Trump used $258,000 from his charity for legal settlements

[frigidmagi]

The Guardian

Donald Trump used $258,000 from his charitable foundation for legal settlements involving his Mar-a-Lago resort in Florida and a New York golf course, it was reported on Tuesday.

The Washington Post reported that in 2007, Trump used his foundation’s money when his Palm Beach, Florida, club was fined $120,000 by the town for having a flagpole that was almost twice the height allowed under local rules.

As part of a settlement, Trump donated $125,000 to veterans’ charities from the Trump Foundation, the paper reported. The foundation’s money comes mainly from other donors, not Trump himself.

The Post reported that in 2010, a golfer sued when he was denied a $1m prize for a hole-in-one in a charity tournament at Trump’s course outside New York City. A $158,000 settlement also came from Trump’s foundation.

Two weeks ago the Washington Post’s David Fahrenthold cast in doubt Trump’s philanthropy and raised questions about purchases he had made, apparently for himself, using money earmarked for charity.

Now Fahrenthold has uncovered what may be, if there is no unforeseen explanation here (the Trump camp has yet to comment), the biggest abuse yet by Trump of tax laws and the trust of donors to his foundation.

“Trump spent more than a quarter-million dollars from his charitable foundation to settle lawsuits that involved the billionaire’s for-profit businesses, according to interviews and a review of legal documents,” Fahrenthold reports:

Those cases, which together used $258,000 from Trump’s charity, were among four newly documented expenditures in which Trump may have violated laws against “self-dealing” – which prohibit nonprofit leaders from using charity money to benefit themselves or their businesses.

What’s the legal hazard here for Trump? The Post writes:

If the Internal Revenue Service were to find that Trump violated self-dealing rules, the agency could require him to pay penalty taxes or to reimburse the foundation for all the money it spent on his behalf. Trump is also facing scrutiny from the office of the New York attorney general, which is examining whether the foundation broke state charity laws ... More broadly, these cases also provide new evidence that Trump ran his charity in a way that may have violated U.S. tax law and gone against the moral conventions of philanthropy.

“I represent 700 nonprofits a year, and I’ve never encountered anything so brazen,” said Jeffrey Tenenbaum, who advises charities at the Venable law firm in Washington. After The Post described the details of these Trump Foundation gifts, Tenenbaum described them as “really shocking.”