The Trump Foundation’s in trouble. Real trouble. The New York attorney general’s office has been after the foundation almost since the get-go, and that persistence has paid off: The Trump Foundation’s admitted defeat, and the Trumps have agreed to dissolve the “charity” under court supervision.
The AG’s judicial dissolution proceeding was filed Oct. 25 against the foundation, President Donald Trump, and his children. It’s 27 pages of devastating reading, at least from the Trump perspective. The AG is proceeding against the foundation and family members for breaches of fiduciary duty, improperly administering foundation assets, and “wrongful related party transactions.”
New York Supreme Court Justice Saliann Scarpulla ruled on Nov. 23 that the suit should be allowed to go forward. The foundation could have kept fighting the inevitable, but its illegal tendencies were impressive even by Trump standards.
Here’s one way to summarize it:
The parade of pecuniary peccadillos committed by the foundation reads like a bad SNL skit. You can almost imagine Alec Baldwin’s Trump attempting to explain how each expenditure was somehow justifiable under law.
That same year, Trump used the foundation for another even more overtly suspicious item.
The smallest [donation], a $7 foundation gift to the Boy Scouts that same year, appeared to benefit Trump’s family. It matched the amount required to enroll a boy in the Scouts the year that his son Donald Trump Jr. was 11.
The stipulation that the Trumps have signed binds them to dissolving the organization and directing whatever assets are left over to legitimate charities contingent on approval from the New York AG’s office—after the final dissolution order. That means the court will first adjudicate claims regarding an alleged $2.8 million in restitution owed by the foundation plus additional penalties for those myriad legal violations. Let’s just hope there will be cash left over for other charities.
The Trumps’ foundation-related troubles are far from over. In its order allowing the case to proceed, the court notes that the AG argues that the individual Trumps failed to ever hold a board meeting or take board minutes; didn’t review foundation assets, liabilities, revenues, and disbursements; and neglected to oversee the foundation and/or supervise accounting staff. Moreover, per the AG, the Trumps permitted non-foundation folks to distribute foundation assets. Most damning of all for the president, he solicited funds directly for the foundation then gave his presidential campaign control over those funds, which it then used to attempt to influence the election, according to the AG.
None of the Trumps’ defenses have stuck so far. Though the organization, and the individual Trumps behind it, argued that many of the AG’s claims should be barred by the statute of limitations, the court rejected that argument, at least for now. So, too, has Justice Scarpulla tossed out claims of animus and bias on the part of former attorney general Eric Schneiderman or the AG’s office.
For most intents and purposes, the AG’s already won. The significance of the stipulation is that, whatever happens with these other claims and specific allegations against the Trumps, the foundation will cease to exist following this litigation.