The Trump Organization was dragged back Monday in a District of Columbia court case that seeks to hold it accountable for its role in more than $1 million in mis-spent funds during former President Donald Trump’s inauguration in 2017.
The development marked the second huge blow to the ex-president’s corporate empire on Valentine’s Day, following news that the company’s own accounting firm accused Trump of preparing statements misleading financiers.
The Trump Organization is currently waging a multi-pronged war with prosecutors in Manhattan investigating tax evasion, New York state investigating bank fraud, and DC pursuing prosecutions for alleged corrupt personal dealings with nonprofit money.
What caused DC’s sudden change? A new judge who saw through the baffling error of a previous judge.
In November, DC Superior Court Judge José M. López appeared to ruin the local attorney general’s investigation when he ruled the case could proceed, but removed the Trump Organization from the trial. His bizarre reasoning was that Donald Trump Jr.’s financial friend, Gentry Beach, had entered into a deal on behalf of the Trump Organization without the company’s authorization, and therefore the company was not really at fault. In reality, Don Jr., Ivanka, and other staff at the company’s New York office were over a ton of paperwork.
In the jaw-dropping decision, López ignored DC Attorney General Karl Racine’s request to get to the bottom of Gentry’s role by subjecting him to sworn testimony and instead put the Trump Organization on a lifeboat.
As The Daily Beast reported last month, the close involvement of Trump’s children and the assignment of a new judge to the case offered a glimmer of hope to turn the tide.
Indeed, Judge Yvonne Williams issued a decision on Monday that focused on the previous judge’s Catch-22.
“It was wrong for the court to rule against the district based on the district’s failure to file … Mr. Beach … when the court had [withheld] adjudicating on the District’s request to conduct this same discovery,” Williams wrote.
The Trump Organization did not immediately respond to a request for comment.
“Our trial is moving forward fully intact and full steam ahead. We sued the inaugural committee for embezzling funds to enrich the Trump family. Now we go to trial,” Racine wrote on Twitter shortly after the judgment.
Racine is seeking reimbursement from the Trump Hotel DC for nearly $1 million in funds that were spent on what local government investigators describe as personal dealings by the new president’s adult children – Don Jr., Ivanka and Eric Trump – to personally benefit by using money intended to celebrate the nation’s peaceful transfer of power. His idea is to create a trust fund that would be diverted to another non-profit organization engaged in charitable community work.
At the heart of this alleged scheme is an episode in which the Trump Organization reserved a block of rooms at the Loews Madison Hotel, only to stiffen the hotel when more than a dozen expected guests failed to show up. . The company successfully dodged a credit collection agency and handed over the $49,358 bill to the nonprofit presidential inaugural committee, the PIC.