• Bloomberg


When Donald Trump offered to pay $10,000 from his personal charitable foundation for a six-foot oil portrait of himself, the future president only meant to “get the bidding started” during a 2014 auction at his Mar-a-Lago resort, his lawyer told a New York judge.

“No one else bid,” attorney Alan Futerfas said in a packed Manhattan courtroom on Thursday, so “he’s stuck with the painting.”

Trump’s lawyer offered the account as one of several reasons why New York Attorney General Barbara Underwood’s lawsuit against the Donald J. Trump Foundation should be tossed out, arguing that the transactions at the center of the case have innocent explanations or were corrected by the charity.

For example, Futerfas said it was “troubling” that Underwood would focus on a payment that was made to benefit a charity that aids children and young adults with developmental disabilities. He also claims the suit is politically biased, part of an effort by Democrats to undermine Trump’s presidency.

Underwood’s suit alleges the nonprofit was little more than Trump’s “piggy bank.” She is seeking to dissolve the charity and to ban the president from serving on a New York not-for-profit for 10 years. She alleges a litany of violations, including improperly using foundation assets for political purposes.

“It is beyond dispute that these were improper self-dealing transactions,” Yael Fuchs, a lawyer for the attorney general, said at the hearing.

New York State Supreme Court Justice Saliann Scarpulla ended the hearing without ruling, after largely shutting down Futerfas’ assertions of political bias by Underwood.

“I don’t want to get into that,” Scarpulla said.

Among the transactions cited in the case was a fundraiser in Iowa while Trump was a presidential candidate. The attorney general alleges that the campaign improperly directed how the donated funds were spent.

Other transactions cited in the state’s lawsuit include

$100,000 used in 2007 to pay a Mar-a-Lago legal settlement. Underwood says the payment was illegal because the foundation wasn’t a party to the suit; Trump says the money eventually went to charity anyway.

There was also $158,000 used in 2012 to help pay a $1 million Hole-in-One golf award. Underwood says it was an illegal use of charity cash for a business obligation; Trump says the money was used exactly how the foundation said it would be — to benefit a charity — but that the foundation was repaid anyway “out of an extraordinary abundance of caution.”

There was also $25,000 paid in 2013 to a political organization helping to re-elect Florida Attorney General Pamela Bondi. Underwood says the donation violated the Internal Revenue Code; Trump says the improper contribution was due to a back-office error and that the foundation ‘took immediate remedial steps’ to correct it with the IRS and reimburse the foundation.

Also, $5,000 was paid in 2013 to the DC Preservation League, a charity that helped with the conversion of the historic Old Post Office in Washington into what is now the Trump International Hotel. Underwood says the money was used to improperly advertise the Trump Hotel Collection; Trump says the benefit to his business was “incidental” and he repaid his foundation.

In 2015, $32,000 was paid to a land-preservation organization. Underwood says the money wrongfully benefited an entity that manages land used for recreation by Trump’s family. Trump said the payment was self-reported to the attorney general’s office and his foundation was reimbursed.

The judge said she can’t decide the case until after an appellate court rules in a different case on whether Trump has presidential immunity from litigation in state courts. In that lawsuit, former “Apprentice” contestant Summer Zervos accuses Trump of defamation for denying her allegations that he groped her.

Futerfas said the case against the Trump foundation is wrongfully focusing on a few transactions out of hundreds that involved money going to organizations in need, amounting to nearly $19 million. Every penny raised by the foundation was donated to charity, aside from $1.7 million being held up by the litigation, Futerfas said.

In a time of both misinformation and too much information, quality journalism is more crucial than ever.
By subscribing, you can help us get the story right.