Multimillion dollar fines imposed on Trump in two New York civil cases leave the Republican without liquidity
In addition to interest on the fines, he’ll have to pay his lawyers, which were initially paid in large part by his presidential campaign. Last year, he spent upwards of $50 million on legal fees alone
Every morning, just by getting out of bed, Donald Trump is charged $87,502 in interest on the fine that a New York judge ordered last week for his businesses’ persistent fraud. The original sanction was for $355 million, but the taxi’s meter doesn’t stop ticking, and today it would take $454 million to pay off the court. Trump, who is the front-runner in the Republican primaries and a likely contender for his reelection in the November elections, estimated his own liquidity at around $400 million last year. If you add the latest fine and its interest to previous sanctions, such as the $83 million he has been ordered to pay for defamation of character, and hefty defense fees, the tycoon’s fortune, which he wielded as a credential for his leap into politics, runs the risk of being reduced to pocket change. The Republican appealed this Monday the fraud judgment, which at least temporarily stops the meter from running.
Such are the straits in which Trump finds himself after New York Attorney General Letitia James announced that she will seize some of his properties if he does not come up with the payment. The longer he takes, the larger the debt will grow. During the course of the persistent fraud case, misrepresentation was uncovered in the valuation of two of his most prized possessions: the Trump Tower in New York and the Mar-a-Lago mansion, his residence since leaving the White House (and the focus of one of the four criminal charges against him: the wrongful retention of classified materials). The list of inflated assets also includes several golf courses.
In 2021, after the assault on the U.S. Capitol by a horde of his followers — whom he had previously goaded to prevent the certification of Joe Biden’s electoral victory — Trump faced the embarrassment of seeing his name removed from several of his properties. This latest blow to his finances is possibly less symbolic, but much more direct.
Trump beat Nikki Haley in the South Carolina primary on Saturday, and his path to the presidential election seems to be completely clear. But his debt is growing, and not just the money he owes on the New York fine. Last year, his campaign had to spend more than $50 million on legal expenses, and last Tuesday, news broke, thanks to campaign documents that were filed with federal regulators, that the Republican PAC (political action committee, the Trump campaign’s engine) paid almost $3 million to lawyers just last month, as his legal problems intensified. Then there’s the $83 million fine, also imposed in New York courts, that he must pay for defaming columnist E. Jean Carroll. In addition, the former president owed another $1.9 million in unpaid legal bills at the end of January, according to the filed documents.
The largest disbursement from Save America, the Republican candidate’s main PAC — which has been active since his 2020 defeat — was more than a half-million dollars paid out to the law firm that is representing him against charges of attempting to reverse the outcome of the 2020 election, one of the most serious of the four criminal accusations filed him, which amount to 91 criminal charges. His two New York civil verdicts, for defaming Carroll and business fraud, do not involve jail time, but do carry hefty fines that could leave him broke.
At the start of the year, the Republican National Committee, which coordinates fundraising and election strategy, had more than $8 million in cash on-hand. The Trump campaign had another $33 million. Neither has released totals for funds raised in January, but they likely will still trail Democratic candidate Biden’s election capital: $130 million in the bank, with $42 million having been received in January. In a country where money is everything, the economic power of a campaign can be the deciding factor in an election, even when poll numbers say otherwise, as is the case with Biden. Incumbent presidents usually have a financial advantage going into an election year.
Evasive maneuvers
Trump demonstrated his strategy during last Tuesday’s televised debate to attempt to label the fines as fraud, comparing himself to Russian opposition leader Alexei Navalny and presenting himself of a martyr of what he has called political persecution unleashed by Democratic rivals to derail his chances at reelection. He has made a mantra of the political “witch hunt,” which he invariably repeats after every unfavorable judicial action. Trump never tires of reminding his followers that New York Attorney General James, who brought the fraud indictment, and Manhattan District Attorney Alvin Bragg, who brought his first indictment in the Stormy Daniels case, are Democrats who he claims are pursuing him for political purposes. With his usual bravado, Trump said on Tuesday that the fraud fine was “a form of Navalny, a form of communism or fascism.”
“If he does not have funds to pay off the judgment, then we will seek judgment enforcement mechanisms in court, and we will ask the judge to seize his assets,” James said in response to the Republican’s laments. “We are prepared to make sure that the judgment is paid to New Yorkers, and yes, I look at 40 Wall Street each and every day,” the prosecutor said, in reference to the Lower Manhattan property known as the Trump building, the first potential target for seizure. Its facade no longer boasts any mention of its owner, but rather, the logo of a well-known drugstore chain.
In addition to the $400 million in cash Trump claims to possess, the rest of his net worth is invested in golf courses, skyscrapers, residential complexes — such as the ones in New York, which removed the letters of his name from their exterior in 2021 — and other properties, along with investments and other holdings. To delay their hypothetical seizure — and to clear the way to the November elections — his lawyers frequently resort to delaying maneuvers (for example, Monday’s appeal in the civil case for fraud).
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