Trump Charity A Continuing Fraud On The People Of New York

scammer419One of the items of breaking news (no, really!) over the last 24 hours is the cease and desist order issued by the New York Attorney General’s Office to Donald Trump’s vaunted “charity”. The full text of the official letter can be found here.

The New York Times described it thusly:

The office of New York Attorney General Eric T. Schneiderman has issued a “notice of violation” to Donald J. Trump’s foundation, ordering it to immediately stop soliciting charitable donations in New York.

The letter, which was sent on Friday and released on Monday morning by Mr. Schneiderman’s office, said its charities bureau had determined that the Donald J. Trump Foundation had been fund-raising in New York this year when it was not registered to do so under state law.

“The Trump Foundation must immediately cease soliciting contributions or engaging in any other fund-raising activities in New York,” wrote James Sheehan, the chief of the charities bureau.

I want to focus on one particular clause in the letter however. The part identifying the “fraud”. To wit:

“The failure immediately to discontinue solicitation and to file information and reports required under Article 7-A with the Charities Bureau shall be deemed to be a continuing fraud upon the people of the State of New York.”

Now, in fairness, that is likely boilerplate/template language for such a cease and desist letter in New York, but that makes it no less true. What has occurred is that the Donald J. Trump Foundation, by not properly registering and being accountable for its activities, has been perpetrating a fraud on the People of the State of New York.

A state government is entitled to regulate, oversee and audit such activity occurring within its borders. As appears to be a pattern with Mr. Trump, he and his organization seemed to think they were simply above such common regulation. The willful non-compliance itself is a fraud, the size of the fraud perpetrated can only further be determined via full registration and full accounting for the multiple years of non-compliant activity the “charity” has engaged in.

There has been a fraud under the statutory and regulatory framework of the State of New York, we are only yet to ascertain the relative scope of it yet. And given the dogged reportage of David Fahrenthold of the Washington Post, which depicts rampant self serving and dealing by Trump as to personal debts via his charity, there is every reason to believe there are very serious issues to be dealt with.

But the ability of the NY Attorney General’s Office to actually deal with these questions depends on the prompt registration and disclosure by Trump of his offending and illegal charity.

Trump and his ill begotten “charity” have 15 days to comply with registration and disclosure. What do you think the odds are he will actually comply in good faith instead of hiding behind some bogus baloney, or submitting patently non-responsive filings, until after the election is over? I’d rate the odds at 100%.

The same odds that exist for Trump turning over his tax returns. Even the one from 1995, that has been beyond the statute of any limitation, whether criminal or civil, for over 15 years.

Bmaz is a rather large saguaro cactus in the Southwestern Sonoran desert. A lover of the Constitution, law, family, sports, food and spirits. As you might imagine, a bit prickly occasionally. Bmaz has attended all three state universities in Arizona, with both undergraduate and graduate degrees from Arizona State University, and with significant post-graduate work (in physics and organic chemistry, go figure) at both the University of Colorado in Boulder and the University of Arizona. Married, with both a lovely child and a giant Sasquatch dog. Bmaz has been a participant on the internet since the early 2000’s, including active participation in the precursor to Emptywheel, The Next Hurrah. Formally joined the Emptywheel blog as an original contributing member at its founding in 2007. Bmaz grew up around politics, education, sports and, most significantly, cars; notably around Formula One racing and Concours de Elegance automobile restoration and showing. Currently lives in the Cactus Patch with his lovely wife and beast of a dog, and practices both criminal and civil trial law.
25 replies
  1. Evangelista says:

    bmaz,

    “If you have an iota of concern for fundamental fairness and due process, you ought be offended… If Tom Freaking Brady cannot get fundamental fairness and due process on a collectively bargained agreement, how the hell do you think…”  Donald Trump can get any fundamental fairness and due process from a greedy gouger like Eric “The Skimmer” Schneiderman and his office of corporate shakedown scammers?

    The first thing you need to do, since you apparently have a copy of the Sheehan to Dillon letter you posted a link to, is take your copy downtown, wherever you are, to the district near the local courthouse where lawyers, for convenience,  locate their offices.  I am not going to advise you to do anything expensive, like consult a lawyer, any paralegal, even one just out of community college, should be able to help you through the letter.  So visit any local coffee bar and turnn on the charm to any local coffee drinker who looks likely to be a paralegal on break.  Pick the youngest-looking, for most likely most recent out of school, and so most likely to be most flattered to be asked to explain a legal letter (and how to read one without mixing between a newspaper article’s and its paragraphs when trying to fathom the complex legaleze of a simple cease and desist letter saying “Stop now and stay stopped pending filing of heresaid specific forms (specified in “section 172″), which filing must be done within fifteen (15) days”.

