The New York attorney general filed a scathing lawsuit against the Trump Foundation on Thursday, alleging a pattern of “illegal conduct” that included “repeated and willful self-dealing transactions.”
Barbara Underwood, who became New York’s attorney general last month after Eric Schneiderman resigned in disgrace, described the Trump Foundation as “little more than a checkbook” that Trump dipped into freely to promote his business and his 2016 presidential campaign.
The suit alleges a number of eye-popping things: that then-campaign manager Corey Lewandowski helped direct the donations to veterans from the Trump Foundation, in an apparent attempt to promote Trump’s candidacy; that there were improper campaign contributions to Florida Attorney General Pam Bondi; that the foundation’s board of directors had not formally met since 1999; and that, of course, the Trump Foundation promoted Trump properties.
Underwood is suing to completely dissolve the Trump Foundation. She is also asking the court to bar Trump from serving on New York nonprofit organizations for 10 years, and called for a one-year ban for his three children — Don Jr., Ivanka, and Eric. The attorney general’s office is also seeking $2.8 million in restitution, plus additional penalties, and has sent referrals to the IRS and the Federal Election Commission about other possible violations of federal law.
Trump blasted the lawsuit on Twitter, calling it “ridiculous” and vowing not to settle. But this latest lawsuit adds to Trump’s mounting legal issues and likely won’t be disappearing anytime soon.
Here are some of the highlights.
1) Board members? What board members?
The lawsuit alleges that the Trump Foundation board “existed in name only,” abjectly failing to fulfill it responsibilities to oversee the charity. The board hadn’t met since 1999 — nearly two decades ago. This is even more bizarre because Don Jr., Ivanka, and Eric Trump all allegedly joined the board in 2006, according to the lawsuit.
In another instance, Allen Weisselberg, a Trump Organization employee and the person listed as the treasurer of the Trump Foundation, was unaware he was even a member of the board when an investigator questioned him, the Washington Post reported.
2) Trump blurred the line between the campaign and his foundation
The lawsuit alleges that in 2016, the foundation’s board “knowingly permitted the Foundation to be co-opted” by Trump’s presidential campaign, in violation of state and federal law.
In January 2016 — right before the Iowa caucus — Trump threw a fundraiser for veterans instead of attending an upcoming primary debate. The Iowa fundraiser raised $5.6 million, with about $2.8 million going directly to the Trump Foundation. (The rest went to directly from donors to veterans’ groups and bypassed the foundation.)
But it was Trump campaign staff that directed the $2.8 million that went to the foundation. Emails and other evidence showed Lewandowski dictating the timing and amount of donations to various groups ahead of the Iowa caucus and at other points during the campaign, with the goal of promoting Trump and his candidacy:
For example, in an email on January 29, 2016, Mr. Weisselberg wrote to Corey Lewandowski, then Mr. Trump’s campaign manager, to say “we should start thinking about how you want to distribute the funds collected for the Vets.” Mr. Lewandowski replied, “I think we should get the total collected and then put out a press release that we distributed the $$ to each of the groups.” Mr. Weisselberg then asked Mr. Lewandowski how much would be given to each group, and Mr. Lewandowski replied that “[n]ot all will be given equal amounts.”
A few minutes after this exchange, Mr. Lewandowski directed the Foundation to make grants in Iowa right before the February 1, 2016 Iowa caucuses, the first nominating contest of the 2016 presidential election cycle. Mr. Lewandowski, emailed Mr. Weisselberg to ask, “Is there any way we can make some disbursements [from the proceeds of the fundraiser] this week while in Iowa? Specifically on Saturday.”
The investigation also found that Trump himself blurred the lines between his charity and his campaign by distributing oversize checks (which had the slogan “Make America Great Again” on them) to groups at his campaign rallies before the Iowa caucus.
3) “Justice for All” received an improper political campaign contribution
The Trump Foundation also mixed political and the foundation in September 2013 when it contributed $25,000 to a political group called “Justice for All” supporting the reelection of Florida’s attorney general, Pam Bondi.
The foundation said on its 2013 tax forms that it did not contribute to a political organization or campaign, according to the lawsuit. But it did something a little strange:
Instead, it listed a $25,000 contribution to a Kansas-based Section 501(c)(3) organization with a similar name, Justice for All. Contrary to this disclosure, the Foundation never made a contribution to the Kansas-based Justice for All.
According to the lawsuit, the foundation said it was a mistake, but Underwood disagreed, saying it “had no credible explanation for the false reporting of grant recipients to the IRS and the State of New York.”
The Trump Foundation donation to Bondi had previously been reported, and Trump reimbursed the foundation for $25,000 in March 2016, along with a payment for a federal excise tax.
4) Trump used the foundation to pay for his lawsuits and other expenses
The lawsuit also alleges multiple instances where Trump used the foundation to pay off lawsuits or promote his businesses that were unrelated to his charity.
Trump used his foundation to settle a 2006 lawsuit with the town of Palm Beach against Mar-a-Lago. He agreed to pay $100,000 to the Fisher House Foundation and personally instructed his staff to make the payment through his foundation. Here’s the note, which Trump himself signed:
In March 2017, after the attorney general had already started its investigation, Trump reimbursed his foundation the $100,000 and paid an $8,000 fine.
5) The Trump Foundation just paid to promote Trump properties
A less serious — but perhaps more Trumpian detail in the lawsuit — is that the foundation paid $5,000 in 2013 to the DC Preservation League for its annual gala for an ad in the program. But instead of advertising the foundation, guess what the program advertised?
That’s right — the Trump hotel.
Andrew Prokop contributed reporting to this article.