The New York Attorney General has taken the action against the Trump Foundation, seeking to dissolve the charity and claim US$2.8 million in restitution.

By Daniel Herborn

Posted on June 15, 2018

On 14 June 2018 the New York State Attorney General’s office filed the lawsuit with the State Supreme Court in Manhattan.

The lawsuit is the culmination of a two-year investigation into Trump’s charity. It seeks to dissolve the organisation and names Donald Trump, the foundation, and three of his children Donald Jr, Eric and Ivanka as defendants.

In addition to monetary restitution, it seeks orders prohibiting Donald Trump from serving on the board of any non-profit organisation authorised by the state of New York for 10 years and Donald Jr, Eric and Ivanka for one year.

Trump took to Twitter to respond with typical fury, blaming “sleazy New York Democrats,”
who are “doing everything they can to sue me”. He added he would not be settling the case.

The Attorney General Barbara Underwood also referred the matter to the Internal Revenue Service (IRS) and the Federal Election Commission for possible further action.

What has the Trump Foundation been accused of?

In a statement, Attorney General Barbara Underwood said: “As our investigation reveals, the Trump Foundation was little more than a chequebook for payments from Mr Trump or his businesses to non-profits, 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.”

The petition alleges that there were at least five instances of self-dealing that were illegal as they benefitted Trump or businesses under his control. These included a US$100,000 payment to settle a legal claim against Trump’s Mar-a-Lago resort and a US$158,000 settlement relating to his Trump National Golf Club’s hole-in-one tournament. On another occasion, the Foundation allegedly used US$10,000 earmarked for charitable purposes to purchase a portrait of Trump for one of his golf courses.

Such foundations are forbidden from engaging in political activities though it is alleged the Trump Foundation provided “extensive support” to his presidential campaign. The lawsuit states campaign director Corey Lewandowski illegally “dictated the timing, amounts and recipients of grants by the Foundation to non-profits”. This included awarding five grants of at least US$100,000 to various groups in Iowa just days before the 2016 presidential caucuses there.

As far back as late 2016, Donald Trump had promised to shut down the Foundation although this move was shelved when Underwood’s predecessor Eric Schneiderman said it could not wind up while it was being investigated. It also made a previous admission of self-dealing to the IRS in 2016.

This lawsuit is just the latest of Trump’s legal woes. He is still being investigated by Special Counsel Robert Mueller for possible Russian collusion in the 2016 presidential election.

Additionally, Summer Zervos, a former contestant on the TV show The Apprentice is suing Trump for defamation for comments he made ridiculing her sexual assault allegations against him. In that case, his lawyers argued that a sitting president could not be sued in a state court.