New York鈥檚 attorney general filed a lawsuit Thursday accusing Donald Trump of illegally using money from his charitable foundation to settle disputes involving his business empire and to burnish his image during his run for the White House.
The president blasted the case as politically motivated. The lawsuit seeks $2.8 million in restitution and the dissolution of the foundation.
The two-year investigation detailed a closely co-ordinated effort between Trump鈥檚 campaign and the foundation to promote his political career by giving out big grants of other鈥檚 people money to veterans organizations during the run-up to the Iowa caucuses, the first presidential nominating contest of 2016, the suit says.
鈥淭he foundation鈥檚 grants made Mr. Trump and the campaign look charitable and increased the candidate鈥檚 profile to Republican primary voters and among important constituent groups,鈥� Democratic Attorney General Barbara Underwood鈥檚 lawsuit said.
It accused the foundation of 鈥渋mproper and extensive political activity, repeated and wilful self-dealing transactions, and failure to follow basic fiduciary obligations.鈥�
In a couple of tweets, Trump called the case 鈥渞idiculous.鈥�
鈥淚 won鈥檛 settle this case!鈥� he wrote.
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The 31-year-old foundation said that it has given more than $19 million to charitable causes while keeping expenses minimal, and that Trump and his companies have contributed more than $8 million.
It already announced its intention to dissolve more than a year ago, the charity added in a statement.
鈥淭his is politics at its very worst,鈥� the statement said, noting that the former New York attorney general who began the investigation, Democrat Eric Schneiderman, was a vocal Trump opponent.
Schneiderman resigned last month after he was accused of physically abusing women he dated; he denied the allegations. Trump鈥檚 tweets also pointed to Schneiderman鈥檚 resignation.
....Schneiderman, who ran the Clinton campaign in New York, never had the guts to bring this ridiculous case, which lingered in their office for almost 2 years. Now he resigned his office in disgrace, and his disciples brought it when we would not settle.
鈥� Donald J. Trump (@realDonaldTrump)
Schneiderman started investigating the charity and ordered it to stop fundraising in New York in 2016, after The Washington Post reported that the foundation鈥檚 spending personally benefited the presidential candidate.
Some of those expenditures, uncovered by The Post, were cited in the lawsuit, including a $100,000 payment to settle legal claims against Trump鈥檚 Mar-a-Lago resort in Palm Beach, Florida; $158,000 to resolve a suit over a prize for a hole-in-one contest at Trump National Golf Club in Briarcliff Manor, New York; and $10,000 to buy a 6-foot (1.8-meter) portrait of Trump at a charity auction.
After New York鈥檚 attorney general began investigating, Trump鈥檚 business empire reimbursed the foundation for the money spent to settle the business disputes. And the painting, which was hanging at a Trump golf club in the Miami area, was returned to the foundation.
Underwood, a career government lawyer who was appointed after Schneiderman鈥檚 resignation and has said she doesn鈥檛 intend to run for election, said she has referred her findings to the IRS and the Federal Election Commission for possible further action.
In exchange for their tax-exempt status, charities are required to follow certain rules, among them a strict prohibition against getting involved in political campaigns.
The Trump Foundation鈥檚 mission says its funds are to be used 鈥渆xclusively for charitable, religious, scientific, literary or educational purposes,鈥� either directly or through other organizations, according to the lawsuit.
In keeping with federal tax rules, the charity鈥檚 incorporation documents say none of its resources can directly or indirectly go to the benefit its directors or officers and none of its activities can benefit any political candidate or campaign.
Trump鈥檚 foundation was 鈥渃o-opted鈥� by his presidential campaign, particularly in the run-up to the Iowa caucuses, the lawsuit says.
Spurning a Republican candidates鈥� debate on Jan. 28, 2016 鈥� four days before the caucuses 鈥� Trump instead participated in a televised rally and fundraiser for veterans organizations.
The event raised approximately $5.6 million, about $2.8 million of which went to the Trump Foundation; the rest was given directly by donors to veterans groups, the lawsuit says.
Then the foundation 鈥渃eded control鈥� over the money to campaign staff members, the suit says.
鈥淚s there any way we can make some disbursements this week while in Iowa?鈥� then-campaign manager Corey Lewandowski wrote in an email to the chief financial officer of Trump鈥檚 business, the Trump Organization.
Lewandowski did not immediately respond to a request for comment Wednesday.
The foundation went on to make five grants of $100,000 before the caucuses, with Trump presenting giant checks at a series of campaign rallies, to applause and praise from such figures as Jerry Falwell Jr., the president of Liberty University and son of the late Rev. Jerry Falwell, who was a force in GOP politics.
鈥淗ow often do you see a presidential candidate giving money away instead of taking it?鈥� the younger Falwell told the crowd at a Trump rally.
The oversized checks bore Trump鈥檚 鈥淢ake America Great Again鈥� campaign slogan along with the foundation鈥檚 address.
Trump didn鈥檛 give any money personally at the time, but several months later, after media pressure, followed through on a pledge to donate $1 million.
Underwood鈥檚 suit was filed the same day the Justice Department鈥檚 inspector general was due to release a report on former FBI Director James Comey鈥檚 handling of the Hillary Clinton email investigation.
The Associated Press
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