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Trump Foundation: Charitable Fraud and Self-Dealing by the Trump Organization

The New York AG investigation found that the Trump Foundation was used as a checkbook for Trump's personal and business interests rather than charitable purposes: charitable funds settled legal disputes for Trump businesses, purchased a $10,000 portrait of Trump, made politically timed donations, and were illegally coordinated with the 2016 campaign. Trump was required to pay $2 million to legitimate charities as a penalty.

Record summary

Grade

Grade 2 of 5: Major Abuse of Power

Executive actions that exceed constitutional authority, circumvent statutory constraints, or weaponize government institutions for political ends. Scale and definitions

Status
Concluded
Incident date
Record updated
Location
New York, NY
Category
Corruption & Self-Dealing
Legal posture
Judicial finding
War-crime classification
Enabling conduct
Verification
Independently verified
ICC relevance
No
Sources
4 cited
Stable ID
trump-foundation-self-dealing
Victims
Donors to the Trump Foundation who believed their funds were being used for charitable purposes; charities deprived of funds used for self-dealing
Alleged responsible parties
  • Donald Trump, President of the Donald J. Trump Foundation— Donald J. Trump Foundation
  • Donald Trump Jr., Foundation board member— Donald J. Trump Foundation
  • Ivanka Trump, Foundation board member— Donald J. Trump Foundation

Key points

  • The Foundation used $258,000 in charitable funds to settle legal disputes benefiting Trump's for-profit businesses
  • The Foundation purchased a $10,000 portrait of Trump displayed at Trump's Doral golf resort and a $20,000 portrait displayed at a Trump property
  • Foundation funds were used to make a $25,000 donation to a political committee supporting the re-election of the Florida AG who was at the time considering whether to join a multistate investigation into Trump University
  • The Foundation had no paid staff and conducted no regular board meetings for years; Trump effectively used it as a pass-through for his own interests
  • The New York AG found illegal coordination between the Foundation and the Trump 2016 presidential campaign, using charitable funds for campaign activities
  • Trump paid $2 million in damages, distributed to legitimate charities, and agreed to ongoing restrictions on his involvement in nonprofits in New York

Overview

The Donald J. Trump Foundation was established in 1987 and dissolved by court order in December 2018. Over the course of the New York Attorney General's investigation, investigators found that it had been systematically used as a vehicle for self-dealing — using tax-exempt charitable donations to benefit Trump's personal and business interests rather than charitable causes.

Self-Dealing Violations

The most significant findings included:

Legal settlement payments: The Foundation paid $258,000 to settle legal disputes involving Trump's for-profit businesses — a clear violation of IRS rules prohibiting self-dealing by tax-exempt organizations. These included a $100,000 settlement with the town of Palm Beach (related to flagpole violations at Mar-a-Lago) and a $158,000 payment on behalf of a Trump-owned hotel in Briarcliff Manor, New York.

Portrait purchases: The Foundation purchased two portraits of Trump at charity auctions — a $10,000 portrait displayed at Trump's Doral golf resort in Florida and a $20,000 portrait also displayed at a Trump property. Using a charitable foundation to purchase items for the personal benefit or business use of the founder is self-dealing.

Political donation: The Foundation made a $25,000 donation to a political committee supporting Florida AG Pam Bondi's re-election campaign in 2013 — at a time when Bondi's office was considering whether to join a multistate investigation into Trump University. Bondi's office subsequently declined to participate in the investigation.

Illegal Campaign Coordination

The New York AG also found that the Foundation was illegally coordinated with the Trump 2016 presidential campaign — using charitable funds to organize and publicize campaign events framed as veteran fundraisers.

Penalty and Dissolution

Trump agreed to pay $2 million distributed to legitimate charities — a fraction of the $2.8 million the AG had sought. The Foundation was dissolved under court supervision. Trump acknowledged no wrongdoing. A New York court found that Trump had violated his fiduciary duty to the Foundation and the charities it was supposed to benefit.

Update log

  1. Updated with court order requiring $2 million in damages.

  2. Updated with court-ordered dissolution.

Sequence of events

  1. Washington Post reveals legal settlement payments

    The Washington Post reports that Trump used $258,000 from the Trump Foundation to settle legal disputes involving his for-profit businesses — a practice known as self-dealing that violates IRS rules for tax-exempt organizations.

  2. Portrait purchases revealed

    Investigation reveals the Foundation purchased a $10,000 portrait of Trump at a charity auction — displayed at a Trump golf club — and a $20,000 portrait purchased in 2014.

  3. New York AG sues Foundation

    New York AG Barbara Underwood files a lawsuit seeking dissolution of the Foundation, $2.8 million in restitution, and a ban on Trump serving as a director of any New York nonprofit for 10 years.

  4. Trump Foundation dissolved by court order

    The Donald J. Trump Foundation is dissolved under court supervision. Remaining assets — approximately $1.8 million — are distributed to legitimate charities chosen by the New York AG.

  5. Trump ordered to pay $2 million

    A New York court orders Trump to pay $2 million in damages to be distributed to eight legitimate charities: Army Emergency Relief, City Meals on Wheels, Give an Hour, Martha's Table, United Negro College Fund, United Way of National Capital Area, U.S. Holocaust Memorial Museum, and the United States Fund for UNICEF.

Sources

  1. AG Underwood Sues Donald J. Trump Foundation and Its Board of Directors — New York Attorney General
  2. New York A.G. Sues Trump Foundation, Alleging Persistent Illegal Conduct — The New York Times
  3. Attorney General James Announces Court-Ordered Dissolution of Trump Foundation — New York Attorney General
  4. Trump used $258,000 from his charity to settle legal problems — The Washington Post

How this record was published

Manually curated This entry was added directly and does not carry an automated audit trail.

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