Earlier this week, news broke that Donald Trump had lined his own pockets with money intended to help kids fight cancer. Specifically, Forbes magazine revealed in 2011 that Trump’s foundation donated $100,000 to the foundation operated by his second son, Eric. That money was originally supposed to help St. Jude Children’s Research Hospital, but somehow made its way back to the coffers of the Trump Organization. Forbes also revealed that the Eric Trump Foundation made some $1.2 million in payments that went to the Trump Foundation–and the money trail appeared to stop there.
That development passed mostly with a yawn. But one person is very interested–New York state attorney general Eric Schneiderman. He announced on Friday that he is taking a close look at the allegations raised in the Forbes report.
A spokesman for Schneiderman’s office said that Schneiderman was “looking into issues raised” by Dan Alexander’s bombshell story. A number of experts on nonprofit law think that Schneiderman will have a lot to keep him busy. The direct funneling of $100,000 from the Eric Trump Foundation to the Trump Organization, for instance, would violate longstanding regulations that forbid leaders of private foundations from using charity money to benefit their for-profit businesses. Marcus Owens, the former head of the IRS’ nonprofit division, believes that this is a case of both foundations working together in a manner that caused “assets to be used for non-charitable purposes.”
But there are other red flags at Eric’s foundation as well. Among them are the fees Eric paid his father for using the Trump Westchester County golf course for his foundation’s celebrity golf tournament. From 2011 to 2015, the Eric Trump Foundation paid over $995,000 in fees to the Trump Organization for using the Westchester course, including over $320,000 in 2015. According to most experts on charity golf, those payments go well beyond what make sense for a one-day golf tournament.
Even without that to consider, Eric Trump led his donors to believe that he didn’t pay a penny to use the course. But his foundation’s tax filings show that he was lying. According to Ian Gillule, a longtime employee at the course, Eric paid up after his father blew his top at the lack of a paper trail. According to Harvey Dale, a law professor at New York University, if Eric made these statements while knowing he was actually paying for the course, “that could be simple charity fraud.”
Sean Delany, the former head of the charities bureau at the New York state attorney general’s office, thinks Eric’s decision to donate foundation money to causes unrelated to cancer research could come back to haunt him. Eric claimed that every penny raised by his foundation went to St. Jude. However, Forbes discovered at least $500,000 went to other causes. Delany believes this could potentially amount to “misrepresentation,” since many of Eric’s donors may have had “no interest in supporting other charities.”
Eric may also have to explain why he used foundation money to buy a copper wine still and a painting. Owens called these transactions “a classic misuse of funds”–the same problem that ultimately brought down the Donald J. Trump Foundation.
All things considered, if I served on the board of the Eric Trump Foundation between 2011 and 2015, I’d have a lawyer on speed dial. There’s a chance this could potentially get very close to the White House. For a time, one of the Eric Trump Foundation’s directors was Dan Scavino, who is now the White House’s social media chief.
Eric’s public statements on the matter would do his father proud. Soon after the Forbes investigation broke, tech journalist Glenn Fleishmann was one of the first to troll Eric over it.
“I steal from children with cancer.” https://t.co/6Ll2fcrUXJ
— Glenn Fleishman (@GlennF) June 6, 2017
Eric’s response?
I have raised $16.3 million dollars for terminally ill children at @StJude with less than a 12.3% expense ratio. What have you done today?! https://t.co/4jf7GIJaBN
— Eric Trump (@EricTrump) June 6, 2017
Hours later, Sally Jenkins asked Eric whether he would respond to questions from The Washington Post’s David Farenthold about his charity’s fundraising.
https://twitter.com/sallyjenx/status/872792362371747840
Eric’s response, again, could have been written by his father.
Respectfully, I have raised $16.3 Million for dying children with an expense ratio of less than 12.3%. Let's not politicize pediatric cancer https://t.co/pqg9272EZr
— Eric Trump (@EricTrump) June 8, 2017
Um, Eric? How is it political to ask whether your charity is on the level?
Eric was slightly more restrained when he announced–as if he had a choice–that he would cooperate with Schneiderman’s review. However, through a spokesman, he continued to stress the money he’d raised for St. Jude. Yep, he’s definitely his father’s son.
Schneiderman has a history of taking on the Trump empire–and winning. He forced Donald Trump to cough up millions to settle lawsuits against Trump University, and all but forced the Donald Trump Foundation to close its doors. His office is in the midst of a broad-ranging investigation into Trump, with two full-time prosecutors handling the case. And now Eric may be about to feel the full weight of an attorney general who has already handed his father a world of severe legal hurt. It may take awhile to unfold, but it should be fun watching another Trump squirm.
(featured image courtesy Max Goldberg, available under a Creative Commons BY-SA license)
