The Eric Trump Foundation is being investigated following accusations made last week that exposed a potential legal violation. Reportedly, while investigating the Trump Foundation, the New York attorney general found some questionable transactions.
The Donald J. Trump Foundation is being investigated for accusations that Donald Trump used his foundation to settle business lawsuits, make a political donation, and purchase two portraits of himself. Now, the New York attorney general is looking into the Eric Trump Foundation after reports alleging the the charity may have funneled donations to benefit the Trump Organization.
“The attorney general’s office is looking into the issues raised by this report,” said Eric Soufer, communications director for the New York state attorney general.
One item of concern is a transaction with the Donald J. Trump Foundation. Allegedly, Donald Trump’s foundation donated $100,000 to the Eric Trump Foundation. Eric’s foundation was billed by a Trump-owned facility for expenses incurred during a charity event, and Eric’s foundation paid the Trump-owned facility.
“The interaction between the Donald J. Trump Foundation and the Eric Trump Foundation is a novel aspect to this situation,” said Marcus Owens, who used to run the nonprofit division of the IRS. “It’s not often that you have a father and son set of foundations that are both under investigation by the same attorney general for basically misusing assets and interacting with each other in ways that cause assets to be used for non-charitable purposes.”
Another issue for the Eric Trump Foundation is that Eric is accused of telling donors that all the money raised during the foundations annual golf event went to St. Jude Children’s Research Hospital. However, IRS filings submitted by the Eric Trump Foundation state that over $500,000 went to other causes, some that had ties to the Trump family.
According to Forbes, there are additional transactions that are being questioned as well. In one case, charity money may have been used to buy a copper wine still, and an antique bottle washer for $1,600. In another transaction, the Eric Trump Foundation is said to have donated $25,000 to the foundation of a Louisiana artist in 2012. That artist created a painting to be auctioned at an Eric Trump Foundation event. Somehow, “the painting — or at least a version of it — ended up in Eric Trump’s house.”
“The purchase of the painting and the personal use of the painting is a classic misuse of funds,” Owens said. “It’s the same problem that the Donald J. Trump Foundation had.”
Owens speculates that the board of directors for the Eric Trump Foundation may also be investigated. “Typically attorney generals look to the boards of charities to ensure that the charity is on an even keel and obeying the law and fulfilling its mission,” Owens said. “It wouldn’t surprise me, if there is a negotiating resolution, that we see a rather dramatic change in board membership.”
When the Eric Trump Foundation was founded, no one on the board of directors besides Eric Trump had apparent ties to the Trump Organization. By 2015, the 17-person board members included Eric and his wife, six Trump Organization employees, and Christi Mahfouz, owner of Ace Specialties, a company that did a lot of business with the Trump campaign.
A spokesperson for Eric Trump said the foundation would cooperate with the review. In a statement, the spokesman said:
“During the past decade, the Eric Trump Foundation has raised over $16.3 million for St. Jude Children’s Research Hospital, including more than $3.6 million to St. Jude and other worthwhile causes just in 2016 alone. The Foundation intends to cooperate fully with the attorney general’s review, and looks forward to a productive and open dialogue with the attorney general’s office to address any questions it may have.”
Eric Trump announced in December that he would stop fundraising for his charity and the foundation changed its name to Curetivity. According to Forbes, Eric Trump still attended a Curetivity event held in May at a Trump golf course.
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