House report finds lax federal oversight of Trump's DC hotel

FILE - A passerby takes a look at the front of The Trump International Hotel on March 4, 2021, in Washington. A federal agency overseeing Donald Trump's Washington hotel let possible constitution violations go unchecked by failing to track millions of dollars from foreign governments that patronized the property. (AP Photo/Julio Cortez, File) (Julio Cortez, Copyright 2021 The Associated Press. All rights reserved.)

NEW YORK – The federal agency overseeing the lease of the luxury hotel that Donald Trump's family company runs in the nation's capital failed to carry out its basic responsibilities because it never tracked the millions of dollars from foreign governments patronizing the hotel or examined the origins of a $75 million loan that helped keep its doors open, according to a congressional report Thursday.

The General Services Administration "washed its hands of responsibility” to review how much the Trump International Hotel was profiting during his presidency from foreign government payments in possible violation of the Constitution's emoluments clause, according to the report by the Democratic-led House Transportation and Infrastructure Committee. That provision bars presidents from receiving gifts or payments from foreign governments.

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The committee said the GSA “ignored critical ethical and constitutional issues involving then-President Trump’s financial interest in the hotel.”

Neither the agency nor the Trump Organization responded to requests for comment.

In 2019, the agency's internal watchdog had criticized the GSA for failing in crucial oversight of the property.

The committee, led by Rep. Peter DeFazio of Oregon, also said the GSA did not monitor spending at the hotel by state and local public officials that could have violated a separate constitutional provision barring domestic government payments.

The report also faulted the agency for not investigating the origins of a $75 million loan to the hotel, a possible source of conflict between Trump's private financial interests and his public role as president. The loan, according to the report, came from the Trump family.

A separate report by the House Oversight and Reform Committee in October said Trump had misled the public on the hotel's finances. The committee released financial statements showing the hotel had lost more than $70 million while he was president.

Ethics lawyers who have criticized Trump's decision to not divest himself of the Washington hotel and other financial interests before becoming president in January 2017 have repeatedly faulted the GSA for not canceling the family's hotel lease despite language in the contract barring government officials from profiting from the property. The hotel occupies the government-owned Old Post Office building. A federal lease with the Trump family runs nearly 100 years, with extensions.

The GSA has said that its review showed Trump was in “full compliance” of the lease because profits from the hotel were not going directly to Trump while he was president. Trump put his assets in a trust controlled by his two adults sons and a longtime executive before his term began.

Separately, the GSA confirmed this week that the Trump Organization had given formal notice that it had reached agreement to sell the hotel lease for $375 million to CGI Merchant Group, a Miami-based real estate investment firm. The GSA needs to sign off on any purchase.

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