AP’s Jake Offenhartz (“Trump’s legal debts top a half-billion dollars. Will he have to pay?“):
Donald Trump’s legal debts might now exceed a half-billion dollars.
A New York judge ordered Trump and his companies Friday to pay $355 million in fines, plus interest, after ruling that he had manipulated his net worth in financial statements.
The stiff penalty comes just weeks after Trump was ordered to pay $83.3 million to the writer E. Jean Carroll for damaging her reputation after she accused him of sexual assault. A separate jury last year awarded Carroll $5 million from Trump for sexual abuse and defamation.
Add interest payments on top of that and the judgments could deal a staggering blow to the personal fortune that remains core to Trump’s political appeal. He has adamantly denied wrongdoing and pledged to appeal, a process that could take months or even years.
In the meantime, here’s what we know about what Trump owes, whether he’ll have to pay up, and what comes next:
How much money does Trump owe now?
The verdict in the civil fraud trial requires Trump to pay interest on some of the deal profits he has been ordered to give up. New York Attorney General Letitia James, who brought the case, said the interest payments totaled $99 million and would “continue to increase every single day until it is paid.”
Between Friday’s ruling and the two judgments in Carroll’s case, Trump would be on the hook for about $542 million in legal judgments.
Trump owes another $110,000 for refusing to comply with a subpoena in the civil fraud case and $15,000 for repeatedly disparaging the judge’s law clerk in violation of a gag order. As part of Friday’s ruling, the judge also ordered both of Trump’s sons to pay $4 million apiece.
Trump’s court-ordered debts don’t end there. Last month, he was ordered to pay nearly $400,000 in legal fees to The New York Times after suing the newspaper unsuccessfully. He is currently appealing a judgment of $938,000 against him and his attorney for filing what a judge described as a “frivolous” lawsuit against Hillary Clinton.
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How quickly does Trump have to pay?
Trump has already deposited $5 million owed to Carroll for the first defamation case into a court-controlled account, along with an additional $500,000 in interest required by New York law. Carroll will not have access to the funds until the appeals process plays out.
He may soon be forced to do the same for the $83.3 million judgment in the second Carroll verdict. Alternatively, he could secure a bond and pay only a portion up front — though that option would come with interest and fees and likely require some form of collateral. Trump would have to find a financial institution willing to front him the money.
In the civil fraud case, it will be up to the courts to decide how much Trump must put up as he mounts his appeal. And he may be required to pay the full sum immediately after the appellate court rules, which could come as soon as this summer, according to University of Michigan law professor Will Thomas.
“New York’s judicial system has shown a willingness to move quickly on some of these Trump issues,” Thomas said. “When we hear from the first appellate court, that’s a point where money is almost certainly going to change hands.”
Can Trump afford to pay?
Trump has claimed he’s worth over $10 billion. Most estimates, including an assessment by the New York attorney general, put that figure closer to $2 billion.
In his 2021 statement of financial condition, Trump said he had just under $300 million in “cash and cash equivalents.” He has since made a number of sales, including his New York golf course and his Washington, D.C., hotel, and may also soon get a windfall when his social media company, Truth Social, goes public.
But even with those income streams, it’s unclear whether Trump and his family members have enough cash on hand to pay all the money they now owe.
Could he use campaign contributions — or PAC money — to pay?
Federal election law prohibits the use of campaign funds for personal use. But the rules are far murkier when it comes to tapping political action committees — or PACs — for a candidate’s expenses.
Over the last two years, Trump’s Save America political action committee, his presidential campaign and his other fundraising organizations have devoted $76.7 million to legal fees. Campaign finance experts expect Trump will try to spend PAC money to defray the cost of his judgments in some way.
“The likelihood of the Federal Election Commission in its current configuration pursuing these violations is not terribly great,” said Daniel Weiner, director of the Brennan Center’s Elections and Government Program.
Vox’s Abdalla Fayyad (“Trump is suddenly in need of a lot of cash. That’s everyone’s problem.“):
Two recent verdicts have now left Donald Trump on the hook for nearly half a billion dollars.
