Tough On Crime
Once upon a time, when Donald Trump still presented an image of business success, Democrats were accused of being Reds, and populist Republicans denouncing elitism and complaining that government just didn't work installed a comedy actor in the White House who may or may not have slipped into senility while in office, a common conservative political line had to do with liberals being soft on crime. There's even a Scalia joke in there, somewhere, but a former spy and dynastic scion had succeeded the senile president.
Anyway, the short form is that Donald Trump, the real-estate heir and television celebrity turned president, the tough-on-crime Republican, both highlights inequality American justice, and now perpetually plays to
get off on a technicality.
The irony is a deluge swamping multiple generations, and thus easy to miss.
†
Steve Mills↱ teases the article from ProPublica: "Did Trump and his lawyers fail to disclose key details about his bond?"
And the first thing is, of course they did. This is Trump, these are his lawyers, and this is how it goes. By the time the editor, Mills, asks his question, we can easily presume the answer is yes. The devil, then, is in the detail.
Former U.S. Attorney Andrew Weissmann reminds, "the
$175 [million] bond has reported issues: the surety company may not be licensed to give bonds in NY & may not have met the NY solvency reqs (can't post more than 10% of its worth so it is solvent to meet the bond requirements)."
That is to say, the details include whether the company is allowed to issue such bond in New York, and also whether the company is even financially capable of fulfilling the obligation.
And remember,
$175 million is
reduced bond.
And then, per
ProPublica↱:
His lawyers had told the appellate court it was a "practical impossibility" to get a bond for the full amount of the lower court's judgment, $464 million. All of the 30 or so firms Trump had approached balked, either refusing to take the risk or not wanting to accept real estate as collateral, they said. That made raising the full amount "an impossible bond requirement."
But before the judges ruled, the impossible became possible: A billionaire lender approached Trump about providing a bond for the full amount.
The lawyers never filed paperwork alerting the appeals court. That failure may have violated ethics rules, legal experts say.
ProPublica did have an opportunity to interview Hankey, who said, "I saw that they were rejected by everyone and I said, 'Gee, that doesn't seem like a difficult bond to post.'"
And, apparently, there were negotiations on this point, but that's where the detail is as fuzzy as you might expect in these tellings:
As negotiations between Hankey and Trump's representatives were underway, the appellate court ruled in Trump's favor, lowering the bond to $175 million. The court did not give an explanation for its ruling.
Hankey ended up giving Trump a bond for the lowered amount.
It's unclear if Trump lawyer Alina Habba or the rest of his legal team were made aware that Hankey reached out about a deal for the full amount. Trump's legal team did not respond to requests for comment.
After ProPublica reached out to Trump's representatives, Hankey called back and revised his account. He said he had heard "indirectly" about ProPublica's subsequent inquiries to Trump's lawyers. In the second conversation, he said that accepting the real estate as collateral would have been complicated and that he wouldn't have been able to "commit" to providing a bond in the full amount "until I evaluate the assets."
Legal ethics experts said it would be troubling if Trump's lawyers knew about Hankey's approach and failed to notify the court.
The reduced bond is, in its own hazy question; the appeals court didn't give much of a reason for the reduction. Still, who knew what and when not only is a manufactured technicality to hang a hope upon, but underscores, yet again, an important question: Donald Trump does not want to collateralize anything in achieving bond, and while that's understandable, it's also not how these things go. Hankey's statements to ProPublica are on both sides of a line: Either it's not difficult except Trump
doesn't want to collateralize assets, or it's not difficult except Trump
can't collateralize assets:
In his first interview with ProPublica, Hankey said that when he heard Trump was having trouble getting a bond, he reached out to Trump's camp, several days before the bond was reduced, with an offer to help ....
.... Hankey told ProPublica that during the talks he came to the conclusion that Trump's "got the liquidity" and was confused why others would have rejected him, speculating that some may have wanted to avoid political backlash: "If you're a public company, maybe you don't want to offend 45% of the population."
Hankey said he informed Trump's camp that he was willing to work with them, and "they said they had the collateral." The two sides went over the assets that had to be pledged, and it was up to Trump "if they wanted to do it." (In his second call, Hankey said making a deal would have been "difficult.")
But, he said, the deal for the larger amount was dropped during a large Zoom call between the two sides, when Trump's camp got a call informing them that the bond was reduced.
Consider what happens next: The appeals court also gave Trump a ten-day extension on the reduced bond; with two days remaining, Trump informed the court that he had secured the reduced
$175 million bond. Six days after that, there remain questions of whether that claim to surety is legally and properly true.
If this bond collapses,
then watch what happens, next: Are those two days tolled or have they expired? What process remains to continue to stall New York from executing the judgment? As it is, the next hearing on the matter is two weeks away.
The weird technicality that's buried in the middle of all this can't possibly be real: Every now and then, a public agency excuses itself by acknowledging that something wasn't properly communicated, but those are public agencies, and not private litigants; most people trying to appeal a fraud judgment don't get to make that sort of excuse. That one of his people didn't mention something to another of his people isn't generally sufficient, but the real question will have to do with how much time Trump can waste while the court runs this one to earth.
So, c'mon, then, let's do the twist: Per
The Independent↱, "Mr Hankey said on Tuesday that his client had provided the full
$175m in cash as collateral for the bond." And what stands out is that
if Trump had the cash to meet the reduced bond,
then he should not need a company like Knight Specialty:
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.
"Defendants or KSIC shall file a motion to justify the surety within 10 days of the service of this notice, failing which the bond shall be without effect, except that the surety shall remain liable on the bond until a new undertaking is given and allowed," the notice read ....
.... Earlier on Thursday, key paperwork from the bond filing was rejected and "returned for correction" to Mr Trump's legal team before being swiftly refiled with the requested financial statement from KSIC and two other missing details ....
.... Bruce Lederman, an attorney with DL Partners, told CNN on Thursday it was understandable that Ms James should wish to know more about the underwriter's capabilities and pointed out that Mr Trump can ask Judge Engoron to sign off on KSIC.
"If they seek court approval of Knight Specialty, I believe that the attorney general will want proof that the company is actually holding the $175m in cash collateral so the bond can be immediately paid if the judgement is affirmed without needing to wait to try to liquidate pledged assets," he said.
And if it starts to feel like a soap opera or professional wrestling, where every twist and turn is unnecessarily complicated, that's part of the point. The question we're waiting on need not exist, and in its way ought not.
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Notes:
@AWeissmann_. "And the $175 bond has reported issues: the surety company may not be licensed to give bonds in NY & may not have met the NY solvency reqs (can't post more than 10% of its worth so it is solvent to meet the bond requirements). 4/22 hearing scheduled by the court." X. 7 April 2024. Twitter.com. 7 April 2024. https://bit.ly/49qtyxC
@smmills1960. "ICYMI: Did Trump and his lawyers fail to disclose key details about his bond? More great reporting from the team of @RobertFaturechi, @JustinElliott & @Amierjeski of @propublica". X. 7 April 2024. Twitter.com. 7 April 2024. https://bit.ly/49mJ7q0
Faturechi, Robert, Justin Elliott, and Alex Mierjeski. "Trump’s Lawyers Told the Court That No One Would Give Him a Bond. Then He Got a Lifeline, but They Didn’t Tell the Judges." ProPublica. 5 April 2024. ProPublica.org. 7 April 204. https://bit.ly/3VJxXsd
Sommerlad, Joe. "Trump’s $175m fraud bond thrown into doubt as New York attorney general questions insurer". The Independent. 5 April 2024. Independent.co.uk. 7 April 2024. https://bit.ly/4aJqqxJ