Former President Donald Trump has reached a settlement with New York state lawyers over a $175 million bond that he posted to block a large civil fraud judgment while he pursues appeals. The bond was put up to prevent the state from seizing Trump's assets to satisfy the more than $454 million judgment that he owes after losing a court case brought by the Democratic attorney general. The attorney general alleged that Trump, his company, and key executives defrauded bankers and insurers by lying about his wealth.

The settlement was reached during a court hearing in Manhattan, where Trump's attorney, Christopher Kise, clashed with Judge Arthur Engoron over the terms of the bond. Engoron challenged Kise with hypothetical scenarios about the availability of the bond money, leading to a testy exchange between the two. However, a deal was struck that will keep the $175 million in a cash account that will gain interest but faces no downside risk. The account has already grown by over $700,000.

New York Attorney General Letitia James had filed a memorandum opposing the surety company that holds the bond, Knight Specialty Insurance, citing concerns about the company's financials and the collateral for the bond. The attorney general's office argued that the $175 million in cash that Trump provided as collateral was in a trust under his control, which could allow him to make withdrawals or replace the funds with other assets that could fluctuate in value.

Despite these concerns, the bond will stand, pending finalization of the agreement by Friday. Trump's attorneys assured the court that the money was paid in cash and placed in an interest-bearing account that cannot lose value. The attorneys for James expressed fears that the bond would not be secured if its value were to drop below $175 million.

The settlement comes as Trump faces a separate criminal trial in Manhattan, where he is accused of falsification of business records related to hush money payments made to an adult film star. Trump has denied all allegations in both cases and has entered a not guilty plea in the criminal matter. His attorneys have accused James and the Manhattan District Attorney of pursuing a politically motivated "witch hunt" against him.