New York Attorney General Letitia James is challenging the $175 million bond that former President Donald Trump posted to appeal his civil lawsuit in New York. James argues that the insurance company behind the bond, Knight Specialty Insurance Company (KSIC), is not authorized to do business in New York and questions whether they have enough funds to back the bond. According to New York state law, smaller businesses like KSIC are not allowed to expose themselves to liabilities greater than 10% of their surplus, which would limit them to $13.8 million, far less than the $175 million bond posted by Trump.
In a filing obtained by Fox News Digital, James accuses KSIC’s management of violating federal law multiple times in recent years and raises concerns about the company’s ability to act as a surety. She also highlights the practice of “shadow insurance,” where KSIC transfers its retained insurance risk to affiliates in the Cayman Islands to artificially boost its surplus on its books. James is pushing for the court to deny the bond and require Trump to post a replacement undertaking within seven days. The judge in the case, Arthur Engoron, previously ruled that Trump and the Trump Organization committed fraud by overvaluing assets and exaggerating net worth on paperwork used to secure financing, marking a significant victory for James and her legal team.
Following Judge Engoron’s ruling, Trump’s sons Donald Jr. and Eric were barred from serving as officers or directors of any New York corporation or legal entity for two years. Trump has vehemently denied any wrongdoing, labeling the case against him as a “witch hunt.” James brought the lawsuit against Trump, alleging fraudulent business practices, and named his children and associates as co-defendants in the case. Trump has pleaded not guilty to all charges. A hearing is scheduled for Monday to address the issues raised by the attorney general’s office, which will run alongside the opening statements in Trump’s criminal trial in New York.
The filing by James further calls into question KSIC’s ability to act as a surety for Trump’s bond, citing concerns about the company’s financial stability and compliance with state regulations. The attorney general argues that the court should not rely on KSIC’s financial summary attached to the bond as evidence of their capacity to back a $175 million bond due to the company’s practices of transferring insurance risk to affiliates. This legal battle is part of a larger legal saga involving Trump and his business practices, with significant consequences for the former president and his associates if the court rules in favor of the attorney general.
The court hearing scheduled for Monday will play a crucial role in determining the fate of Trump’s civil fraud case and the validity of the $175 million bond posted for his appeal. Attorney General Letitia James has been leading the charge against Trump and his business practices, accusing him of fraud and seeking accountability for his actions. Trump’s staunch denial of any wrongdoing and his continued fight against the legal challenges brought against him set the stage for a high-profile legal battle that has captivated public attention and divided opinions on the former president’s conduct. The outcome of this case could have far-reaching implications for Trump, his family, and the future of his business empire.
