Donald Trump paid his $175 million court judgement in his New York fraud case with the assistance of the ‘king of subprime car loans’ after the billionaire investor made the approach himself.
‘I had heard that he was trying to put together the $460 million bond. I reached out at that time. We began to have a conversation. The bond got reduced,’ billionaire Don Hankey told DailyMail.com.
‘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?”‘
He was referencing a New York appeals court that lowered the amount and gave Trump 10 days to secure a bond, after his lawyers said in a filing it was nearly impossible to obtain underwriting.
Don Hankey, known as the ‘king of subprime car loans,’ reached out to Trump while the former president was seeking a bond to fight a court judgement against him. The billionaire Hankey’s firm provided a bond on Trump’f $175 million court judgment
‘It was much easier, because he put up all cash,’ he said. Hankey departed from an earlier report that said Trump provided collateral in cash and investment grade bonds.
‘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. We have a screen shot of it and it was all cash.’
Asked why Trump didn’t simply pay the award himself, he said the transaction allows Trump to collect interest if the $175 million is invested in a money market or other allowable investment vehicle while being held in a trust account pending appeal.
He said he said he didn’t have any concerns about lending to Trump, who declared bankruptcy over his Atlantic City casinos decades ago.
‘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,’ he said. ‘If you have real estate it can take months to liquidate the real asset.’
He said during initial conversations, he spoke with Trump intermediaries about using real estate as collateral – something he said he was willing to do.
‘I thought his credit was pretty good,’ said Hankey, a Trump donor and Trump supporter who says he didn’t know the former president personally.
‘That’s what we do. We do that in Los Angeles. We work a little bit outside the box,’ he said. He said he charged a ‘very nominal fee’ he would not disclose.
‘There’s not much risk that’s involved if he puts up the cash. It’s being held in trust for us,’ he said.
‘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,’ he said.
‘We reached out to somebody else and said we would do it. That word got back to him.’ He said he interacted with Trump Organization counsel Alan Garten and got a thank you call from Eric Trump when the bond was agreed to.
The outreach came after Trump’s lawyers argued he could not find an institution willing to back him when he was facing a larger $454 million judgement that an appeals court knocked down.
Forbes estimates Hankey’s net worth at $7.4 billion, an amount he does not dispute.
He runs an LA-based auto services empire called the Hankey Group, focusing on borrowers who have bad credit who still need to find a way to buy a ride.
The appeals court gave Trump 10 additional days last month to obtain a bond, something he was able to do on Tuesday while appealing the fraud judgment against him.
Knight Specialty Insurance Company, one of several divisions of the Hankey Group, provided the bond.
He fully acquired Midway Ford in 1972, then expanded into lending.
He says the firm ‘started carrying some of the paper that we couldn’t get a bank to carry. That was in the 1980s. We started out subprime only.’ Then he expanded to other borrowers – with 1.5 million customers around the country and about $15 billion in paper loans.
Hankey told Forbes on Monday that he reached out to Trump shortly before the appeals court acted.
Judge Arthur Engoron had issued an order requiring Trump to report on his efforts to obtain bond.
The bond relies on cash as collateral. Axos Bank, in which Hankey is a top non-institutional investor, loaned $100 million to refinance Trump Tower
Trump announced he had obtained the bond Monday while he appeals the court judgment in his New York fraud case
‘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,’ he told Forbes. ‘Yes, I voted for him in the past, but this is a business deal and this is what we do. I have never met Donald Trump, nor talked to him on the phone,’ said Hankey.
He gave $2,700 to Trump’s presidential campaign in 2016, along with a series of state parties and $32,400 to the Republican Party back in 2013. His wife has also donated to Trump.
Despite his fortune, Hankey does not have a large media presence.
Hankey is also one of the biggest non-institutional investors in Axos Bank, Bloomberg News reported. The bank loaned Trump $100 million to refinance Trump Tower and another $125 million to refinance his Doral golf course in Florida at a time the fraud trial was putting his assets under the microscope, according to disclosure reports.
Hankey told DailyMail.com he holds about 5 per cent of Axos, but had ‘nothing to do with’ the Trump Tower refinance. He was ‘not involved at all’ in the other loans to Doral.
He said he has been following Trump’s fraud trial but didn’t venture an opinion. ‘I don’t even think I should comment. This is what Knight Insurance does and we’re happy to issue bonds,’ he said. ‘It doesn’t matter if you’re Republican or Democrat, we’re happy to produce our services to people.’
Hanky had earlier said Trump was using cash and investment grade bonds as collateral.
That means he isn’t using his real estate assets, after claiming the court judgement would force him to unload property at ‘fire sale’ prices.
Hankey also backed another trophy property, this one on the West Coast – the Bel Air mega house known as the One. His credit on the property, which features 20 bedroom and 30 bathrooms, reached $100 million in 2022, with a nasty court fight in bankruptcy court over the 105,000 square foot property.
He says his firm got ‘most of our back’ including all of its principle.
The Hankey Group also includes arms including Westlake Financial Services, Midway Auto Group, and North Hollywood Toyota, where buyers can get ‘pre-qualified in seconds’ for such vehicles as a 2016 Prius or a 2020 Corolla.