Trump’s Civil Fraud Bond Backer Is Even Shadier Than We Thought

The company underwriting Donald Trump’s $175 million bond is owned by a man whose seedy business practices were flagged by Trump’s own administration.

Billionaire Don Hankey, also known as the “king of subprime car loans,” was sued by the Justice Department just nine months into Trump’s presidency, after it was discovered that another one of Hankey’s companies, Westlake Services, had illegally repossessed 70 cars belonging to service members, violating the Servicemembers Civil Relief Act, The Daily Beast reported Wednesday.

Westlake settled with the Trump administration in just 10 days, according to a settlement agreement, with the company agreeing to pay $700,000 in damages to affected members and getting fined more than $60,000 by the federal government.

“Westlake and Wilshire specifically target servicemembers, including junior enlisted servicemembers, as customers for their subprime and near-subprime loan products,” prosecutors wrote.

But it wasn’t the first time Hankey’s companies had been penalized by the feds. Two years before the alleged misconduct, Westlake and one of its subsidiaries, Wilshire, were hit by the Consumer Financial Protection Bureau for “illegal debt collection tactics,” according to the Beast. That resulted in an even larger penalty, including more than $44 million in restitution payouts.

That’s all a part of the game to Hankey, who carved out his $7.4 billion fortune through those kinds of predatory practices, targeting low-income customers with high-interest auto loans.

Hankey’s Knight Specialty Insurance Company is the group that underwrote Trump’s bond for his civil fraud trial, but it’s not Hankey’s only investment in Trump’s financial situation. Hankey is also believed to be the largest shareholder in Axos Financial, according to MSNBC’s Lisa Rubin, a financial institution that in 2022 refinanced more than $50 million of Trump’s loans on Trump Tower and Trump National Doral Miami, according to documents filed with the Office of Government Ethics.

Hankey told Forbes that Knight initiated the deal with the criminally charged GOP presidential nominee, and explained that Trump had used both cash and investment-grade bonds to secure the money with his insurance company. Hankey added that he had never met Trump but had been a supporter of his previous campaigns.

“This is what we do at Knight insurance,” Hankey told Forbes on Monday. “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. So, we reached out, and he responded.”

Two investors in the shell company that merged with Trump Media & Technology Group, or TMTG, the parent company of Donald Trump’s personal social media platform Truth Social, pleaded guilty Wednesday to insider trading, the latest in the organization’s laundry list of recent issues.

Florida venture capitalist Michael Shvartsman and his brother Gerald pleaded guilty in New York to one count of securities fraud, and could face up to 20 years in prison, according to a statement from the U.S. Attorney’s Office in the Southern District of New York.

In October 2021, the pair made more than $22 million in illegal profits by using insider knowledge and trading in securities of the Digital World Acquisition Corporation, or DWAC, ahead of its merger with Trump’s company. The Shvartsmans were later arrested and charged in June last year.

“Michael and Gerald Shvartsman admitted in court that they received confidential, inside information about an upcoming merger between DWAC and Trump Media and used that information to make profitable, but illegal, open-market trades,” said U.S. Attorney Damian Williams in a statement.

The Shvartsmans plea comes after a rocky couple of weeks for TMTG. After the company’s initial public offering last week, its stock price surged to $57 a share, valuing the company at $8 billion. But in the past few days, everything has come crashing back to earth.

The company’s SEC filings, released Monday, showed massive losses of $58 million, sending its stock price plummeting, with auditors expecting the company to lose even more money in the future.

Trump’s social media venture could make him a lot of money, which he desperately needs to pay his many legal bills. But he’s not legally allowed to sell off any of his 72 million shares in the company for six months without permission from his company’s board of directors, as it would lead to a steep drop in the stock price. He still might manage to do so anyway, considering that the board, made up of former administration staffers, political allies, and his son Donald Jr., would likely rubber-stamp such a request.

Former national security adviser John Bolton has an unconventional suggestion for saving the U.S. alliance with NATO through a potential second term under Donald Trump: Just keep the former reality TV host distracted.

“So as Donald Trump’s former national security adviser, you believe that all Americans and everyone should take it very seriously when he says he wants to withdraw from NATO, and a second Donald Trump term, you believe, would mean an almost immediate withdrawal from NATO,” prompted MeidasTouch’s Ben Meiselas on Wednesday.

“Well I think he would do it very early in the term,” Bolton replied. “The remedy I would propose to anybody who doesn’t want us to withdraw from NATO is find a way to distract his attention.

“Since he has a short attention span, that can work, at least for a while, until it pops back into his head,” he said. “This is, I think unfortunately, a very good example of what a second Trump term would be like. A lot of things he talked about in the first term, maybe made some tentative steps toward but didn’t actually carry through on, we’ll see again in a second term.”

According to Bolton, a policy hawk who also served in Ronald Reagan’s administration, the consequences of America’s exit from the Cold War alliance could be dire, effectively resulting in the end of NATO, leaving behind a fractured and significantly weakened European alliance, while devastating America’s international credibility as an ally.

Trump has long criticized America’s relationship with the international military alliance, baselessly insisting that other NATO members have failed to pay their dues, and argued that the U.S. has been shortchanged by other members, even though that’s not how the alliance operates.

