President Donald Trump’s charitable foundation has persistently broken state and federal laws with improper political activity, self-dealing and failing to follow basic fiduciary obligations, New York said in a lawsuit seeking to dissolve the organization.
State Attorney General Barbara Underwood on Thursday sued the Donald J. Trump Foundation, Trump, his daughter Ivanka and his sons Donald Jr. and Eric, seeking a court order forcing its dissolution and blocking board members from serving on any not-for-profit organization authorized by New York law.
The lawsuit deepens the legal woes of the president, adding to U.S. Special Counsel Robert Mueller’s investigation of his campaign, a federal investigation in New York of his longtime lawyer Michael Cohen, and civil suits related to hush-money deals signed on his behalf.
The president fired back on Twitter shortly after news of the lawsuit broke.
“The sleazy New York Democrats, and their now disgraced (and run out of town) A.G. Eric Schneiderman, are doing everything they can to sue me on a foundation that took in $18.800,000 and gave out to charity more money than it took in, $19,200,000,” Trump wrote. “I won’t settle this case!”
Underwood said her office began probing the foundation in June 2016, when Schneiderman was still attorney general, and found that it operated without any oversight by a functioning board of directors. Decisions were made without "adequate consideration" and assets were misused to pay off legal obligations, promote Trump hotels, buy personal items and support Trump’s campaign, according to the suit.
"The foundation was little more than a checkbook for payments to not-for-profits from Mr. Trump or the Trump Organization," Underwood said in a 41-page complaint filed in New York state court in Manhattan.
Underwood is also seeking restitution of the $2.8 million she says was paid to the presidential campaign and penalties. Underwood said she has sent letters to the Internal Revenue Service and Federal Election Commission for further investigation. She’s seeking to ban Trump from serving as a director of a New York not-for-profit for 10 years. She’s also seeking a one-year ban for each of his three children that serve as board members.
The foundation has no employees, delegated its operations to a management company that provides back-office services to the entities that make up the Trump Organization, and Trump ran the charity "according to his whim, rather than the law," according to the suit.
“This is politics at its worst,” the foundation said in a statement. “This is unconscionable -- particularly because the foundation previously announced its intention to dissolve more than a year and a half ago.”