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D.C. attorney general sues Trump inaugural committee for money spent on Trump properties

Feds subpoena Trump inaugural committee
Feds subpoena Trump inaugural committee 04:27

District of Columbia Attorney General Karl Racine is suing Donald Trump's inaugural committee and the businesses overseeing Trump International Hotel in Washington, claiming the nonprofit inaugural committee coordinated with Trump family members to overpay for event space in a way that enriched the Trumps.

The D.C. attorney general claims the inaugural committee knew it was paying above-market prices and failed to consider cheaper alternatives. The attorney general also claims the inaugural committee spent funds to throw a private party for the Trumps that cost "several hundred thousand dollars." 

"District law requires nonprofits to use their funds for their stated public purpose, not to benefit private individuals or companies," Racine said in a statement announcing the suit. "In this case, we are seeking to recover the nonprofit funds that were improperly funneled directly to the Trump family business." 

The lawsuit isn't the first which comes in the middle of Mr. Trump's Senate impeachment trial, isn't the first wave of legal woes for the president's inaugural committee. Federal prosecutors in the Southern District of New York subpoenaed the inaugural committee over records related to the committee's donors.

Since the Trump inaugural committee's funds are now depleted, the D.C. attorney general's office said any money they're suing over would come from the Trump entities overseeing the president's D.C. hotel. Mr. Trump sometimes visits his D.C. hotel, which is just a few block from the White House down Pennsylvania Avenue. 

The attorney general found top campaign aide Rick Gates managed discussions with the hotel about the event space. The attorney general's office also claims inaugural committee event planner Stephanie Winston Wolkoff raised concerns about the hotel's pricing with the president, Gates and Ivanka Trump. The contract the committee ultimately entered cost the committee more than $1 million, far above the hotel's own internal pricing guidelines, according to the attorney general's office. The attorney general also claimed the committee paid for event space for a party for the president's adult children. 

A spokesperson for the inaugural campaign insists they were within the law.

"The facts will show that the PIC operated in compliance with the law and this suit is without merit. In fact, it reads more like a partisan press release than a legal filing. The PIC has also received no outreach from the DC AG since last summer which, when coupled with the obviously suspect timing of the complaint, confirms the completely baseless nature of the allegations," the spokesperson said.

And the Trump Organization called the claims utterly false, and nothing more than a "PR stunt." 

"The AG's claims are false, intentionally misleading and riddled with inaccuracies," a spokesperson for Trump Hotels said in a statement provided to CBS News. "The rates charged by the hotel were completely in line with what anyone else would have been charged for an unprecedented event of this enormous magnitude and were reflective of the fact that hotel had just recently opened, possessed superior facilities and was centrally located on Pennsylvania Avenue. The AG's after the fact attempt to regulate what discounts it believes the hotel should have provided as well as the timing of this complaint reeks of politics and is a clear PR stunt." 

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