$83 Million Verdict Renews Spotlight on Trump’s Finances
He did not go to jail, and has not lost his grip on the race for the Republican presidential nomination, but a jury’s verdict in a civil defamation trial last week nonetheless hit Donald J. Trump where it hurts: his wallet.
The jury’s decision to award $83.3 million to E. Jean Carroll came at an inopportune moment for the former president, who might soon face another large penalty from a civil fraud case brought by the New York attorney general, Letitia James. Mr. Trump and his family business are bracing for the judge in that case to impose a punishment in the coming weeks that could reach hundreds of millions of dollars.
Together, the judgments might deliver a punishing one-two punch to the former president, a financial threat unlike any he has experienced in decades.
The payouts would hardly raise the specter of bankruptcy for a man who estimates his net worth — the subject of much debate — in the billions. And they pose no risk to his freedom, unlike his four criminal indictments. But they could erode some of his financial cushion and force him to sell various assets, a New York Times review of his financial records and interviews with people close to him show.
Both penalties will also strike at the core of Mr. Trump’s identity — and his ego — and test his method of managing legal crises. For years, he has portrayed himself as a self-made mogul who can bend the justice system in his favor. And as the cases against him have mounted, he has sought to blur his varied legal woes into what he baselessly describes as a “witch hunt” directed by his political opponents.
“The enterprise that is Trump isn’t going to be taken down by a bunch of criminal cases,” said Steven M. Cohen, a former federal prosecutor and top official in the attorney general’s office who now teaches corporation law at New York Law School. “The enterprise that is Trump is going to be picked apart by these civil cases, and at some point there is a risk of collapse.”
The verdict for Ms. Carroll, a writer whom Mr. Trump defamed, infuriated the former president, who called it “absolutely ridiculous!”
Steven Cheung, a spokesman for Mr. Trump, did not address the specifics of how Mr. Trump would fund either the Carroll judgment or the potential civil fraud trial penalty.
He said that Mr. Trump had built a “tremendously successful, unparalleled business” before he was elected.
“The unjust verdicts will be appealed, and all the hoaxes will be defeated, as President Trump did nothing wrong,” he said.
In a social media post on Sunday, Mr. Trump took aim at the attorney general’s accusation that he had inflated his net worth, writing: “I AM WORTH MUCH MORE THAN THE NUMBERS SHOWN ON MY FINANCIAL STATEMENTS.”
Hefty legal costs are not a new reality for the infamously litigious Mr. Trump, but never before has the tally been so high.
He has been using a political action committee, originally seeded with donations raised from his false claims of widespread fraud in the 2020 election, to pay the bulk of his and some witnesses’ legal fees in the criminal cases against him. But while some campaign finance experts think he could use it to help fund the Carroll judgment, it could only cover a fraction of the amount the jury set.
That leaves Mr. Trump with the prospect of having to dig into his own pocket to pay Ms. Carroll and the State of New York.
People close to Mr. Trump, who requested anonymity to discuss his financial situation, insist he has the money to cover the two major payouts. And in a deposition last year for Ms. James’s case, Mr. Trump stated that he had $400 million in cash available.
The Times — which reviewed several years of Mr. Trump’s financial statements and court documents that shed light on his finances — was unable to independently verify those assertions. Mr. Trump’s family business is a privately held company that is not required to file detailed public reports with regulators.
And his most recent financial disclosure, which he is required to submit as a presidential candidate, contains ranges rather than specific figures.
Still, the publicly available records and interviews with people knowledgeable about his finances offer a snapshot that suggests that Mr. Trump has more than enough cash, or investments in the financial markets that can be converted into cash, to cover the $83.3 million he now owes Ms. Carroll.
The attorney general’s potential penalty could be a different story.
Ms. James is seeking $370 million. The judge, Arthur F. Engoron, has appeared sympathetic to her case throughout the monthslong trial.
If Mr. Trump suddenly owes hundreds of millions of dollars, he might have to sell much of his investment portfolio or other assets.
When Mr. Trump was entering the White House, Allen H. Weisselberg, his longtime chief financial officer, prepared a memo showing that the Trump Organization was running low on cash. It had $60 million, which included more than $26 million tied up in a partnership he could not touch.
During much of his presidency, the annual financial statements Mr. Trump’s company submitted to his lenders showed that he had anywhere from $75 million to $93 million in cash and “cash equivalents,” depending on the year. (These statements were released as part of Ms. James’s case).
Since then, Mr. Trump’s company has sold some once-prized assets: the operating license at his golf club in the Bronx and a lease he controlled at his hotel in Washington. His proceeds from the hotel sale alone, after paying off a mortgage and other investors, were $131.4 million before tax, according to a document filed in Ms. James’s case.
In Mr. Trump’s post-presidential life, his business, the Trump Organization, has also struck new deals with foreign partners, including a Saudi-backed golf venture and a Saudi-based real estate company, for a housing and golf complex to be built in Oman.
It is unclear what his company has done with that money — whether it is cash in a bank account, was invested in the stock market or was used to fund Mr. Trump’s various businesses, many of which have lost money over the years.
For now, while he appeals both cases, Mr. Trump need not immediately pay Ms. Carroll and the State of New York.
He could pay the court system, which will hold the money while the appeal is pending. This is what he did last year when a jury ordered him to pay Ms. Carroll $5 million in a related case.
Alternatively, Mr. Trump could try to secure an appeal bond, which would save him from having to pay the full amount up front. This methodwould essentially assure Ms. Carroll and Ms. James that Mr. Trump has the money to pay but prevents them from collecting while his appeals are heard.
But securing such a bond would require Mr. Trump to find a company willing to write the bond at a time when he faces significant legal jeopardy.
And if he does secure the bond, it probably will not be cheap. The value of the bond is likely to be 110 percent of the verdict, so in the case involving Ms. Carroll, about $92 million, legal experts said. Mr. Trump will also have to pay the bonding company a substantial premium and offer it a significant amount of collateral, more even than what he owes. He will also owe interest to Ms. Carroll and the State of New York.
Legal experts said that Mr. Trump might not be able to pledge his properties as collateral. Instead, the experts said, the bonding company might demand that he pledge liquid assets, such as certificates of deposit or Treasury bonds.
“This is no walk in the park,” Stuart Levine, a business attorney in Baltimore who regularly deals with various types of bonds for clients, said after reviewing Mr. Trump’s latest financial disclosure form.
Mr. Trump’s net worth has long been a source of pride for the former president, though it can also be a double-edged sword.
On the final day of the recent trial, Ms. Carroll’s lawyers tried to convince the jury that Mr. Trump should face a steep punitive fine — after all, only a large number would matter to such a wealthy man.
“He has said that his brand alone is worth $10 billion,” Ms. Carroll’s lawyer, Roberta Kaplan, said in her closing arguments — using Mr. Trump’s own words, which he delivered during a deposition in the attorney general’s case, against him.
“He said it’s the hottest brand in the world,” Ms. Kaplan continued. She rattled off the estimated value of his Florida estate, Mar-a-Lago, and his golf resort outside Miami.
Mr. Trump’s lawyer Michael Madaio objected, saying, “These are not personal assets she’s referring to,” implying that they belonged to Mr. Trump’s company.
He was overruled.
Jonah E. Bromwich and William K. Rashbaum contributed reporting.