D.C. lawsuit claims inaugural committee spending enriched Trump family

WASHINGTON >> Donald Trump’s inaugural committee spent more than $1 million to book a ballroom at the Trump International Hotel in the nation’s capital as part of a scheme to “grossly overpay” for party space and enrich the president’s own family in the process, according to a lawsuit filed Wednesday.

The District of Columbia’s attorney general, Karl Racine, said the committee misused nonprofit funds and coordinated with the hotel’s management and members of the Trump family to arrange the events. He said one of the event’s planners raised concerns about pricing with Trump, the president’s daughter Ivanka Trump and Rick Gates, a top campaign official at the time.

“District law requires nonprofits to use their funds for their stated public purpose, not to benefit private individuals or companies,” Racine said. “In this case, we are seeking to recover the nonprofit funds that were improperly funneled directly to the Trump family business.”

It was the latest allegation that Trump and his family have used public and nonprofit funds spent at Trump-owned properties to enrich themselves — part of the peril of Trump not fully withdrawing from his businesses while he is president. Trump has maintained ownership but turned the reins over to his adult sons, who have bristled at the charge that they are profiting off their father’s presidency.

The committee has maintained that its finances were independently audited, and that all money was spent in accordance with the law. The committee raised an unprecedented $107 million to host events celebrating Trump’s inauguration in January 2017. But the committee’s spending has drawn mounting scrutiny.

The inaugural committee said Wednesday that it cooperated with the investigation and that Racine’s office hadn’t contacted its lawyers to interview any employees. A spokesman for the committee also said the group had not been contacted by the attorney general’s office since last summer and suggested the timing of the suit was politically motivated, as the Senate impeachment trial of the president on charges of abuse of power and obstruction of Congress was underway.

“The facts will show that the PIC operated in compliance with the law and this suit is without merit. In fact, it reads more like a partisan press release than a legal filing,” according to a committee statement.

Prosecutors found that Gates, a former Trump campaign aide who flipped on the president during the special counsel’s Russia investigation, personally managed discussions with the hotel about using the space, including ballrooms and meeting rooms.

In one instance, Gates contacted Ivanka Trump and told her that he was “a bit worried about the optics” of the committee paying such a high fee, Racine said.

Stephanie Winston Wolkoff, a former adviser to first lady Melania Trump who played a leading role organizing the inaugural parties, had also told Trump, when he was president-elect, and Ivanka Trump that she was uneasy with the offer, Racine said. Winston Wolkoff later followed up with an email to Gates and Ivanka Trump warning that the hotel’s proposal was at least twice the market rate, Racine said.

But Gates went through with it anyway, at a cost of $1.03 million, the suit says.