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Trump Faces $536.8 Million in Legal Penalties, how will he pay?

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Trump Faces $536.8 Million in Legal Penalties, how will he pay

(CTN News) – After losing $536.8 million in two judicial defeats, it’s unclear if former President Donald Trump’s opponents will receive any money.

On Friday, a New York judge ordered Republican presidential frontrunner Donald Trump and his business trust to pay $453.5 million in penalties and interest for fraudulently inflating the value of real estate holdings, including his own Trump Tower penthouse and private club in Florida.

Last month, a Manhattan federal jury sentenced Trump to pay $83.3 million to writer E. Jean Carroll in defamation. Carroll accused Trump of sexually assaulting her in the mid-1990s.

Trump won’t ‘go gently’

Trump claims both charges were political hit jobs intended to hinder his steamroller campaign for the Republican nomination, and he has promised to appeal.

Donald Trump is going to fight this to the end and will try to delay it until the last possible moment,” said George Arzt, a senior New York political consultant.

“There is no chance that he is going to go gently.”

But it won’t stop New York Attorney General Letitia James, who sued Trump for real estate fraud, or Carroll and her lawyers from attempting to take their judgements right away, analysts say.

Defendants in Trump’s position may face collection actions even during an appeal unless they get an appeal bond or make a cash deposit with the court that exceeds the judgment amount with interest.

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In the real estate fraud case, it means Trump would have to furnish hundreds of millions of dollars in cash or property upfront — unless someone agrees to offer him a lower-cost appeal bond — to ensure James’ ability to collect later if his promised appeal failed.

If Trump files an appeal without obtaining a bond or making a deposit with the courts, Carroll and James would ordinarily be able to seize the money immediately.

That “would mean liquidating bank accounts and seizing his assets, not just in New York, but anywhere in the United States,” Mitchell Epner, a former federal prosecutor who has practised law in New York for about 30 years, told USA TODAY.

“It’s a really bad outcome, which is why most people and most companies, if they take an appeal, try to figure out a way to put up the undertaking, to stay the judgement, during the course of the appeal,” says Epner.

Will Donald Trump face a cash crunch?

However, obtaining a bond or depositing the cash can be difficult when dealing with the types of court judgements Trump faces.

While the health of Trump’s money remains unclear, third-party assessments place the real estate and reality TV mogul’s net worth far above the hefty New York judgements. Last year, the Bloomberg Billionaire’s Index assessed his fortune at $3.1 billion, while Forbes reported $2.6 billion.

That surplus may indicate that Trump can comfortably pay. However, his true level of financial comfort is more likely determined by the amount of cash he has on hand. Epner says very few companies — even well-capitalized — have hundreds of millions of dollars.

“If you are a business, you want to have your assets at work, in real estate, in operating companies, in things that are going to be paying you more than the amount of interest you can get by putting it into a bank,” says Epner.

This means that despite being a multibillionaire, Trump will most likely feel the squeeze.

“A nine-figure number, coming on top of the $83.3 million number in the E. Jean Carroll case, is going to put a very severe cashflow crunch on Donald Trump,” said Epner.

In a 2023 deposition for the civil fraud case, Trump stated that he had “fairly substantially over $400 million in cash.” The assertion has not been independently verified, but his current legal situation may require him to forfeit a sizable portion of that amount if it is accurate.

Assuming Trump is a multibillionaire, Ohio-based bonds advisor Mark Levinson predicted Trump would be able to obtain an appeal bond but warned the process might be unpleasant.

A bonding company will most likely want Trump to post collateral equal to the amount of the judgment or obtain an irrevocable letter of credit from a bank — a form of bank guarantee — to ensure the company can reclaim the money, Levinson said.

“Even for someone that’s three or four times over a billionaire,” Levinson said, the $83.3 million Carroll judgment alone is a lot of money to part with. According to him, Friday’s $453.5 million fraud judgment may need collaboration among different surety companies that supply appeal bonds.

“That’s going to be pretty difficult for anybody to get that bond,” he said.

In the New York civil fraud case, Trump received a judgement from a state court. To avoid collection, the losing party must get an appeal bond or deposit 100% of the judgment plus interest.


Carroll won $83.3 million against Trump in a New York federal court, which has the authority to require Trump to post a deposit or bond to prevent Carroll from collecting during his appeal. That court normally seeks 100% of the judgment plus interest.

After losing an earlier action against Carroll for $5 million, Trump placed a deposit surpassing that amount with the court while pursuing an ongoing appeal.

In both circumstances, a court may prevent the winning party from immediately claiming the money. However, if that does not happen and Trump cannot find the money, Carroll and the state attorney general’s office may pursue him.

The New York judgement contained $453.5 million, with interest, in “joint and several liability” against Trump and certain corporations. “Joint and several liability is warranted when the misconduct of the company and its top controlling officers are indistinguishable,” Judge Arthur Engoron stated in his verdict on Friday. That implies Attorney General James can sue either Trump or the firms for their entire liability.

Carroll’s lawyer, Roberta Kaplan, has already committed to seek the full verdict in the $83.3 million defamation case.

“Even if he doesn’t have the cash on hand, he has plenty of assets, and he may have to sell his assets to pay us, but we’re going to get the money,” Kaplan told CBS Mornings on Monday.

‘Trump would avoid bankruptcy at all cost.’

Epner said whether a bonding company would want to help Trump is unclear. Trump’s casinos have been bankrupt for decades, and he financed the $5 million Carroll judgment.

Levinson also said that Trump’s chequered history with creditors may give a bonding company concern. If there are concerns that Trump will declare bankruptcy, the company may require collateral worth 100% of the bond or even an irrevocable letter of credit from an acceptable bank because that type of guarantee, unlike collateral in the form of property or cash, cannot be reclaimed during the bankruptcy process.

“If he can’t get an appeals bond, then he has to put up an undertaking in the court itself, and that ordinarily is cash,” he said.

Filing for bankruptcy remains a possibility. Former New York mayor Rudy Giuliani responded to a $148 million court loss in a slander lawsuit filed by two Georgia election workers. Filing for bankruptcy automatically halts efforts to collect from the debtor.

However, filing for bankruptcy would have serious consequences.

“I think Trump would avoid bankruptcy at all costs because if he filed, the bankruptcy court allows super broad discovery into his financial affairs with the help of subpoena power, which I believe he would not want,” said Albert Togut, a bankruptcy lawyer with 45 years of experience.

“In the same manner that Trump didn’t want to disclose his taxes when he was running for president or when he was president, I can’t imagine that he would ever want a trustee with federal court powers to be looking into his affairs,” Togut told the U.S. News & World Report.

Arsi Mughal is a staff writer at CTN News, delivering insightful and engaging content on a wide range of topics. With a knack for clear and concise writing, he crafts articles that resonate with readers. Arsi's pieces are well-researched, informative, and presented in a straightforward manner, making complex subjects accessible to a broad audience. His writing style strikes the perfect balance between professionalism and casual approachability, ensuring an enjoyable reading experience.

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