Trump Foundation: New York AG Found Persistent Illegal Conduct, Ordered Dissolution
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The New York AG's investigation found: Trump used foundation funds to settle legal obligations of his businesses (including a $100,000 payment from the foundation to settle a lawsuit against Mar-a-Lago), purchased items for personal use (including a $10,000 portrait of himself and a $12,000 signed Tim Tebow helmet), directed foundation funds to charities at political events in exchange for applause in possible violation of campaign finance law, and improperly used the foundation to pay a $25,000 contribution to a political organization supporting Florida Attorney General Pam Bondi — who subsequently declined to investigate Trump University fraud claims. Trump did not have meaningful control over the foundation, which was run largely by his children without proper board oversight.
Overview
The New York Attorney General found the Trump Foundation was used as a personal checkbook: to pay legal settlements for Trump's businesses, to buy portraits of Trump for display at his properties, and to make political contributions that benefited Trump's campaign. A court ordered Trump to pay $2 million in damages and the foundation was dissolved under judicial supervision.
The Self-Dealing
The rules governing charitable foundations exist because donations are tax-exempt on the premise they go to public benefit, not to benefit the foundation's principals. The Trump Foundation violated this in documented, specific ways.
A $100,000 foundation check settled a lawsuit against Mar-a-Lago over a flagpole ordinance — paying a legal obligation of Trump's business. A $10,000 foundation check bought a portrait of Trump that ended up displayed at one of his golf clubs. A $12,000 foundation check bought a signed Tim Tebow football helmet. These were not charitable expenditures.
The Political Use
The most significant violation was using the foundation for campaign activities. During the 2016 Iowa caucus period, Trump held a veterans fundraiser instead of attending a Fox News debate. The event raised pledges. Trump directed where the money went — and received political credit for doing so. The New York AG found this may have violated rules against charitable organizations engaging in campaign activities.
The Bondi Contribution
In 2013, the foundation contributed $25,000 to a political committee supporting Florida Attorney General Pam Bondi's re-election. Political contributions are prohibited for charitable foundations. Trump paid an IRS fine. Bondi's office had been reviewing whether to investigate Trump University fraud claims. It declined to proceed.
The sequence — contribution, continued in office, non-investigation — raised pay-to-play questions that the IRS fine did not resolve.
The Resolution
The foundation was dissolved under judicial supervision. Trump paid $2 million in damages. His three eldest children were required to complete training on nonprofit governance obligations. The court found that Trump had violated his legal duties as the foundation's head.
Timeline
Sequence of events
January 1, 1987
Trump Foundation established
The Donald J. Trump Foundation is established as a charitable organization in New York. It is intended to serve as a vehicle for Trump's philanthropic activities. Over subsequent decades, it receives donations from outside entities and is used in ways the New York AG will later find violate charitable law.
September 1, 2013
Foundation donates $25,000 to Bondi re-election PAC
The Trump Foundation makes a $25,000 contribution to a political committee supporting Florida Attorney General Pam Bondi's re-election, in violation of rules against political contributions by charitable foundations. Trump pays a $2,500 IRS fine. Bondi's office subsequently declines to investigate Trump University fraud claims.
January 28, 2016
Iowa veterans fundraiser — foundation donations used for political benefit
Trump holds a fundraiser for veterans instead of attending a Fox News debate. The event raises $5.6 million in pledges. The New York AG later finds that Trump personally directed foundation donations at the event and received political credit, raising potential campaign finance violations.
June 14, 2018
New York AG files lawsuit against Trump and children — dissolution sought
New York AG Barbara Underwood files a lawsuit against Trump, Ivanka Trump, Donald Trump Jr., and Eric Trump for misuse of charitable assets, self-dealing, and using the foundation for political purposes. The AG seeks dissolution of the foundation and $2.8 million in damages.
December 18, 2018
Trump agrees to dissolve foundation under judicial supervision — $2 million in damages
Trump agrees to dissolve the Donald J. Trump Foundation under judicial supervision. He agrees to pay $2 million in damages to eight charities. The AG retains oversight of the dissolution. Trump's children continue to face individual claims in a separate proceeding.
November 7, 2019
Trump pays $2 million in court-ordered damages — children complete nonprofit training
A New York judge orders Trump to pay $2 million in damages, finding that he had misused the foundation for personal and political purposes. Trump's three eldest children are required to complete training on the obligations of nonprofit board members.
Sources
- ↑ Trump Agrees to Dissolve His Charitable Foundation Under Judicial Supervision — The New York Times
- ↑ Trump to dissolve foundation after charity found to be used for personal, political purposes — The Washington Post
- ↑ NY AG: Trump foundation used as 'personal checkbook' for Trump — The Associated Press
- ↑ Petition: In the Matter of the Donald J. Trump Foundation — New York Attorney General
Verification