On Friday, a New York judge handed the former president a $355 million penalty, and banned him from serving in a leadership position in any business in New York for three years, for fraudulently inflating his net worth to lenders in order to receive more favorable loan agreements. And in January, a Manhattan jury ordered Trump to pay the writer E. Jean Carroll $83.3 million for defaming her after she accused him of raping her. (A separate jury in May had found Trump liable for sexually abusing Carroll in the 1990s.)
Together, the damages from these two lawsuits are worth more than the amount of cash Trump claimed to have on hand last April, potentially putting him in a financial bind as he also faces debt repayments and mounting legal fees. Even if he appeals these decisions, as he is expected to do, he still likely will have to front the money while that process runs its course, or secure a bond, which would come with its own conditions.
For a well-connected billionaire, that might usually amount to nothing more than a temporary inconvenience; after all, Trump could always liquidate some of his assets or borrow even more money to cover his short-term obligations.
But Trump isn’t just one of the country’s richest men, with an estimated net worth in the low billions; he’s also running to serve a second term as president of the United States. And for any candidate for public office — let alone the presidency — being cash-strapped while owing such significant amounts of money could be a serious liability.
“It’s pretty scary from an ethics perspective,” said Virginia Canter, the chief ethics counsel at the Citizens for Responsibility and Ethics in Washington, a nonpartisan watchdog group that has chronicled Trump’s abuses of power and filed lawsuits against him.
You don’t have to look far to find the reasons why. Trump’s first term was riddled with conflicts of interest, and that’s in no small part because of his financial well-being (or lack thereof, depending on how you look at it). At the time that he tried to overturn the 2020 election, he was hundreds of millions of dollars in debt, largely stemming from loans to help rehabilitate his struggling businesses, and most of which would be coming due over the subsequent four years. Throughout his presidency, he refused to divest from his businesses, which made millions of dollars in revenue from taxpayers and continued to do work with other countries while he was in office — a practice he indicated he would repeat in a second term.
The fact that he has so many entanglements with big businesses and other nations leaves plenty of room for things to go awry. That’s why a 2020 New York Times exposé uncovering his staggering debt during his first term wasn’t just embarrassing for Trump, who has a tendency to claim he’s richer than he actually is. It also raised fears about how his debt could implicate national security.
As the former head of the Justice Department’s National Security Division told Time magazine in 2020, “For a person with access to U.S. classified information to be in massive financial debt is a counterintelligence risk because the debt-holder tends to have leverage over the person, and the leverage may be used to encourage actions, such as disclosure of information or influencing policy, that compromise U.S. national security.”
As Trump campaigns for a second term, his personal finances are becoming increasingly relevant, especially now that he has to pay hundreds of millions of dollars in damages from the two civil lawsuits.
And with his criminal cases still looming, things could get even worse for him. His debt “makes him prime for corruption and really exploiting his office for his own personal gain,” Canter said.
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Lawsuits aside, Trump also has plenty of debt on his hands. His financial disclosures filed with the Federal Election Commission last year showed that he has at least $200 million in debt. And according to Forbes, his business owed roughly $1.3 billion in 2021.
That’s not as dire as it sounds, especially because Trump has been steadily paying down the money he owed when he was leaving the White House three years ago. For example, he’s paid off most of the $295 million he owed Deutsche Bank — a major source of his debt. But some of Trump’s debts warrant more scrutiny.
Ultimately, it’s impossible to know exactly how financially stable Trump is at any given moment. While some signs — like his ability to repay some of his debts or, say, him being a very wealthy man with very wealthy friends — indicate that he’s doing just fine, there are still some warning signs for his campaign. Trump has faced a steady stream of hefty legal bills that stem from his four indictments, and that has drained much of his campaign cash. In fact, Trump’s campaign has spent more than $50 million on legal fees in the past year alone. According to the Associated Press, 84 percent of spending from Trump’s Save America political action committee has gone toward covering legal expenses.
Those aren’t exactly the typical spending habits of a normal campaign. But then again, Trump isn’t a normal candidate.
No. No, he’s not.
And, I’m a bit embarrassed to admit, I really hadn’t considered the impact of this mounting legal debt—which doesn’t even include fees owed to his attorneys, which I imagine are substantial—on a potential second Trump term, having focused entirely on what it meant for his re-election prospects.
