Downward angle icon Downward angle icon. Former President Donald Trump speaks at a press conference at 40 Wall Street earlier this year. Alexi J. Rosenfeld/Getty Images Attorney General Letitia James plans to seize Trump's cash and property if he doesn't pay his civil fraud debt. Trump's bank accounts will be seized and his property could be sold at sheriff's auctions. One of New York's top judgment enforcement lawyers explains how the process will unfold.
Don't expect to see a gold-plated toilet dragged to the curb outside Trump Tower, nor will the glass revolving doors of 40 Wall Street or Trump Plaza be padlocked any time soon.
The March 25 deadline for Donald Trump to present New York Attorney General Letitia James with the $457 million civil fraud judgment he now owes the state will likely pass without much disruption.
But if Trump does not post cash or bail, or if an appeals panel denies a stay of execution, James has said he is prepared to begin “enforcement,” which could include seizing Trump's assets and having the sheriff sell some of his New York real estate.
Plans to take President Trump's social media platform, Truth Social, public within six months could net him up to $3 billion, but it may be too late to scare off bidders.
Bernard D'Orazio, a veteran Manhattan judgment enforcement lawyer who has been called “the best collections lawyer in New York” by sheriff's officials, gave Business Insider a step-by-step rundown of what happens next.
Trump doesn't have to do anything.
D'Orazio, lead attorney at the law firm Bernard D'Orazio, said Trump was under no legal obligation to do anything on March 25.
“He is perfectly within his legal right to do nothing and will not face jail time for failing to pay,” D'Orazio said.
“We no longer imprison debtors, and only in rare cases, when they disobey a court order and are found in contempt of court,” he said.
“But the onus to take any action falls squarely on the person who wins the case – the judgment creditor. The onus is on them to seek enforcement of the judgment,” he added.
So, is it all down to Letitia James?
It will be the attorney general's responsibility to initiate enforcement, but he will be assisted by New York state civil procedure laws and rules, as well as the sheriff's offices of New York City and Westchester County, where Trump owns several properties.
“Letitia James is responsible for identifying Mr. Trump's assets and determining which ones to seize or auction,” D'Orazio said.
That's the easy part.
James likely knows how much the presumptive Republican presidential nominee has and where his assets are located, after investigating and suing Trump for five years and because she receives regular updates from the court-ordered fraud monitor who has been monitoring the Trump Organization's finances for the past 16 months.
But whether she decides to target Trump's cash, real estate or both, D'Orazio said the county sheriff's office would be responsible for seizing Trump's bank accounts and auctioning his real estate.
Trump outside the 54-story Trump Palace on East 69th Street between Second and Third Avenues in 1990. Photo by Associated Press/Mark Lenihan
“This is old school,” D'Orazio said, “but I'm not talking about the old west sheriff with the cowboy hat and the star on his chest.”
“Our legal system is derived from the English system and enforcement of civil judgments ultimately rests with the sheriff,” he said.
So what happens first?
D'Orazio predicts James will first target the cash held by Trump and his organizations in bank accounts registered in New York.
“We may be able to make progress quickly by asking for his liquid assets to be frozen,” he said.
“The attorney general can do that by sending a letter to the bank where he has an account. It doesn't mean the money is in your hands yet,” he added. “This is just the first step in the process.”
D'Orazio said once the bank has confirmed to James that Trump's funds are frozen, it can order the New York City Sheriff's Department to “seize,” or confiscate, the funds.
“The sheriff will send a legal document to the bank called a 'garnishment,' which will require the bank to give the money to the sheriff,” he said.
“The sheriff then gets that money plus his fees. By law the sheriff is entitled to 5 percent,” he said, and the money will be returned to the city.
“It's called the 'pound fee,'” he said.
For example, if the sheriff were to collect $100 million in cash from Trump's bank account, he would transfer $95 million to the attorney general's office to help pay Trump's judgment.
The remaining $5 million would go into city coffers, D'Orazio said.
But when is the auction?
D'Orazio said James would not drain the entire balance in Trump's corporate bank account.
“How is he going to pay his salaries?” he said. “I don't think the attorney general wants to put all the building porters and doormen out of work or have all these businesses close down.”
Instead, she may go after some of her husband's real estate assets to reach the total judgment amount.
James may start by choosing which assets she wants to sell. Last month, she told ABC she has already set her sights on 40 Wall Street, or the “Trump Building.” Trump leases land in the building, which Forbes magazine valued at about $80 million in September. James can see it a block north from the window of her Financial District office.
James could also target physical assets, such as Trump's penthouse in Trump Tower.
Or they could go for intangible assets, such as a 30% stake in 1290 Avenue of the Americas, a skyscraper one block north of Radio City Music Hall that Forbes estimates is worth $287 million.
Here's a look at the Trump properties James could target.
After James determines the assets, the sheriff's office could send Trump a notice to begin selling them.
“This is an old-fashioned procedure for executing a sale, a live auction where a third party comes in and bids on the property being sold,” D'Orazio said.
Again, the Sheriff's Office will collect a 5% fee on the auction sale.
All told, the sale fees to cover the $500 million judgment could exceed $25 million, a boon to the city's finances and coming directly from President Trump's wallet.
Can you sell your Manhattan penthouse?
D'Orazio said Trump's three-story Manhattan penthouse at the top of his flagship store, Trump Tower, on Fifth Avenue, would be an attractive target.
In September, Forbes magazine estimated the penthouse was worth $52 million.
The property is a likely target because “it is personally owned by Mr. Trump, it is not mortgaged and it is not his primary residence,” D'Orazio said.
“If it was his primary residence, the attorney general would need to get a court order to sell it,” he said.
“But because it's a vacation home, the attorney general may seek to go after the property immediately,” he added. “But by 'immediately,' I mean 'months.'”
For months? Until Election Day?
A lot needs to happen before a sheriff's sale can actually take place, and Trump will likely try to legally obstruct the process throughout.
“Debtors can delay things,” D'Orazio said.
Trump has already appealed the ruling to the Manhattan Court of Appeals, asking the court to either reduce the sentence or delay the execution while the appeal continues.
But there are other delays Trump could try.
“The Judgment Enforcement Act acts as a safety valve,” D'Orazio said.
“You can apply to the court for what's called a protective order, which is meant to prevent unnecessary harassment and abuse by judgment creditors,” he added.
New York Supreme Court Judge Arthur Engoron, who is overseeing Trump's civil fraud case, is likely to deny the protective order, but Trump could still appeal the denial.
“The appeals court will not hear appeals in the summer,” D'Orazio said, “unless Trump can somehow schedule an appeal in June, which may not be possible, the next time the appeals court could hear the case would be in September.”
Former President Trump owns an $80 million lease on 40 Wall Street. Jeff Greenberg
Auctions take time
D'Orazio said that even without the delays caused by these lawsuits, it would take three to four months to schedule, promote and hold an auction.
He added that the sheriff's office must publish four notices of the auction in a public newspaper before the auction can take place.
Auctions are held only once a month in each of New York City's five boroughs, and James can auction multiple properties at one auction.
Trump's Manhattan property will be auctioned in Manhattan, and anyone can participate, but the logistics could be difficult given the intense media and public interest.
If such a sale were to occur, Trump would keep any proceeds beyond what is needed to satisfy the judgment.
But as Trump has previously complained, any forced property sales, whether conducted by sheriffs or by Trump himself to pay his bail, could be done at “bargain prices.”
“I would be forced to mortgage or possibly sell significant assets at bargain prices, and if I win on appeal, I would lose them,” Trump said in a Truth Social post this week. “Does that make sense?”