A lawsuit filed Thursday against the Donald J. Trump Foundation, and its directors, alleges a persistent pattern of illegal conduct, occurring over more than a decade, that includes unlawful political coordination with the Trump presidential campaign, repeated and self-dealing transactions to benefit Trump’s personal and business interests, and violations of legal requirements for non-profit foundations.
New York Attorney General Barbara D. Underwood initiated a proceeding to dissolve the Trump Foundation under court supervision and obtain restitution of $2.8 million and additional penalties. The lawsuit also seeks to ban Trump from serving as a director of a New York not-for-profit for 10 years, with a one-year ban for the foundation’s other board members, Donald Trump Jr., Ivanka Trump, and Eric Trump.
Underwood also sent letters Thursday to the Internal Revenue Service and the Federal Election Commission identifying possible violations of federal law for further investigation and legal action.
Trump used the Trump Foundation’s assets to pay off his legal obligations, to promote Trump hotels and other businesses, and to purchase personal items, the lawsuit alleges. In addition, at Trump’s request, the Trump Foundation illegally provided support to his 2016 presidential campaign by using the Trump Foundation’s name and funds it raised to promote his campaign for the presidency, including in the days before the Iowa nominating caucuses.
“As our investigation reveals, the Trump Foundation was little more than a checkbook for payments from Mr. Trump or his businesses to nonprofits, regardless of their purpose or legality,” said Underwood. “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.”
The attorney general’s investigation found that the Trump Foundation raised more than $2.8 million to influence the 2016 presidential election at the direction of the leadership of the Trump presidential campaign. The foundation raised the funds from the public at the nationally televised fundraiser Trump held instead of taking part in the presidential primary debate in Des Moines, Iowa, on January 28, 2016.
In violation of state and federal law, senior Trump campaign staff, including Campaign Manager Corey Lewandowski, dictated the timing, amounts, and recipients of grants by the foundation to non-profits, as shown by communications between campaign staff and foundation representatives:
At least five $100,000 grants were made to groups in Iowa in the days just before the February 1, 2016, Iowa caucuses.
The Trump Foundation also entered into at least five transactions that were unlawful because they benefited Trump or businesses he controls. These include a $100,000 payment to settle legal claims against Trump’s Mar-A-Lago resort; a $158,000 payment to settle legal claims against his Trump National Golf Club in 2008 from a hole-in-one tournament; and a $10,000 payment at a charity auction to purchase a painting of Trump that was displayed at the Trump National Doral in Miami.
After the attorney general’s investigation began, the foundation paid excise taxes on three of the transactions and Trump restored funds for the transactions to the foundation, but the foundation hasn’t paid excise taxes on the Mar-A-Lago or Trump National Golf Club transactions.
None of the foundation’s expenditures or activities were approved by its board of directors, according to the lawsuit. The investigation found that the board existed in name only: it didn’t meet after 1999; it didn’t set policy or criteria for choosing grant recipients, and it didn’t approve of any grants. Trump alone made all decisions related to the foundation.
