Trump Foundation acknowledges wrongdoing to IRS

http://www.msnbc.com/rachel-maddow-show/trump-foundation-acknowledges-wrongdoing-irs?cid=sm_fb_maddow

11/22/16 11:22 AM—Updated 11/22/16 11:35 AM
By Steve Benen

One of the great ironies of the 2016 presidential election is that Americans were told that one of the candidates had a controversial charitable foundation that may have run afoul of the law – but voters were encouraged to look at the wrong candidate.

The Clinton Foundation faced a series of unproven allegations, but in the end, the entity was simply a charity that did worthwhile work around the globe. The Trump Foundation, meanwhile, faced far more credible allegations, some of which appear to be true.

We already know – because Trump’s team already admitted – that the Donald J. Trump Foundation broke one law when it made an illegal campaign contribution to Florida Attorney General Pam Bondi, around the time the Florida Republican was weighing an investigation into “Trump University,” a separate scandal-plagued Trump entity. The Washington Post’s David Fahrenthold reports today that the Trump Foundation’s troubles now appear to run deeper.

President-elect Donald Trump’s charitable foundation has admitted to the IRS that it violated a legal prohibition against “self-dealing,” which bars nonprofit leaders from using their charity’s money to help themselves, their businesses or their families.

That admission was contained in the Donald J. Trump Foundation’s IRS tax filings for 2015, which were recently posted online at the nonprofit-tracking site GuideStar. A GuideStar spokesman said the forms were uploaded by the Trump Foundation’s law firm, Morgan, Lewis and Bockius.

As the Post’s article explained, the IRS asked if the Trump Foundation had transferred “income or assets to a disqualified person.” The foundation checked “yes.”

The same document asked if the Trump Foundation had engaged in any acts of self-dealing in prior years. On this, the Trump Foundation also checked “yes.”

In the charitable world, self-dealing is a fairly serious misstep. Charities are expected to use its resources to advance its non-profit mission, whatever it might be, which is why it’s illegal for those running a charitable foundation to use its resources to benefit themselves – as Trump’s charity evidently did.

At least for now, we don’t know exactly what the Trump Foundation is fessing up to. Over the course of several months, the Washington Post’s Fahrenthold reported several instances of apparent self-dealing, but the new materials don’t offer any details. Maybe Team Trump is acknowledging misdeeds we’re already aware of; maybe this refers to new information that hasn’t yet reached the public.

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Philip Hackney, who formerly worked in the IRS chief counsel’s office and now teaches at Louisiana State University, said he wanted to know why the Trump Foundation was now admitting to self-dealing in prior years — when, in all prior years, it had told the IRS it had done nothing of the kind.

“What transactions led to the self-dealing that they’re admitting to? Why weren’t they able to recognize them in prior years,” Hackney said. He said that, since the prior years’ returns were signed by Trump, that opened the president-elect to questions about what he had missed and how.

Take a moment to imagine the feeding frenzy that would exist right now if, just two weeks after the election, the Clinton Foundation quietly told the IRS it broke the law.

Then imagine the scale of the congressional investigation that would follow.