We have been discussing the serious allegations against Donald Trump’s charitable foundation, which have been used in transactions that are linked to Trump’s businesses rather than charities. — which has been sustained for years by donors outside the Trump family — has never obtained the certification that New York requires before charities can solicit money from the public, according to the state attorney general’s office. Now, New York Attorney General Eric Schneiderman (D) has made the surprising allegation that the Donald J. Trump Foundation does not have the necessary registration and annual audit to operate as a large foundation. I have been critical of Schneiderman in his investigation of climate change skeptics. However, the failure to obtain this necessary registration and comply with basic auditing is quite surprising. Once again, I am unclear how any attorneys representing Trump could continue to maintain the charity without satisfying such basic legal requirements, particularly one (the auditing) designed to prevent the very type of intermingling of funds that been raised by critics.
Any charity that solicits more than $25,000 a year from the public must obtain this registration before raising money and submit to annual audits to assure that no money is used to benefit the officers through self-dealing. Schneiderman could move to enjoin the charity and even force the return of past money raised by Trump. What is known is that the Trump Foundation took in at least $1.67 million through Trump’s website. Trump has reportedly given at least $5.4 million between 1987 and 2006.
In Trump’s defense, two points should be raised. First, there is still a considerable amount of money given to charity from this foundation, even if you consider the couple of controversies that we discussed earlier. Second, for much of its history, Trump was the only donor. That would allow him to claim the minimal level of reporting and certification under Estates, Powers and Trusts Law. His attorneys did in fact file annual reports during that period in compliance with the law and there was likely no required independent audit.
The key period will be the last decade when the Foundation began to solicit donations from third parties. The gradual change may have blindsided Trump’s attorneys but it should not have. At some point, the charity had change to a major solicitor of charitable funds.
This is a serious matter because courts treat these requirements as straightforward and unrelenting standards. There is little room for interpretation. That would place the New York attorney general in a commanding position unless the certification and auditing allegations are proven false.