Trump plan­ning to close his char­i­ta­ble foun­da­tion

The Denver Post - - FRONT PAGE - By Mark Ber­mand and David A. Fahren­thold

Pres­i­dent-elect Don­ald Trump said he plans to shut down his char­i­ta­ble foun­da­tion, a de­ci­sion that comes af­ter re­peated con­tro­ver­sies over how it col­lected and dis­bursed funds.

In a state­ment Satur­day, Trump of­fered no time­line for when his foun­da­tion would close, but he said he had di­rected his at­tor­ney to take the steps needed to close the char­ity. It was also not im­me­di­ately clear when the foun­da­tion would be able to dis­solve, given an on­go­ing in­ves­ti­ga­tion in New York.

“The Foun­da­tion has done enor­mous good works over the years in con­tribut­ing mil­lions of dol­lars to count­less wor­thy groups, in­clud­ing sup­port­ing veter­ans, law en­force­ment of­fi­cers and chil­dren,” Trump said in the state­ment. “How­ever, to avoid even the ap­pear­ance of any con­flict with my role as Pres­i­dent I have de­cided to con­tinue to pur­sue my strong in­ter­est in phi­lan­thropy in other ways.”

The Don­ald J. Trump Foun­da­tion has come un­der in­tense scru­tiny this year af­ter a se­ries of re­ports in The Wash­ing­ton Post de­tail­ing its prac­tices, in­clud­ing cases in which Trump ap­par­ently used the char­ity’s money to set­tle law­suits in­volv­ing his for-profit busi­nesses.

New York’s at­tor­ney gen­eral has been in­ves­ti­gat­ing the char­ity af-

ter some of these re­ports, and a spokes­woman for that of­fice said the foun­da­tion could not of­fi­cially shut down un­til that probe is over.

“The Trump Foun­da­tion is still un­der in­ves­ti­ga­tion by this of­fice and can­not legally dis­solve un­til that in­ves­ti­ga­tion is com­plete,” Amy Spi­tal­nick, the spokes­woman, said Satur­day in an e-mail.

The foun­da­tion is un­usual in that it largely col­lects and do­nates money from other peo­ple. In fact, from 2009 to 2014, Trump told the In­ter­nal Rev­enue Ser­vice that he had given his name­sake foun­da­tion no money at all. The big­gest donors in re­cent years were Vince and Linda McMa­hon, the pro-wrestling mag­nates, who gave the Trump Foun­da­tion $5 mil­lion be­tween 2007 and 2009. Trump re­cently nom­i­nated Linda McMa­hon to head the Small Busi­ness Ad­min­is­tra­tion.

Trump said Satur­day that he was “very proud of the fact that the Foun­da­tion has op­er­ated at es­sen­tially no cost for decades, with 100% of the money go­ing to char­ity.” The Trump Foun­da­tion has no paid em­ploy­ees and a board of five, con­sist­ing of Trump, three of his chil­dren and a long­time Trump Or­ga­ni­za­tion em­ployee. They all work a half-hour per week, ac­cord­ing to an IRS fil­ing.

The pres­i­dent-elect added that “be­cause I will be de­vot­ing so much time and en­ergy to the Pres­i­dency and solv­ing the many prob­lems fac­ing our coun­try and the world, I don’t want to al­low good work to be as­so­ci­ated with a pos­si­ble con­flict of in­ter­est.”

The foun­da­tion told the IRS that it had $1.16 mil­lion in to­tal as­sets by the end of 2015, the most re­cent tax fil­ing avail­able. A spokes­woman for Trump said she had no ad­di­tional in­for­ma­tion Satur­day re­gard­ing where any re­main­ing money might be sent.

Trump’s foun­da­tion has ad­mit­ted in IRS tax fil­ings for 2015 that it vi­o­lated a pro­hi­bi­tion against “self-deal­ing” that says non­profit lead­ers can­not use their char­ity’s funds to help them­selves, their rel­a­tives or their busi­nesses.

In these tax fil­ings, the char­ity checked “yes” in re­sponse to a ques­tion ask­ing whether it had trans­ferred any in­come or as­sets to “a dis­qual­i­fied per­son” — a de- scrip­tion that could have meant Trump, a rel­a­tive or a Trump-owned busi­ness.

