Judge Hands Trump a Major Victory Over Letitia James in Bond Battle
Former President Donald Trump got some good news Monday when the $175 million bond in his civil fraud case was accepted by New York Judge Arthur Engoron, Axios reported.
Engoron’s approval means New York Attorney General Letitia James won’t be able to seize Trump’s assets or freeze his bank accounts — a possibility if the Republican presidential candidate had been required to post a previous bond set at nearly half a billion dollars.
James had questioned the financial viability of the issuer of the bond, Knight Specialty Insurance Co.
Among other things, she pointed to Knight’s lack of registry with the New York State Department of Financial Services.
Trump argued he had to go to California to retain the firm because he is prohibited from using a New York firm, USA Today reported.
On Friday, James made a court filing arguing that the defendants in the case and Knight had “failed to justify” the surety of the bond and called upon Engoron to void the bond and make the former president post a different bond within seven days.
Lawyers for the state expressed concern that Trump might have access to a cash account with Charles Schwab financial services that was used as collateral for the Knight bond, USA Today reported.
But the former president cannot remove the money without that action being approved by Knight, Trump lawyer Christopher Kise said in court on Monday.
Also, Kise said, Schwab would not allow access. “We have to put the money somewhere,” the attorney said.
Nevertheless, Engoron questioned the arrangement.
“You keep using the word ‘agreement,” the judge said. “What if they break the agreement?”
“It all seems like a house of cards,” he said.
Lawyers for Trump and James hammered out a new agreement, which Engoron approved.
Knight would keep “exclusive control” of the bond, with the company and Trump making monthly certifications that cash is available, according to the state.
Also, Knight has agreed to the designation of an agent to handle the transactions, and any changes in agreements between the former president and the company require court approval, according to Axios.
The bond represents a substantial reduction from the $454 million Trump was initially ordered to pay — an amount the billionaire would have had difficulty producing in cash.
That shortfall had James anticipating the seizure of his business assets.
Trump was accused of fraud in the overvaluation of property, which many have said is essentially a victimless practice common in real estate.
The state’s action against the president has given pause to others engaged in business in New York.
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