Trump Says He Can’t Secure Bond for $454 Million Civil-Fraud Judgment

Donald Trump’s lawyers on Monday said the former president has been unable to obtain a bond to guarantee payment of a $454 million civil-fraud judgment against him, despite trying to negotiate a deal with some of the largest suretors in the world.

In a filing to a New York appeals court, Trump said that the judgment, ordered by a state judge last month, was so large that suretors wouldn’t accept real estate as collateral and would require cash to guarantee the bond. A private company like the Trump Organization would need $1 billion in cash to obtain the bond and to continue to operate, an amount the company doesn’t have, the filing said.

“Defendants’ ongoing diligent efforts have proven that a bond in the judgment’s full amount is ‘a practical impossibility,’” Trump’s lawyers wrote.

The legal drama places Trump’s finances and his image as a successful business tycoon in peril less than eight months before voters will decide whether to elect him for a return trip to the White House.

Trump has asked a New York appellate court to waive the bond requirement while he appeals the judgment, arguing that paying now would cause him irreparable harm. If the court turns down his request and he is unable to obtain a bond, New York Attorney General Letitia James, who sued Trump in 2022, could begin enforcing the judgment at the beginning of next week. James, a Democrat, has said that if Trump can’t come up with the money, she will look to seize his assets.

In a sworn statement filed with the appeals court, the general counsel for the Trump Organization said the company worked with four separate brokers and reached out to 30 suretors. One suretor, Chubb, considered issuing a bond in exchange for a mix of cash and real estate as collateral but ultimately balked at a deal, stating within this past week that it would only accept cash as collateral, the court submission said.

The judgment stems from a ruling by Justice Arthur Engoron that found Trump falsely valued parts of his real estate empire for financial gain. The judge imposed $355 million in penalties, plus interest, meaning Trump’s debt grows daily.

The civil-fraud judgment is perhaps the largest financial headache facing Trump, who recently clinched the Republican presidential nomination. Trump earlier this month cleared another financial hurdle by securing a nearly $92 million bond from Chubb to guarantee a defamation judgment he owes to writer E. Jean Carroll.

In addition to the monetary penalties, Engoron ordered that Trump be barred from running his business for three years, and his two sons, Eric Trump and Donald Trump Jr., for two. The judge also barred the company from applying for loans with financial institutions registered in New York for three years. An appeals judge already put those penalties on hold for now, but declined to block the financial penalties. A panel of judges is now reviewing the matter and could rule as soon as this week.

James has opposed putting the judgment on hold and said there was no guarantee Trump could pay later if his appeal fails. “Defendants have never demonstrated that Mr. Trump’s liquid assets—which may fluctuate over time—will be enough to satisfy the full amount of this judgment following appeal,” James’s office wrote.

Even if James were to begin the seizure process, Trump wouldn’t immediately lose his assets, lawyers said. To seize real estate, for example, James would need to bring a foreclosure action against Trump to obtain whatever equity he has in a property, said Mark Zauderer, a partner at Dorf Nelson & Zauderer. Any orders issued by courts during the process could be appealed, he said.

“The collection process can be painfully slow,” Zauderer said.

Trump’s net worth is estimated at about $3 billion, but much of his wealth is tied up in hotels, resorts, golf courses and New York properties. The amount of liquid assets he has isn’t clear. In a deposition last year, he testified that he had $400 million in cash.

Trump has denied inflating his assets and called James’s case politically motivated. His lawyers have said the financial penalties ordered by the judge are unconstitutionally excessive.

Trump’s lawyers argued he shouldn’t be effectively forced into selling property under duress to raise money now. “Obtaining such cash through a ‘fire sale’ of real estate holdings would inevitably result in massive, irrecoverable losses—textbook irreparable injury,” they wrote in Monday’s filing.

Selling real estate now could be particularly painful for Trump, as prices of most property types have fallen since interest rates spiked in 2022. This is especially true of office buildings, which also have been hammered by a rise in vacancy resulting from the more flexible workplace policies companies adopted during the pandemic era. Trump’s most valuable assets include the office building at 40 Wall St. in New York and stakes in 1290 Sixth Ave. in Midtown and 555 California St. in San Francisco.

In support of its request to waive the bond, Trump’s legal team submitted a sworn statement by an executive of Lockton Companies, which the Trump Organization hired to help secure a bond package.

“While it is my understanding that the Trump Organization is in a strong liquidity position, it does not have $1 billion in cash or cash equivalents,” the executive, Gary Giulietti, said.

The executive said his team had reached out to virtually every major surety in the market and spent “countless hours” negotiating with one of the largest insurance companies in the world. He said none of the sureties would accept hard assets such as real estate as collateral.

Giulietti also testified at trial as an expert in underwriting for the defense. In his ruling, Engoron questioned Giulietti’s testimony, noting that he had a continuing personal and professional relationship with Trump.

Peter Grant contributed to this article.