Trump has not said what ex­actly he did to vi­o­late the rule, or what he has paid the IRS in penalty taxes as a re­sult. The IRS has not com­mented when asked whether it was in­ves­ti­gat­ing the Trump Foun­da­tion.

Trump’s char­ity has been pro­hib­ited from fundrais­ing by the of­fice of New York At­tor­ney Gen­eral Eric Sch­nei­der­man, an ac­tion that came af­ter The Post re­ported that the foun­da­tion had failed to reg­is­ter with the state. This meant the foun­da­tion had dodged an­nual au­dits re­quired in the state of New York.

Sch­nei­der­man’s of­fice is also in­ves­ti­gat­ing the Trump Foun­da­tion af­ter re­ports in The Post de­scrib­ing ap­par­ent cases of self-deal­ing that date back to 2007. The Trump Foun­da­tion spent $30,000 to buy two large por­traits of Trump him­self, in­clud­ing one that was hung in the sports bar at a Trumpowned re­sort. Trump also ap­pears to use $258,000 of his foun­da­tion’s money — legally ear­marked for char­i­ta­ble pur­poses — to set­tle law­suits in­volv­ing two of his for-profit clubs.

In ad­di­tion, the Trump Foun­da­tion gave a $25,000 gift to a cam­paign com­mit­tee back­ing Florida At­tor­ney Gen­eral Pam Bondi even though non­profit or­ga­ni­za­tions such as the char­ity are not al­lowed to give po­lit­i­cal gifts. That gift was made as Bondi’s of­fice was con­sid­er­ing whether to in­ves­ti­gate fraud al­le­ga­tions against Trump Uni­ver­sity. A con­sul­tant who worked on Bondi’s re­elec­tion ef­fort has said that Bondi was not aware of the com­plaints when she so­licited the do­na­tion from Trump. Ul­ti­mately, Bondi’s of­fice did not pur­sue those al­le­ga­tions.

The move to shut down Trump’s foun­da­tion, first re­ported Satur­day by the New York Times, comes as the pres­i­dent-elect and his fam­ily are fac­ing in­tense ques­tions re­gard­ing how they will avoid con­flicts of in­ter­est while he is in the White House.

“The an­nounce­ment that the Foun­da­tion will be shut down is a nec­es­sary first step for the in­com­ing ad­min­is­tra­tion to avoid mas­sive ethics prob­lems, but it does not come close to end­ing the story,” said Noah Book­binder, ex­ec­u­tive di­rec­tor of Cit­i­zens for Re­spon­si­bil­ity and Ethics in Wash­ing­ton, a watch­dog group aligned with al­lies of Demo­cratic pres­i­den­tial nom­i­nee Hil­lary Clin­ton. The group’s tips and re­search helped re­veal some of the Trump foun­da­tion’s ap­par­ent vi­o­la­tions of the law.

In a state­ment, Book­binder said the Trump char­ity’s “past in­stances of wrong­do­ing must be fully in­ves­ti­gated” and called on the pres­i­dent-elect to “sell his busi­nesses and take com­pre­hen­sive steps to pre­vent con­flicts of in­ter­est for him and his ad­min­is­tra­tion.”

Trump has said his two adult sons will run his com­pany, but he has not pro­vided de­tails about how he will ex­tri­cate him­self from his com­plex net­work of busi­nesses.

He post­poned a news con­fer­ence this month meant to ad­dress the is­sue and has not resched­uled it.

In an­other case of Trump ap­par­ently try­ing to wrap up lin­ger­ing ques­tions and le­gal is­sues be­fore he takes of­fice, he agreed to set­tle fraud claims against his de­funct Trump Uni­ver­sity real es­tate sem­i­nars.

A fed­eral judge Tues­day gave pre­lim­i­nary ap­proval to a deal in which Trump would pay $25 mil­lion as part of the set­tle­ment.

Last week, Trump’s el­dest son, Eric, said he was sus­pend­ing his char­i­ta­ble foun­da­tion af­ter fac­ing ques­tions about whether donors could re­ceive spe­cial ac­cess.

The Eric Trump Foun­da­tion, founded in 2007, raises more than $1.5 mil­lion a year through a golf tour­na­ment and other events, and it passes on the bulk of its money to St. Jude Chil­dren’s Re­search Hospi­tal, a pe­di­atric-cancer cen­ter in Memphis, Tenn.

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