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Trump’s lawyers told the court that no one We Are LA program receives $2.8M investment would give him a bond. Then he got a lifeline, but they didn’t tell the judges. By City News Service
“If that deal was on the table for the taking, the representation from the earlier time would be untrue, and the lawyer would have an obligation to correct,” said Stephen Gillers, a legal ethics professor at New York University Law School. In the rules of conduct for lawyers, the failure to update an important piece of evidence would fall under what’s referred to as the “duty of candor to a tribunal,” said Ellen Yaroshefsky, a professor of legal ethics at Hofstra Law. “Any judge is going to be furious that this wasn’t corrected,” she said. Scott Cummings, a legal ethics professor at UCLA’s law school, agreed that there was a potential ethical failure but said Trump’s lawyers could argue that they were not obligated to alert the court. “A very narrow reading of this rule would be there is no obligation to report because it wasn’t a false statement at the time,” Cummings said. The need for the bond arose from a case brought against Trump by the New York attorney general, who accused him of fraudulently inflating his net worth to get favorable loans and other benefits. A judge agreed and ordered Trump and the other defendants to pay $464 million. See Trump Page 28
See We Are LA Page 28
This story was originally published by ProPublica. ProPublica is a Pulitzer Prize-winning investigative newsroom. Sign up for The Big Story newsletter to receive stories like this one in your inbox.
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ormer President Donald Trump scored a victory last month when a New York court slashed the amount he had to put up while appealing his civil fraud case to $175 million. His lawyers had told the appellate court it was a “practical impossibility” to get a bond for the full amount of the lower court’s judgment, $464 million. All of the 30 or so firms Trump had approached balked, either refusing to take the risk or not wanting to accept real estate as collateral, they said. That made raising the full amount “an impossible bond requirement.” But before the judges ruled, the impossible became possible: A billionaire lender approached Trump about providing a bond for the full amount. The lawyers never filed paperwork alerting the appeals court. That failure may have violated ethics rules, legal experts say. 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. As negotiations between
Former President Donald Trump holds a campaign rally at the Rochester Opera House in Rochester, New Hampshire, on Sunday, Jan. 21, 2024. | Photo by Liam Enea CC BY-SA 2.0 DEED
Hankey and Trump’s representatives were underway, the appellate court ruled in Trump’s favor, lowering the bond to $175 million. The court did not give an explanation for its ruling. Hankey ended up giving Trump a bond for the lowered amount. It’s unclear if Trump lawyer Alina Habba or the rest of his legal team were made aware that Hankey reached out about a deal for the full amount. Trump’s legal team did not respond to requests for comment. 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.” Legal ethics experts said it would be troubling if Trump’s lawyers knew about Hankey’s approach and failed to notify the court. New York state’s rules of professional conduct for lawyers forbid attorneys from knowingly making false statements to a court. At the time Trump’s lawyers told the court that meeting the bond would be impossible, Hankey said he had not yet reached out to the Trump team. But the rules of conduct also dictate that lawyers must “correct a false statement of material fact or law previously made” to the court.
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wo organizations on Monday donated a combined $2.8 million to support the Mayor's Fund of Los Angeles, a nonprofit closely associated with Mayor Karen Bass and efforts to prevent evictions and homelessness. The Bob & Dolores Hope Foundation gave $1.5 million and Health Net gave $1.3 million to invest in the Mayor's Fund for Los Angeles' We Are LA program, which aims to prevent evictions by connecting renters with resources. On its website, the nonprofit, which is overseen by an independent board of directors, noted it has helped more than 411,000 at-risk Angelenos, and provided targeted outreach to people who have received notices of intended eviction. "We must bring unhoused Angelenos inside while doing all that we can to prevent people from falling into homelessness in the first place, and that means local government partnering with businesses and philanthropists across the city to confront this crisis," Mayor Karen Bass said in a statement. The two organizations join L.A. Care Health Plan, which made previous investments totaling $1.8 million, as the program's largest donors. L.A. Care Health Plan's donation helped the program off the ground. Bass recognized L.A. Care Health Plan's "generous donation" and commended The Bob & Dolores Hope Foundation and Health Net for taking a similar step and joining the effort. "This is not a fight we will win if private philanthropy does not lock arms with us in this effort to provide the life-saving resources that Angelenos deserve," Bass said in a statement. "Thank you to our philanthropic partners for locking arms and partnering with us to confront the greatest challenge facing our city." On top of outreach, the We Are LA program offers a hotline and organizes tenant resource clinics to help reach anyone who may face eviction. A member of the program will connect with a person in need of help, then a caseworker assesses all of the resources available to that individual and helps them through the process of applying for government, other charitable aid and even legal services. "There were nearly 6,000 notices of eviction filed in March alone," President and CEO Conway Collis of the Mayor's Fund said in a statement. "These are life-saving gifts that will help us prevent thousands of Angelenos — including families and children — from falling into homelessness." The Mayor's Fund has served more than 32,000 individuals and families to help them avoid eviction and stay housed. Additionally, the nonprofit recently formed a partnership with U.S. VETS to help service veterans in Los Angeles and is beginning new programs to directly serve vulnerable popu-
By Robert Faturechi, Justin Elliott and Alex Mierjeski, ProPublica