Donald Trump said he is taking steps to separate himself from his businesses “to fully focus on running the country.” But House Democrats and others questioned whether conflicts of interest would remain if his adult children take operational control of his global real-estate empire.
The president-elect, in a series of Twitter posts on Wednesday, wrote that “Legal documents are being crafted which take me completely out of business operations.” He said he would reveal details at a New York news conference with his children on Dec. 15.
U.S. law exempts presidents and vice presidents from conflict-of-interest rules, which require many federal employees to recuse themselves from decisions involving their financial interests.
In the past, Mr. Trump has said he would set up a what he referred to as a “blind trust” with his three oldest adult children in charge. By definition this wouldn’t be a blind trust since family members cannot be involved in those under federal law.
President-elect Donald Trump said he had chosen Todd Ricketts, co-owner of the Chicago Cubs and the son of one of his top donors during the campaign, to serve as deputy secretary of commerce.
Donald Trump will enter the White House with a vast number of potential conflicts of interest regarding his business dealings. So why isn't he beholden to the same rules as everyone else?
Democrats on the House Judiciary Committee asked committee Chairman Bob Goodlatte (R., Va.) to hold hearings on the matter. “There is concern that foreign governments and government-owned corporations may steer business to [Mr. Trump], or offer him favorable business terms, in an effort to gain political influence with his administration,” the Democrats wrote in a letter to Mr. Goodlatte.
During the presidential campaign, Mr. Trump said he would fully sever himself from the Trump Organization, which operates the family’s businesses. Many of its newest licensing and management deals are with overseas partners.
Of the first 29 foreign leaders Mr. Trump spoke with following his election, he had real-estate related projects in eight of their countries.
Mr. Trump said last week that he legally could retain his role in the business operations. Then on Wednesday he took a different tack. “I feel it is visually important, as President, to in no way have a conflict of interest with my various businesses,” he said on Twitter.
There is an important distinction between the business operations Mr. Trump said he would transfer and ownership. If he retains ownership he would still know what government actions domestically and around the world could help the businesses, and foreign leaders could help the company’s bottom line by patronizing his hotels. Sean Spicer, a spokesman for Mr. Trump’s transition team, declined to provide further details on how Mr. Trump would address the ownership issue.
“Unless his solution is to sell the business outside the family and put the proceeds in a blind trust, he’s not really doing anything to solve the problem,” said Noah Bookbinder, executive director of the Washington advocacy group Citizens for Responsibility and Ethics in Washington.
Jonathan Macey, a professor of corporate law at Yale Law School, said the public nature of many Trump Organization’s properties around the world would make it almost impossible for Mr. Trump to fully distance himself from any knowledge that might affect the company’s success.
Richard Painter, who served as the chief ethics lawyer in the George W. Bush administration pointed to another potential pitfall: If Mr. Trump retains ownership of the company, and a foreign government spends money at his properties, it could trigger a provision in the Constitution known as the emoluments clause, which says “no person holding any office or profit or trust under them, shall, without the consent of the Congress, accept any present, emolument, office, or title, of any kind whatever, from any king, prince, or foreign state.”
“If he does not divest ownership, there are a number of problems we are going to have to deal with,” Mr. Painter said.
Mr. Trump can’t easily give his children the business because of the 40% federal gift tax that would apply. The children could borrow money to purchase the company from him, though that would also likely have tax consequences.
The Trump Organization, originally called Elizabeth Trump & Son, has been controlled by his family since the 1920s, and Mr. Trump’s career in the business began in the 1970s. His adult children Ivanka, Eric, and Donald Jr. already play a senior role in the company and have led much of the operations and deal making for years. Mr. Trump has long said he planned to hand over control to them, but he has wavered on the timing of this change in recent weeks.
(WSJ)
