Trump Closely Involved In Payoffs To Karen McDougal And Stormy Daniels
New reports indicate that Donald Trump was closely involved in the efforts to buy the silence of a Playboy model and a former adult film star.
The Wall Street Journal is reporting that in the weeks before the Presidential election in 2016, President Trump personally facilitated the payments that ware made to Stormy Daniels and Playboy model Karen McDougal
As a presidential candidate in August 2015, Donald Trump huddled with a longtime friend, media executive David Pecker, in his cluttered 26th floor Trump Tower office and made a request.
What can you do to help my campaign? he asked, according to people familiar with the meeting.
Mr. Pecker, chief executive of American Media Inc., offered to use his National Enquirer tabloid to buy the silence of women if they tried to publicize alleged sexual encounters with Mr. Trump.
Less than a year later, Mr. Trump asked Mr. Pecker to quash the story of a former Playboy model who said they’d had an affair. Mr. Pecker’s company soon paid $150,000 to the model, Karen McDougal, to keep her from speaking publicly about it. Mr. Trump later thanked Mr. Pecker for the assistance.
The Trump Tower meeting and its aftermath are among several previously unreported instances in which Mr. Trump intervened directly to suppress stories about his alleged sexual encounters with women, according to interviews with three dozen people who have direct knowledge of the events or who have been briefed on them, as well as court papers, corporate records and other documents.
Taken together, the accounts refute a two-year pattern of denials by Mr. Trump, his legal team and his advisers that he was involved in payoffs to Ms. McDougal and a former adult-film star. They also raise the possibility that the president of the United States violated federal campaign-finance laws.
The Wall Street Journal found that Mr. Trump was involved in or briefed on nearly every step of the agreements. He directed deals in phone calls and meetings with his self-described fixer, Michael Cohen, and others. The U.S. attorney’s office in Manhattan has gathered evidence of Mr. Trump’s participation in the transactions.
Mr. Cohen, who left the Trump Organization to serve as the president’s personal attorney in early 2017, and other aides denied Mr. Trump played any role in the two hush-money deals when they were first reported in the Journal.
Federal prosecutors in Manhattan came to believe otherwise. In August, they outlined Mr. Trump’s role—without specifically naming him—in a roughly 80-page draft federal indictment they had been preparing to file against Mr. Cohen.
When Mr. Cohen pleaded guilty that month to campaign-finance violations, prosecutors filed a 22-page charging document asserting that Mr. Cohen “coordinated with one or more members of the campaign, including through meetings and phone calls, about the fact, nature, and timing of the payments.”
The unnamed campaign member or members referred to Mr. Trump, according to people familiar with the document.
The revelations about Mr. Trump’s involvement in the hush-money deals come as Special Counsel Robert Mueller continues his probe into Russian electoral interference, and as a newly elected Democratic majority in the House of Representatives has signaled its intention to investigate the Trump administration when it takes power. Manhattan federal prosecutors who investigated Mr. Cohen are now examining business dealings by the Trump Organization.
Mr. Cohen, who implicated the president in his crimes when he pleaded guilty in August, has met with investigators for Mr. Mueller and with federal prosecutors in New York, seeking to provide information that could mitigate his sentence, which is scheduled for Dec. 12.
He told federal prosecutors he conferred with Mr. Trump in the weeks before the 2016 election about paying Stephanie Clifford, the former adult-film star known professionally as Stormy Daniels, to keep quiet about her allegations of a sexual encounter with Mr. Trump. He told them that Mr. Trump urged him to “get it done.”
Mr. Cohen has also described to prosecutors his discussions with Mr. Trump and a Trump Organization executive about how to pay Ms. Clifford without leaving the candidate’s fingerprints on the deal.
The Journal report then goes on to detail the extent of Trump’s involvement in both the payoff by Pecker and his company, which owns the National Enquirer and several other publications, to arrange for the silence of Karen McDougal, who has alleged that she had a months-long affair with Trump back in 2005 and 2006 when his wife was pregnant with their son Barron, and Stephanie Clifford (a/k/a Stormy Daniels), who has alleged at least one sexual encounter with Trump during the same time period. This report runs counter to the claims that Pecker, Cohen, and Trump had made that the President, then a candidate for President, was involved in any of the negotiations with the two women and also denied that he had any knowledge regarding the agreements that were ultimately reached with the two women and the payments that were made to them in connection with those two payoffs. Notwithstanding those denials, the Journal’s report makes clear that Trump was intimately involved with these negotiations, was aware of the terms of the agreements reached with the women and the status of the negotiations, and was fully aware of the mechanisms by which the two women would be paid to remain silent about their respective relationships with Trump a decade earlier. In other words, it is clear from this report that Pecker, Cohen, and Trump all lied to the media when they claimed that the President had no idea what was going on.4
As noted, the original claim from the White House was that the President had no idea what was going on with regard to these payments, and the President himself restated this position several times when asked about it by reporters. In addition to the fact that these claims of ignorance did not pass the test of credulity, generally speaking, these claims quickly began to fall apart in the spring of this year. In May, for example, Rudy Giuliani, who had at that point only recently joined the President’s legal team, appeared on Fox News Channel and revealed, to the surprise of many, that not only did the President know about the payoff to Daniels but that he had reimbursed Cohen for the $130,000 that was paid to Daniels. A week later, the President released an updated financial disclosure in which he acknowledged having reimbursed Cohen beginning late in 2016 and continuing into the beginning months of his time as President. These reports were later substantiated by the report that Cohen had recorded his conversations with the President regarding a separate payoff to Playboy model Karen McDougal, which took place at roughly the same time as the Daniels payment. In both cases, it seems clear from the context that the intent of the payment was to protect the campaign, which would mean both payments violate applicable campaign finance laws.