    She should be able to also explain that the wording in the C&D (cease and desist) letter, “The failure immediately to discontinue solicitation and to file information and reports required under Article 7-A with the Charities Bureau shall be deemed to be a continuing fraud upon the people of the state of New York.”  as well as the wording, “All forms must be properly certified, complete and accurate.” and “Any person who swears falsely…” etc. etc. is what is called ‘legal boilerplate’, which means it is not accusation, but is, rather, specific statement of legally required forewarning, intended by the requiring to assure C&D letter recipients are, and have been, informed what is stated, in order to avoid incidental failures, which might be unintended.  She should also be able to inform you, from her recent education, if not experience yet, that the inclusion of the required phrasing is NOT accusation of crime, or of having committed crime, or of intention to commit a crime, or presumption of thinking to intend, or maybe intend, on the part of the letter recipient to engage in crime or criminal activities.

    If you play it really cool and act really impressed by her knowledge, and thank her nicely, your picked paralegal should be flattered enough she should not even suggest you should buy her coffee for her wafting the fog of confusion from your troubled brow.

    If, on the other hand, you are unable to control your disappointment at learning that Donald Trump is not really in trouble, and his lawyers have fifteen days to correct any oversights, and you rage and swear and maybe kick the table, spilling your benefacting para-angel’s coffee, you should help clean up the spill and buy her another cup.  Try to think of the outlay as the cost of your losing control, not as another nefarious trick by Donald Trump to make you look a fool and cost you money.

    Then rush home, knock back two Prozac with a tall glass of Kool-Aid and lie down in a cool, darkened room.  Try to relax and not fantacize about what you wish for Donald Trump, or what you wish that he were doing, or would do, or had done, that you would love to see him caught for doing.  Try to think of things like thorny mesquite and cacti, things less stickery and pricky than your relationship to Donald Trump.

     

    • bmaz says:

      Spare me your run on rambling mental drivel. And take your prozac and kool aid and shove it. If you have anything substantive to add, come back; if not, then, please, don’t bother.

      • bevin says:

        Do you have any other response to criticism than to accuse those differing of insanity, add some crude abuse and tell them that their viewpoints are illegitimate?

        What Evangelista did not point out is that you are, once more, making an argument in favour of the lesser evil candidate in the election. No doubt the implications, down the ticket, are your real motive, still, it does get very boring reading your abusive rants at the expense of a candidate who seems unlikely to win more than an insignificant proportion of the votes cast by commenters at this blog.

        • bmaz says:

          Nope, not when I encounter pure unadulterated dissembling bullshit. And I detect it’s stinky aroma. Asking for transparency and legality is not favoring anybody, other than American citizens and intelligent voting. Thanks for your participation!

  2. lefty665 says:

    It apparently is federally registered. If so there will be a string of 990’s showing finances, or it’s a federal crime too.  If Trump’s CPAs are worth a damn, the state forms they produce will tie back to the federal returns and the bank recs. That means the numbers are likely available now.

    Looks like the foundation was just one more piece of Trump ego candy. The Donald, his three kids and one poor Trump employee were the B.O.D. No professional staff to make sure they did things right.

    Seemed to me that Schneiderman drew a pretty hard line in the sand, and 15 days seemed like a very short window to do the accounting and to get someone to audit it. You have a far better feel for what’s legal boilerplate and what’s a real threat than I do, so I appreciate your take.

    If Trump’s not in compliance by day 15 Schneiderman, at a minimum, has the opportunity to make a really big stink. That’s a gift that keeps on giving every additional day they’re out of compliance up to and including Nov. 8th. Politics in the Big Apple plays hard.

     

    • bmaz says:

      Didn’t think about the federal angle; if so, that is an excellent point. You never know though, I would not put it past Trump to be so arrogant and sloppy as to have buggered up that too. Fascinating point, we shall see!

      FYI, despite all the money that has been moved in and out of this charity over the years, it appears to have had the most minimal legal fees imaginable (can’t find figure now, but was tiny, maybe couple of hundred dollars). So who knows. Also, interestingly, son Eric has an almost identical separate charity that somehow managed to comply with all rules, audits etc. It is all baffling.

  3. Peterr says:

    As someone who is on the board of a charity and works with more than a handful of others, I get really irritated when charities decide they don’t need to be registered or follow the rules or fill out the paperwork. Some folks don’t do this, because “gosh, we’re all just good people trying to do good work — what do we need rules or paperwork for?” What they don’t realize is the number of scams out there that drag the reputation of legitimate charities through the mud.

    I want charities to register, so that everyone knows they are legit. It makes all charities look better if we all lay our cards on the table for everyone to see. Yeah, it can be a hassle, but it’s a small price to pay for weeding out the obvious scams.

