New York investigates whether Trump Foundation violated tax laws
An investigation from the New York State Department of Taxation and Finance has opened the door to possible prosecution
An investigation has opened into whether US President Donald Trump’s foundation has violated state tax laws, a move that could lead to possible prosecution.
The New York State Department of Taxation and Finance opened the investigation into the Donald J. Trump Foundation on the back of the New York Attorney-General’s decision to file a lawsuit against the foundation last month.
A criminal investigation could find evidence of illegal activity beyond the accusations listed in the Attorney-General’s lawsuit and would essentially make it impossible for the Trump Foundation or the first family to avoid criminal charges.
Attorney-General Barbara Underwood claimed Trump was using the foundation as a “chequebook for payments” during his presidential election, adding: “This is not how private foundations should function and my office intends to hold the foundation and its directors accountable for its misuse of charitable assets.”
According to the lawsuit, a 2016 investigation has found the charity operated without oversight from a board of directors which “resulted in the misuse of charitable assets for the benefit of Donald J Trump and his personal, political and/or business interests”.
It’s not clear what the current investigation is scrutinising, but it is possible it will look into the Attorney-General’s claims that Trump and three of his children led improper political activity, self-dealing transactions and did not implement legal formalities.
Where the lawsuit seeks to dissolve the foundation and recover millions of dollars in restitution, and effectively ban Trump and his children from operating in foundations, the investigation may find criminal activity that could be reported to law-enforcement agencies and then be passed onto a grand jury for prosecution.
New York Governor Andrew Cuomo opened a door to a possible criminal case against the foundation. In order for Underwood to file a criminal suit, the Attorney-General would first need a criminal referral, which could be provided by the investigation.
The Governor’s counsel, Alphonso David, said: “At Governor Cuomo’s direction, the state stands ready to provide the Attorney-General with the appropriate criminal referral on this matter if and when she asks for it.”
However, the Attorney-General may not proceed with a criminal investigation, with concerns Trump’s lawyers could seek a stay in the civil case and delay proceedings.
When filing the lawsuit last month, the Attorney-General’s office also sent referral letters to the Internal Revenue Service and the Federal Election Commission for potential further action, including possible criminal charges.
Amy Spitalnick, Communications Director for Underwood, said: “We continue to evaluate the evidence to determine what additional actions may be warranted and will seek a criminal referral from the appropriate state agency as necessary.”