Trump Faces $370 Million fine in a New York Fraud trial. How Would he repay it?

A verdict in Donald Trump’s civil fraud trial is expected to be delivered on Friday, potentially determining the future of his family business.

The former president, his adult sons, and his namesake company have already been held accountable for deceitfully exaggerating the worth of assets in statements to lenders.

Prosecutors have requested that the judge impose a fine of $370m (£291m) on Mr. Trump and impose certain limitations on his business activities within the state.

That’s a substantial amount of money, even for someone with significant wealth. According to legal experts, the substantial penalty and the potential impact on Mr. Trump’s real estate empire could have significant financial consequences.

“He won’t just transform into a working class individual,” commented Diana Florence, a former federal prosecutor. “However, there will be a significant amount of money involved.” His wealth is set to take a major hit.

Why could Trump be fined $370 million?

The New York Attorney General Letitia James argued in court that a sum of $370m was the suitable amount for the Trumps to repay as a financial penalty. This penalty, known as disgorgement, entails returning the money acquired through fraudulent methods.

She computed the total by considering three factors: the money that Mr. Trump supposedly gained from interest rate savings on loans due to misrepresenting his assets, the “bonuses” given to Trump Organisation employees involved in the scheme, and the profit obtained from two property transactions that Ms. James claims were fraudulently acquired.

Judge Arthur Engoron will be responsible for deciding the financial penalties when he delivers his ruling.

Regardless of the sum, Mr. Trump would also be responsible for paying annual interest on the fine, which would be retroactive to the time when the alleged offences occurred. The 9% interest rate in New York could result in Mr. Trump having to pay a substantial amount in addition to the penalty.

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Mr Trump vehemently denies any wrongdoing and argues that the banks actually profited from his investments, refuting any claims of fraud or criminal activity. It is anticipated that he will file an appeal, which would temporarily suspend the verdict until a higher court examines the case.

However, in order to prevent the payment of the fine or the seizure of personal assets during the appeal process, he must still deposit the full amount to be held by the court within 30 days.

A substantial amount – but not an overwhelming one


According to a calculation by Forbes Magazine, Mr. Trump’s total net worth is estimated to be $2.6 billion. In 2021, the New York Attorney General’s Office estimated his annual net worth at $2 billion.

According to those estimates, a penalty of $370m would represent a significant portion, around 15-18%, of Mr. Trump’s wealth.

In addition to facing a potential penalty, it’s worth noting that he has already been ordered to pay $83.3 million in damages to writer E Jean Carroll as a result of a defamation case that concluded in January. His legal expenses are also increasing as he confronts four criminal cases at both the federal and state levels.

These combined financial burdens may exceed the amount of cash that Mr. Trump currently possesses. According to legal experts, there are multiple potential options available to him.

It will cost Trump if he secures a bond

In order to avoid the need for immediate payment, Mr. Trump may consider exploring the option of obtaining a bond, which would serve as a guarantee from a third party that he will be able to cover the entire fine. That would result in a significant increase in his expenses, including additional charges and interest. It is possible that he would need to provide collateral as well.

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According to Steven Cohen of the New York Law School, individuals usually need to provide approximately 10% of the total amount owed in order to obtain a bond from a bonding company.

If Mr. Trump were to owe $370 million in disgorgement, he could potentially be required to pay a bond company $37 million (£29 million) in order to obtain the bond. And he won’t be able to recover that fee.

If Trump needs money, he might sell assets.

During a deposition in this case, Mr. Trump claimed to have $400 million in cash available. However, the accuracy of this amount could not be independently confirmed by the BBC. Considering his existing legal obligations and expenses, it appears that the $370m fine would exceed his available funds.

“He needs to consider his options for managing his assets, including the possibility of selling off businesses to generate the necessary funds,” commented Sarah Kristoff, a former federal prosecutor.

A significant portion of Mr. Trump’s wealth is connected to his investments in the real estate industry. According to Forbes, his New York real estate empire is valued at $490m (£384m), which includes his flagship condominium skyscraper, Trump Tower, worth $56m (£44m) based on their assessment.

His portfolio boasts a diverse range of properties across the nation, including golf courses, condominium towers, hotels, and even a winery.

“Something will need to be sold or liquidated in order to generate the funds to cover such expenses,” commented William Thomas, a professor at the University of Michigan Ross School of Business.

Trump might solicit the funds from his devoted followers.

Mr. Trump may also rely on his extensive fundraising network to cover his substantial legal expenses. As reported by the New York Times, a portion of the funds raised from his supporters is allocated towards covering the expenses of his defence in both civil and criminal trials.

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He has utilised two political action committees to raise funds for his legal fees and presidential campaign. These structures, commonly employed for political purposes, have served as his primary means of financial support for these trials. These entities are distinct from his official presidential campaign account.

From March of 2023 to the end of the year, his Save America political action committee reportedly spent close to $40m on lawyers and other related fees, according to Forbes calculations.

According to Shanna Ports, a senior counsel at the Campaign Legal Centre, Mr. Trump has the potential to utilise Save America to cover a court-ordered penalty, as per federal campaign finance regulations. According to her, making this payment with official campaign funds would not be permitted.

However, attorneys informed the BBC that fundraising may not be a viable option in Mr. Trump’s situation.

According to former federal prosecutor Michel Epner, a significant penalty could pose a serious challenge for him to quickly come up with a substantial amount of cash. He mentioned that raising such a significant amount of funds from his supporters within a short timeframe would be quite remarkable.

Based on recent filings with the Federal Election Commission, his Save America PAC began the new year with $5m in cash on hand.

Mr. Trump will gain a better understanding of the implications for his business and personal wealth once Judge Engoron issues his final decision. However he decides to make the payment, any significant penalty will undoubtedly result in significant financial difficulties for the former president.

“Trump, despite his questionable claims and falsehoods regarding his wealth, is undeniably a person of substantial wealth,” stated Mr. Thomas, the esteemed business professor. “However, it is uncommon for the majority of individuals to have $400 million readily available.”

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