    Similarly, anyone who donates to a charity better hope that they’ve been properly registered. If I’ve given a big donation to an unregistered or improperly registered charity and then deducted the contribution on my taxes, I will be in a world of hurt if/when the IRS audits me for that big donation (and big donations are one of the flags for an audit). “Sorry, but there is no record of this as a legitimate tax-deductible charity, and so you owe us X in additional taxes and Y in a penalty for late payment. Make the check payable to United States Treasury.”

    This is separate from the question of whether the Trump Foundation is a scam or simply sloppy, but either way, if Schneiderman didn’t look into this after all the publicity the Foundation has been getting for being . . . how to put it? . . . irregular in its handling of money, he’d be opening himself up to charges of misconduct in office.

    • Peterr says:

      Tierney Sneed pointed out an interesting tidbit about Trump’s Foundation:

      The Trump Foundation has no paid staff and hasn’t spent much on lawyers. The last time the charity reported on its tax returns any spending on legal fees was 2010, according to the Washington Post, and the total for the year was $53.

      Bmaz, help me out with the billable hours stuff here. $53 amounts to what — 10-15 minutes of work over the course of a year?

      This doesn’t answer the question of scam or sloppy, but it sure explains a lot.

      • bmaz says:

        I’d assume that any NY atty working for Trump, in any capacity, bills at a bare root minimum of $500/hr.

      • lefty665 says:

        Unless a not-for-profit gets in a wrangle there’s not a lot of need for legal work, beyond the initial getting set up correctly, as in board structure,bylaws and getting square with the IRS and states they operate in. FWIW the earliest 990’s available on Guidestar are 2010. That may be when their status changed due to accepting outside money and required a lawyer to submit the change form and start filing 990s with the IRS.

        Humm, about 6-7 minutes, enough time to review the change form the bookkeeper prepared and sign it.

        There should be some ongoing accounting/bookkeeping expenses as they did seem to be keeping enough records to file the federal financial returns. Wouldn’t be surprised to find that got shoved off on a Trump business bookkeeper under the heading of “Other duties as assigned”.

      • earlofhuntingdon says:

        I agree with bmaz.  Any Manhattan lawyer, performing other than clerical work for a high-profile charity operated by a celebrity billionaire, would charge at least $500/hr., more likely $750-1000/hr.  The lawyer in that role is selling credibility as much as legal services; her name is on the line as much as Donald’s.  The $53 cited is derisory and would be regarded as such by anyone viewing the disclosure.  It’s a raised middle finger (as was the banking system’s disregard of title, transfer and trust rules in the housing crisis).  The amount means that Trump’s charity neither sought nor obtained legal services.  His charity is intentionally flying blind in a legal, accounting and tax snowstorm.  Non-compliance is guaranteed.  Donald must think it doesn’t matter, just what we want in a president.

         

      • lefty665 says:

        Haven’t had time to look at the returns themselves, but will try to make it.

        The use of 3rd party donations for Trump’s benefit that have been in the media appear material if substantiated. The IRS takes a dim view of that. The lack of professional staff and closely held BOD seem to confirm that it was also just more Trump ego balm than a real charitable organization.

        Dunno how they managed to gaffe getting registered with New York. That’s pretty fundamental and should have rung bells with whoever filed the change forms with the IRS. When they transitioned from all Trump money to public donations and apparently started filing 990s that should have triggered the thought “Gee, isn’t there something we need to do with the state too?”. We’ll soon enough have someone fall on their sword for that oversight. Don’t expect it will be Donald. He has people for that, just like with plagiarism. OTOH, one of the maxims of management is that you can delegate authority to act, but not responsibility for the (in)actions.

        As much as I dislike Trump, it smells more like negligence, no one running the show, than intentionally venal. It certainly has set Schneiderman up for some good free shots. It’s not every day you get the chance to be self righteous and say fraud and presidential candidate several times in close succession, especially while brandishing an enforcement baseball bat.

        • bmaz says:

          As far as the registration issue, I agree. I think. But as to the self dealing aspect, that would seem to have to be at Trump’s direction.

          • lefty665 says:

            I agree.  If we hear Schneiderman or the IRS start using words like “defalcation” we’ll be able to infer they have found both wrongdoing and intent. In that case with Trump astride both halves of the transactions, it will be hard for him to skate.

            Unfortunately, I don’t expect those wheels can turn fast enough to report before 11/.8. Also, the IRS really doesn’t want to get overtly involved in presidential campaigns. Don’t expect they’re in a hurry, especially if it would give the Repubs in Congress another shot at impeaching the Commissioner.

            • bmaz says:

              No question there. And, frankly, any consideration of PIN protocols at DOJ would militate against it federally. And on state level, hard to see Schneiderman even considering taking that step before the election. There are real issues there after the election though, win, lose or draw for Trump.

