Administration

Trump ordered to pay $2M in settlement over Trump Foundation lawsuit

President Trump has been ordered to pay $2 million to nonprofit groups as part of a settlement in a lawsuit alleging he used his charity's funds for personal and political means.

The New York Supreme Court ordered Trump to pay $2 million in damages as part of a settlement stemming from a June 2018 civil lawsuit filed by the state attorney general's office against him, his three eldest children and the Trump Foundation that alleged violations of campaign finance law. The dispute centers on $2.8 million raised by the Trump Foundation at an Iowa fundraiser for military veterans during the 2016 campaign cycle.

Manhattan Supreme Court Justice Saliann Scarpulla ruled Thursday that the money was used for Trump's campaign and disbursed by his campaign staff rather than by the charity itself.

"A review of the record, including the factual admissions in the Final Stipulation, establishes that Mr. Trump breached his fiduciary duty to the Foundation and that waste occurred to the Foundation," Scarpulla wrote in the order.

"Mr. Trump's fiduciary duty breaches included allowing his campaign to orchestrate the Fundraiser, allowing his campaign, instead of the Foundation, to direct distribution of the Funds, and using the Fundraiser and distribution of the Funds to further Mr. Trump's political campaign," the judge wrote.

Scarpulla said that she lowered the figure from $2.8 million to $2 million because the funds ultimately reached their intended destinations.

The judge also declined a request by the New York attorney general that Trump pay a statutory penalty twice the amount of damages, noting that Trump "has stipulated to a number of proactive conditions so that the conduct which engendered this petition should not occur in the future." 

The order comes after the foundation agreed to dissolve under court supervision as part of an agreement with the state attorney general's office announced in December. The judge wrote in the order that the parties agreed to a "consensual resolution of the bulk of this proceeding" in October that left it up to her to determine the amount Trump would pay in damages. 

As part of the settlement, Trump agreed to reimburse the foundation for more than $11,000 in payments of auction items at a charitable benefit and to adhere to restrictions should he become an officer or director of an existing charity in New York. 

New York Attorney General Letitia James lauded the order on Thursday, calling it a "major victory" in the office's efforts "to protect charitable assets and hold accountable those who would abuse charities for personal gain."

Trump lashed out at James, a Democrat, in a statement issued on Twitter later Thursday, accusing the state attorney general of "deliberately mischaracterizing" the settlement for "political purposes." He also accused James, the previous attorney general who filed the lawsuit, Barbara Underwood, and her predecessor Eric Schneiderman of "politically motivated harassment." 

"I am the only person I know, perhaps the only person in history, who can give major money to charity ($19M), charge no expense, and be attacked by the political hacks in New York State. No wonder why we are all leaving!" Trump said, referencing his recent decision to change his residency to the state of Florida. 

Marc Mukasey, an attorney for the Trump Foundation, similarly cast the lawsuit as politically motivated. 

"Following the 2016 presidential election, the Trump Foundation publicly announced its intention to voluntarily dissolve and distribute all of its remaining funds to charity," Mukasey said in a statement. "Unfortunately, that donation was delayed due to the New York Attorney General's politically motivated lawsuit."

 "We are pleased that the Court, in rejecting the New York Attorney General's frivolous request for statutory penalties, interest and other damages, recognized that every penny ever raised by the Trump Foundation has gone to help those most in need," Mukasey added. 

The Trump Foundation plans to donate the money to Army Emergency Relief; Children's Aid Society; City Meals-on-Wheels, Give an Hour, Martha's Table, United Negro College Fund, United Way of Capital Area, and the U.S. Holocaust Memorial Museum, Mukasey said.  

- Updated at 4:07 p.m.

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