Can a President Trump Keep His Business Intact?
There’s a federal law on the books that could discourage him from holding onto his assets.
Andrew Stark
| Oct 12, 2016
excerpt:
And so in principle anything Trump did in office could affect his brand—whether positively or negatively, wittingly or unwittingly. There’s no evidence to suggest Trump would intentionally use the presidency to secure more wealth for himself. But if he were to maintain his current holdings in the Trump Organization, his ability to make policy in the public interest would be inherently compromised across the board. And the philosophy behind the conflict-of-interest laws is that officials should never be in a position to advance their financial holdings, even if—as Rockefeller argued—they are sufficiently honest to rise above their interests. After all, the democratic electorate can’t ever look into an official’s mind and ensure that his or her decisions are always well motivated.
There is, however, a law outside of the conflict-of-interest statutes that could deter Trump from retaining his business interests while in office—and one that has received insufficient attention. Introduced in the Ethics Reform Act of 1989, it prohibits any senior “noncareer officer” of the government from permitting his or her name to be “used” by any firm that “provides professional services involving a fiduciary relationship.” While the conflict-of-interest statutes exempt the president, the text of the use-of-name law does not, though its use in court would require the repeal of a 25-year-old executive-branch regulation that does exempt the president and vice president. As important, Congress explicitly said this statute was meant to ban the use of an officer’s name not only in traditional fiduciary-based firms, such as law partnerships, but in a range of other ventures including “real estate, consulting and advising, [and] architecture.” The U.S. Office of Government Ethics regulations that apply the law adopted this broad definition.
This is where Trump’s business interests come in: It would appear that many of his organization’s activities fall under those barred by the use-of-name law. On its website, the Trump Organization says that it engages in “real estate sales” and “brokerage” services. Even on a narrow, technical understanding, University of Houston Law professor Teddy Rave told me, “a real-estate broker … can certainly be in a fiduciary relationship with a buyer or seller.” More broadly, the Trump Organization speaks of its “collaborative” relationships and “intimate involvement” with the companies that license Trump’s name; one can, the website boasts, “see the touch of the Trump brand in every aspect of the properties” it works with. That suggests—to use the law’s broad understanding of the kinds of organizations to which an officer of government can’t lend his or her name—that a fair bit of “consulting and advising” might be going on in Trumpworld.
How the use-of-name law would translate to Trump Organization activities isn’t precisely clear. It could mean merely that the company can't invoke "Trump" in its own title if he becomes president. But it might also mean that it can't “use” the Trump name by licensing it to any other entity, which would mean that everything from Trump golf courses to Trump hotels couldn't bear his moniker. That would be the more accurate interpretation, says Kathleen Clark, a professor at Washington University Law in St. Louis, Missouri. Congress’s “endorsement of a broad reading of the statute” was “intended to prevent … outsiders from ingratiating themselves with government officials by providing excessive outside compensation,” she told me. And that would apply to any business licensing Trump’s name.
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http://www.theatlantic.com/politics/archive/2016/10/trump-holdings-conflict-of-interest/503333/I wondered about this in the beginning.
