In the wake of a New York business fraud lawsuit, former President Donald Trump is preparing to contest a substantial monetary judgment that could potentially devour a significant portion of his stated liquid assets. However, the pathway to his appeal is fraught with obstacles, starting with procuring a substantial appeal bond which is proving to be a formidable challenge.
On a pivotal Friday ruling, Mr. Trump was slapped with roughly $355 million in fines, an amount ballooned with an additional $98 million in interest by a judge’s ruling that held the former president accountable for fraudulent manipulation of financial claims submitted to banks. The ruling carries with it a hefty daily interest of $87,502.
To avoid shelling out the entire fine during his anticipated appeal, Trump faces the necessity of posting an appeal bond, usually pegged at up to 120% of the judgment, enhanced by accumulating interest.
Consequently, the judgment—comprehensive of the original sum and interest—would mandate Trump to post an appeal bond upwards of $540 million. Despite being a heavyweight in the real estate sector, Mr. Trump might find hurdles in leveraging his properties as bond collateral.
Neil Pedersen, who helms Pedersen & Sons, a surety bond company in New York, suggests that real estate isn’t quite the draw for bond collateral that one may expect. The implication for Trump could involve liquidating certain assets to acquire a bond. Additionally, the ex-president will incur a bond fee potentially running into millions.
The legal proceedings against Trump, initiated by Judge Arthur Engoron’s verdict, could extend across several years. The case is further compounded by Trump’s notable status as a leading presidential candidate.
Describing the scenario as “unprecedented,” Mr. Pedersen outlined the potential hesitancy of bond companies considering the commitment to a figure who could possibly reassume the presidential mantle.
The necessity of upholding an indemnity agreement against someone with prospects of becoming president again is uncharted territory, Pedersen expressed.
Nevertheless, Trump remains resolute in his intent to appeal Judge Engoron’s decision—a ruling that presents more than just monetary implications. It strikes at the heart of Trump’s self-forged identity as a supremely prosperous business mogul, a narrative he has meticulously crafted over many years.
His quest for an appeal, however, may be stymied by prospective bond agents who may harbor reservations due to the contentious nature of Trump’s business operations and assertions of wealth, especially those that have recently been scrutinized and contested within the legal system.