New York AG “takes exception” to Trump’s bond in fraud case | Insurance Business America
“There are serious questions about if this bond was properly posted,” expert says
Insurance News
By
Ryan Smith
The $175 million surety bond posted by former president Donald Trump to appeal his fraud judgment is missing key information usually included in such bonds, according to the New York attorney general.
However, the surety bond provided by Knight Specialty is missing information generally included in such bonds, according to a report by CBS News. Among the missing information is a financial statement from Knight SPecialty, a certificate of qualification from the New York Department of Financial Services, and information related to power of attorney for the bond provider.
New York Attorney General Letitia James filed paperwork with the court Thursday saying that her office “takes exception to the sufficiency of the surety.” James’s filing said that Knight Specialty was not an admitted carrier in New York and does not have the certificate of qualification required by state insurance law, CBS News reported.
Donald Trump didn’t post cash for his bond.
In fact, AG Letitia James filed that the company who did, Knight Specialty Insurance Company, didn’t even bother giving them the certificate that they were even qualified to post it for him.
She’s now asking them to do so. Otherwise… pic.twitter.com/a8ya5Or2mq
— Art Candee 🍿🥤 (@ArtCandee) April 4, 2024
Trump attorney Christopher Kise told CBS News that James’s filing was “another witch hunt” and an effort to “stir up” a “baseless public quarrel.”
Trump’s side has 10 days to file a motion to “justify” the bond, according to CBS News. This will require Knight Specialty to prove that it is financially capable of paying the bond.
Attorney Bruce H. Lederman told CBS News that he was struck by several “glaring errors” in the bond.
“In all the years I’ve been doing this, you always have to have a certificate from the Department of Financial Services saying that you’re licensed to issue a surety bond,” Lederman said.
On Wednesday, the New York Supreme Court clerk’s office returned the bond to Trump’s legal team “for correction,” although no specifics were publicly released, CBS News reported. Knight Specialty refiled the posting on Thursday before James filed her exception to the bond.
Adam Pollock, a former assistant attorney general in New York, also questioned whether the bond was sufficient.
“This bond is deficient for a number of reasons, including that the company doesn’t appear to be licensed in New York and doesn’t appear to have enough capital to make this undertaking,” Pollock told CBS News.
The company doesn’t appear to meet the state’s requirement that prohibits companies from putting more than 10% of their capital at risk, CBS News reported.
However, Knight Insurance president Amit Shah said the restriction doesn’t apply in Knight’s case.
“Knight Specialty Insurance Company is not a New York domestic insurer, and New York surplus lines laws do not regulate the solvency of non-New York excess lines insurers, so we don’t believe we need the 10% surplus,” he told CBS News.
Shah said Knight has more than $1 billion in equity.
However, Lederman told the news outlet that the “underlying case” was about the state AG “requiring strict compliance with the law”
“The law requires an insurance company posting a surety bond to be authorized in New York,” he said. “And there are serious questions about if this bond was properly posted.”
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