A New York court reduces the amount of Trump’s bond to $175 million and gives him ten more days to pay it

This Monday, former U.S. President Donald Trump got a small legal and financial reprieve. A New York appeals court ruled that the Republican presidential candidate must pay only a $175 million bond to satisfy his sentence for civil fraud, and he has 10 more days to deposit it, pending appeal. This is a significant reduction from the full $464 million judgment (nearly $355 million in penalties plus interest) that was due today. The order means that Trump and his sons can continue to run their New York business, albeit supervised by court order, and obtain loans from New York financial institutions for the time being.

As Trump appeared in Manhattan criminal court for a pretrial hearing in the Stormy Daniels case (the payment of hush money to a porn actress to cover up an extramarital affair), the businessman convicted for continued fraud in his companies — for a decade, he fattened the value of his properties to obtain credit and insurance advantages — avoided the execution of a sentence that would leave him virtually without liquidity, beyond the one hundred million dollars he managed to raise at the end of February for the payment; the judge deemed that amount insufficient. Last week, his lawyers reported that some thirty insurance companies had declined to come to his aid, which had unleashed all kinds of speculation about the businessman’s lack of liquidity. At the beginning of the month, an insurance company guaranteed the full amount of the bond ($92 million) that he had to post to appeal his conviction for his defamation of the writer E. Jean Carroll. The payment of the bonds is an essential condition for him to appeal the verdict.

In recent days, amid Trump’s increasing lack of liquidity, there was rampant speculation that New York Attorney General Letitia James might seize Trump’s real estate or even automobiles. Those calculations were wrong. On Friday, Trump himself said on his social media website Truth Social that he had almost $500 million in hard cash to make the payment, a prerequisite for appealing the fine that a New York judge imposed on him on February 16 for continued business fraud. Days earlier, his lawyers had said that Trump could not afford to pay.

That same Friday, the IPO of his social media website allowed the Republican presidential candidate to make a theoretical profit of $3 billion, a potential cash lifeline while his real estate empire was under threat of seizure, although that money is not immediately redeemable. James had already targeted several foreclosable properties, namely an estate and a golf course in Westchester County (north of Manhattan).

The multimillion-dollar fine for business fraud has been a setback for his reputation and the image of a successful man that once allowed him to make the leap into politics. In addition to Trump, his two eldest sons and other executives of the Trump Organization were found liable for fraud. But neither this civil case, nor any of the four criminal cases he faces in New York, Washington, Florida and Georgia, have hindered his presidential candidacy, and he has already wrapped up the Republican nomination for the November 5 election ahead of the Republican convention in July.

Although his campaign is hobbling financially behind President Joe Biden’s buoyant figures, the Republican hasn’t shown signs of discouragement, only anger at what he describes as a politically motivated legal persecution (or “witch hunt”). On Thursday, Trump reiterated this line of defense on his social media: “ELECTORAL INTERFERENCE,” he wrote in his usual capital letters. He also complained that depositing money in order to appeal was “VERY EXPENSIVE,” and fired off a fundraising message to his supporters titled “KEEP YOUR FILTHY HANDS OFF Trump Tower!”

On Friday morning, however, the former president wrote on Truth Social that he had “ALMOST FIVE HUNDRED MILLION DOLLARS IN CASH.” One of his lawyers later clarified that Trump was referring to “money (reported on his campaign disclosure forms) that he’s built up through years of owning and managing successful businesses around the world,” not cash on hand.

There is a direct link between Trump’s legal woes and his campaign: the Republican candidate has turned each trial into a political instrument. And there’s another, more delicate connection between his financial hardship and his election fundraising apparatus: the new agreement with the Republican National Committee guarantees that donations first go to his PAC (Political Action Committee, the engine of Trump’s campaign) that pays his legal bills before going to the party itself.

The former president’s struggle to raise funds, after multiple insurers declined to underwrite a bond for him, has become something of a political thriller. Hypothetical conflicts of interest if he turns to private donors — or foreign sources — to find the money in a race against the clock have come to the fore in the last few days as the deadline passed. Judge Arthur Engoron, who presided over the case, has imposed new restrictions on the Trump Organization by expanding oversight, meaning the company will not be able to move large sums of money or undertake major actions without scrutiny.

The hypothetical legal seizure of properties is also not without its problems. Some of Trump’s real estate may be mortgaged or subject to financial arrangements that are difficult to unravel. In the event of a sale, the proceeds would first go to compensate lenders, meaning that a substantial portion of the Trump empire would need to be sold to reach the nearly $500 million he owes the state.

The most remote option for him to emerge unscathed would be to file for bankruptcy, a strategy he has used several times throughout his business career. That could allow him to dispose of assets in an organized manner. But Trump has privately expressed his opposition to that route, and for now it remains the least likely solution.

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