AG Grewal: Trump Presidential Transition Team Agrees to Settlement Over Registration as Charitable Organization, Subpoena Compliance
AG’s Office Will Receive Transition Records that Organization Previously Refused to Produce
NEWARK – Attorney General Gurbir S. Grewal and the Division of Consumer Affairs (“the Division”) announced today that Trump for America, Inc., a New Jersey-based 501(c)(4) social welfare organization that raised millions of dollars to support Donald J. Trump’s 2016 Presidential Transition, has entered into an agreement to resolve allegations that the entity unlawfully failed to register with the Division as a charitable organization and then failed to comply with a related subpoena.
Under the agreement, Trump for America, Inc. will cease to exist; will pay a penalty of $30,000, with $27,500 suspended; and will submit a registration statement and additional documents to the Division. The agreement preserves the Division’s ability to further investigate other misconduct by Trump for America, Inc. beyond its failure to register with the Division as a charitable organization.
The agreement also resolves a dispute between the Division and KCH & Associates, LLC, which the Division alleges provided paid fundraising assistance to Trump for America, Inc. without registering with the Division as a fund raising counsel or independent paid fund raiser, then failed to comply with a related subpoena. KCH & Associates will file a registration statement with the Division; pay a penalty of $30,000, with $27,500 suspended; and produce records responsive to the Division’s subpoena.
The agreement is memorialized in a Consent Judgment signed this morning by a judge on the Superior Court in Essex County.
The announcement comes as the Attorney General and the Division also announce a temporary Voluntary Compliance Program to encourage 501(c)(4) social welfare organizations like Trump for America, Inc. to come into compliance with New Jersey’s requirements that they register as charitable organizations with the Division. The Voluntary Compliance Program runs through October 1, 2020.
“This case should send a message that all are equal before the law, and none are above it,” said Attorney General Grewal. “We expect charitable organizations to comply with New Jersey’s laws, and we expect compliance with our subpoenas. Any organization that fails to comply may be dissolved and face other penalties.”
“Ensuring compliance with New Jersey’s charities laws is an essential part of the Division’s mission,” said Paul R. Rodríguez, Acting Director of the Division of Consumer Affairs. “We take this responsibility seriously and as this case shows, we will hold organizations accountable for failures to comply with legal requirements designed to protect donors and the public.”
Trump for America, Inc. was established as a 501(c)(4) social welfare organization created for the purpose of soliciting and receiving contributions to help finance and assist Donald J. Trump in the presidential transition process.
The organization—originally named Trump Transition Project, Inc.—was incorporated in New Jersey in June 2016. Trump for America, Inc. raised significant contributions from New Jersey residents and held at least one fundraising event in New Jersey, according to public reports. The Division’s court filings also describe payments from Trump for America, Inc. to KCH & Associates and Cam Henderson of Morristown, New Jersey, in connection with fundraising activities.
In February 2019, the Division subpoenaed Trump for America, Inc. and KCH & Associates after determining that Trump for America, Inc. had not registered with the Division as a charitable organization under New Jersey’s Charitable Registration and Investigation Act and that KCH & Associates had not registered as a fund raising counsel, independent paid fund raiser, or related entity.
The Attorney General and the Division filed a lawsuit to enforce the subpoenas in January 2020, after Trump for America, Inc. claimed that it was required neither to register as a charitable organization with the Division nor to comply with the subpoena, and asserted that a confidentiality agreement prohibited KCH & Associates from producing documents to the Division.
Deputy Attorney General Eric Apar of the Special Litigation Section of the Division of Law represented the State in the subpoena enforcement action. Former Assistant Attorney General Glenn J. Moramarco and former Deputy Attorney General Katherine A. Gregory contributed to the matter.
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The mission of the Division of Consumer Affairs, within the Department of Law and Public Safety, is to protect the public from fraud, deceit, misrepresentation and professional misconduct in the sale of goods and services in New Jersey through education, advocacy, regulation and enforcement. The Division pursues its mission through its 51 professional and occupational boards that oversee 720,000 licensees in the state, its Regulated Business section that oversees 60,000 NJ registered businesses, as well as through its Office of Consumer Protection, Bureau of Securities, Charities Registration section, Office of Weights and Measures, and Legalized Games of Chance section.