WASHINGTON (AFP) - Mr Donald Trump's presidential hopes has suffered a punishing new setback as the authorities clamp down on his charitable foundation, while Mrs Hillary Clinton seized the offensive to brand him an unscrupulous businessman.
With just five weeks to go before the Nov 8 election, Mr Trump is seeking to climb out of one of the darkest periods of his White House campaign as his vice-presidential pick Mike Pence goes toe to toe against Democratic Senator Tim Kaine late Tuesday (Wednesday morning, Singapore time) for their only debate of the campaign.
Already weakened by damaging revelations about his taxes, the real estate billionaire was hit with an order by New York Attorney-General Eric Schneiderman that the Donald J. Trump foundation must "cease and desist from soliciting contributions" in New York.
The notice informed the charity that it had engaged in fund-raising activities not permitted under the law because it had not been registered with the state authorities.
With Team Trump on the defensive after leaked documents suggested he may have paid no income tax for two decades, his Democratic rival rounded on him as a business bully who cares little for his fellow countrymen.
"While millions of American families, including mine and yours, were working hard paying our fair share, it seems he was contributing nothing to our nation. Imagine that," a fired up Mrs Clinton said in Toledo, Ohio.
"He has been 'dissing' America in this whole campaign," she charged, riding high on a surge in polling carried out after the bruising first presidential debate.
The pair face off in their second showdown on Sunday.
Mr Trump used an appearance before military veterans in Virginia to pound the former secretary of state once more for handling classified information via a "basement" private e-mail server.
But he appeared to stumble when he addressed veterans suffering from post-traumatic stress disorder, suggesting some were returning from battle ill-equipped to cope.
"When you talk about the mental health problems, when people come back from war and combat and they see things that maybe a lot of the folks in this room have seen many times over, and you're strong and you can handle it, but a lot of people can't handle it," he said.
Mrs Clinton pounced on the comment in the evening, posting a fact-checking page on her website muddying Mr Trump's record on veterans.
"A person who implies that veterans suffering from PTS are not 'strong' is unfit to be Commander-in-Chief. Period," she said on Twitter.
Mr Trump's strongest line of attack has been personal in recent days, and of a degree of brutality rare even for this year's bare-knuckles campaign. He mocked Mrs Clinton over the weekend for coming down with pneumonia and even questioned her fidelity to her husband.
"Hillary Clinton's only loyalty is to her financial contributors and to herself," he said.
"I don't even think she's loyal to Bill, if you want to know the truth. And really, folks, really, why should she be, right?" said the Manhattan tycoon, who revived talk of Mr Bill Clinton's past infidelities following his lacklustre debate performance.
His campaign manager Kellyanne Conway meanwhile accused Mrs Clinton on CNN of working to "blame and shame the women who had consensual sex with her husband over a number of years".
Mr Trump has defiantly dodged mounting questions about his tax record. His top allies praised their candidate's business acumen following a weekend bombshell revelation by The New York Times that he declared a loss of US$916 million (S$1.3 billion) on his 1995 tax return, enabling him to legally avoid paying taxes for up to 18 years.
If true, the report based on documents leaked to the Times is proof of the tycoon's "absolute genius", former New York mayor and Trump surrogate Rudy Giuliani said.
Mr Trump reportedly took massive, albeit legal, tax breaks on failing businesses, earning millions for himself while shareholders and investors swallowed the losses and contractors went unpaid.
Mrs Clinton seized on the Times report to blast her rival not just for refusing to pay his share, but as a business failure.
"How anybody can lose a dollar, let alone a billion dollars, in the casino industry is kind of beyond me," she said. "Here's my question: What kind of 'genius' loses a billion dollars in a single year?"
Mr Trump parried the accusations during a rally in Pueblo, Colorado, saying he has long railed against "unfairness" of US tax laws.
"Honestly, I have brilliantly used those laws," he said.
"As a businessman and real estate developer, I have legally used the tax laws to my benefit, and to the benefit of my company, my investors and my employees."
Polls released by Politico/Morning Consult and CNN/ORC show Mrs Clinton with a six-point and five-point lead, respectively.
A fresh Quinnipiac battlegrounds poll also showed Mrs Clinton leading in the key swing states of Florida, Pennsylvania and North Carolina, but trailing Mr Trump in Ohio.