Trump ordered to pay $2 million for improper use of foundation funds
© Wikimedia (Gage Skidmore)
Trump ordered to pay $2 million for improper use of foundation funds

A New York state judge fined US President Donald Trump $2 million for improperly disbursing Trump Foundation funds through his 2016 presidential campaign, according to a Thursday court filing.

The lawsuit stems from a 2016 televised fundraiser in Des Moines, Iowa, in which Trump raised over $2.8 million to support charitable organizations serving veterans. The funds were ultimately donated to the Trump Foundation, but the disbursement was improperly orchestrated through the Trump political campaign.

Justice Saliann Scarpulla ordered Trump to pay the $2 million in damages after the president, and his children, Eric, Ivanka and Donald Jr., had reached settlement terms with the New York Attorney General to dissolve the foundation, disburse its remaining assets to various charities and allow Scarpulla to set the damages. In addition to these terms, the Trump children also completed “an in-person, interactive board training session pertaining to charitable organizations and the fiduciary responsibilities of those organizations’ directors and officers.”

Scarpulla commended the president for resolving the bulk of the lawsuit with the Attorney General and ultimately disbursing the funds collected to the proper charitable organizations. However, because the disbursement of foundation funds was carried out by Trump’s political campaign staff and not by the foundation, the disbursements were in direct violation of New York’s Estates Powers & Trusts Law § 8-1.4, which governs the distribution of charitable assets. Therefore, the additional $2 million penalty was due to Trump’s breach of his fiduciary duty.

Scarpulla’s order also outlined certain steps that the president must take if he wishes to serve as an officer or director of another charitable trust in New York.