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Dressed in a pinstriped suit and blue tie, with New York’s Plaza Hotel framed over his left shoulder and Central Park over his right, the president’s son Eric Trump touts his charity’s 2014 golf invitational in a Trump Organization video. “It’s really kind of the pinnacle for the Eric Trump Foundation,” he says. “We just raised an inordinate amount of money, and it all obviously goes to the children of St. Jude.”
The charity did in fact raise a serious amount of money at the golf event that year, some $1.8 million, according to federal tax filings, while maintaining an impressive expense ratio of just 14%. But not all of the money went to St. Jude Children’s Research Hospital, a renowned pediatric cancer center in Memphis, where the Eric Trump Foundation had been telling its donors their money went for years. In fact, St. Jude received $1.2 million, $240,000 covered expenses and more than $200,000 went to other organizations, most of which had no programs to help kids with cancer but did have strong ties to Trump family members and interests.
Ten thousand dollars paid for tables at an event for another nonprofit, the Little Baby Face Foundation, which honored Eric at its annual gala one year. Some $37,000 went to the Staten Island Zoo, which at one point said the Eric Trump Foundation had helped to donate three arctic foxes. Another $15,000 went to a charity that supports at-risk Jewish children in a southern Ukrainian city.
And that was just in 2014. From 2011 to 2015, the Eric Trump Foundation donated more than $6 million to St. Jude Children's Research Hospital, but it also doled out over $500,000 to about 40 other charities, while assuring donors on its website that all gifts supported St. Jude.
A spokesperson for the Eric Trump Foundation, which was recently rebranded Curetivity, said the charity had been transparent — at least with some people. “Relevant donors whose money was given to causes other than St. Jude were made aware the funds would be donated elsewhere,” the spokesperson wrote in an email to Forbes. “All donations made via the website were given to St. Jude.”
But in light of the charity’s public statements, nonprofit legal experts say any donations that did not go to St. Jude are likely to catch the eye of New York Attorney General Eric Schneiderman. His office announced that it was launching an inquiry into the Eric Trump Foundation earlier this month, after Forbes revealed practices that appeared to violate state laws and federal tax rules. The attorney general, a Democrat who has publicly opposed the president’s policies, is also investigating the Donald J. Trump Foundation.
“If you are raising money for X, and you give it to Y, that is fraud, even if Y is a charity,” says James Fishman, a former assistant attorney general for the state of New York who now teaches at Pace University’s law school. “If I’m writing a check for somebody, and you give it to somebody else, I mean that is fraudulent.”
The Eric Trump Foundation wasn’t always this way. The president’s second son started the charity in 2007 with two friends and, by all accounts, good intentions. In its first four years, the organization sent almost all of its money to St. Jude. It made one major exception, in 2008, when it gave $65,000 to a charity that supports military families. The charity, Fisher House, was added to the Eric Trump Foundation website, signaling to donors that some money would go to an organization besides St. Jude.
But in 2010, the culture inside the Eric Trump Foundation began to change. Four of the original seven directors of the charity dropped off of the board, and three essentially full-time Trump Organization employees joined, marking the beginning of a power shift that ultimately left the organization controlled mostly by people who were financially dependent on Eric’s father, Donald Trump.
The future president insisted that his for-profit golf club begin billing his son’s charity for hosting its fundraiser at the course, according to former Trump golf employee Ian Gillule and former Eric Trump Foundation board member Katrina Kaupp. From 2012 to 2014, the Eric Trump Foundation also made gifts to at least four organizations, which spent an estimated $400,000 or more on events at Donald Trump-owned properties.
As the charity donated more and more to disparate causes, its website increasingly gave the impression that everything was going to the hospital. By 2011 a “donate now” page read “All donations go toward supporting the St. Jude Children’s Research Hospital.” Two years later, the messaging got more specific: “All donations solely benefit St. Jude Children’s Research Hospital.”
