NEW YORK • The New York State Attorney-General's Office filed a scathingly worded lawsuit yesterday taking aim at the Donald J. Trump Foundation.

It accused the charity and the Trump family of sweeping violations of campaign finance laws, and self-dealing - or transactions benefiting President Donald Trump's personal and business interests -as well as illegal coordination with the presidential campaign.

The lawsuit, which seeks to dissolve the foundation and bar Mr Trump and his three eldest children, Donald Jr, Ivanka and Eric, from serving on non-profit organisations, was an extraordinary rebuke of a sitting president.

The Attorney-General also sent referral letters to the Internal Revenue Service and the Federal Election Commission for possible further action, adding to Mr Trump's extensive legal challenges.

The lawsuit, filed in State Supreme Court in Manhattan, was the culmination of a nearly two-year investigation of Mr Trump's charity, which became a subject of scrutiny during and after the 2016 United States presidential campaign.

While such foundations are meant to be devoted to charitable activities, the complaint asserts that Mr Trump's was often used to settle legal claims against his businesses, even spending US$10,000 (S$13,300) on a portrait of Mr Trump that was hung at one of his golf clubs.

The foundation was also used to curry political favour, the lawsuit asserts. During the 2016 race, the foundation became a virtual arm of Mr Trump's campaign, e-mail traffic showed, with his campaign manager Corey Lewandowski directing its expenditures, even though such foundations are explicitly prohibited from political activities.

Mr Trump immediately attacked the lawsuit, characterising it in a Twitter post as an attempt by "sleazy New York Democrats" to damage him. He vowed not to settle the case.

The US$10,000 portrait was one of several examples of the foundation being used in "at least five self-dealing transactions", according to the Attorney-General's Office, violating tax regulations that prohibit using non-profit charities for private interests.

In 2007, to settle a dispute between the City of Palm Beach and Mr Trump's Mar-a-Lago resort, the foundation paid US$100,000 to the Fisher House Foundation, another charity.

In 2012, Mr Martin B. Greenberg sued the Trump National Golf Club after he made a hole-in-one at a fund-raising golf tournament that promised to pay US$1 million to golfers who aced the 13th hole, as he did. As part of a settlement, the foundation paid US$158,000 to a foundation run by Mr Greenberg.

It also paid US$5,000 to one organisation for "promotional space featuring Trump International Hotels", and another US$32,000 to satisfy a pledge made by a privately held entity controlled by Mr Trump to a charitable land trust.

The foundation lawsuit and the referrals to the federal agencies are the latest of Mr Trump's voluminous legal challenges, starting with the ongoing investigation into ties between Mr Trump, his associates and Russia.

NYTIMES