Weeks before President-elect Donald Trump even takes office, critics are warning that his vast financial interests threaten to embroil him in conflicts of interest that could cast doubt on the motives for his decisions and have the potential to undermine his presidency.
The billionaire real estate tycoon, soon to be the wealthiest U.S. president ever, is not required by law to divest his financial holdings and has shown no interest in doing so. But numerous past U.S. presidents have done just that, while others — none of them as wealthy as Trump — have placed their holdings in blind trusts while they were in the White House.
The 70-year-old Trump says he plans to turn control of his business empire over to three of his adult children — Donald Trump Jr., Eric Trump and Ivanka Trump, all in their 30s — and other Trump Organization executives.
Trump says he would let this group independently manage his vast array of real estate ventures, golf courses, and other Trump-branded businesses as he heads to the White House to run the country.
Trump has called this arrangement a blind trust, but that is sharply at odds with the normal understanding of the financial mechanism — one in which independent managers control a wealthy individual’s holdings, with the right to sell and buy properties without the individual knowing what transactions are being made.
The president-elect told The New York Times on Tuesday that "in theory" he could continue writing checks at his business organization, but said he is "phasing that out now" and handing over control to his children.
"I'd assumed that you'd have to set up some type of trust or whatever and you don't," Trump said. "The law's totally on my side, the president can't have a conflict of interest."
Nonetheless, he said, "I would like to do something," but hedged about selling his business empire. "That's a really hard thing to do, because I have real estate."
Even so, he said that with his election two weeks ago, "My company's so unimportant to me relative to what I'm doing."
As president, Trump's decisions on trade deals with foreign governments could affect the value of his overseas holdings, as could U.S. military action. Within the U.S., interpretations of anti-discrimination and labor laws could affect how he treats workers at his resorts, while tax code changes would determine how much tax he pays on his business deals.
Last week, even as he interviewed potential cabinet members for his administration, Trump met at his Trump Tower in New York with three Indian business partners who are building a Trump-branded luxury apartment complex near Mumbai.
Not a blind trust
Major U.S. media outlets have written extensively in recent days about the potential conflicts Trump faces. And government watchdogs in the U.S. are crying foul at his planned arrangement, especially since Trump named all three children, along with Ivanka Trump’s husband, Jared Kushner, to his transition team, which is now weighing the appointment of key officials in the new government that takes over January 20. U.S. media reports say Kushner could join his father-in-law's administration as a White House adviser.
Richard Painter, the ethics adviser for former President George W. Bush, the last Republican chief executive before Trump, told VOA that what Trump is planning to do “isn’t a blind trust. He knows what the assets are. He could sell them, or the independent manager could.”
Painter said that without putting his assets in a blind trust, Trump will face continual conflicts between his official acts as president and the impact on his personal wealth.
He said that if Trump loosens banking regulations, as he has announced he plans to, “it could increase his real estate values, at least in the short term.”
Painter said that Trump also faces a legal issue. U.S. law prohibits foreign governments from making any payments to top government officials as they might if national banks had made loans to Trump businesses. “Every single payment would be viewed as a gift,” Painter said.
Karen Hobert Flynn, president of the Washington-based Common Cause government ethics watchdog, said, "I think it will dog every week of his presidency if he doesn't do anything about it."
Flynn said questions would be raised when he meets with foreign leaders in whose countries he has business interests. "Are where he goes and who he meets with in the best interests of the U.S., or just expanding the Trump brand?" she asked.
World of potential conflicts
Trump has substantial business holdings in at least 18 countries, including China, South Korea, Azerbaijan, United Arab Emirates, Uruguay, the Philippines, Turkey and India. Much of his line of commercial products, including furniture and clothing, is manufactured overseas, and all of these activities could be affected — or influenced — by his policies on trade, U.S. military intervention or other global disputes.
In Turkey, a NATO partner and important U.S. ally in fighting Islamic State, Trump has a licensing deal that allows his name to be used on two towers in Istanbul. But he angered some officials there with his campaign call to ban Muslims from immigrating to the United States.
In the U.S., he will oversee the country’s tax collection agency, the Internal Revenue Service, after pointedly refusing to release his U.S. tax returns during the election campaign. It was the first time in 40 years that a U.S. presidential candidate had failed to disclose the documents before an election.
In Washington, he recently opened a luxury hotel a few blocks from his new home at the White House. But a conflict lurks there, too, since Trump’s business empire leases the property for the hotel under a 60-year agreement with the U.S. government’s property management agency.
Whatever the possible conflicts, Trump has shown no inclination to create a blind trust that does not include the three adult children from the first of his three marriages.
On several occasions, Trump has made it clear that he wants the three children to run the business empire.
He said that when he flirted with running for president in 2011, his three eldest children were too young and inexperienced in the business world.
“When I looked last time, they really weren’t prepared, they weren’t ready,” Trump told Britain’s Daily Mail. “But now they’re ready — Ivanka and Don and Eric…”
No undue influence
One of Trump’s staunchest advocates during the election campaign, former New York Mayor Rudy Giuliani, said he sees no problem in letting Trump’s children oversee their father’s business ventures rather than pushing all of his financial interests into an independent blind trust.
Giuliani told CNN recently that if the three children were removed from control, Trump “would basically put his children out of work, and they’d have to go start a whole new business, and that would set up new problems.”
Giuliani — under consideration as Trump’s secretary of state, the government’s top diplomat, or another key job in Washington — said that once Trump assumes power, he would erect “a wall between” himself and his children’s business oversight “with regard to government matters. You have to have some confidence in the integrity of the president."
Reince Priebus, Trump’s choice as White House chief of staff, dismissed concerns about a conflict between Trump's assets and the government he is about to take over.
“I can assure the American people that there wouldn’t be any wrongdoing or any sort of undue influence over any decision-making," Priebus told CNN.
VOA's Cecily Hilleary contributed to this report.