Donald Trump’s presidency has long been plagued by accusations that he’s profiting off his office, as the Trump Organization has benefited from the MAGA mainstays at his Pennsylvania Avenue hotel, the foreign governments booking their travel at Trump properties—and, of course, the president’s frequent golf outings and Mar-a-Lago trips. And according to a new lawsuit, the Trump Organization has been allegedly using Trump’s presidency to line its pockets since Day One. The District of Columbia filed a lawsuit Wednesday against the Trump Organization, Trump International Hotel, and Trump’s inaugural committee, which alleges that the nonprofit inaugural committee “improperly wasted” its funds by “grossly overpaying” for event space at Trump’s D.C. hotel.
According to the lawsuit, Trump’s inaugural committee allegedly paid the Trump Organization more than $1 million for its inaugural events at the Trump hotel—an “unreasonable” amount that ran far higher than the market rate for comparable event spaces and the hotel’s usual pricing structure. The inaugural committee’s contract with the Trump Organization paid for event spaces at the hotel even on days when it was booked by other occupants, and the committee “failed to explore” other venues that could host the events for far cheaper, or even free. By acquiescing to the Trump hotel’s massive price tag, the lawsuit alleges, the inaugural committee violated provisions for nonprofit entities that bar it from using funds “to benefit a private
individual or company.”
“The [Presidential Inaugural Committee’s] contract with the Trump Hotel for event space violated the PIC’s articles of incorporation by causing the PIC to pay amounts to the Trump Hotel that were unfair, unreasonable and unjustified and that acted ultimately to confer improper private benefit on the Trump Entities,” D.C. Attorney General Karl A. Racine alleges in the suit. “District nonprofit law required the PIC to seek out and pay reasonable fair market value for services rendered. The PIC did not do so, instead choosing to host its events at the Trump Hotel and pay far more than market value, ultimately for the private benefit of the Trump Entities.” As a result, the lawsuit is asking the Trump entities to pay back the $1,033,757 spent on the inauguration events, which should be put into a trust and directed to a nonprofit for “promoting civic engagement.”
In response to the lawsuit, a Trump Organization spokesperson said in a statement that “the AG’s claims are false, intentionally misleading and riddled with inaccuracies.” “The rates charged by the hotel were completely in line with what anyone else would have been charged for an unprecedented event of this enormous magnitude and were reflective of the fact that [sic] hotel had just recently opened, possessed superior facilities and was centrally located on Pennsylvania Avenue,” the spokesperson continued. “The AG’s after the fact attempt to regulate what discounts it believes the hotel should have provided as well as the timing of this complaint reeks of politics and is a clear PR stunt.” The presidential inaugural committee has also disavowed the suit, saying “the facts will show that the PIC operated in compliance with the law and this suit is without merit.”
The fact that the inaugural committee was overpaying the Trump Organization for its space was allegedly not lost on members of the Trump team—including Ivanka Trump and the president himself. Per the lawsuit, the high cost of renting out Trump hotel space was repeatedly flagged by inaugural committee Deputy Chairman Rick Gates (yes, that Rick Gates) and event planner Stephanie Winston Wolkoff, who each raised their concerns directly to Ivanka herself. Gates commented in an email to Ivanka that the “cost itself seems quite high” and he was worried about the “optics of PIC paying Trump Hotel a high fee,” while Winston Wolkoff emailed Gates, Ivanka, and others that the amount being charged was at least twice as much as was reasonable. “These are events in PE’s [the President-elect] honor at his hotel and one of them is with and for
family and close friends,” Winston Wolkoff wrote. “Please take into consideration that when this is audited it will become public knowledge that locations were also gifted and costs underwritten to lower rental fees.”