"Trump's in a corner": Judge comes down "very hard" after Trump seeks discount on fraud penalty

A New York appeals court on Wednesday denied Donald Trump's request to freeze the $454 million judgment he faces in his civil fraud case, leaving the former president in financial hot water.

Trump's attorneys asked the appeals court to permit him to post a $100 million bond, in which an outside company would promise Trump would eventually pay the judgement because it would be "impossible" for him to secure one for the full amount, the lawyers said, per The New York Times. But a single appellate judge assigned to the petition, Anil Singh, rebuffed the former president Wednesday. 

Trump will make another attempt at pausing the judgment next month with a five-judge appellate panel but remains responsible for posting a bond for the full amount in the interim. Any company willing to provide that bond would require the former president to guarantee cash or other collateral, the Times notes.

Failure to secure the bond allows the New York attorney general's office, which brought the case accusing Trump of defrauding banks and insurers by exaggerating his assets, to collect the $454 million from him. Attorney General Letitia James is expected to give Trump a 30-day grace period, set to expire March 25, after which she could seize his bank accounts and even assume control of his New York properties.

In addition to the $454 million judgment, New York Supreme Court Justice Arthur Engoron hit Trump and his co-defendants with several other penalties. Engoron barred him from obtaining a bank loan in the state for three years and heading a company in the state in that same period, barriers that further complicate Trump's race to secure a bond. 

“The exorbitant and punitive amount of the judgment coupled with an unlawful and unconstitutional blanket prohibition on lending transactions would make it impossible to secure and post a complete bond,” Trump’s lawyers in the appeal.

Singh halted those punishments on Wednesday, which could make Trump's efforts to acquire a bond for the full judgment easier.

Trump's stake in Trump Media & Technology Group, his social media company, could also offer him some financial relief if a delayed merger goes through this year and raises its value to up to $4 billion, the Times reports, but that deal won't finalize before James' grace-period expires. 

In a filing of its own, James' office asked the appeals court to deny Trump's request. 

“There is no merit to defendants’ contention that a full bond or deposit is unnecessary because they are willing to post a partial undertaking of less than a quarter of the judgment amount,” the attorney general’s office wrote. “Defendants all but concede that Mr. Trump has insufficient liquid assets to satisfy the judgment.”

Real estate comprises the bulk of Trump's net worth, and the total of his judgment in the civil fraud case and the $83.3 million he was ordered to pay earlier this month for defaming writer E. Jean Carroll, reportedly exceeds his available cash. A New York Times review of his financial records found that Trump held $350 million in cash as well as stocks and bonds he could quickly sell. 

"However the case is resolved, Mr. Trump’s request for relief represented a humbling concession from a man whose public image is synonymous with wealth," the Times added. "His conspicuous displays of gold-plated luxury underpinned his rise to tabloid fame, a stark contrast with the current spectacle of his scrambling to avert financial trouble."

Legal experts told the outlet that even if the five-judge appellate panel rejects Trump's request, he could still acquire a larger bond, highlighting that the former president's attorneys did not describe the $100 million bond as his only option. 

“The $100 million bond resembles an opening real estate bid,” Mark Zauderer, a partner at law firm Dorf Nelson & Zauderer and veteran New York business litigator who has secured many appeal bonds, told The Times. “But here, the negotiation will end, because it is the court that will determine the actual dollar amount of security, not Trump.”

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Tim O'Brien, Bloomberg Opinion's senior executive editor and the author of "TrumpNation," argued that Trump has a slim chance at successfully pausing the judgment and the blame for it falls squarely on him. 

Trump "now has a public referendum on his wealth," O'Brien said during a Wednesday night MSNBC appearance. "He spent 55 or so of his 78 years lying or bloviating about how much money he has, and now when push comes to shove, a man who has routinely said he's a multibillionaire is having trouble scratching up several hundred million dollars to make a court judgment."

The MSNBC political analyst went on to describe how "complex" it would be for Trump to leverage some of his properties, in part, because of the intricacies of his ownership. Two of his most valuable skyscrapers in San Francisco and New York, for example, aren't totally his. Trump, instead, is a minority partner in the buildings. 

"He's not going to be a free agent to sell out his stake without his partner allowing him to," O'Brien said. "Everybody in New York real estate or anywhere else he has a property now knows he is going to be selling under duress if he has to. And he is not going to get a good price for some of these properties.

"He's arrived in this place because he and his lawyers decided fairly early on to try to beat up the judge in this case," he continued. "The judge came down with a very hard penalty, and Trump's in a corner."