Dem
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GOP
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Donald Trump needs to put up a bond for $454 million in order to stop NY AG Letitia James from beginning the process of seizing and auctioning off his properties next week. Trump's lawyers said that they talked to 30 surety companies and none of them were interested. So the lawyers proposed cutting the requirement to $100 million.
Yesterday, James responded by explaining the law to Trump's lawyers. First of all, the purpose of a bond is to make sure that if the defendant loses on appeal, the money owed can be paid out immediately. If the bond were only $100 million and Trump lost, James would have to go to court and fight for the other $354 million, Trump would resist, and it would go on for years. She's not interested in playing that game.
She also noted that all that is required is that $454 million is in the state's bank account by Monday. How he gets the money is up to him. Specifically, if he went to nine different surety companies and asked each one for $50 million, he could get to $450 million. Add in $4 million of his own money and he's there. His argument that no company will loan him $454 million is bogus. He doesn't have to get the entire bond from a single company. By spreading the risk, no surety company would be unreasonably exposed. All of them would require collateral, but he could offer this one a hotel, that one a couple of golf courses, a third one an office building, a fourth one an apartment building, etc. The properties need not be in New York or even in the United States. If some company was willing to take his firstborn as collateral, that's up to the parties themselves. New York State doesn't care where the money comes from as long as it is legal. Of course, getting a loan from Russia or Saudi Arabia might have political consequences, but not legal ones. So it looks like James is not going to budge, but it is the state Appellate Division's call.
Trump may have one other way out, but it is a bit complicated. A special-purpose acquisition company called Digital World Acquisition (DWAC) is planning to merge with the company that owns Trump's Truth Social platform. The DWAC shareholders will vote on the merger tomorrow. If it goes forward, Trump's shares in the merged entity will be worth about $4 billion, based on the current stock price of DWAC. However, Trump will be forbidden from selling his shares for 6 months and he needs the $454 million bond by Monday. Maybe he could try to offer the stock to a surety company as collateral. However, the surety company might question whether Truth Social was really worth $4.5 billion since it loses money year after year.
Full disclosure: We got the idea for the headline from Talking Points Memo, which used a variant of it. (V)