Trump Foundation "has operated in persistent violation of state and federal law governing New York State charities" for more than a decade by, among other things, paying off legal bills with charitable funds, the New York Attorney General's Office said in a lawsuit it filed Thursday.
"Mr. Trump ran the Foundation according to his whim, rather than the law", the lawsuit says, claiming he used the charity's millions of dollars to pursue vanity projects, finance his run for president, and settle legal threats to the Trump family's corporate empire.
The foundation also paid $5,000 to one organization for "promotional space featuring Trump International Hotels", and another $32,000 to satisfy a pledge made by a privately held entity controlled by Mr. Trump to a charitable land trust.
Illustrating the poor management of the foundation, of which Trump was president until moving into the White House in January 2017, the lawsuit said its board had not met since 1999.
Trump vowed that he would never settle the case, brought by current Attorney General Barbara Underwood.
The president fired back on Twitter shortly after news of the lawsuit broke. IRS and FEC representatives declined to comment.
In a couple of tweets, Trump called the case "ridiculous". Underwood not only wants to shut down the foundation, she wants to bar Donald Trump from leading another NY charity for 10 years and his children from serving on any nonprofit boards for a year.
Comey later headed a separate probe into alleged ties between President Donald Trump's campaign and Russian Federation. She is seeking to dissolve the foundation, in addition to barring Donald Sr. from serving on nonprofit organizations for 10 years, and his three eldest kids for one year.
In 2013, for instance, the foundation nakedly violated tax law by cutting a $25,000 check to Florida Attorney General Pam Bondi's re-election fund, the suit claims.
Corey Lewandowski, then Trump's campaign manager, dictated the timing, amounts and recipients of grants from the event, according to the lawsuit, and other campaign officials were involved in the preparations.
The foundation went on to make at least five grants of $100,000 each to Iowa groups before the caucuses, with Trump presenting giant checks at a series of campaign rallies. If nothing else, Ms Underwood's action on Thursday moved the Trump Foundation closer to an end.
The Trump Foundation also attacked the attorney general's office and said it was playing "politics at its very worst". Trump's tweets also pointed to Schneiderman's resignation and his support for Trump's 2016 Democratic presidential rival, Hillary Clinton.
The Trump campaign, at the time, said the foundation meant to co-operate with the investigation.
Associated Press writers Ryan J. Foley in Iowa City, Iowa; Jake Pearson in NY and Tami Abdollah and Jill Colvin in Washington contributed.