UPDATE 3-Trump agrees to new restrictions on $175 million bail in New York civil fraud case
(Reread with new bail agreement)
By Jody Godoy
NEW YORK, April 22 (Reuters) – Former President Donald Trump on Monday agreed to additional restrictions on $175 million bail in the former U.S. president’s civil fraud case in New York, allaying concerns from the state Attorney General that the funds were not secure.
The bond issued by Knight Specialty Insurance is intended to ensure that Trump complies with a $454.2 million judgment won by state Attorney General Letitia James if he does not win his appeal.
Judge Arthur Engoron imposed the sanction after finding that Trump, the Republican presidential nominee to face President Joe Biden in the Nov. 5 election, fraudulently inflated his net worth and real estate assets to entice banks and insurers to offer better conditions.
James, a Democrat, challenged the bond this month, saying Trump still had access to the Charles Schwab account given as collateral to the insurer.
But at a hearing Monday, steps from where jurors heard opening arguments in Trump’s criminal trial, lawyers for Trump and Knight agreed that the funds would remain in cash and not would not be exchanged for securities.
They also agreed that Knight would have sole control of the account and not withdraw funds, and that he would provide James with monthly statements to ensure the money wasn’t going anywhere.
The deal was reached after Engoron questioned the security of the guarantee.
“You keep using the word agreement, what if they break the agreement?” he asked Trump lawyer Christopher Kise. “It all looks like a house of cards.”
Knight is owned by billionaire Don Hankey, a Trump supporter.
Earlier Monday, Trump defended the bond in the courtroom during the criminal trial.
“We put the money in and the number is 175,” Trump said. “She shouldn’t complain about the bail bond company. The bail bond company would be a good thing because I’ve invested money. I have a lot of money to invest.”
James had argued in court papers that a trust owned by Trump still controlled the account and that Knight’s own financial arrangements appeared insufficient to cover the bond.
Hankey previously said in an interview that he charged Trump a low fee because he didn’t anticipate problems.
“We thought it would be a simple procedure that would not lead to further legal problems and it is not happening that way,” he said. “We probably didn’t charge enough.”
Hankey made his fortune in subprime auto loans, with some regulators criticizing his companies’ debt collection tactics. He is worth $7.4 billion, according to Forbes magazine.
Trump was initially expected to secure bond for the entire verdict while he appealed, but a state appeals court allowed him to post a lower bond.
With much attention now focused on Trump’s criminal trial, Engoron noticed the relative number of people in the courtroom compared to when he oversaw the civil fraud trial.
“Where is everyone?” he joked at the start of the hearing.
(Reporting by Jody Godoy in New York; additional reporting by Andy Sullivan in Washington; editing by Nick Zieminski, Bill Berkrot and Alistair Bell)
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