- Two attorneys general are suing President Donald Trump and accusing him of violating the U.S. Constitution.
- The suit centers partly on foreign governments making payments to Trump's D.C. hotel.
- Trump retained ownership of his businesses when he took office, creating conflict of interest issues
President Donald Trump is being accused of violating a part of the U.S. Constitution that the founders put in place to curb corruption.
The attorneys general for the District of Columbia and Maryland filed a lawsuit making those claims on Monday. They accuse Trump of improperly accepting payments from foreign governments.
Their argument is that Trump — who kept ownership of his businesses when he became president of the United States — is violating the so-called emoluments clauses of the Constitution.
One of the clauses was written to ensure that U.S. government officials would not be corrupted by favors or gifts from foreign governments. Here is the text of the foreign emoluments clause in Article I, Section 9 of the Constitution:
No Title of Nobility shall be granted by the United States: And no Person holding any Office of Profit or Trust under them, shall, without the Consent of the Congress, accept of any present, Emolument, Office, or Title, of any kind whatever, from any King, Prince or foreign State.
Trump's election immediately created concerns that he could use the office to drive more business to his companies. When he took office, he moved his business interests into a trust managed by his sons, saying that this curbed conflicts of interest.
But the president retained actual ownership of the companies, meaning that he still makes money from them. Foreign governments — including Kuwait, Saudi Arabia, Turkey and Georgia — have bought rooms or held events at Trump's D.C. hotel since he took office. The Embassy of Kuwait even switched an earlier booking at the Four Seasons to the Trump hotel, according to the The Washington Post.
Past presidents have traditionally sold their holdings or put them into "blind" trusts run by a third party. For example, before he took office, President Jimmy Carter gave his agricultural holdings to an independent trustee. Presidents George W. Bush and Bill Clinton put investments into blind trusts.
Representatives for Trump had argued that selling his sprawling business empire or putting it into a blind trust would have been too difficult.
In January, Trump promised to track profits from foreign governments and donate them to the U.S. Treasury. But the Trump Organization has not tracked those payments. Instead, it has suggested that it's the responsibility of those foreign governments to report the transactions, NBC News reported last month.
Separately, D.C. Attorney General Karl Racine and Maryland Attorney General Brian Frosh, both Democrats, argued that Trump has violated a constitutional provision to prevent corruption at home. That provision is designed to ensure that the president will not favor one state over another and bars him from receiving any compensation beyond what is approved by Congress.
The attorneys general contended that Trump's presidency has created a situation in which states could feel compelled to make policy decisions that help his businesses.
The White House and Justice Department did not immediately respond to CNBC requests for comment.
The lawsuit is the second filed against Trump over emoluments, and it's the first filed by government entities. Watchdog group Citizens for Responsibility and Ethics in Washington sued the president earlier this year.
But many aspects of the case are unclear. The Supreme Court has never taken up a case about the foreign emoluments clause, according to the Post.
It's therefore not clear how the provision applies to the president. Representatives for Trump have argued that payments for services rendered do not count as a gift as defined by the Constitution.
Another possible hurdle for the attorneys general is that they may have to prove that Trump's businesses have caused harm to their own jurisdictions, according to NBC News. That could come by arguing, for example, that Trump's hotel is drawing business away from the taxpayer-owned D.C. convention center.