“Follow the money” became the credo of investigative journalists and other snoops for a reason. While it can be laundered or otherwise hidden, money generally leaves a trail, even if it is sometimes tangled or incomplete.
But with the Donald J. Trump Foundation, according to a lawsuit filed last week by the New York State Attorney General’s Office, hundreds of thousands of dollars seemingly traveled in a simple circle. Money from the foundation, which by definition is for charitable donations, paid for settlements of legal claims against Mr. Trump’s businesses and a portrait of Mr. Trump that graced a wall at one of his golf clubs, according to the A.G.’s office.
In other words, his book might better be titled “The Art of the Self-Deal.”
In addition to self-dealing, the A.G.’s lawsuit accuses Mr. Trump and his three oldest children of violating campaign laws — foundation funds were allegedly disbursed in coordination with the presidential campaign, despite laws prohibiting their use in political activities. The office has referred its findings to the Internal Revenue Service and Federal Election Commission, which may opt to take action of their own.
Mr. Trump has denied the allegations. But the lawsuit joins other cases swirling around the president and his rather curious money-managing ways. There is the “this crazy Stormy Daniels deal,” as Mr. Trump has called a $130,000 payment to keep the adult film star and director quiet about an alleged affair with him. That payment went through a shell company created by his lawyer and fixer, Michael Cohen, as part of a deal signed right before the 2016 election — raising questions of whether it violated campaign laws that limit contribution amounts and require disclosure of expenditures.
And there is the emoluments suit filed by Maryland Attorney General Brian Frosh and his counterpart in Washington, D.C., arguing that the profits Mr. Trump makes from his hotel less than a mile from the White House, popular with visiting foreign dignitaries, violates the constitutional ban on officeholders receiving benefits from other governments. That hotel, of course, is but one of the president’s many-tentacled business interests, in which he maintains ownership stakes but which he has said are now managed by his two oldest sons.
Whether Mr. Trump can fully sever his duties as president from his interests in a business that is essentially based on his persona may well be impossible. As with so much involving his presidency, however, the question is: What is anyone going to do about it?
Still, the Trump Foundation is another matter. It cannot be that difficult to keep your do-gooder dollars separate from those you use for your private business. Perhaps, in the most generous possible explanation, you might imagine someone in accounts payable mixing up the checkbooks and, whoops, the money you were going to give to the local hospital or high school band somehow went to paying a $158,000 legal settlement with a golfer who sued saying he didn’t get the $1 million promised for making a hole-in-one at a tournament at Trump National Golf Club. Even that scenario, though, leads to questions of why the foundation’s board did not pick up on such a strange charitable grant. The A.G. suit has a possible explanation: Three of Mr. Trump’s children, Don Jr., Eric and Ivanka, were members of the board — which hadn’t met since 1999.
The number of foundations and their donations have been growing in recent years, and many are widely admired for their work— from the Bill and Melinda Gates Foundation’s global health initiatives to the Bloomberg Philanthropies’ government innovation efforts, which Baltimore has gratefully accepted. In 2014, the most recent year for which figures were available, the U.S. was home to more than 86,700 foundations with assets exceeding $865 billion, and they gave out more than $60 billion, according to the Foundation Center, a nonprofit that gathers and analyzes data on philanthropy.
But with that growth, some fear that because these are private, often family-based groups, there is inadequate scrutiny. Often, as with the Trump Foundation, family members serve on their boards, which may not be as independent as directors of public charities.
The Urban Institute’s Center on Nonprofits and Philanthropy concluded in a recent report that compared to the amount of money that flows through charitable organizations, the level of oversight they receive is slight. With the responsibility of monitoring them often spread through multiple state agencies, problems may go undetected or fall through the cracks, the center found, and only a fourth of state attorney general offices even have a dedicated charities bureau that regulates them.
Unfortunately for the Trump family, New York is one of them.
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