'It is unacceptable': Ethics doubts swirl as Trump club doubles fee

US President Donald Trump's Mar-a-Lago resort in Palm Beach on Dec 30, 2016.
US President Donald Trump's Mar-a-Lago resort in Palm Beach on Dec 30, 2016.PHOTO: NYTIMES

UNITED STATES (NYTIMES) - On the same day that the Trump Organization announced its appointment of two ethics monitors to advise on potential conflicts of interest, it faced a new ethical quandary: Is it right to double the price of the initiation fee at Mar-a-Lago, the Trump family's private club in Florida, or would that be seen as cashing in on President Donald Trump's arrival in the White House?

The question emerged after Bernd Lembcke, the managing director of the 118-room club in Palm Beach, Florida - which Trump recently labeled the Winter White House - confirmed on Wednesday that the price of new memberships had increased to $200,000 from $100,000, and that applications had surged since Trump won the election in November.

Lembcke's acknowledgment came hours after the Trump Organization announced that it had named Bobby Burchfield, a longtime Republican Party lawyer and corporate litigator, as an "independent ethics adviser." The Trump Organization pointed to the move as a sign of its commitment to addressing questions about potential conflicts of interest.

"We take our role and the responsibility we have to our company, and our thousands of employees, very seriously," Eric Trump, one of the president's sons and an executive vice president of the Trump Organization, said in a statement announcing the appointment of Burchfield.

But Robert Weissman, the president of the government ethics watchdog group Public Citizen, said the selection of Burchfield and the decision to double the Mar-a-Lago initiation fee demonstrated that the Trump Organization was unprepared to confront the ethics challenges it now faces.

"At the minimum, this creates the appearance of cashing in on the presidency and selling direct personal access to the president," Weissman said of the new Mar-a-Lago fee. "It is unacceptable. And it demeans the office of the presidency." Lembcke said in an interview that the fee change had been planned last fall, before the election, and that $200,000 was the cost before 2010, when it was cut in half because of the recession. The fee increase was first reported by CNBC.

Lembcke, who has worked at Mar-a-Lago for 21 years, acknowledged that there had been an increase in the club's popularity resulting from Trump's election, as a wave of new applicants have sought to become members.

"We have had a sudden surge in requests," he said, adding that new members must be recommended by a current member, as is the case at many private clubs.

The new initiation fee went into effect on Jan 1, although he said the annual $14,000 dues remained the same. The club has 482 members, Lembcke said, but has a cap of 500 members.

Asked if having Trump in the White House has meant greater interest in outsiders joining the club - including people who might want access to Trump - Lembcke said, "It enhances it." Trump made a number of appearances at the club during the campaign, and he spent the holidays there last month. He has indicated he intends to be a familiar face at Mar-a-Lago during his presidency.

Members are already noticing differences at the club, particularly when Trump is in town.

"It's now more cachet," said Robin Bernstein, a longtime member. "It's more exclusive." Another member, Jeff Greene, a billionaire developer who ran for a Senate seat in Florida in 2010, said Mar-a-Lago was now a "much more interesting" place.

"I went there for lunch, actually, a couple of weeks ago," he said, "and it was much more crowded than it ever was before." The Trump administration faces a particularly daunting task in confronting potential conflicts of interest, or the appearances of such, given the president's refusal to legally separate himself from his business. He has instead handed it to his children - a decision that has drawn the ire of ethics experts.

The White House also announced on Wednesday that it had appointed a legal team to handle compliance and ethics matters. The team will serve under Donald F. McGahn II, the White House counsel, and consists of four lawyers, including Stefan C. Passantino, who has specialized in campaign compliance and election law issues for clients like Newt Gingrich and J. Dennis Hastert, both former Republican House speakers. McGahn said in a statement that the establishment of the team "reflects the importance of ethics compliance to the President and this administration." In addition to Burchfield's appointment, the Trump Organization also announced on Wednesday (Jan 25) that George Sorial, a longtime executive, would be its chief compliance counsel.

Burchfield served for decades as a Republican Party legal adviser, with clients that included former Rep. Tom DeLay, R-Texas, when he was investigated on allegations of campaign finance violations and money laundering. Burchfield also serves as the chairman of Crossroads GPS, the so-called dark money group founded by Karl Rove, the White House adviser during the administration of former President George W. Bush.

Trevor Potter, a former Republican chairman of the Federal Election Commission, commended Burchfield as a "very good lawyer" and a "competent litigator," but said a better choice, from a conflicts standpoint, would have been a nonpartisan federal judge.

"He is very much a Republican insider," said Potter, who now leads the Campaign Legal Center, a nonprofit focused on campaign finance. "He was undoubtedly picked in part because he has a history of being a reliable Republican lawyer, a partisan who has represented the party in a number of suits. So he is not an outsider." Burchfield declined to comment on Wednesday. A partner in the Washington office of the law firm King & Spalding, he will continue with his practice, and the Trump Organization will essentially serve as a client. His corporate clients have included United Airlines and the NFL, and he has at times offered ethics compliance advice to major corporations and individuals, a lawyer at his firm said.

Elliot S. Berke, a Republican ethics lawyer who has shared clients at times with Burchfield, including DeLay, said Burchfield was not the kind of lawyer who would simply sign off on what his clients asked. "He is an absolute master on complex ethics and compliance issues," Berke said. "He has the ability to be impartial and fair. He would see that as his obligation as a lawyer to do so." Back at Mar-a-Lago, Lembcke said that given the growing interest by potential members in joining the club, "We are very careful in vetting them." But he declined to release a list of new members, saying membership was private.

"That is why you join a private club," he said. "You want privacy." The primary reason so many people want to join is the work Trump has done in upgrading the club since he bought it two decades ago, Lembcke said. Mar-a-Lago was originally built as an estate for Marjorie Merriweather Post, a socialite and the owner of the cereal giant General Foods, and, as the club itself says, it has been on "the VIP list of places that established Palm Beach as a winter haven for the elite many decades ago."