Pressure Builds on Trump to Divest or Put Holdings in Blind Trust

In a rare point of agreement between liberal transparency groups and Wall Street Journal editorial writers, President-elect Donald Trump is being urged to serve himself and the nation better by taking more drastic steps than currently planned to wall off his financial holdings.

Nearly 20 legal and transparency groups joined by individual government ethics specialists wrote a joint letter to the billionaire released on Thursday, urging Trump to “place all of your business assets and investments into a genuine blind trust or the equivalent. This means that control of these assets would be transferred to an independent trustee who would sell the assets and place the proceeds in investments which do not create conflicts of interest and which are not disclosed to you. Alternatively, you could convert the Trump Organization businesses to cash and buy treasury bills and widely diversified mutual funds. These holdings are deemed conflict-free under federal law.”

The letter was signed by mostly liberal groups, and  White House ethics advisers Norm Eisen (under President Obama) and Richard Painter (under President George W. Bush), along with a scholars Thomas Mann of the Brookings Institution and Norm Ornstein of the American Enterprise Institute, who have teamed up on books highly critical of today’s Congress.

The letter warned that Trump’s holdings in the United States and abroad create potential “conflicts of interest of unprecedented magnitude” in policy, standards for government contractors, consumer protection, the functioning of the civil justice system, financial regulation, labor rights and workplace safety and health standards, and bankruptcy law. “Every time any private party sees an opening for litigation against a Trump business entity," the letter said, “that person, perhaps in collusion with your political opponents, could file suit, perhaps even against you personally, embroiling the presidency in litigation.”

“Draining the swamp is important,” said Scott Amey, general counsel of POGO, but "avoiding self-dealing at all costs is absolutely essential.”

The letter comes as the Trump Organization, the umbrella for all the president-elect’s companies, is preparing to transfer management of the president-elect's companies to his adult children. It has said none of his children—referring primarily to Donald Jr., Eric and Ivanka-- will formally join the administration, but instead will participate on the executive committee of the transition team.  A Trump spokesman told a Wall Street Journal reporter this week that the “structure” it chooses to transfer management to Trump’s children will “comply with all applicable rules and regulations.”

On the Trump family questions, the letter said “a clear firewall must be established so that these family members have no involvement with policy decisions at the White House.” The White House Counsel would enforce this firewall. “This means you should pledge not to discuss the businesses with your children or anyone else involved," the letter stated. "Contacts about the Trump businesses should be prohibited between all other administration officials and people involved in the businesses, including any of the children who maintain an ongoing involvement with the businesses.”

On Friday, the Wall Street Journal editorial page also recommended a blind trust. “The left is already teeing this up as a target,” it wrote. “Answer: liquidate” Trump’s stake in the company and put the cash in a true blind trust. “There is no question that a Trump business sale would be painful and perhaps costly,” it said. But “if he wants to succeed, he’s going to have to make a sacrifice and lead by example.”