Forbes is certainly not a liberal source.
Dan Alexander ,
Forbes Staff
I write about Donald Trump and the people around him.
This story appears in the June 29, 2017 issue of Forbes.
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The real star of the day is Eric Trump, the president's second son and now the co-head of the Trump Organization, who has hosted this event for ten years on behalf of the St. Jude Children's Research Hospital in Memphis. He's done a ton of good: To date, he's directed more than $11 million there, the vast majority of it via this annual golf event. He has also helped raise another $5 million through events with other organizations.
The best part about all this, according to Eric Trump, is the charity's efficiency: Because he can get his family's golf course for free and have most of the other costs donated, virtually all the money contributed will go toward helping kids with cancer. "We get to use our assets 100% free of charge," Trump tells Forbes.
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That's not the case. In reviewing filings from the Eric Trump Foundation and other charities, it's clear that the course wasn't free--that the Trump Organization received payments for its use, part of more than $1.2 million that has no documented recipients past the Trump Organization. Golf charity experts say the listed expenses defy any reasonable cost justification for a one-day golf tournament.
Additionally, the Donald J. Trump Foundation, which has come under previous scrutiny for self-dealing and advancing the interests of its namesake rather than those of charity, apparently used the Eric Trump Foundation to funnel $100,000 in donations into revenue for the Trump Organization.
And while donors to the Eric Trump Foundation were told their money was going to help sick kids, more than $500,000 was re-donated to other charities, many of which were connected to Trump family members or interests, including at least four groups that subsequently paid to hold golf tournaments at Trump courses.
All of this seems to defy federal tax rules and state laws that ban self-dealing and misleading donors. It also raises larger questions about the Trump family dynamics and whether Eric and his brother, Don Jr., can be truly independent of their father.
Especially since the person who specifically commanded that the for-profit Trump Organization start billing hundreds of thousands of dollars to the nonprofit Eric Trump Foundation, according to two people directly involved, was none other than the current president of the United States, Donald Trump.
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The Donald J. Trump Foundation famously acted like an arm of the overall business, using the charity's money to settle a Trump business lawsuit, make a political donation and even purchase expensive portraits of its namesake. Meanwhile, Trump businesses billed the Trump campaign, fueled by small outside donors, more than $11 million to use his properties, chefs and private aircraft.
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It's hard to find an explanation for this cost spike. Remember, all those base costs were supposedly free, according to Eric Trump. The golf course? "Always comped," he says. The merchandise for golfers: "The vast majority of it we got comped." Drinks: "Things like wine we were normally able to get donated." And the evening performances from musicians like Dee Snider of Twisted Sister and comedians like Gilbert Gottfried: "They did it for free." So many sponsors donated, in fact, that the event invitation has carried enough logos to make a Nascar team proud.
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IT DOESN'T SEEM A COINCIDENCE that at the same time the Eric Trump Foundation went from what appeared to be a clean, efficient operation to a seemingly Byzantine one that suddenly found itself saddled with costs, there was a clear shift of control.
In 2010, the year the economics of the tournament suddenly pivoted, four of the seven original board members, who were personal friends of Eric, left. Those 4 were eventually replaced by 14 new board members, the majority of whom owed all or much of their livelihoods to the Trump Organization.
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