Trump $175M Bond: Trump and Don Hankey Have “Done the Hanky-Panky”

hanky-panky: unacceptable or dishonest behavior, especially involving sexual activity or money (Cambridge Dictionary)

I’ve said before that when I heard some dude named Don Hankey had “posted” Trump’s $175 million bond for his NY State Fraud case my mind immediately jumped to the thought “hanky-panky” and a song I remember from when I was young. The song was about romance gone wrong (the singer’s gal cheating) but dictionary definitions of the term, including the one above note it’s commonly used to describe financial or other misconduct. And it’s becoming increasingly clear that whether you want to call it hanky-panky, shenanigans, chicanery, misrepresentations or outright lies the bond pledged to the court in New York wasn’t what it what represented to be. Worse, there’s a real question about whether Team Trump lied to the court in getting the original $454M (plus interest accruing daily) amount reduced by the appellate court to $175M in the first place.

Let’s take a closer look. If you haven’t been following this story, those of us who have been paying attention to both print and pundit coverage there’s plenty of eye-opening stuff that I’m pretty sure the appellate judges who showed Trump mercy aren’t happy to be learning. Let’s start with Knight Insurance, owned by California billionaire Don Hankey who sure as hell has been no Boy Scout in his long and sleazy life. (Not noted in the Wikipedia link his his being faced to pay almost a million in settlements to U.S. troops he screwed over in two separate swindles) He claims to have never met Trump, and doesn’t really know him yet prior to this he’s bailed out Trump financially to the tune of hundreds of millions of dollars, including Trump’s DC hotel and the Doral golf course/resort down in Florida.

Keeping all that in mind when Trump’s judgement in the New York fraud case was announced Team Trump immediately complained. To be fair most people, including giant corporations with actual tens of billions in assets would complain but what matters is coming up with cash or bond to forestall enforcement while an appeal plays out. A person or business can either put cash in escrow with the court (as Trump did with the first, $5M E. Jean Carroll verdict) or obtain a surety bond. We all knew that for all his bluster Trump was lying through his teeth about having the cash. That lie by the way he started spouting during a deposition given in this case!

In one of the rare times we can believe Trump, he said roughly thirty companies that provide this type (and could afford to) this size bond rejected him. Gee, I wonder why? He wasn’t even lying (well, not much) when he said they wouldn’t accept real estate as collateral. Given it’s doubtful any real estate Trump owns is unencumbered, but in fact is already being used as collateral for other loans I can see why bond companies would say no. Or ask for a LOT of actual cash upfront in addition to any real estate. Trump of course didn’t have anywhere near four hundred million or more in “liquid cash”, or even probably half that so the reputable bond companies told him to go pound sand.

That’s where, as this article from ProPublica things got shall we say interesting. Dubiously (at best) so in fact.  Trump’s lawyers provided a list of almost thirty firms that rejected providing the bond, and citing refusal to accept real estate as collateral. According to them it was “an impossible bound amount.” (FYI there’s no requirement only one company put up the bond. The issue of getting multiple companies to kick in part of  it to collectively meet the amount needed seems to have not been addressed) This was all playing out publicly, and according to ProPublica the “impossible” suddenly become possible:

In an interview with ProPublica, billionaire California financier Don Hankey said he reached out to Trump’s camp several days before the bond was lowered, expressing willingness to offer the full amount and to use real estate as collateral.

“I saw that they were rejected by everyone and I said, ‘Gee, that doesn’t seem like a difficult bond to post,’” Hankey said.

However, the appellate court was never informed, and by not doing so it seems Trump’s lawyers might be on the hook for ethical violations. There’s some serious rationalizing taking place (as I see it) with those commenting on this about whether Trump’s lawyers knew before the bond amount was reduced that Hankey had offered to step in. Call me cynical but if they claim they didn’t know they are lying. Who the hell do you think Hankey would have contacted to say he’d help? Fredo 2 aka Eric? Of course he’d have contacted Trump’s lawyers!  Regardless, even if they didn’t find out until after the appellate court took pity on Trump once they knew they were obligated to inform the court.

