September 13, 2016; Politico
Politico reported last night that New York’s attorney general, Eric T. Schneiderman, is inquiring into the Trump Foundation’s compliance “with the laws governing charities in New York.” As readers may remember, seeing regulatory action at the IRS level and at the state level is now pretty common, as the IRS is losing its enthusiasm for taking risks that might be viewed as judgment calls and state charity offices have stepped up to the challenge. Schneiderman, as most know, has been on the far end of the continuum on the active regulation of nonprofits in that state. So this story’s only real surprise is that the IRS is taking action in a highly politicized third-rail of a situation—but the flagrancy of Trump’s organization made that necessary.
NPQ readers are likely familiar by now with the various concerns about Trump’s so-called charitable activities, which have included donating to Florida AG Pam Bondi’s political campaign even as she considered whether to join a multi-state suit against him being brought by state attorneys general, never or rarely using any of his own money to fund the gifts coming from the foundation carrying his name, and apparently in general playing fast and loose with other people’s money.
Schneiderman, who has not only been an extraordinarily activist AG on nonprofit matters but has also been investigating Trump University, told CNN that his office’s concern about the foundation is not new.
My interest in this issue really is in my capacity as regulator of nonprofits in New York State. And we have been concerned that the Trump Foundation may have engaged in some impropriety from that point of view…and we’ve inquired into it and we’ve had correspondence with them. I didn’t make a big deal out of it or hold a press conference. We have been looking into the Trump Foundation to make sure it’s complying with the laws governing charities in New York.
House Democrats on the Judiciary committee have also requested that U.S. Attorney General Loretta Lynch open an investigation into Trump’s gift to Bondi as a violation of campaign finance laws, an incident for which he has already been fined by the IRS.
If Trump has been skirting campaign finance laws, it will not have been the first time. CNN reports on one interesting incident:
In the midst of a casino battle with the St. Regis Mohawk tribe of New York in 2000, Trump and longtime adviser Roger Stone were fined $250,000 after a group Trump and Stone started aired radio ads critics said were racist. The spots, sponsored by the “Institute for Law and Society,” accused the Mohawk tribe of being involved in drug smuggling, money laundering and trafficking illegal immigrants.
The ads ended with the narrator saying, “Are these the kinds of neighbors we want?”
The group was a fake institute, ultimately tied to Trump. Trump and Stone paid the largest fine levied by New York lobbying regulators at that time, while never admitting guilt.