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Following former President Donald Trump posting a $175 million bond on Monday in his New York civil fraud case, questions have been raised over what he put up as collateral.
Trump on Monday posted the bond, preventing the state from seizing his assets while he appeals a ruling that he and top executives at The Trump Organization inflated their value to obtain more favorable terms from lenders and insurers.
In the original ruling from Judge Arthur Engoron, Trump was ordered to pay more than $460 million in penalties for fraud, including interest, but the former president's attorneys succeeded in getting the bond reduced to the $175 million number in order to appeal that decision.
Trump, the presumptive Republican nominee in the 2024 presidential election, was able to secure the bond through Knight Specialty Insurance Company, which is owned by the privately held Hankey Group. Don Hankey, the chair of the company heads both organizations.
Since the former president posted the bond, a number of people have speculated on X, formerly Twitter, over what Trump could have put up as collateral to secure the funds from Hankey.
Newsweek has reached out to Trump's spokesperson and Hankey via email for comment.
MSNBC host and legal contributor Katie Phang wrote on X shortly after Trump posted the bond, "My question: what did Trump use as collateral for this bond?.."
Meanwhile, X user Hope took aim at Trump's Truth Social platform writing, "I hope the Bond company that loaned Trump 175 million didn't take Truth Social stock as collateral."
The comment about Truth Social comes amid a recent SEC filing showed the company, which Trump holds a nearly 60 percent stake in, made just over $4.1 million in revenue but racked up $58.2 million in costs in its latest operating year. It revealed an operating loss of $15.96 million and around $40 million in interest.
Former federal and state prosecutor Eric Lisann pointed out Trump's posting of a previous appeal bond in his case with author E. Jean Carroll, adding that there are similar concerns regarding this bond and the collateral required to secure the bond.
"We are back now to the same concerns raised when the Chubb Insurance Group posted Trump's $91 million appeal bond in the E Jean Carroll judgment appeal. Did some 3rd party - who exactly - help Trump post the (court-reduced without explanation) $175 million collateral required by subprime lender Knight Insurance Company to stave off collection on the NY state civil fraud judgment? Does that person exert hidden leverage over Trump?," Lisann wrote on X.
Trump posted a bond of nearly $92 million as he appeals the jury's verdict in Carroll's civil defamation case. The bond was secured by the Federal Insurance Company, a part of insurance company Chubb Corporation.
The former president was ordered in January to pay $83.3 million to Carroll, a former Elle columnist, for damaging her reputation after she accused him of sexually assaulting her in a department store dressing room in the mid-1990s. A separate jury last year awarded Carroll $5 million from Trump for sexual abuse and defamation.
Trump has denied any wrongdoing in all his civil and criminal cases, saying that they are politically motivated.
Lisann added, "Recall Trump's attorneys swore in court that Trump didn't have the funds. Does the company owner Don Hankey get anything special from Trump or a political backer? Is Knight Insurance sufficiently liquid to write a check for $175 million when/ in the event that the appeal ends with an affirmance?"
Amid the questions of collateral, however, according to Forbes who spoke to Hankey, Trump's collateral to secure the loans was a combination of cash and investment-grade bonds.
"This is what we do at Knight insurance. I'd never met Donald Trump. I'd never talked to him on the phone. I heard that he needed a loan or a bond, and this is what we do. So, we reached out, and he responded," Hankey told Forbes.
In addition, after helping Trump pay his bond, Hankey told ABC News that he is a Trump supporter.
"This is what we do at Knight Insurance, and we're happy to be able to accommodate the ex-president in this situation," Hankey said "I'd say it's more of a business decision, but I happen to be a supporter also."
"It was a relatively low number, and Donald Trump put up all the collateral in cash," he added.
About the writer
Natalie Venegas is a Weekend Reporter at Newsweek based in New York. Her focus is reporting on education, social justice ... Read more