The Cold War organization has “no ledger that maintains accounts of what countries pay and owe,” according to former Obama staffer Aaron O’Connell, who explained to NPR in 2018 that “NATO is not like a club with annual membership fees.”

In February, Bolton claimed that Trump had completely fabricated a story in which he allegedly told a European leader that he’d allow Russia to “do whatever the hell they want” to NATO allies if they didn’t “pay their “bills.”

“But … the fact that it’s an imaginary conversation that makes Trump look very good—as all of Trump’s imagined conversations do—doesn’t mean that he doesn’t believe what he’s saying,” Bolton said at the time.

The White House has canceled its yearly iftar banquet, a tradition where the president hosts Muslims in government, community leaders from across the country, and members of the diplomatic corps to break their daily Ramadan fast with an evening meal. And President Biden’s Gaza war policy appears to be why.

The White House decided Tuesday to cancel the meal, Al Jazeera English reported, citing two sources familiar with the matter. The move came after many Muslim community members declined invitations and warned leaders not to attend in protest of Biden’s support for Israel’s war on Gaza.

“The American Muslim community said very early on that it would be completely unacceptable for us to break bread with the very same White House that is enabling the Israeli government to starve and slaughter the Palestinian people in Gaza,” Edward Ahmed Mitchell, the deputy director of the Council on American-Islamic Relations, told Al Jazeera.

On Monday, CNN reported that the White House would be hosting a scaled-back iftar dinner the next day, but hours later, the White House announced that there would only be a smaller meal for Muslim government staffers, with a separate meeting for Muslim community leaders.

Even that meeting with the president didn’t go as planned, when a Palestinian American doctor walked out in protest.

“I said it was disappointing I’m the only Palestinian here, and out of respect for my community, I’m going to leave,” Dr. Thaer Ahmad, an emergency physician from Chicago who traveled to Gaza earlier this year, told CNN. That meeting also included national security adviser Jake Sullivan and Vice President Kamala Harris, as well as other administration officials.

The cancellation comes on the heels of better than expected results for a protest vote in Wisconsin’s Democratic presidential primary elections Tuesday. Voters who selected an “uninstructed” option on their ballot instead of voting for Biden or Representative Dean Phillips (who has suspended his campaign) currently make up 8 percent of the results, or just over 48,000 votes, exceeding organizers’ goal of at least 20,000 votes, which was Biden’s margin of victory over Donald Trump in 2020.

Wisconsin’s results follow similar efforts in states across the country, which began with Michigan’s “uncommitted” movement, spearheaded by the state’s Arab and Muslim American communities. The results on Super Tuesday in March shattered expectations in the swing state, also exceeding Biden’s 2020 margin of victory.

Biden’s support from the Muslim community has sharply declined since the start of the Israeli offensive against Palestinians in Gaza in October. Since then, his disaffected Muslim supporters have demanded he call for a cease-fire in the war before they agree to support his 2024 campaign.

But recent news of Israel’s bombing of an aid convoy in the territory, as well as fresh U.S. shipments of fighter jets and bombs to Israel are not likely to help matters. As Michael Tomasky wrote for The New Republic in February, the president needs to change his Israel policy, and fast.

Manhattan District Attorney Alvin Bragg has two words for Donald Trump’s latest attempt to throw out his New York hush-money trial: no way.

In March, the former reality TV host and his legal team filed a formal request to adjourn his hush-money trial on the basis of too much “pretrial publicity,” arguing that the nature of his charges were too widely known in New York, making it impossible for him to get a fair trial.

But in a Wednesday legal filing, Bragg argued that Trump’s language, which admits the pretrial publicity will never end, reflects his true intentions: to keep the trial at bay indefinitely.

“Defendant appears to acknowledge that there is no end in sight to public coverage of this criminal proceeding, laying bare his strategy of obtaining an open-ended delay of the trial,” Bragg wrote in a 38-page memo. “The answer to defendant’s complaint about pretrial publicity is thus to hold this trial sooner rather than later.”

Bragg also argued that Trump’s insistence on the jury’s inherent bias was undercut by several legal precedents.

“Defendant’s request for an adjournment is based on the fundamentally flawed premise that any amount of pretrial publicity irreparably taints the jury pool,” Bragg continued. “That argument flouts bedrock law that expressly holds otherwise. Pretrial publicity, even when pervasive and adverse, ‘does not inevitably lead to an unfair trial.’”

If anything, Trump could get a fair trial despite all the publicity—as shown in a study commissioned by Trump’s own lawyers, which found that 67 percent of Manhattan’s denizens said they could “definitely” or “probably” set aside their opinion of Trump to give him a fair shake.

And, besides all that, it’s not just the press drawing attention to the first criminal trial of a former president, but Trump himself too. He has incessantly complained about the proceedings at his rallies and on his social media platform, Truth Social. Bragg argued it would be “perverse to reward” Trump with an “adjournment based on media attention he is actively seeking,” pointing to motions filed by Trump’s legal team attempting to protect his right to keep posting online about it.

“Moreover, defendant has made clear that he intends to continue stoking such publicity. In opposition to the People’s motion for an order restricting defendant’s extrajudicial statements, defendant insisted on preserving his ‘uncensored voice on all issues that relate to this case’ and his entitlement to make ‘unfettered’ comments about this case,” Bragg wrote.