Donald Trump was told to pay $355 million on Friday after a New York judge found the former US president liable for unlawfully inflating his wealth and manipulating the value of properties in a bid to obtain bank loans and insurance on favourable terms.
He was also banned from running companies in New York for three years. This aspect of the ruling deals a major blow to his business empire and financial standing.
There is no threat of imprisonment because it is not a criminal but civil case. The ruling also bars Donald Trump from being the CEO of Trump Org and also bars him from holding any top business office in the state for three years.
The former US president will also have to bring in a new independent “compliance” officer. The judge left it up to a third-party monitor to oversee the former president’s assets like the Trump Tower and other New York properties. The monitor will be installed to ensure that the business follows financial reporting and accounting rules.
Trump’s sons Eric and Donald Trump Jr. were also found liable in the case and ordered to pay more than $4 million each. These two, like their father, won’t be able to do acquisitions, take loans or refinance, but for two years, unlike their father who has been fined for three years.
One of the biggest problems Trump will have to deal with right away is finding a way to pay a $355 million penalty. On top of that, he’ll also have to pay a high interest rate of 9% while he waits for his appeal to go through the courts in New York.
Trump will likely need to give the bond company about 10% of the penalty in cash to get a security bond. Then, he’ll have to offer some of his properties as collateral to cover the rest of the bond. This is because most bond companies require both cash and property to secure the bond.
A document from Trump Org in 2021, presented in court during the fraud trial, stated that Trump had nearly $293.8 million in cash and cash equivalents, with a total net worth of $4.5 billion.
The estimated worth of Trump’s New York real estate assets is some $690 million, according to Forbes.
Forbes estimates the ex-president’s fortune at $2.6 billion, a sum that includes $870 million in golf clubs and resorts, $190 million in real estate outside York City and $640 million in “cash and personal assets”.
However, the Attorney General’s office disputed these figures.
If an appeals court reduces the penalties ordered by Engoron, Trump will likely get back a significant portion of the money he puts in. But the former president is expected to be charged a hefty, non-refundable fee by the bond company. The fee could amount to millions of dollars, according to lawyers.
Trump’s ability to fulfil this requirement will also test his claims of being a multi-billionaire with substantial cash flow in the hundreds of millions.
Trump to Challenge Ruling
Donald Trump lashed out Friday at the “sham” ruling by a New York judge who fined the Republican presidential candidate $355 million. “This ‘decision’ is a Complete and Total SHAM,” Trump wrote on his Truth Social platform, also branding the judge “crooked” and the prosecutor “totally corrupt”.
“We’ll be appealing” the decision handed down by Judge Arthur Engoron, Trump said outside his Mar-a-Lago estate. He accused President Joe Biden of driving the prosecution, calling it “weaponization against a political opponent who’s up a lot in the polls”.
However, according to a report by the New York Post, it may take a couple years for the challenge to make its way through the courts because the lawyers will first file an appeal at the First Department of the state’s Appellate Division and the State Court of Appeals in Albany will ultimately hear the case.
The New York Post citing veteran New York lawyer Ron Kuby said that Trump’s legal team is “dazzlingly ill-equipped to deal with the extraordinarily complex appeals process” and said the former president needs to “add someone to his legal team more well versed in the byzantine world of New York real estate law”.
What Other Penalties Does Trump Have to Pay?
Last month, a Manhattan federal jury ruled that he must pay $83.3 million in damages for defamation of advice columnist E.Jean Carroll. A separate jury also found he sexually assaulted the columnist.
The former president must also prepare for a criminal trial in the ‘hush money’ case starting March 25 which will examine if he manipulated his company’s records to conceal a payment to porn star Stormy Daniels in a bid to conceal a sex scandal from voters before the 2016 election.
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