One important piece of information in the report is that the beginning of the negotiations with both Daniels and McDougal were apparently linked to the release of the Access Hollywood tape, which was quickly followed up by allegations from more than a dozen women of sexually inappropriate behavior by Trump over the years. As election law expert Rick Hasen noted back in August, this is potentially very legally significant:
Cohen’s payment to Daniels, if motivated to help the campaign, would be a likely campaign finance violation. Depending on his motive, either Cohen made an excessive and unreported “in kind” contribution to the campaign—by funding a payment in excess of the $2,700—or Cohen made an unreported loan to the campaign which the Trump campaign should have reported. If Trump knew about it at the time, Trump could be implicated in a conspiracy with Cohen.
The problem with this case, as in the 2012 case against John Edwards for payments by supporters to his mistress, is the question of whether the funds were campaign-related. Edwards’ defense was that his payments were personal to help his relationship with his wife—not campaign related—an argument that led to Edwards being acquitted on one charge and the jury deadlocked on the others.
So too it could be with the Cohen-Daniels payment. If Cohen intended the payment to preserve Trump’s relationship with his wife Melania, for example, rather than to bolster the campaign, then there would be no campaign finance violation. As I have been saying for a while, the case could turn on whether there is documentary evidence indicating an intent one way or the other.
The Journalreports federal prosecutors view the release of the “Access Hollywood” tape as the “trigger” for Cohen’s payments to Daniels.
That’s a big deal. Two important Republican election lawyers have attempted to set a high bar for how to tell when a payment in this context might be campaign-related rather than personal. Charlie Spies told the Journal in February that the payment to Daniels was “an expense that would exist irrespective of whether Mr. Trump was a candidate and therefore should not be treated as a campaign contribution.” And former Federal Election Commission chair Brad Smith wrote in an April op-ed in the Journal that “FEC regulations explain that the campaign cannot pay expenses that would exist ‘irrespective’ of the campaign, even if it might help win election. At the same time, obligations that would not exist ‘but for’ the campaign must be paid from campaign funds.”
Even under these tough standards for what counts as campaign-related, the proof of the timing would be damning for Cohen. Why should Cohen not care a whit about protecting Trump’s reputation in his wife’s eyes in September 2016, but be anxious to close the deal—and shut Daniels up—right as the campaign faced a crisis involving allegations of Trump’s treatment of women? The Daniels payment was not an expense that existed until the campaign needed it. But for the campaign, it seems that Cohen would not have paid.
The payment to Daniels has gotten attention largely thanks to the salacious details that Daniels has revealed about her relationship with Trump and the fact that the President’s statements on the matter have been, shall we say, inconsistent. However, as I’ve noted in the past, there are potentially serious legal consequences involved here as well that could come back to bite both Cohen and Trump. Additionally the recent revelations about what the President may have known about the payment from Cohen to Daniels, when he knew it, and the apparently now established fact that he ultimately reimbursed Cohen for the payment could give investigators grounds to expand the investigation of Trump’s personal and business finances both in connection with the Cohen investigation in New York and the investigation being led by Robert Mueller into Russian interference with the 2016 election and ties between the Trump campaign and Russian official.
The most paramount legal implication comes from the potential violation of campaign finance laws. If it can be established that the payment to Daniels was made primarily out of the fear that her allegations could become public immediately prior to the 2016 election then that payment could be interpreted as being an illegal in-kind campaign contribution. In that respect, these revelations are potentially quite significant if they turn out to be accurate. From the report, it seems as though Cohen (and by extension Trump) rejected the idea of making any kind of payment when initially approached by the lawyer that was representing Daniels in September 2016 but that they significantly changed their tune after the release of the Access Hollywood tape, which was quickly followed by a group of women that ended up numbering nearly two dozen who accused then-candidate Trump of having sexually harassed them in the past. The immediate impact of those revelations, of course, was exceedingly negative for Trump’s campaign. Not only did it lead many Republicans to openly attack their party’s nominee less than a month before Election Day but it also had a measurable impact on the polling that was only reversed by the release of the letter regarding reopening the Clinton email investigation that James Comey sent to Congress about two weeks later. As Hasen notes, this makes it highly probable that the payment to Daniels was meant to protect Trump the candidate and the Trump campaign, not to protect Trump the person or the Trump marriage. If that’s the case, then the payment would seem to clearly fall within the kind of illegal in-kind campaign contribution that the election laws contemplate.
The most significant thing that has happened since that report in August, of course, is that Cohen has pled guilty to a number of charges, including several related to the payments to Daniels and McDougal, and that in doing so he indirectly implicated Trump in the entire illegal scheme. This report not only provides far more detail about the President’s involvement in that scheme, but it also tends to bolster the allegations that Cohen makes via the admissions set forth in his plea agreement. Where this all leads is unclear, but it does seem to reinforce the reasons why, as was reported repeatedly throughout the summer, Trump has as much to worry about from a legal perspective from what Michael Cohen might tell prosecutors as he does from the ongoing Russia investigation in Washington. Now that Democrats will have control of the House and its investigatory powers starting in January, it seems inevitable that we’ll be learning more about all of this, and more, as time goes on.