New York Judge Arthur Engoron has given the green light to a new agreement reached on Monday between Donald Trump’s legal team and state Attorney General Letitia James.
This agreement aims to strengthen the $175 million bond that Trump had posted to appeal a $454 million judgment in a civil fraud trial. The trial accused Trump of inflating the value of his real estate empire in statements made to lenders.
Last Friday, James had urged Engoron to nullify the bond, contending that Knight Specialty Insurance Co. lacked authorization to issue bonds in New York.
The bond’s collateral, held by Knight, is a cash account with Charles Schwab financial services. State lawyers had expressed concerns that Trump might have access to this account.
However, during a hearing on Monday, Trump’s lawyer Christopher Kise reassured Engoron that Trump would not be able to withdraw funds from the account without Knight’s approval, and Charles Schwab would not permit it.
“We have to put the money somewhere,” Kise stated.
Engoron, nevertheless, expressed doubts about the security of the collateral.
“You keep using the word agreement, what if they break the agreement?” Engoron inquired. “It all seems like a house of cards.”
Subsequently, lawyers representing Trump and James convened to negotiate an arrangement. Under this agreement, Schwab will maintain the account in cash, while Knight will have exclusive control over it. Engoron has endorsed this deal.
Trump told reporters Monday he was forced to deal with the California company because the judgment barred him from dealing with financial institutions in New York. Trump said he put up $175 million in cash so James should have no concerns about whether the bond is legitimate.
“She doesn’t like the bonding company because she doesn’t know if the collateral is good,” Trump said in the hallway outside his criminal trial. “The bonding company would be good for it because I put up the money. I had plenty of money to put up.”
Trump had said it would be impossible for him to post a bond for the entire $454 million while he appeals the case, to ensure the judgment is paid if he loses the appeal.
Trump appeal continues to challenge Engoron’s $454 million judgment
Engoron ordered Trump in February to repay ill-gotten gains from getting more favorable interest rates on loans by exaggerating the value of his properties for years.
For example, Trump tripled the square footage of his Trump Tower penthouse, valued the building at 40 Wall St. in Manhattan by hundreds of millions more than its appraised value and estimated the value of his Mar-a-Lago resort in Florida at hundreds of millions more than its tax assessment.
Trump has complained bitterly about Engoron’s ruling, particularly about the value of Mar-a-Lago.