So the question, to borrow a phrase from Watergate is (paraphrased) What did they know and when did they know it? I have a feeling the time will be coming when Trump’s lawyers will be, like so many Trump lawyers before them needing their own lawyers as they face scrutiny from the courts and even the Bar. In any case, ProPublica kept digging and reached out to Trump’s representatives. That prompted Hankey to call them back and revise his initial account:

After ProPublica reached out to Trump’s representatives, Hankey called back and revised his account. He said he had heard “indirectly” about ProPublica’s subsequent inquiries to Trump’s lawyers. In the second conversation, he said that accepting the real estate as collateral would have been complicated and that he wouldn’t have been able to “commit” to providing a bond in the full amount “until I evaluate the assets.”

This isn’t the only instance of Hankey seeming to feel the heat of the spotlight. Of getting worried about being burned and doing some self butt-covering. I like the “indirectly” part of his revised statement. We might never be able to prove it in court but even a MAGA goober can read between the lines like you and me and know that Team Hankey and Team Trump had a pow-wow to coordinate their positions/statements.  But let’s move on to the fact that after the amount of the bond was reduced to $175 million Hankey had his Knight Insurance pledge to cover it. Or so it seemed.

Trump announced on a Monday evening the bond had been “posted” when it in fact hadn’t. But the paperwork from Knight did get submitted later in the week before the deadline, except it wasn’t in order. There were mistakes and missing information (to be fair, not rare) including rather significantly a current financial statement. It was assumed the court wanted one from Trump, but given how things have developed it seems they might instead have wanted one from Knight Insurance. Or both Trump and Knight insurance. Reporting on that has been less than clear. Still, the court gives people a chance to make the requested fixes when this type of thing happens and like anyone else Knight Insurance (Hankey) was given a chance to do so.

And then what had been a car crash started to become a pile-up. I’d urge you to read the linked ProPublica piece in its entirety to get details on all the back and forth between Hankey who admits to direct involvement with Trump’s “people” (personally I want specifics as to exactly who he spoke with) both before and after the bond was reduced. He claims to have been baffled why others wouldn’t accept Trump’s real estate as collateral, but that after the bond was reduced talks ended with a maybe we can do business on something else next year. However he says, a few days later they called back saying they needed his help after all so he stepped  up.  And seems to have tripped on the step, or slipped or both. Now, with the New York AG asking, filing a motion actually to take a closer look at just how secure the Surety Bond is the car-crash-pileup grows.

In addition to its own article that covers the same ground as the piece I’ve already cited, Salon has another article about the credibility of Trump’s lawyers and the validity of the bond that’s been entered with the court. It starts out by saying legal experts and even former regulators claim this bond is “highly irregular.” Okay, let me admit I’m still trying to become truly knowledgeable about this stuff but when experts are saying it’s pretty much just a promise Trump can pay up if he has to even I know a bond is supposed to do more than THAT. The Salon article cites another outlet, The Daily Beast which bluntly says this arrangement in effect negates “the whole point of an insurance company guarantee.”

Oh, but it gets better. Or perhaps worse depending on how you choose to look at things. From Salon:

It does not appear that Knight Specialty Insurance Co. could even cover the bond if it wanted: according to a court filing, the company has financial reserves of just $138 million. And while a related corporate entity claims a financial surplus of $1 billion, the court filing does not explicitly state that it would be liable.

“Based on the financial statement provided, Knight Specialty is providing a bond that is one-third of its total assets and greater than its surplus, which is incomprehensible for a carrier to underwrite,” Maria T. Vullo, a law professor at Fordham University who previously served as New York’s top financial regulator, told the publication.

