Trump boycotted a televised debate in January, instead holding a high-profile Charity event for veterans in Iowa that helped raise millions of dollars from donors around the Country.
But Trump’s Charitable Foundation, the organization through which many of the donations were made, did not take a basic legal step that nonprofit experts say is required of Charities when they hold fund-raisers that may draw donors from many states.
Some 40 states require registration by Charities raising money within their borders. But the Donald J. Trump Foundation does not show up in the Charity registers of 38 of those states. The Foundation has long been registered in New York, its home state.
Failure to register in a state before a fund-raiser is not considered a grave misstep in the nonprofit sector, charity specialists say. The omission can usually be rectified if the organization registers later.
Still, the Clinton Foundation, associated with Mr. Trump’s campaign rival, Hillary Clinton, and former President Bill Clinton, appears to be registered in nearly all the states, according to a search of state Charity records. And the failure of a prominent Charity like the Trump Foundation to register could raise questions about the efficiency of its operations.
“There is a legal requirement for charities to register, not in every state, but in most states, before they start soliciting,” said Sandra Miniutti, the Chief Financial Officer of Charity Navigator, an organization that rates Charities. Many Charities, particularly smaller ones, often do not fulfill state registration requirements, Ms. Miniutti said. But she added, “Any time a charity fails to follow the law, they risk damaging the public’s perception of their ethics.”
Trump’s fund-raiser for veterans, held on Jan. 28 in Des Moines, drew much attention at the time because he had decided to go to the event instead of attending a Republican Primary debate that evening after a clash with the debate host, Fox News.
The fund-raising effort remained in the spotlight in the following months as The Washington Post pressed the Trump Foundation to detail which veterans groups would receive money and when. Trump’s personal gift of $1 million was made months after the Iowa event, and came after much scrutiny by the news media.
Much of the $5.6 million that Mr. Trump helped raise for veterans came from wealthy individuals, and much of it went directly to veterans groups. The Trump Foundation said $1.67 million had come from online donations, but it did not break down the sources by state.
Charities have to register in states where they raise money so that officials there are aware of their activities. The Charities may also have to make financial filings with the state in which they register. The process helps make charities more accountable to donors at the state level.
“The Donald J. Trump Foundation is aware of the state charitable-solicitation requirements and believes it was in compliance,” the Foundation said in a statement sent by Hope Hicks, a spokeswoman for Mr. Trump. Iowa does not require charities to register before soliciting, the statement noted. It also said the fund-raising included “a one-time online donation option for the event, which does not require advance registration.”
Charity law specialists said they were not aware of any such sweeping exemption. Trump’s Foundation declined to comment further when asked to explain why it did not need to register in states beyond Iowa for the online fund-raiser.
The Foundation also may not have registered because it does not have a history of raising money through National appeals. In its statement, the foundation said it “has no plans to solicit funds in the future.”
Registration with the states need not be particularly burdensome. Charities can have state registrations handled for a fee by organizations that will do the paperwork. “Typically, Charities, if they are of a decent size, will hire an outside firm to manage it for them,” Ms. Miniutti said.
While Trump’s Foundation is unlikely to face stiff penalties for not registering, Charity specialists noted that some states, like California and Pennsylvania, were stricter than others in enforcement. Officials from Pennsylvania and California confirmed that the Trump Foundation had not registered in those states.
“No charitable organization shall solicit contributions or have contributions solicited in its behalf before approval of its registration statement,” Pennsylvania’s Charities law states.
When asked if Mr. Trump’s Charity had breached the law, Wanda Murren, a spokeswoman for Pennsylvania’s Department of State, said the state could not automatically assume so. “The question is whether these organizations are actually soliciting in Pennsylvania and whether they are exempt from registration or are required to register,” Ms. Murren wrote in an email. “We do not have enough information to say they should be registered.”
If a Charity is required to register in Pennsylvania but fails to do so, she said, the penalties can range from fines and civil actions to criminal sanctions. “When possible, the bureau will first attempt to get the organization to comply with the law,” she wrote, referring to the state’s Bureau of Corporations and Charitable Organizations. “In other words,” she added, “the bureau will let them know they need to register.”
Brenda Gonzalez, a spokeswoman for California’s Department of Justice, declined to comment specifically on the Trump Foundation. She said California law did not exempt Charities from registering if they planned a one-time fund-raising effort.
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