The auction, offering coffee with the next first daughter during a 45-minute private meeting, had been running for 10 days and had drawn 28 bids, the highest of which had reached USD 72,888.
"The bidders included at least three businessmen who said in interviews that they saw their donation as an opportunity to have coffee with Trump to press her for information about her father's plans as president or to try to urge (him) Trump to take up an issue important to them," a report in the New York Times said.
The Trump Organisation said in a statement that the Trump family had waited to decide what to do about the auction until "our team was aligned on steps moving forward".
"We wanted to handle this with proper discretion once this was brought to our attention," said the statement.
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Richard Painter, who served as an ethics lawyer for former president George Bush, said that Ivanka should not have been soliciting charitable donations from the public in exchange for special access, given the prominent role she has played in the transition effort and the prospect that she may serve as an informal adviser to her father's administration with an office in the White House.
Eric Trump issued a statement, expressing regret that the charity effort had to be called off.
"Today, the only people that lost are the children of St Jude," his statement said.
Painter said if Ivanka is going to be in the government and "a power behind the throne she should observe the same ethics restrictions that other White House employees face".
She had planned to have her coffee with the winning bidder either at Trump Tower in New York or the Trump International Hotel in Washington.
He said the first family should cease all such fund- raising, no matter how noble the cause, or they could find themselves facing the same allegations that Hillary Clinton did over the Clinton Foundation.