august 4, 2017 forbes india | 23Trump golf tournament took place,
raising $220,000. A compelling
sales pitch evolved—the free golf
course and the donated goods and
services assured donors that every
penny possible went to charity. The
Eric Trump Foundation employed
no staff until 2015, and its annual
expense ratio averaged 13 percent,
about half of what most charities
pay in overhead. His original
seven-person board was made up
of personal friends, an innocuous
lot who helped sell tournament
tickets, which last year ranged from
$3,000 for a single all-day ticket to
$100,000 for a pair of VIP foursomes.
For the first four years of the golf
tournament, from 2007 to 2010,
the total expenses averaged about
$50,000, according to the tax filings.
Not quite the zero-cost advantage
that a donor might expect given
who owned the club but at least in
line with what other charities pay
to host outings at Trump courses,
according to a review of ten tax filings
for other charitable organisations.
But in 2011, things took a turn.
Costs for Eric Trump’s tournament
jumped from $46,000 to $142,000,
according to the foundation’s IRS
filings. Why would the price of
the tournament suddenly triple in
one year? “In the early years, they
weren’t being billed [for the club]—
the bills would just disappear,”
says Ian Gillule, who served as
membership and marketing director
at Trump National Westchester
during two stints from 2006 to
2015 and witnessed how Donald
Trump reacted to the tournament’s
economics. “Mr Trump had a cow. He
flipped. He was like, ‘We’re donating
all of this stuff, and there’s no paper
trail? No credit?’ And he went nuts.
He said, ‘I don’t care if it’s my son
or not—everybody gets billed’.”
Katrina Kaupp, who served on the
board of directors at the Eric Trump
Foundation in 2010 and 2011, also
remembers Donald Trump insisting
the charity start paying its own way,
despite Eric’s public claims to the
contrary. “We did have to cover the
expenses,” she says. “The charity
had grown so much that the Trump
Organization couldn’t absorb all of
those costs anymore.” The Trump
Organization declined to answer
questions about the payments.
But it seems that for the future
president, who Forbes estimates
is worth $3.5 billion, a freebie to
help his son directly fight kids’
cancer took a backseat to revenue.
“I saw that Eric was getting
billed,” Gillule adds. “I would always
say, ‘I can’t believe that his dad is
billing him for a charitable outing.’
But that’s what they wanted.”
It’s also very consistent. 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, fuelled
by small outside donors, more than
$11 million to use his properties,
chefs and private aircraft.
At first the extra bills did not cost
the Eric Trump Foundation anything.
Shortly before the spike in costs,
the Donald J Trump Foundation
donated $100,000 to the Eric Trump
Foundation—a gift explicitly made,
according to Gillule, to offset the
increased budget. Thus, the Eric
Trump donors were still seeing their
money go to work for kids along
the same lines as previous years.
The Eric Trump Foundation
declined to comment on thatdonation. In effect, though, this
manoeuvre would appear to have
more in common with a drug cartel’s
money-laundering operation than
a charity’s best-practices textbook.
That $100,000 in outside donations
to the Donald J Trump Foundation
(remember: Trump himself didn’t
give to his own foundation at
this time) passed through the
Eric Trump Foundation—and
wound up in the coffers of Donald
Trump’s private businesses.
“His father, Mr Trump, always,
until the presidency, had a very,
very tight rein on what was going
on,” says Gillule, referring to the
company’s golf courses. “The
buck always stopped with him.”T
he costs for Eric’s golf
tournament quickly escalated.
After returning, in 2012,
to a more modest $59,000—while
the event brought in a record $2
million—the listed costs exploded
to $230,000 in 2013, $242,000 in
2014 and finally $322,000 in 2015
(the most recent on rec ord, held
just as Trump was ratcheting up his
presidential campaign), according
to IRS filings. This even though the
amount raised at these events, in
fact, never reached that 2012 high.
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“I wouLd aLways say, ‘I can’t
believe that his dad is billing him
for a charitable outing’. But that’s
what they wanted.”