POLITICS
What happens if Trump can’t pay the bond? Possible scenarios if the former president can’t raise $464 million
Donald Trump’s legal team has told court officials it is ‘a practical impossibility’ to pay the $464 million bond to appeal his civil fraud conviction.
Donald Trump’s legal team says the former president has failed to put up the $464 million bond needed to stay his New York civil fraud judgment. According to a court filing by Trump’s lawyers, defendants have approached 30 surety companies through four separate brokers with no success in procuring the money.
“Defendants’ ongoing diligent efforts have proven that a bond in the judgment’s full amount is ‘a practical impossibility,’” according to the filing.
Trump needs to post the entire bond amount by today, Monday 25 March, to stop New York Attorney General Letitia James from collecting the judgment while he appeals.
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How much interest is added to Trump’s bond each day?
Monday is when the 30-day automatic stay of Judge Arthur Engoron’s ruling will expire. If Trump fails to pay the bond, the New York Attorney General would have the green light to begin seizing the assets of the Republican frontrunner for president.
“If he does not have funds to pay off the judgment, then we will seek judgment enforcement mechanisms in court, and we will ask the judge to seize his assets,” said James in an interview with ABC reporter Aaron Katersky.
If an appeals court intervenes, Trump will get a reprieve. Meanwhile, the amount will continue to grow by $114,000 each day because of interest.
What enforcement mechanisms could be used?
If Trump fails to pay, enforcement mechanisms and potential bankruptcy proceedings come into play. Enforcement mechanisms such as asset seizure, bank account levies and wage garnishment may be employed to compel payment.
Asset seizure entails the confiscation and sale of valuable possessions, including property and vehicles, to raise funds.
Bank account levies allow creditors to access funds in the individual’s bank accounts to fulfill the debt. Wage garnishment involves a portion of the individual’s wages being withheld by their employer and directed towards satisfying the judgment, though without an income Trump would be unlikely to suffer this.
Bankruptcy filing
If Trump is unable to meet the financial obligations despite these enforcement measures, he may consider filing for bankruptcy. Bankruptcy provides a legal framework for debt relief and restructuring.
However, it’s essential to note that certain types of debts, particularly those resulting from fraud or intentional wrongdoing, may not be dischargeable in bankruptcy. Trump has never filed for personal bankruptcy but some of his businesses have.
The former president’s legal team however insists the attorney general has no basis to worry about collecting the judgment, saying that the defendants’ assets greatly exceed the amount of the ruling.