The way I see it the instant the appellate court reduced the bond to $175 million they reduced the amount the state of New York can ever expect to collect when Trump finally loses his appeal.  Imagine Trump agreeing to cough up the balance between the “bond” and the rest of the judgement. Done laughing? Ok, let’s move on. The fact is, Knight Insurance can’t pay the “bond” they have put up either! Worse (for Hankey) this was the case when the paperwork was submitted!  I’d say he has some explaining to do. I know he doesn’t care what I think, but he WILL care when the state of New York comes a calling and suggests he LIED to them. Officially lied to them.  To say all this is not only unusual but stinks to high heaven is quite the understatement. Salon is rather more polite:

Indeed, experts who reviewed the bond filing said it appears to state that it is “Donald J. Trump” who “shall pay” any bond, an arrangement that is far from normal.

“This is not common,” N. Alex Hanley, CEO of the civil bond company Jurisco, told the outlet.

Gee Mr. Hanley, ya think?  Like a greased pig Trump always seems to slip away from the clutches of accountability, and since Hankey, if pressed to make good on the $175 million refuses (His Axos bank that has loaned so much to Trump could likely transfer that amount to his other company, Knight Insurance) AG James is going to have to start filing motions across the country. Both Trump and Hankey will be laughing about it.

I think we have a whole new fraud case here. That Hankey and Trump conspired to find a way out of him having to pay any judgement to NY state and it was apparent weeks before the actual amount of damages was announced by judge Engoron we knew it was going to be several hundred million or more. Let’s look at some dots:

• Don Hankey has a long and sordid career (just like Trump) of being an asshole and putting the screws to, as well as outright cheating people.
• Hankey claims to not know Trump all that well, and has never even actually met him however…
• Hankey’s bank has since Trump’s left office provided huge, HUGE loans to bail Trump out financially with multiple Trump properties. (But he doesn’t know Trump! Sure)
• Trump again needs help, and Hankey sees a chance to pick up an easy fee (two or three million which would be standard for a normal Surety Bond) to cover Trump in this current situation and steps up.
• Hankey’s out in California. His company isn’t even licensed to to business in New York. That can be corrected and the court would likely allow some back-dated paperwork but why should he? Like Trump, he can sit in another state and say, “sue me” or “come get it if you think you can.” Or even point to the fine print of the bond agreement and say “go get it from Trump. He promised to make good on payment himself rather than force Knight Insurance to do so.
• If he didn’t flat out lie, then Hankey sure as hell misrepresented things when he filed paperwork with the court in the form a a Surety Bond. The closer you look the more it looks like a “promise” from Trump himself. As in worthless.

Add all this up and it looks like Hankey paired up with Trump to try and pull a fast one on the court. Both have spent their careers engaging in sleaze, making promises they didn’t intend to keep and sticking it to others whenever they could. Like Trump before getting into politics Hankey for the most part got away with the lion’s share of his crap. Both are hardly the only rich, or at least highly leveraged business people to dance back and forth over the line of what’s legal and what’s not and have prosecutors sigh and decide not to devote the time and expense to holding them accountable.

However, Trump’s world changed when he stepped into the middle of the Presidential spotlight. It’s bright, and and also unblinking. Sometimes the glare is harsh and penetrates nooks and crannies those under it want to stay dark. Trump didn’t, like most former Presidents step away. He fought even getting pushed to the edge of the circle of that spotlight. That means hangers on, and supporters wind up stepping from the dim shadow outside the circle and into the light themselves. That’s what’s happened to Hankey and he’s not liking it one bit.

In fact, as reported here on PZ, other blogs and even in mainstream media Hankey has been making noises like maybe he wishes he hadn’t gotten involved in all this. At the very least he’s wishing he’d charged more of a fee to Trump to arrange the bond. He’s certainly getting more than two or three million bucks worth of trouble! But this is a high profile matter that’s been part of, and sometimes dominating pretty much every news cycle for a while now. You really do have to wonder if Hankey is that boneheaded and clueless, or really thought he could pull a fast one with his pal Trump.

I say he chose to “do the hanky-panky” and got caught.

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