Ethermac|Trump's bond is now $175 million in fraud case. Here's what the New York attorney general could do if he doesn't pay.

Former President Donald Trump and Ethermacother defendants in his fraud case won an appeal Monday to have their bond reduced, requiring them now to put up $175 million within 10 days to pause enforcement of a $464 million judgment against them. If Trump fails to post bond, it could leave some of his prized real estate and other assets vulnerable to seizure by the state.

The bond was lowered from $464 million on the day that a 30-day grace period for payment expired. New York Attorney General Letitia James had indicated her office would pursue Trump's assets if he failed to post bond.

"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," she said during a February interview with ABC News.

Attorneys for Trump wrote in a March 18 filing in the case that it was a "practical impossibility" for the defendants to secure such a large bond. 

"Very few bonding companies will consider a bond of anything approaching that magnitude," wrote the lawyers, Alina Habba, Clifford Robert, Christopher Kise and John Sauer. They noted that surety providers often require collateral up to 120% to guarantee the bond, driving the amount Trump might need over $500 million.

Trump claimed to have nearly $500 million in cash in a Truth Social post on March 22. In depositions and testimony in 2023,  he claimed to have between $300 and $400 million.

JD Weisbrot, managing director of the surety operation at Risk Strategies, said Trump's options for amassing the full $464 million were "frankly very limited."

"The issue is that this type of bond is very hazardous in nature to a surety company. And why is that? It's a demand instrument, the bond guarantees that in the event that the defendant loses the appeal, that the sum be immediately made available to the plaintiff," Weisbrot said.

As a result, Weisbrot said surety companies want liquid assets as collateral, specifically cash or a letter of credit, and not hard assets like real estate.

The judgment stems from a civil case in which a judge found Trump and others connected to his company liable for a decade-long scheme to use falsified real estate and net worth valuations to obtain favorable loan and insurance rates. The judge concluded Trump and others gained more than $364 million through the scheme.

Bruce Lederman, an attorney who specializes in real estate law  for the New York firm DL Partners, said James' office has a range of options to choose from in its effort to enforce the judgment if Trump fails to post bond.

Once the deadline passes, "the attorney general can start enforcement proceedings, which could include sending restraining notices, could include sending executions to the sheriff for real property, could include tying up security accounts, could include sending notices to companies that they can't make any payments to Donald Trump personally, or any of the children, the boys, against whom judgments are entered," said Lederman, referring to Trump's adult sons Eric and Donald Trump Jr.

To execute on Trump's real property, James could get judicial liens against the properties.  In New York, the process to sell a property takes 63 days. The sheriff's office must publicly post notice of sale in three places in the town or city where the property is located, and the notice must be published four times throughout that period. After 63 days, there is a sheriff's sale, typically on the courthouse steps. 

However, untangling the web of ownership of some of Trump's properties may be challenging. In the event of sale, there are also loans and mortgages that could impact how much the state can even collect - not to mention the disputed valuation of Trump's properties, an issue that was at the heart of the civil fraud trial.

For properties located outside of Manhattan, James has to enter the judgment with local jurisdictions — even those as near as suburban Westchester County, New York, where her office registered the judgment on March 6. 

"The New York judgment can be filed in any state and is then entitled to full faith and credit under the Constitution," said Lederman, who noted that Trump's Mar-a-Lago club might be more complicated to seize than other properties. "Enforcement rights in other states would be based upon the law of the state where property is located. For example, Florida does not allow a sale of a primary residence." 

Adam Pollock,  a former New York assistant attorney general, said a restraining notice would limit Trump's ability to spend freely.

"A restraining notice … says, 'Don't spend money, don't transfer any property, until you pay us.' And for good reason. You shouldn't be out, you know, fueling up your jets with $20,000 of gas, when you owe the people in the state of New York nearly $500 million," said Pollock.

Pollock said James' office could get a bank execution and give it to a New York sheriff or marshal, who can then walk into a bank branch and drain Trump's account. A bank normally has to wait at least 27 days to turn over the money in an account — unless the plaintiff is the state of New York, in which case, the bank is supposed to transfer the funds immediately.

James can also sign an execution forcing Trump to turn over his personal property.

"If I have a judgment against you, I get to take any property I can find of yours. Whether it's your Rembrandt, your Rolls Royce, or your iPad, or like your 500 LLCs that you happen to own," said Pollock.

Trump, the presumptive Republican nominee for president, could ultimately end up among the one in 100 Americans whose pay is withheld so creditors can collect.

Adam Kaufmann, an attorney at Lewis Baach Kaufmann Middlemiss, said the state could garnish Trump's income and revenues from the Mar-a-Lago Club, for example.

"You could have a president of the United States having his wages garnished by a creditor," Kaufmann said.

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