Looming legal penalties raise questions about Donald Trump's finances
Former President Trump is facing hundreds of millions of dollars in looming penalties from civil cases that could challenge the ability of Trump and his organizations to fund the legal judgments against them.
A New York judge on Friday ruled that Trump and other defendants in the case committed fraud while building his real estate empire by deceiving banks, insurers and others by overvaluing his assets and exaggerating his net worth on financial documents used to secure financing for various transactions.
Judge Arthur Engoron ruled that the former president and his organizations owe more than $354 million in damages, plus 9% interest, and also barred Trump from running a business as an officer or director in New York State for three years. The judge is expected to issue a decision on the amount that Trump will have to pay soon, and he may increase that amount to $370 million plus interest sought by New York Attorney General Letitia James.
The fraud ruling comes weeks after Trump was ordered to pay more than $83 million in a defamation case brought by writer E. Jean Carroll, who accused Trump of sexual assault and had previously been awarded more than $5 million from Trump in a separate civil case. In total, the more than $400 million in penalties is a significant sum that has prompted speculation about the ability of the former president and his organizations to pay the bill without having to sell off assets.
Former US President Donald Trump takes the stage during a "Get Out The Vote" rally in Waterford Township, Michigan, US, on Saturday, Feb. 17, 2024. Photographer: Nic Antaya/Bloomberg via Getty Images
TRUMP BARRED FROM OPERATING BUSINESS, ORDERED TO PAY OVER $350 MILLION IN NY CIVIL FRAUD CASE
Trump's net worth has been estimated at $2.6 billion by Forbes, and a Trump Organization document that was included as evidence during the trial indicated that Trump had $293.8 million in "cash and cash equivalents" at his disposal in 2021.
The AG's office said that figure included $93 million in assets that weren't liquid. The document also put Trump's net worth at $4.5 billion, which he has called too low.
"We didn't include billions of dollars in brand value," Trump said in an October 2022 deposition. "If I wanted to show you a good statement, I would have added maybe $10 billion or something for the brand."
It's unclear how much cash and liquid assets Trump currently holds, but assuming the fraud penalties are upheld, that amount would be insufficient to cover his court liabilities without putting properties up as collateral during appeal or liquidating those assets by selling them.
NEW YORK AG TAKES VICTORY LAP AFTER TRUMP FRAUD RULING: 'JUSTICE HAS BEEN SERVED'
Trump attorney Christopher Kise said Friday that Trump "will of course appeal" and added that he "remains confident the Appellate Division will ultimately correct the innumerable and catastrophic errors made by a trial court untethered to the law or to reality."
Lawyers told the New York Post that Trump will likely have to put up 10% of the penalty in cash and use properties as collateral to cover a security bond while the case is under appeal. The appeals court could ultimately reduce the penalties ordered by the judge, although that isn't certain and the appeals process could take years.
The Trump Organization did not immediately respond to a request for comment.
New York Gov. Kathy Hochul has sought to tamp down concern from those in the business and investment community that the case against Trump could be a sign of things to come for other companies, saying that most business owners are law-abiding and that the judge found Trump violated the law.
"This is really an extraordinarily unusual circumstance because the law-abiding, rule-following New Yorkers who are businesspeople have nothing to worry about because they're very different from Donald Trump and his behavior," she said on the "Cats Roundtable" radio show with billionaire Jon Catsimidis.
"The governor of New York does not have a say in the size of a fine. And we want to make sure we don't have that level of interference," Hochul added. "You do not want me as governor to be telling judges that I'm going to overrule their decisions. We need a clear separation of powers."
Fox News' Brooke Singman contributed to this report.