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

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.