Though no longer president of the United States, Donald Trump is still making headlines. In an exclusive interview with Rolling Stone, two unidentified sources allege that the Trump Organization has committed insurance fraud. In 2011, a flood damaged Trump’s golf course in Westchester County, N.Y. The Trump Organization received $1.3 million in an insurance claim payout, but did so by allegedly inflating its damage claims.
Did the Trump Organization's commit flood insurance fraud over its Westchester golf course?
Despite such a large payout, only $130,000 or $150,000 was used to facilitate renovations for the Trump National Golf Club in Briarcliff Manor. The unnamed insurance company smelled a rat when the Trump Organization did not provide receipts to account for the damages. With the lack of evidence to back the claim, the insurer withheld an unlisted amount of the total insurance claim payout.
Additional unnamed sources told Rolling Stone that this insurance scheme is not one-off behavior for the Trump Organization. They allege the company is a habitual insurance defrauder with a history of inflating the amounts of repairs needed for Briarcliff. The source detailed that “the company would routinely gather overinflated repair estimates, often from members of Trump’s clubs, that could be used to justify insurance claims.”
Shabby modifications and lack of accountability at Briarcliff Village.
Rolling Stone details that “Trump Organization calculated that it got more than $2 back from insurers for every dollar it paid in — a return of more than 100 percent. Broadly, the source says, the company viewed insurance not as an expense, but rather as an ongoing source of profit.'” The company also received even more money in insurance claims because the company improperly modified golf course features that were originally meant to serve as protection from floods.
The anonymous source also claims that these modifications were only done for aesthetic reasons and not for the safety or efficiency of the golf course. This resulted in $250,000 in damages. More specifically, the organization turned grassy basins meant to catch rainwater into ponds that caused massive flooding after the course received 5 inches of rainfall. Trump’s company denies accountability for this ordeal and refuses to pay the estimated $238,000 in damages.
After both the village and Trump Organization played hot-potato with the blame, the case settled with the Trump Organization offering a mere $50,000. This insurance fraud allegation is one of many legal issues Trump's Briarcliff Manor is facing, including tax evasion.
The future looks grim for Donald Trump.
It’s uncertain when the totality of Trump’s legal problems will be behind him considering his reluctance to release his taxes. Additionally, when they were finally released, it revealed the breadth of his tax avoidance and his chronic business losses. According to the NY Times, Trump’s tax records “do not have the specificity to evaluate the legitimacy of every business expense Mr. Trump claims to reduce his taxable income.”
Trump has claimed in the past that his ability to avoid paying taxes “makes [him] smart.” The U.S. District Court for the Southern District of New York may one day have the last word on that.