An unlikely partnership emerged this week that allowed former President Donald Trump to post the required $175 million bond to appeal his New York fraud case judgment — and the identity of his billionaire backer has just been revealed.
Trump’s bond was paid by billionaire investor Don Hankey, dubbed the “king of subprime car loans.”
“I had heard that he was trying to put together the $460 million bond. I reached out at that time,” Hankey told The Daily Mail. “We began to have a conversation. The bond got reduced. So they thanked us for the help trying to put the larger bond together. So we said goodbye.”
“A few days later they called back and said, ‘Would you come back and do the $175 million bond?'”
It was Hankey’s firm, Knight Specialty Insurance Company, that ultimately provided the bond after what he described as straightforward negotiations with Trump’s legal team.
However, there was a shift in the collateral requirements as the talks progressed.
“He first gave us a list of bonds and we approved the bonds as collateral along with some cash. When the collateral was finally posted it appears to be all cash,” Hankey stated. “We have a screenshot of it and it was all cash.”
For Trump, putting up the full $175 million collateral in cash provides financial benefits beyond simply covering the bond amount, Hankey explained.
Trump can continue to collect interest if the collateral is invested in a money market or other legal investment entity if he wins, and if he loses the appeal Hankey can quickly collect.
“If the appeal is lost or we have to come up with cash, with a bond you only have about 24 hours to come up with the cash. If you have real estate it can take months to liquidate the real asset,” he said.
Hankey, who has previously donated to Trump’s campaigns, expressed confidence in the 45th president’s ability to repay based on the former president’s overall financial standing.
“I thought his credit was pretty good,” he stated, brushing aside Trump’s past troubles like bankruptcies tied to his Atlantic City casinos.
“That’s what we do. We do that in Los Angeles. We work a little bit outside the box,” Hankey said of his willingness to take on the deal. “There’s not much risk that’s involved if he puts up the cash. It’s being held in trust for us.”
Hankey represented a lifeline for Trump at a crucial moment. As the former president’s lawyers argued in court, they were unable to find an institution willing to back the massive $454 million bond amount that was initially mandated – a sum his lawyers called “unprecedented” and unreasonable.
“I’d never met Donald Trump. I’d never talked to him on the phone. I heard that he needed a loan or a bond, and this is what we do,” Hankey told Forbes. “We reached out to somebody else and said we would do it. That word got back to him.”
Hankey, whose automotive services empire focuses on subprime borrowers, added: “I am a supporter happy to help him also this is what we do at Knight [Specialty Insurance Company]. We’re just doing our job.”
Hankey’s willingness to put up the bond allowed the former president to meet the revised $175 million legal requirement and continue challenging the judgment against him.
Trump’s lawyers had previously warned properties may need to be unloaded at “fire sale” prices if unable to secure a bond because his assets are not liquid.
With an estimated $7.4 billion net worth, Hankey had the resources to facilitate an agreement after initial conversations about using Trump’s real estate holdings as collateral.
“I’d never met Donald Trump, nor talked to him on the phone,” Hankey reiterated to Forbes. “Yes, I voted for him in the past, but this is a business deal and this is what we do.”
By leveraging his professional expertise and personal wealth, the subprime lending magnate was able to extend a financial lifeline that could prove critical as Trump’s high-stakes legal battle in the state of New York rages on — and Trump devotes his energy and other resources towards the 2024 election rematch against President Joe Biden.
The Horn editorial team