Barbara Underwood, the attorney general, accused the Donald J. Trump Foundation and its directors of conducting "extensive unlawful political coordination" with the campaign, and "repeated and wilful self-dealing" to benefit Trump's personal and business interests.
"The Trump Foundation was little more than a checkbook for payments from Mr Trump or his businesses to nonprofits, regardless of their purpose of legality," Underwood said in a statement. "That is not how private foundations should function."
The foundation could not immediately be reached for comment.
Trump's children were also named as defendants in the attorney general's petition, filed with the New York State Supreme Court in Manhattan.
New York is also seeking $2.8 million of restitution plus penalties, a 10-year ban on Trump serving as a director of a New York nonprofit, and one-year bans for his children Donald Jr, Eric and Ivanka.