              • Evangelista says:

                bmaz,

                If I was a NYT reporter, with all of the personal and professional integrity required to maintain the security of a continuing paycheck from that organization, I suspect I would have no qualms about schmoozing into the Charities Office in NYC, with a request to do a little research in the archive files for a story to feature the Office Personnel… and while doing the said ‘researching’ scoop out from the file the form document my NYT pre-approved story would require to be missing and wad it into a pocket (being legal, the documents should be paper, but if electronic, once in the system it could be deleted, maybe with a little Tammany Hall complicity, ‘for the candidate’ you know, it’s an old New York Tradition…  Then go write the story…  And then wait and watch for the to-be-expected file-check, discovery of absence, and then, with minimal grinding of gears, the rumble of the Old Machinery starting to turn.

                What d’you think?  Keep in mind that the victim charity has apparently been in business for some number of years and the Official Letter references only 2016.  Unless the filing requirement is brand new, the implication is that the document was filed previous years…  Which means oversight or my here suggested  Slick-Steve Swipe scenario.

                P.S. Don’t read this if it will ruin your day.  And please note, I am on good behavior and so have written no schneid comments about how maybe professional Hillary can make amateur Donald look a boob at the next debate giving him one of those condescending “woman-splain” lectures how to do charity-fraud “right”.

        • earlofhuntingdon says:

          I think that maxim is for show, if the behavior of Goldman, GM and VW is representative.

  4. Evangelista says:

    bmaz,

    If I was a NYT reporter, with all of the personal and professional integrity required to maintain the security of a continuing paycheck from that organization, I suspect I would have no qualms about schmoozing into the Charities Office in NYC, with a request to do a little research in the archive files for a story to feature the Office Personnel… and while doing the said ‘researching’ scoop out from the file the form document my NYT pre-approved story would require to be missing and wad it into a pocket (being legal, the documents should be paper, but if electronic, once in the system it could be deleted, maybe with a little Tammany Hall complicity, ‘for the candidate’ you know, it’s an old New York Tradition…  Then go write the story…  And then wait and watch for the to-be-expected file-check, discovery of absence, and then, with minimal grinding of gears, the rumble of the Old Machinery starting to turn.

    What d’you think?  Keep in mind that the victim charity has apparently been in business for some number of years and the Official Letter references only 2016.  Unless the filing requirement is brand new, the implication is that the document was filed previous years…  Which means oversight or my here suggested  Slick-Steve Swipe scenario.

    P.S. Don’t read this if it will ruin your day.  And please note, I am on good behavior and so have written no schneid comments about how maybe professional Hillary can make amateur Donald look a boob at the next debate giving him one of those condescending “woman-splain” lectures how to do charity-fraud “right”.

    • bmaz says:

      Alright. So, I see that you not only took it upon yourself to ignore my advice to stay out of this and other threads if you had nothing but rambling poo to contribute, you also took it upon yourself to post the same run on drivel both here and above. The same baloney twice. Are you so obsessed with hearing yourself talk in blog electrons and characters that you thought it appropriate to waste our attention TWICE, with the same exact comment, twice in the same post??

      This will be yet another warning. Stop. We do not need that bunk gibberish, and it does not contribute to the conversation, meaningfully, in the least. You only get so many of these advisories. Try to use the few remaining you have wisely.

  5. Evangelista says:

    bmaz,
    Sorry about the double-posting. Account it to getting used to the new site and its quirks: I met odd delays and did not get feedback to my first posting, as a reply, and experimented posting as a “join the discussion”, to see if that worked. No feedback from there, either (‘feedback = indication the post went through, including appearing on the site with a refresh). No indications the posts went through, nothing except a blink. I went on assuming I had finally pushed you beyond endurance and was banned. I attributed it to my inadvertent omission of ‘L’ from ‘prickly’, which was supposed to conjure image no more ‘inappropriate’ that the cactus pear. Please feel free to remove either of the double post.

    To not offend you with going on too long again, I will only ask very quickly if you have noticed that “The Skimmer” (who has done nothing for any victims, only shaking down the perps for pieces of their actions, to his Gov Officials gang, or ever went after anybody for any perps of MERS for their industry-wide local taxes and fees avoidances [though neither has any other legal official]) has “admitted” (not announced), that Hillary has omitted tax filings for a number of years? No prob if it went by; New York officials screwing around in elections is business as usual, not news.

  6. Evangelista says:

    Just a quick add re my ref to ‘quirk’ on site: Finished my forensics and found not a quirk on site, but lag and surface-scan by a site-spoofer node responsible. I, apparently, yet again, upset some half-horse with time on its hands and spyware to try. I was asleep at the switch, or I would have thought that right off, but I didn’t recall anything I had done net-wise to stir a bureaucratic miscrea-ant nest lately. Maybe it took them a while for them to organize to respond to the last time, or maybe I did something accidentally?

    • bmaz says:

      Thanks for the gibberish! You are always willing to step to the plate with some rambling inanity, and you have done so yet again. Well done Evangelista! We know we can count on you.

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