New York Attorney General Letitia James has filed a request with a judge to invalidate former President Donald Trump’s $175 million bond in his civil fraud case. She expressed concerns about the company’s capability to secure such a substantial amount.
In court filings, James raised doubts about whether Trump’s surety, Knight Specialty Insurance Co. from California, could effectively secure the $175 million bond. As the hearing approaches, this concern will be further examined and discussed.
According to James’ office, KSIC is a small insurer that lacks the authorization to conduct business in New York. They also claim that prior to their collaboration with Trump, KSIC had never written a surety bond in New York.
According to the filing, KSIC has a total policyholder surplus of only $138 million. New York state law prohibits the firm from incurring liabilities, such as a bond, that exceed 10% of its surplus, which amounts to $13.8 million.
James’ office has criticized Trump for his apparent control of $175 million in cash that he placed in an account as collateral. The defendants have been accused of failing to demonstrate that the bond is adequately collateralized by identifiable assets.
According to her office, KSIC does not currently possess the sole authority to manage the account. They will only gain control if they choose to exercise their right to do so with a two-day notice.
According to Trump’s attorney, Alina Habba, he is eagerly awaiting the opportunity to appeal the verdict and prove his innocence.
Earlier this month, James filed a motion requesting that Trump’s lawyers or the insurance company provide more information about the collateral backing the bond or file a motion to justify the surety bond within a period of 10 days.
James’s office is unable to collect on the $464 million verdict that Judge Arthur Engoron previously issued against Trump, the Trump Organization, and its top executives. This is due to Trump’s bond, which has been preventing James from receiving the funds. The verdict was a result of a conspiracy to inflate the net worth of the organization’s assets, which took place over a number of years.
Trump alone was responsible for a staggering $454 million in liabilities.
In March, a state appeals court reduced the bond to $175 million after Trump’s attorneys argued successfully that securing a full bond would be “impossible.”
