Donald Trump and co-defendants in talks with insurance giants Chubb Firm withdraws after $464 million appeal bond sought in former president’s civil fraud case — One of Trump’s lawyers said the company drew attention days ago for bailing Trump out in a separate case.
Chubb is one of more than 30 companies that have refused to make bonds to halt large-scale business fraud convictions, Trump’s lawyers said in a filing with a New York appeals court on Monday.
Lawyers in the filing asked the appeals court to “stay” the verdict until New York Attorney General Letitia James begins collecting the verdict – a process that could begin as early as next week. James said she would seize Trump’s assets if he cannot pay the judgment.
A panel of judges at the court has yet to rule on Trump’s request to stay the sentence without posting a full surety bond.
Alan Garten, a lawyer for the Trump Organization, said in the filing that Chubb was the only firm willing to consider underwriting the appeal bonds that would be secured by a mix of liquid assets and real estate.
Other companies – including Warren Buffett’s Berkshire HathawayLiberty Mutual, Allianz Insurance and traveler – Just want cash or other liquid assets.
The appeal bond is intended to prevent a party losing a court decision from using the appeals process to delay or avoid paying a penalty. These bonds also ensure that plaintiffs can receive compensation quickly if their appeal is unsuccessful.
Garten said Chubb is “actively negotiating” with Trump and his co-defendants. But “within the past week,” Chubb changed his approach and “notified the defendants that they could not accept the real estate as collateral,” he said.
“While disappointing, this decision is not surprising as Chubb was the only guarantor willing to consider accepting real estate as collateral,” Garten said.
Garten’s statement comes more than a week after news emerged that a Chubb subsidiary had provided Trump with a $91.6 million appeal bond in a separate civil case in which he was found guilty of defaming author E. Jean Carroll over rape accusations. responsible.
Chubb faced swift scrutiny for underwriting the bond. News outlets pointed out that Chubb CEO Evan Greenberg had previously been appointed by Trump to the Trade Policy Advisory Council and business groups aimed at responding to the economic losses of Covid-19.
On Wednesday, Greenberg sent a letter to investors, clients and brokers expressing concerns about the bonds.
“As sureties, we do not take sides, it would be wrong to do so, and we in no way side with the defendants,” Greenberg wrote. “When Chubb issues an appeal bond, it does not make a judgment on a claim, even if the claim involves Alleged reprehensible conduct.”
He added that Trump’s bond in the defamation case was “fully collateralized.”
Records show Trump used Charles Schwab accounts as collateral for Carroll-related bonds.
CNBC asked Chubb on Wednesday whether the company was in discussions with Trump’s team to obtain a bond in a trade fraud case.
In response, Chubb said, “As a matter of policy, we do not confirm or deny whether we have commercial discussions with businesses or individuals.”
A Chubb spokesperson did not respond to CNBC’s request for comment on Monday’s court filing.
Lawyers argued in the filing that Trump would face significant harm if he was forced to quickly sell part of his real estate portfolio to generate enough cash to obtain bonds.
They said despite their “efforts” it was “impossible” to post the full appeal bond.
That’s largely because the handful of guarantee companies willing to issue such large bonds won’t accept “hard” assets like real estate as collateral, they say.
JD Weisbrot, president and chief underwriting officer of JW Surety Bonds, said that because the appellants frequently failed again, surety companies considered the bonds “dangerous” and generally required them to be fully backed by liquid assets.
Weisbrot told CNBC that unlike banks, which are better equipped to attach liens and sell properties, insurance companies “are not in the business of holding real estate.”
Still, Weisbrot agreed with Trump’s lawyers that the size of the bond was “unprecedented.”
“I’ve never heard of a private organization of this size requiring a bond,” he said.
As the deadline for James to collect a fraud conviction loomed, the Republican presidential candidate took to social media to vent his anger over the case.
Trump ‘actually wants me to spend hundreds of millions of dollars to gain the right to appeal his ridiculous decision’ release Tuesday morning on his social media site Truth Social.
“I was forced by a corrupt judge and attorney general to hand over any money until the appeal was concluded,” he claimed in a later statement. postal.
In fact, a New York court ruled Require Trump will post an appeal bond to prevent James from collecting fees on the fraud verdict.
“No one has heard of anything like this before. I will be forced to mortgage or sell significant assets, perhaps at a fire sale price, and if I win my appeal, they will be gone,” Trump wrote on the website.
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