Attorney General Barbara Underwood alleges a pattern of persistent illegal conduct over more than a decade that includes extensive unlawful political coordination with the Trump presidential campaign.
Underwood is asking a court to dissolve the Trump Foundation and wants $2.8 million in restitution plus additional penalties.
The attorney general seeks to ban Trump from serving as a director of a New York not-for-profit for 10 years and Trump’s children from serving for one year.
The complaint alleges that the Trump Foundation engaged in repeated and willful self-dealing transactions to benefit Trump’s personal and business interests.
“As our investigation reveals, the Trump Foundation was little more than a checkbook for payments from Mr. Trump or his business to nonprofits, regardless of their purpose or legality,” Underwood said. “This is not how private foundations should function, and my office intends to hold the Foundation and its directors accountable for its misuse of charitable assets.”
The investigation also found that the board existed in name only and did not meet after 1999. Additionally, Trump allegedly made all decisions related to the foundation.
“This is politics at its very worst,” a Trump Foundation representative said in a statement. “The Foundation has donated over $19 million to worthy charitable causes — more than it even received. The President himself — or through his companies – has contributed more than $8 million. The reason the Foundation was able to donate more than it took in is because it had little to no expenses. This is unheard of for a charitable foundation. The Foundation currently has $1.7 million remaining which the NYAG has been holding hostage for political gain. This is unconscionable — particularly because the Foundation previously announced its intention to dissolve more than a year and a half ago. The prior NYAG, who was recently forced to resign from office in disgrace, made it his stated mission to use this matter to not only advance his own political goals, but also for his own political fundraising. The acting NYAG’s recent statement that battling the White House is ‘the most important work (she) have ever done’ shows that such political attacks will continue unabated.”
The White House press office did not immediately respond to a request for comment from CNN. But the President tweeted about the suit.
“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. I won’t settle this case!” he said in one tweet.
“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,” he said in another tweet.
Eric Schneiderman resigned as New York attorney general in May after The New Yorker reported allegations of physical assault by multiple women.
Underwood told CNN she has the facts to back up her complaint.
“This is a straightforward case of violation of the laws governing charitable foundations and nonprofit corporations in New York,” she told CNN’s Christiane Amanpour.
She contends that the Trump Foundation used the tax-deductible donations in at least five instances that benefited Trump or businesses he controls.
These instances include a $100,000 payment to settle legal claims against his Mar-a-Lago resort in Florida; a $158,000 payment to settle legal claims against his Trump National Golf Club in 2008 from a hole-in-one tournament; and a $10,000 payment at a charity auction to purchase a painting of Trump that was displayed at the Trump National Doral in Miami.
Underwood said that after the investigation by her office began in 2016, the foundation paid excise taxes on three of the transactions, and Trump restored funds for the transactions to the foundation. But she added that the foundation has not paid excise taxes on the Mar-a-Lago or Trump National Golf Club transactions.
In addition to filing the complaint, Underwood sent letters to the Internal Revenue Service and the Federal Election Commission asking those agencies to investigate possible violations of federal law.
Neither agency provided a comment to CNN when asked about the letters.