WWE’s board finds Vince McMahon paid $5 million to Donald Trump’s charity
The $5 million was reportedly among nearly $20 million in unrecorded company expenses
Contributions totaling $5 million to Donald Trump’s charity in 2007 and 2009 were among $19.6 million in unrecorded company expenses Vince McMahon paid out before he stepped down from World Wrestling Entertainment Inc. amid misconduct allegations, an internal board investigation found.
In securities filings this month, WWE said that the roughly $20 million that came out of Mr. McMahon’s pocket should have been disclosed, because the transactions benefited the company he ran. While the bulk of the payments went to women who accused Mr. McMahon and another WWE executive of sexual misconduct, the company said in the filings that the $5 million was unrelated to such allegations but didn’t state its purpose.
People familiar with the board investigation said the $5 million represented charitable donations to the now-dissolved Donald J. Trump Foundation in the same two years that the then-real-estate developer made appearances at WWE televised events.
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WWE Chairman and CEO Vince McMahon speaks at a news conference announcing the WWE Network at the 2014 International CES at the Encore Theater at Wynn Las Vegas on January 8, 2014 in Las Vegas, Nevada. (Ethan Miller/Getty Images / Getty Images)
Mr. McMahon retired as chairman and CEO last month, ending his four-decade tenure as the head of the company that he and his wife, Linda McMahon, built into wrestling’s biggest business.
An attorney for WWE said the payments to Mr. Trump should have been booked as business expenses because Mr. McMahon was a principal shareholder and the payments benefited the company. He declined to say why the payments benefited WWE.
The tax returns for the Trump Foundation in 2007 and 2009 show contributions of $4 million and $1 million, respectively, from WWE. In 2007, Mr. Trump appeared on the pay-per-view event WrestleMania 23, where he shaved Mr. McMahon’s head in a bit promoted as the "Battle of the Billionaires." He appeared in 2009 on the nationally televised "WWE Raw," with a story line that had Mr. Trump taking over WWE before selling it back to Mr. McMahon at double the price.
In the "Battle of the Billionaires" in 2007, Mr. McMahon and Mr. Trump fought a proxy match, each represented by a professional wrestler, with the winner getting to shave the loser’s head. Mr. Trump’s wrestler won.
A person who reviewed Mr. Trump’s contract for the WrestleMania appearance said that Mr. Trump directed Mr. McMahon to send a $4 million appearance fee to Mr. Trump’s charity.
Mr. Trump had his associates review the contract to ensure that under no circumstances would Mr. McMahon be allowed to shave his head, even if Mr. Trump’s wrestler dropped dead in the ring, this person said.
After the event, Mr. Trump boasted that his appearance had been such a success that Mr. McMahon agreed to give him an additional $1 million, this person said.
Donald Trump, Stone Cold Steve Austin and WWE Chairman Vince McMahon. (Jamie McCarthy/WireImage / Getty Images)
An attorney for WWE didn’t dispute that the contributions were related to Mr. Trump’s appearances but challenged the notion that $1 million was a bonus for the success of the event.
"Mr. Trump and WWE entered into a contract whereby WWE agreed to and did pay him personally an appearance fee of $1 million," Jerry McDevitt, the attorney, said in an email. "At the same time, the McMahons made a personal contribution to the Trump Foundation of $4 million. There was no additional fee paid to Mr. Trump, or any additional contribution to the Trump Foundation, due to the success of the event."
Mr. Trump received a $100,000 fee for his appearance on "WWE Raw" in 2009, while "at the same time" Mr. McMahon and his wife made a $1 million donation to Mr. Trump’s foundation that year, Mr. McDevitt said.
Before the foundation’s dissolution, Mr. Trump had been known to direct his appearance fees there. Comedy Central gave the Trump Foundation $400,000 in 2011, the foundation’s tax return shows. That was the same year Mr. Trump was roasted on the cable channel by Seth MacFarlane, the creator of the television show "Family Guy."
A spokeswoman for Paramount Media Networks, which includes Comedy Central, didn’t respond to requests for comment.
Mr. Trump’s spokespeople didn’t respond to requests for comment.
The $5 million was listed on the foundation tax returns as coming from WWE, but the company said in securities filings this month that the payments came from Mr. McMahon personally.
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The $4 million sent by Mr. McMahon to the Trump charity in 2007 represented 98% of all contributions the foundation received that year, while the $1 million in 2009 amounted to 91% of the foundation’s receipts that year.
Mr. Trump agreed to dissolve the foundation in a settlement with the New York state attorney general’s office, which alleged in a 2018 lawsuit that Mr. Trump misused the charity funds to further his 2016 presidential campaign, pay legal settlements and promote his business.
Mr. Trump admitted to misusing nonprofit funds and was ordered by a New York judge to pay $2 million to charities as part of the 2019 settlement.
"I am the only person I know, perhaps the only person in history, who can give major money to charity ($19M), charge no expense, and be attacked by the political hacks in New York State," he said in a 2019 statement posted on Twitter. "No wonder why we are all leaving!"
WWE said in a Monday securities filing that the internal investigation into the payments by Mr. McMahon is "substantially complete."
WWE Chairman and CEO Vince McMahon attends a press conference to announce a major international event, WrestleMania XXIX, at MetLife Stadium on February 16, 2012 in East Rutherford, New Jersey. (John W. Ferguson/WireImage / Getty Images)
The $14.6 million in settlements Mr. McMahon entered into with women, first revealed by The Wall Street Journal, included a $7.5 million pact in 2018 with a former wrestler who alleged Mr. McMahon coerced her into giving him oral sex. She alleged that Mr. McMahon pushed her out after she refused further sexual encounters, according to people familiar with the deal.
A company spokesman has said a sexual relationship between Mr. McMahon and a former WWE paralegal that resulted in a $3 million settlement this year was consensual. The spokesman has said the company is cooperating with the internal investigation and takes the allegations seriously.
Mr. McMahon remains the majority owner of WWE’s Class B shares, giving him the bulk of shareholders’ voting power, securities filings show.
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Mr. McMahon’s departure came as the Securities and Exchange Commission and federal prosecutors in the U.S. attorney’s office for the Southern District of New York launched their own inquiries into the payments, the Journal previously reported.
Spokesmen for the U.S. attorney’s office and the SEC declined to comment.