New York Attorney General Letitia James has filed an opposition memorandum against the surety company holding the $175 million bond for former President Donald Trump as he appeals a $460 million decision in a civil fraud trial. The concern lies in the financial stability of the bondholder, Knight Specialty Insurance company, and the collateral for the bond. Trump’s claim that $175 million in cash provided as collateral is in the DJT Revocable Trust, not under Knight’s control, raises issues about the security of the bond.
The attorney general’s office argues that if Trump maintains control over the account, he could potentially profit from the bond deal by earning interest exceeding the fees owed to Knight for posting the bond. Knight falls short on certain requirements for a surety bondholder under New York insurance law, including limitations on capital at risk and surplus levels. The attorney general also notes concerns about Knight’s risk transfer practices and the credibility of its management. Representations for Trump did not respond immediately to requests for comment on the matter.
The state has requested the court to mandate Trump to provide a replacement for the bond within seven days of a ruling on the issue. A hearing is scheduled for Monday to address this pressing matter, which highlights the intricacies and potential implications of the legal battle surrounding the bond in Trump’s civil fraud case.