Yet more than $50,000 went to other charities who held various events. In 2013, the Eric Trump Foundation paid $833 for a golf outing benefitting the foundation of Miami Dolphins tight end Anthony Fasano, according to a representative for the athlete. Eric Trump attended a dinner for the Lubavitch Youth Organization, a Jewish charity in New York, and donated $10,000 to the group, according to the director of the organization. The Eric Trump Foundation paid $15,000 for tables at a gala for the Little Baby Face Foundation, which offers surgery to children with facial deformities, in 2013 and 2014, according to a Little Baby Face Foundation representative.
At least $200,000 went to causes that appear to be favorites of Trump family members. Eric’s wife Lara, who is passionate about animals, first appeared on the charity’s list of directors in 2013. That year, the organization shipped more than $60,000 from the kids-cancer charity to a zoo, animal shelter and horse rescue in New York. A favorite cause of Eric’s brother Don Jr., cleft-palate charity Operation Smile, received $20,000.
And then there were the auctions. In 2013, the Eric Trump Foundation spent $940 to buy an undisclosed item at an auction to support the American Heart Association, according to a spokesperson for the heart charity. The same year, $1,600 went to a wine industry organization, which the Eric Trump Foundation incorrectly identified as a charitable organization on its tax filings, in exchange for a copper wine still and an antique bottle washer purchased at auction, according to the wine organization.
When asked about the donation, Eric Trump responds, “I don’t know. I honestly don’t. What year would that have been? I mean $1,600 bucks doesn’t sound like a very big item.”
In 2012, the Eric Trump Foundation made a $25,000 donation to the foundation of a Louisiana artist. The artist, whose paintings sometimes sold for roughly $25,000, created a portrait of Donald Trump for the auction at an Eric Trump Foundation event. It is unclear what exactly happened next, but an identical painting showed up in a 2014 Eric Trump photo shoot, hanging above the couch in his house. A charity spokesperson did not respond to questions about the donation.
A close review of Eric Trump Foundation tax filings raises more questions. According to the documents, all revenue flowing into the Eric Trump Foundation from 2008 to 2014 came from the annual golf invitational. The charity helped to organize other events, like a walk across the Brooklyn Bridge. But money from those events was sent directly to St. Jude without going through the financial statements of the Eric Trump Foundation, according to a 2015 state filing.
Two former board members, Katrina Kaupp and Doug Reinhardt, said they believed the proceeds from the golf invitational also went entirely to the children’s hospital. “From what I know, all of it went to St. Jude,” Reinhardt says. “I’m 99.9% positive all of it went to St. Jude.”
But not all of it did, according to the charity’s IRS filings.
Kaupp says that may be partially because members of the board of directors made additional donations specifically targeting other charities, which could have been lumped in as golf tournament revenue on the IRS documents. A spokesperson for the charity did not respond to a question about whether board members had donated to specific other organizations through the Eric Trump Foundation. But there is some evidence to support Kaupp’s theory. At Eric’s wedding, for instance, he and his wife Lara asked for donations in lieu of gifts. That money was then split, with some of it going to St. Jude and $55,000 going to a North Carolina animal shelter named Paws Place, which was a favorite charity of Lara’s, according to Peggy Durso, the operations director of the animal charity.
But Eric Trump and his fellow board members did not donate all of the money that went to other causes. State filings from 2012 show that all directors and their families gave just $72,600 of the total $2.3 million raised that year. Yet the foundation shelled out more than $110,000 to organizations other than St. Jude, according to IRS documents. That means that even if the directors had given no money to St. Jude, they still would not have donated enough to offset the payments to other organizations. In 2013 Eric Trump, the other board members, their families, and “companies of one of the family members” gave $65,000, while the charity donated more than $150,000 to organizations other than St. Jude, according to state and federal filings.
“If one represents that the funds are going to be used to benefit charity A and instead they go to charities B, C and D, that’s a misrepresentation,” says Sean Delany, a former assistant attorney general who oversaw the charities bureau in the state of New York. “A donor might choose to donate specifically because they care deeply about children’s cancer issues, or they care deeply about supporting St. Jude hospital in particular, and have no interest in supporting those other charities.”