(CMR) Concerns have been raised that Donald Trump's $175 million bond could be “very difficult” to collect if his conviction is upheld as the parent company of the US company that issued the bond is based in the Cayman Islands.
The former president was issued a $464 million bond to appeal his civil fraud conviction; however, when he could not come up with the amount, the New York appeals court gave him a bond of $175 million.
Trump was able to get the bond for 175 million; however, questions have been raised about the company that issued the bond and whether the amount can be collected should Trump's conviction be upheld.
The Daily Beast reported while the bond's issuer, Knight Specialty Insurance Company, is based in the United States, its parent company is in the Cayman Islands. Reports are that the company's balance sheet in the US suggests it might not have enough surplus cash to make good on its promise.
“The Caymans are widely recognized as a ‘secrecy jurisdiction. If you called the regulator in the Caymans and asked, ‘Can you tell me if Knight reinsurance has enough to cover these claims?’ Their laws require total confidentiality,” Tom Grober, a forensic account, told The Daily Beast.
Dave Jones, a former California insurance commissioner, also raised concerns about the bond's connection to a foreign jurisdiction, Newsbreak reported.
“What the New York AG must be thinking is, ‘What recourse do I have in Cayman Island courts? If I get a judgment against the bond, even if I sue the reinsurer, can I enforce that judgment in a Cayman Island court? Maybe, maybe not, “It raises a whole other level of complexity,’” Jones said.
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