Jose Pagliery
Thu, May 5, 2022
Photo Illustration by Thomas Levinson/The Daily Beast/Getty
As the dust settles from the legal fight between the District of Columbia’s attorney general and the Trump family, it’s becoming clear to government watchdogs and the case’s star witness that the former president has once again gotten off easy.
On Tuesday, D.C. Attorney General Karl Racine declared victory after the multibillion-dollar Trump Organization and the former president’s inauguration committee agreed to fork over $750,000 for their shady dealings in the run-up to Donald Trump’s 2017 celebrations in the nation’s capital. The deal ends his years-long investigation into the way Trump’s family and company misused nonprofit funds to honor the incoming president to instead enrich themselves.
But that’s less than the $1 million the AG had accused the Trump family of misspending in nonprofit funds by booking events at the Trump International Hotel Washington D.C.’s vastly overpriced rooms.
More importantly, the Trump Organization and the 58th Presidential Inaugural Committee were allowed to maintain they did absolutely nothing wrong.
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“Defendants dispute these allegations on numerous grounds and deny having engaged in any wrongdoing or unlawful conduct,” the proposed settlement reads.
The announcement was severely disappointing news for Stephanie Winston Wolkoff, who helped plan the event and became a key government witness against the Trumps after news stories appeared to pin the blame for mismanagement of funds on her.
“I’m just so shattered. It’s awful, it’s unjust, it’s absurd,” she told The Daily Beast. “I can’t believe this. They stole so much. The self-dealing. The perjury. They all know about it.”
Winston Wolkoff, who wrote a tell-all book about her time as first fady Melania Trump’s adviser, lamented that Donald Trump had slithered away again.
“He is above the law. There’s just no accountability whatsoever. For $750,000,” she said.
Elizabeth Hempowicz, director of public policy at the Project on Government Oversight, described the settlement as “the kind of thing that helps fuel this public perception that there are two systems of justice: one for the everyman and another for the rich and powerful.”
“It's not about the money at the end of the day. What is a million dollars to the Trump family?” she said.
In reality, the money owed by the former president’s inaugural committee–some $350,000–was actually already paid by an insurance company. Lee Blalack, an attorney representing Trump’s Presidential Inaugural Committee (PIC), said in a statement that an insurer had already delivered its half of the penalty and the nonprofit could officially wind down now that the litigation was over.
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“As the settlement states, the PIC continues to dispute all of the Attorney General’s claims and remains confident that had this case gone to trial, the PIC would have prevailed based on the evidence,” he said in a statement.
There was even some dancing on the grave, per se.
“It would have required the PIC’s insurer to spend double the amount of this insurance settlement just to try this case to verdict, and thus this modest settlement payment only makes common sense,” he added.
Presidential inaugurations are hastily put together celebrations that potentially fall prey to all the misgivings of a pay-for-play scheme: they’re organized by the incoming president’s associates and quickly funnel millions of dollars from donors who could see this as an opportunity to call in future favors from the administration. The concerns were heightened with Trump, who held extravagant parties for his children at the hotel with their name on it—one that soon became the go-to spot for lobbyists seeking to curry favor with his administration.
But the proposed settlement between the Trump entities and the D.C. attorney general shows that an incoming president’s family can use the opportunity to enrich itself with minimal consequences, Hempowicz told The Daily Beast.
“It certainly doesn't give us any bright-line rules that other inaugurations can operate under,” she said.
AG Karl Racine still declared victory, putting out a statement on Twitter that the district was “resolving our lawsuit and sending the message that if you violate DC nonprofit law—no matter how powerful you are—you'll pay.”
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But what the local attorney general gave up in the deal is the ability to pursue the matter any further, meaning prosecutors may ignore how the Trump Organization’s then-chief financial officer, Allen Weisselberg, held a shadow job auditing the committee’s finances. The Trump Organization maintained that it had nothing to do with the case—it was merely a shell company with zero employees and no relationship to the hotel—and that somehow its CFO managed to get looped in three months after the celebration to conduct an audit of the committee’s finances.
Investigators will also be ignoring how daughter of the twice-impeached former president, Ivanka Trump, testified under oath that she “really didn’t have an involvement” in the planning of the inauguration, even though emails surfaced at Mother Jones showing she closely scrutinized the event.
D.C. law enforcement is also forgoing further exploration into how a firm pertaining to long-time Trump buddy Mark Burnett, who created The Apprentice, walked away with nearly $25 million in nonprofit funds for helping broadcast the event, even though accounting records appear to show fudged numbers.
Accounting documents viewed by The Daily Beast show the committee’s planners drafted at least three versions of a television production budget with vastly varying costs for the same services that all curiously added up to almost exactly $25 million.
However, Noah Bookbinder, president of the watchdog group Citizens for Responsibility and Ethics in Washington, said any of the merited disappointment should be tempered with the grim reality that prosecutors face when targeting the rich and political powerhouse of the Trump family.
“Donald Trump and his associates have a strategy of aggressive litigation and particularly delay tactics. They will try to drag things out as long as possible. They will make it as difficult as possible. For the attorney general to get them to a place where they were willing to pay up is pretty remarkable,” he said.
“I wish it was more. And I wish it were all the money they got through self-dealing,” Bookbinder told The Daily Beast. “It is frustrating that Donald Trump always seems to escape without admitting anything.”
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According to the pending deal, D.C. will receive the money and redirect it equally to two youth development nonprofits, the Mikva Challenge Grant Foundation and the DC Action for Children Today.
The settlement isn’t final yet, though. A local judge will still have to approve it and be convinced that the terms are fair and stand up to scrutiny.
In fact, the Trump Organization would have got out of this entirely were it not for Judge Yvonne Williams, who inherited the case at the start of the year. Williams dragged the Trump Organization back into the lawsuit as a defendant after the previous judge had inexplicably let it go on the theory that the New York-based company was outside his jurisdiction.
The Trump loyalist who led the committee, billionaire Tom Barrack, is still dealing with his own legal problems. He was indicted last summer on charges that he abused his position in the president’s circle of trust by engaging in foreign lobbying and obstructing justice.
Meanwhile, the worst of Trump’s present legal nightmare seems to be merely inching forward. A years-long criminal investigation by the Manhattan District Attorney's Office into his alleged business fraud seems to be falling apart, now that the new DA who inherited the case from his predecessor this year has thus far blocked investigators attempts at seeking a grand jury indictment, according to multiple inside sources and a leaked resignation letter.
A parallel investigation by the New York attorney general remains a civil matter that would not land him in prison. And what could be the most promising criminal investigation—the Fulton County district attorney’s probe of the infamous phone call where Trump pressured Georgia's top elections official into flipping the 2020 election results by materializing 11,780 MAGA votes out of thin air—is just getting started.
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