For 'Persistently Illegal Conduct,' New York AG's Lawsuit Demands Trump Foundation Be Shuttered

A two-year investigation into President Donald Trump's charity by New York State culminated on Thursday in a lawsuit alleging "persistently illegal conduct" including violations of campaign finance laws and tax regulations, and illegal coordination with Trump's 2016 campaign to benefit his presidential run.

"As our investigation reveals, the Trump Foundation was little more than a checkbook for payments from Mr. Trump or his businesses to nonprofits, regardless of their purpose or legality," Barbara D. Underwood, New York's attorney general, wrote. "This is not how private foundations should function and my office intends to hold the foundation accountable for its misuse of charitable assets."

Underwood accused the Trump family of using the foundation's funds to settle claims against Trump's real estate empire and purchase a $10,000 portrait of Trump, as well as funneling money to the 2016 campaign.

In addition to filing the lawsuit—which demands that the Trump Foundation be dissolved and that Trump and his children Eric, Donald Jr., and Ivanka be barred from leading nonprofits in New York; and seeks $2.8 million in damages—Underwood sent referrals to the IRS and the Federal Election Commission {FEC) for potential further legal action against Trump.

The purchase of the portrait for one of Trump's golf clubs constituted a "self-dealing transaction," according to the attorney general, and violated tax laws.

The investigation also revealed coordination between the Trump campaign and the foundation regarding funds raised for the campaign. Although charitable organizations are "prohibited from participating or intervening in any political campaign on behalf of a candidate," according to Underwood's lawsuit, the Trump Foundation raised $2.8 million for the campaign in early 2016.

Trump campaign staffers—including former campaign manager Corey Lewandowski—then took control of the funds, dictating "the manner in which the foundation would disburse those proceeds, directing the timing, amounts and recipients of the grants."

"Mr. Trump's wrongful use of the foundation to benefit his campaign was willful and knowing," concluded Underwood.