Note: This is intended to be a living Q&A. We’ll update it as news breaks and as The Washington Post turns up more details about the ethical questions related to President Trump’s businesses.
1. President Trump still owns his company while he is president. Is that illegal?
Not by itself.
By law, the president is exempt from the ethics statutes for federal workers, which prohibit them from taking action on issues where they have a personal financial stake in the decision.
The logic was that a president can’t recuse himself or herself from any given issue: There’s only one president. If a president steps over a major ethical line, the remedy would be the impeachment process.
That said, the Constitution does place some limits on a president’s financial dealings, in its emoluments clauses. These bar the president from taking “emoluments,” or gifts, from foreign governments or individual U.S. states. In a spate of lawsuits, critics of Trump have said he is violating these clauses because the Trump Organization still does business with both state leaders and foreign governments. Those cases are still pending.
2. What have Trump and his sons pledged to do to avoid ethics conflicts?
A month before entering office, Trump issued a six-page white paper, prepared by one of his attorneys, laying out some parameters for the company while he is in office. The paper says that the Trump Organization will “in essence” function “only as an asset management company” by placing severe restrictions on new deals to avoid conflicts of interest.
Eric Trump, the president’s third child and a trustee of the Trump Organization, said that in running the company, “there are lines that we would never cross, and that’s mixing business with anything government.” To make sure of that, the company hired special staff, including an ethics adviser to approve large transactions — Washington lawyer Bobby R. Burchfield.
3. Have the Trumps stuck to these promises?
In an interview, Burchfield, the ethics adviser, says they have.
When the company is close to finalizing a deal, Trump’s sons bring it to Burchfield for approval, he said. Burchfield then reviews the deals according to four standards:
a. Are the prospective business partners paying fair market value to the Trumps?
b. Are they appropriate people for the Trumps to do business with?
c. Could they be trying to gain political influence by doing the deal?
d. Is there anything about the transaction that could diminish or embarrass the president?
After Burchfield reviews a proposal, he sometimes suggests changes. There have been times when the company has decided not to forge a deal after hearing his advice, he said. Other times, the parties have made modifications and brought the deal back to him. But he said he doesn’t sign off on anything unless it is fully compliant with the ethical standards adopted by the company.
“I’m not issuing opinions that say no. I’m not issuing opinions that say ‘Almost, but not quite.’ I’m only issuing opinions if the transaction fully complies with the ethics standards,” he said.
Burchfield said he’s issued approvals for more than a dozen deals since Trump was elected.
4. Do we know anything about the transactions the ethics adviser has signed off on?
For the most part, no.
The Trump Organization is privately held, so it doesn’t have to release this data — and has in general chosen not to.
In June, the company announced it had signed an agreement with hotel owners in Mississippi to lend its brand to four hotels there, but those properties have not yet opened. The head of Trump Hotels, Eric Danziger, has repeatedly said he has other deals in the works to add new hotels in other cities, but none have been announced as completed.
5. I’ve heard that many buyers of Trump condominiums are anonymous LLCs. If that’s the case, how does Burchfield know what entities the Trump Organization is dealing with?
He asks, he said.
“We look behind the LLC to see who the real parties in interest are, and we look behind it to see where the money is coming from,” Burchfield said.
Journalists at USA Today and BuzzFeed have documented how, since the election, many of the buyers for Trump-owned real estate have been listed as limited liability companies. These are common in real estate transactions, and they have the effect of obscuring the actual people behind the purchase. Many of the sellers are third parties unaffiliated with the Trump Organization.
Burchfield reviews most transactions of $2 million or more and condo sales of $2.5 million or more, and he said people shouldn’t be surprised to see the company pen transactions with limited liability companies.
“They’re in the real estate business, and real estate businesses are commonly formed as LLCs,” he said.
6. Didn’t the president also promise he would do “no new foreign deals?” What does that mean?
The white paper says Trump’s business won’t engage in foreign deals, including any “with a foreign country, agency, or instrumentality thereof, including a sovereign wealth fund, foreign government official, or member of a royal family.”
The Trump Organization has not announced any overseas deals since Inauguration Day.
7. Is the president still involved in his business?
Trump’s white paper says he is to receive company reports “that only reflect the profit or loss of the company as a whole.” Eric Trump later said he gives his father “quarterly” updates. Burchfield said he has seen no evidence of the president’s involvement in the company — other than spending all or part of more than 100 days at a Trump property last year.
“I have not observed any instances in which the president has been involved in any aspect of the business, at least that I’ve had visibility into,” he said.
8. How have other business executives who were elected president handled this?
In the past 40 years, every other president has either sold his businesses or put them into a blind trust, in which an independent trustee is named to manage the businesses and the president is barred access. That includes Jimmy Carter, Ronald Reagan, George H.W. Bush, Bill Clinton and George W. Bush. Carter even sold his family’s peanut farm to avoid raising ethical questions.
However, in court documents, the Justice Department recently pointed out that George Washington bought several plots of land from the then-territory of the District of Columbia, through a sale that Washington himself approved as president. It’s safe to say that’s probably not a deal Burchfield would have approved today.
9. Didn’t Trump promise he would donate his presidential salary?
But there are still some unanswered questions about what will be done with Trump’s donations. In two cases, the programs he donated to help don’t seem to exist — at least, not yet.
Last year, Trump announced that he would donate his salary from the first quarter of 2017 to the National Park Service. That donation was made: The superintendent at Antietam National Battlefield in Maryland said her park was given the money and will use it to repair a historic house and fences.
The next quarter, the White House announced that Trump had donated his $100,000 paycheck to the Department of Education. “The funds will be used to host a Science, Technology, Engineering and Math-focused camp for students,” a news release said at the time.
In February, a Department of Education official said that the camp doesn’t exist yet — it’s “in the planning stages.” The Department of Education was asked: When will the camp be functional? What will it be called? “I don’t have that information yet,” the official said.
In the fall, the White House announced that the president’s third-quarter donation would go to the Department of Health and Human Services. An official at that department said the donation would be for “a large-scale public-awareness campaign about the dangers of opioid addiction.”
Does that program exist?
“The program exists in the planning, coordination and development phase, as is appropriate for a large-scale campaign. We will use the funds when they can have the most effect,” a department spokesman said. He did not give a timeline or a name for the program, which he said would be separate from an existing opioid program called Rx Awareness.
On Feb. 13, the White House announced that Trump would donate his salary from the fourth quarter of 2017 to the Department of Transportation. That gift will help fund a $1.5 billion new grant program, intended to help infrastructure projects. The program is considering applications, but has not made any grants yet.
10. Didn’t Trump promise to give his company’s foreign profits to the U.S. treasury?
He did, and the company says it will follow through on that promise this month.
The Trump Organization pledged to donate “all profits from foreign governments’ patronage at our hotels and similar businesses” to the treasury. It told Congress that this covers all transactions where the bill is paid directly by a foreign government. However, the Trump Organization said it would be too “intrusive” to question individual guests to see whether a government was paying their bills.
The company says it plans to estimate the profits from these transactions and pay it to the government in one lump sum annually.
Submit your questions: Have questions about President Trump’s company? The Washington Post is interested in hearing from readers about what you would like to know about the Trump Organization and the president’s relationship with the brand he built.