1y ago

Trump’s $175m fraud bond thrown into doubt as attorney general questions insurer

www.independent.co.uk

Letitia James filed a ‘notice of exception to the sufficiency of the surety’ seeking more information about Knight Specialty Insurance Company

Donald Trump’s $175m bond in his New York civil fraud case has been thrown into doubt by New York Attorney General Letitia James after she filed a notice asking for evidence that the out-of-state firm that underwrote it really has the money to pay up.

Ms James’s office submitted a “notice of exception to the sufficiency of the surety” on Thursday asking for further proof that California-based Knight Specialty Insurance Company (KSIC) has the capital to proceed on the former president’s behalf.

KSIC is not regulated by New York state, which means that it is not authorised to issue surety bonds in the Empire State and therefore cannot obtain a certificate from the New York Department of Financial Services, which is customarily part of any bond package.

38 comments

Just assume everything he says is a lie and everything he does is a crime.
You would be right more often than not.
Saves time.
- The funny thing is, even if this shady company is found not to be able to post the bond, per new york state law they're still legally on the hook for the money, unless an actual elgibile bond is found. So Letitia James may get to go after both this shady company and Trump, with the shady company forced to then go after Trump directly to get back the portion they promised to the state.
- This. Once I started assuming everything he says is a lie (until proven right) life became so much easier.
  
  THAT!
“What if I give you 10,000 pairs of Trump shoes, 3600 Trump bibles and some Monopoly money? Would that get me off the hook?”
- What about the other 180 million?
  
  I love how that, probably correctly, implies 10,000 pairs of Trump shoes, 3600 Trump bibles and some monopoly money has a value of negative 5 million dollars.
- Honestly, at this point, I suspect Trump is gonna be the kind of asshole that pays in pennies just to be a dick.
  
  And you know he'd stiff the dump truck drivers who had to deliver them.
  Anyone want to do the math on how many dump trucks it would take to deliver $175m worth of pennies?
  
  https://www.lx.com/money/pennies-for-your-thoughts/17579/
  There are about 130 billion pennies currently in circulation
  That's more than 716 million pounds in pennies. The Mint produces 5-16 billion pennies every year. Coins that are heavily damaged are typically removed from circulation.
  Seems like there literally aren't enough pennies in the US for him to do that.....
  Edit: me dumb, math hard. But at the same time, good luck to him getting the pennies out of everyone's change jars....
- But what if I want a bite of Trump steak chased by a shot of Trump vodka while flying on Trump Shuttle? Oh wait, all of those ideas failed miserably.
Geez. Imagine New York state has to sue Knight to get them to pay up on behalf of Trump after he looses this boneheaded appeal and owes the now 1 billion (plus or minus, whatever) that will have accumulated on top of his judgement.
That's another 5m in legal expenses for NY and probably 3 years out the door.
That's enough time for Trump to age out of this planet and for his family to have somehow moved most or all of the income producing assets to a new business.
Let me guess they will give him another infinity days to come up with the proof?? This shit went from NY looking amazing to end up looking like a bunch of pussies. He's grabbing them in front of the world. Clown show.
Idk NY’s rules on surety bonds, but the general rule in insurance is, if you can’t find coverage in the admitted market then you go to the surplus market—which KSIC is a surplus lines insurance company (and not regulated by the state). Dodd-Frank even prohibits states from denying that these companies can be regulated by the states.
Short answer: this is normal insurance procedure. If you can’t find an admitted company to cover you, then you go to the surplus/excess lines market, which is not regulated by the state.
This hinges on New York’s laws regarding surety bonds, which I have no idea about. Some coverages, of course, have to be written in the admitted market, like your car insurance.
- This hinges on New York’s laws regarding surety bonds
  But that's exactly the issue. The bond company is pretending that they don't have to follow any law/regulation because they're out of state. While AG is objecting based upon the NY law regarding the bond.
  Meaning, need to show financials. Need to have enough assets. The AG said that their assets are lower than the bond amount. While the bond should be 10% of the assets at most.
  The bond company added the financials of another company that's not involved with the bond. Pretty shady behaviour.
- I am not an expert and this is not my area.
  Another article this morning (I'll link if I can find it) said that a normal bond (construction surety etc.) follows the rules you laid out. There is specific language in NY legislation with extra requirements for court bonds.
  eta: https://www.cbsnews.com/news/donald-trump-175-million-civil-fraud-bond-valid-new-york/
  "For court bonds, as regulated by the CPLR, the law is clear about in-state license requirement," said Pollock, who noted that there are surety bonds used in other industries like construction that would not be subject to that rule.
- Honestly the whole lawsuit sounds kind of ridiculous to me. Isn't it up to the lender to audit the property of the one who asks for money to assure that they are able to pay it? After all, the one asking for money may (out of ignorance, or malice) overvalue their property, and they may be right, should there be someone who actually is willing to buy it for that price. The confidential documents lawsuit sounds to me like a waaaay easier and clearer win. (if only the democrats hadn't decided to "forget" about it after similar claims were found regarding Biden)
  
  What do Democrats have to do with the documents lawsuit? The special prosecutor is on it.
  Are you suggesting that maybe we let the free-market figure his bond out without oversight?
  This was a weird comment.
  
  It feels like you are pushing the burden of finding out a person is lying to the lender, but the law says you have to tell the truth (and you sign saying the presentation is the truth) when presenting collateral. Lying about valuations is part of the root of the 2008 financial collapse, and it’s disheartening to hear people say “so what” less then a generation later. The government is fulfilling its role of oversight the way it would have been great to see in the 2000’s before the collapse.
  
  The claims were not very similar lol
  
  Go lie about your assets on a mortgage or other loan application and falsify some paperwork. See what happens to you. Why should Trump get to do that?
  All this lawsuit is doing is making him pay back all the money he gained by lying. The profits he made from his lies and falsifications were calculated by an independent auditor and used to calculate the amount he has to pay back. New York state law says you cannot benefit financially from fraud, the profits must get pulled back.
- Mr Hankey
  Hiiiiidy hoooo
  I think they do it this way to avoid putting up property as collateral and she is right to make sure they actually have that cash on hand because that's a stupid amount of cash to keep on hand.
Good review of the matter:
https://www.youtube.com/watch?v=l1ujvO-jhDM

38 comments