Trump Foundation Paid $25,000 to Settle Trump University Legal Claim Using Charity Funds

The Donald J. Trump Foundation illegally paid a $25,000 settlement related to Trump University litigation using tax-exempt charitable funds rather than Trump’s personal or business accounts. This payment represented another instance of Trump using his charitable foundation as a personal checkbook to settle legal obligations arising from his for-profit business ventures. The payment was later revealed to have gone to Florida Attorney General Pam Bondi’s political committee “And Justice for All” in September 2013, just as her office was reviewing whether to join New York’s fraud investigation into Trump University.

Background

Trump University, a for-profit real estate seminar program that charged students up to $35,000 for supposed real estate investing secrets, faced mounting legal problems by 2013. The New York Attorney General had already launched a fraud investigation that would result in a $40 million lawsuit against the program, and attorneys general in other states including Florida were receiving consumer complaints and evaluating whether to pursue similar enforcement actions.

When a legal settlement payment related to Trump University became due, Trump directed the Trump Foundation to make the payment rather than using Trump Organization funds or his personal assets. Federal tax law strictly prohibits 501(c)(3) charitable foundations from using charitable assets to settle legal obligations of their founders or their for-profit businesses. The payment provided direct financial benefit to Trump by relieving him of a business legal liability using charitable funds contributed by others.

Adding to the corruption, the $25,000 payment was made to Florida Attorney General Pam Bondi’s political committee shortly after Bondi personally solicited the donation from Trump and just as her office was considering whether to investigate Trump University fraud complaints from Florida residents. Bondi’s office ultimately declined to pursue any investigation despite receiving at least 22 consumer complaints, creating the appearance of a clear quid pro quo arrangement funded with illegally misdirected charitable dollars.

Significance

This payment exemplifies the triple layer of corruption characteristic of Trump Foundation abuses: illegal self-dealing using charity funds for business purposes, improper political contributions by a 501(c)(3) organization, and apparent pay-to-play to influence law enforcement decisions. The New York Attorney General’s 2018 lawsuit cited this payment as evidence of the Foundation’s “persistent illegal conduct,” noting that Trump treated the Foundation “as little more than a checkbook to serve Mr. Trump’s business and political interests.”

The IRS eventually fined the Trump Foundation $2,500 for the illegal political contribution to Bondi (though it misidentified the recipient in its tax filing as a Kansas charity with a similar name, suggesting deliberate concealment). In 2019, Justice Saliann Scarpulla ordered Trump to pay $2 million in damages and undergo mandatory training on charitable foundation operation, finding 19 admitted violations. The incident demonstrates how Trump systematically leveraged charitable status to fund both business settlements and political influence, converting others’ charitable contributions into personal financial and political benefits.