his net worth by several billion per year on financial statements to get better insurance and loan terms.
The former president has said he plans to fight Engoron’s decision, but he must either secure a bond to show he’s good for the money if he loses his appeal or put the full judgment amount in escrow.
“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 current defense attorney and former prosecutor in New York, Kevin. J. O’Brien, adding it was “standard procedure.”
“This is an attempt to keep appellants honest,” explained O’Brien. “The real difficulty is the size of the judgment is so huge.”
According to his attorneys, the bond would require Trump to post 120% of his debt with collateral totaling $557.5 million.
Trump previously sought to lower the bond amount to $100 million and now seeks to avoid paying the bond altogether.
O’Brien said that if Donald Trump could prove to the court that he is likely to win his appeal, he “might have an argument” to get the bond amount lowered.
Could Trump mortgage or sell off his properties?
An aide for Trump argued he shouldn’t be forced to sell his properties in a “fire sale” to come up with the cash because he’d suffer irreparable losses in the sale of them for cheap and would never be able to get them back at the same price if he won the ultimate judgment appeal.
Donald Trump could try to take out a mortgage on any of his numerous properties to meet the bond—however, legal experts say the move would not come without a hitch.
O’Brien explained that the former president may already be “mortgaged to the hilt” and lenders might be “reluctant to do business with him” given his financial and legal problems and the “scrutiny” that is now centered on him.
Trump’s attorneys said he has already been in talks with 30 firms to secure the bond
Trump’s attorneys said he had been in talks with 30 firms as he attempted to secure the massive bond, but all negotiations had fallen through as the companies would not accept his properties as collateral.
“That’s the way it goes,” said O’Brien, and it’s “unlikely the appellate division is going to be moved just because he has to sell assets.”
O’Brien said, “I don’t think he’s going to have much success” on appeal. The appellate division is not going to overturn Judge Engoron’s decision lightly.”
What will happen if Trump can’t make the deadline?
If Trump’s bid to pause Monday’s deadline for his bond isn’t granted and he cannot come up with the money by then, Attorney General James can begin going after his assets — a measure she assures she won’t hesitate to use.
Melissa Levin, a New York real estate attorney, said if Trump is forced to cough up the entire amount by Monday he is “going to have the 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 says,” Levin added.
Both New York civil lawyers Imran Ansari and Levin said the AG could pursue the former president’s properties in New York and elsewhere.
Levin said she could also pursue other assets, such as wages, bank accounts, art, rent on buildings, accounts receivable, and money market accounts.
“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,” said Ansari.
“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,” Ansari added.
Real estate that Trump either owns or has a stake in includes iconic buildings in the Big Apple: the Trump International Hotel and Tower, 40 Wall Street, Trump Park Avenue, and 1290 Avenue of the Americas, in which he owns a 30% profit share.
The Trump Organization has owned the ground lease to the 40 Wall Street Trump Building since 1995 and rents out space there, making him more of a landlord than the owner.
Donald Trump owns parts of the Trump International Hotel and Tower located at One Central Park West, including room-service kitchens, the parking garage, lobby bathrooms, a valet booth, a restaurant space, and a single unit.
Trump’s 1290 Avenue of the Americas building’s 30% profit share runs through 2044.
The former president owns the 120-unit 502 Park Avenue building after purchasing the former hotel in 2001 for $115 million.
According to Curbed, his real estate holding company additionally owns the commercial and retail parts of Trump Tower at 724 Fifth Avenue, while he owns the penthouse triplex.
O’Brien said if the attorney general attempts to seize assets in other states, like Mar-a-Lago, which is located in Florida, she would need to make an application with the court where the property is located.
If James goes after Trump’s most-prized assets, it could kick off a lengthy legal process that would be “enormously cumbersome,” said O’Brien.
The former prosecutor added, “It’s going to take a long time before Trump loses any of these properties.”
