Trump Sued For Using Charity as ‘Little More Than A Checkbook’
18 June 2018 at 5:09 pm
The New York attorney general is suing President Donald Trump’s charitable foundation along with its directors – the president, his sons Eric and Donald Jr. and daughter Ivanka – accusing them of “extensive and persistent” violations of state and federal charities law.
The lawsuit, announced by Barbara Underwood on Thursday, alleges a pattern of persistent illegal conduct, occurring over more than a decade.
It claims Trump used the foundation’s charitable assets to pay off his legal obligations, to promote Trump hotels and other businesses, to purchase personal items, and provide extensive support to his 2016 presidential campaign.
Meanwhile “directors failed to meet basic fiduciary duties”, with the foundation’s last recorded board meeting in 1999.
Underwood described the foundation as “little more than a checkbook for payments from Mr Trump or his businesses to nonprofits, regardless of their purpose or legality”.
“This is not how private foundations should function and my office intends to hold the foundation and its directors accountable for its misuse of charitable assets,” Underwood said.
The lawsuit seeks to dissolve the foundation under court supervision and obtain restitution of US$2.8 million (A$3.6 million) plus penalties.
It also seeks to ban Trump and other board members from serving on the board of any other New York not for profit for 10 years and one year respectively.
In addition to filing its dissolution petition, the Office of the Attorney General sent referral letters to the Federal Election Commission and the Internal Revenue Service, identifying possible violations of federal law for further investigation and legal action by those federal agencies.
It comes after the attorney general’s investigation, which dates back to 2016, found the Trump Foundation engaged in “repeated and willful self-dealing transactions to benefit Mr Trump’s personal and business interests.”
The suit said Trump repeatedly used tax-exempt money to cover business expenses, including covering the prize costs at a golf tournament, resolving fines against Trump’s Mar-A-Largo resort, and even paying US$10,000 (A$13,426) for a portrait of Trump hung at his Doral golf club.
It also found the Trump Foundation raised in excess of US$2.8 million (A$3.6 million) “in a manner designed to influence the 2016 presidential election” at the direction and under the control of senior leadership of the Trump presidential campaign.
The foundation raised the funds from the public at the nationally televised fundraiser Trump held in lieu of participating in the presidential primary debate in Des Moines, Iowa, in January 2016.
At least five US$100,000 (A$134,262) grants were made to groups in Iowa in the days immediately before the February 2016 Iowa caucuses.
According to the attorney general’s petition, none of the foundation’s expenditures or activities were approved by the board, which “existed in name only”.
The investigation found the board did not meet after 1999, did not set policy or criteria for choosing grant recipients, and did not approve of any grants. Trump alone made all decisions related to the foundation.
The sleazy New York Democrats, and their now disgraced (and run out of town) A.G. Eric Schneiderman, are doing everything they can to sue me on a foundation that took in $18,800,000 and gave out to charity more money than it took in, $19,200,000. I won’t settle this case!…
— Donald J. Trump (@realDonaldTrump) June 14, 2018
In response, Trump called the lawsuit “ridiculous”.
He took to Twitter to criticise the suit and Underwood’s predecessor Eric Schneiderman, who resigned as New York attorney general in May after The New Yorker reported allegations of physical assault by multiple women.
White House press secretary Sarah Sanders said the New York Attorney General’s Office was “outrageously biased”.
“The previous New York AG, who was forced to retire in disgrace, made a stated mission to use this matter to advance his own political gain and the current acting New York AG has stated that battling the White House is the most important job she’s ever done. That sounds outrageously biased and certainly problematic and very concerning,” Sanders said.