As Trump Cries ‘No Collusion,’ Other Campaign Probes Close In

(Bloomberg) -- The tawdry tale of a hush money payment to a porn actress has ballooned into an investigation of considerable peril to people around President Donald Trump’s campaign.

Fresh details emerged in court papers Wednesday about how Trump loyalists conspired to keep American voters from learning about the candidate’s alleged affairs. A tabloid publisher, American Media Inc., told prosecutors that the president’s lawyer and at least one Trump campaign member helped hatch the plan to buy and bury such stories more than a year before the election -- and federal prosecutors in New York are continuing to investigate.

It’s the latest example of potential Trump campaign violations with no apparent link to Russian election meddling. The hush-money case was referred to federal prosecutors in New York by Special Counsel Robert Mueller’s team, who have unearthed a raft of other legal problems while pursuing possible collusion with Russia.

The investigation into the suppression of negative news has already resulted in a guilty plea by Trump’s ex-lawyer, Michael Cohen.

“I never directed Michael Cohen to break the law,” Trump tweeted on Thursday morning. He continued to insist that no crime was committed and wrote that Cohen had agreed to plead guilty only to “embarrass the president and get a much reduced prison sentence.”

Other authorities are asking questions about at least two campaign issues: the improper use of money by the Trump Foundation in Iowa, and the possible coordination of messaging with the National Rifle Association. Less is known about those inquiries. Pivotal to all three cases, though, is whether people around Trump knowingly broke campaign finance or other laws on the way to Trump’s 2016 election victory.

‘Broader Potential Conspiracy’

Under its non-prosecution agreement, AMI, the publisher of the National Enquirer, is providing useful information, said Randall Eliason, a former federal prosecutor who teaches at George Washington University. “When you look at that, coupled with statements in Cohen’s sentencing documents that he acted with others in the Trump campaign, there’s clearly indications that prosecutors are looking at a broader potential conspiracy.”

AMI admitted that it agreed to buy and bury damaging stories about Trump and made a payment to suppress a Playboy model’s allegations that she’d had an affair with Trump. It agreed to cooperate for three years.

“You now have AMI admitting that the payments were made for the purpose of influencing the election,” said Robert Mintz, a former federal prosecutor who is now in private practice in New Jersey and isn’t involved in the case. “It’s a critical admission because, if true, it transforms the payment into a criminal violation as opposed to simply a private transaction.”

U.S. Senator Dianne Feinstein of California, the ranking Democrat on the Judiciary Committee, agreed.

“Evidence continues to build that President Trump directed a violation of campaign finance law to affect the presidential election,” she said in a statement Wednesday. “These are serious, criminal allegations and they demand further scrutiny from Congress.”

Trump Charity, NRA

In New York, the state attorney general has alleged that the Trump Foundation, which is overseen in part by Trump’s sons Don Jr. and Eric, improperly diverted funds to the campaign in the Iowa caucus. The attorney general’s office filed a lawsuit against the Trump Foundation in June, naming Trump and the children and citing violations of state and federal laws.

At the time, Trump tweeted that “sleazy New York Democrats” were behind the legal action.

While the New York Attorney General is looking into the improper use of charity funds, another case turns on a law that prohibits candidates and political action committees from coordinating their ad buys. Last week, a good-governance group filed a complaint with the Federal Election Commission urging it to investigate whether the NRA and the Trump campaign improperly worked together in the 2016 race.

The complaint, based on revelations in Mother Jones and The Trace, cites millions of dollars in ad buys that both groups placed using the same network of consulting firms.

Secret Keeper

In the hush-money matter, Cohen, the longtime keeper of Trump’s business and personal secrets, is spilling. So is the media kingpin who was deeply involved. Once dismissed as tabloid fodder, the saga escalated once two women -- including porn star Stormy Daniels -- who were paid off no longer agreed to keep mum.

Trump’s relationship with AMI’s chief executive officer David Pecker runs deep. He once said the company deserved journalism’s Pulitzer Prize. Not only did the two men talk frequently from the president’s Mar-a-Lago base in Florida, but Trump’s son-in-law, Jared Kushner, had worked on a bid to buy the company in 2014, according to people familiar with the effort.

Kushner already controlled a New York media property, the New York Observer. The deal ultimately fell through because of weak advertising revenue.

As the fledgling Trump campaign was gearing up in 2015, American Media’s Pecker met with Cohen and at least one other campaign member to talk about how to suppress negative news that could arise, according to court documents released Wednesday. It’s not clear who the other campaign official might be.

American Media went on to buy the rights to the story of Karen McDougal, who described an affair with the president, with the intent of keeping it out of circulation, the company now concedes. The media company was supposed to be repaid by Cohen, it now says. Though that never happened, AMI has previously referred to the deal as profitable. That raises questions about what it might have earned in return. It was also involved in spiking an unflattering story by a doorman in a Trump building.

‘You Never Know’

Trump and Cohen at one point considered purchasing all the negative information Pecker’s company had acquired on Trump.

In a phone recording broadcast on CNN this past July, Trump and Cohen appeared to discuss the effort. “I need to open up a company for the transfer of all that info regarding our friend, David,” Cohen said about Pecker. “It’s all the stuff. All the stuff, because you never know.”

During the campaign, Trump considered creating his own media company because of the ratings bonanza he garnered for news outlets, according to published reports. Ideas swirled about the possibilities, especially since most prognosticators gave him little chance of winning. Trump brushed aside the idea in September 2016. “I have no interest in a media company,” he told the Washington Post. “False rumor.”

Kushner handled important matters behind the scenes during the presidential campaign and afterward moved into the White House as a trusted adviser.

When MSNBC’s morning hosts went from acquaintances of Trump, visiting Mar-a-Lago, to outspoken critics after he became president, the National Enquirer moved forward with a planned story about their then-private, personal relationship.

The hosts, Joe Scarborough and Mika Brzezinski, who subsequently came forward and recently wed, said at the time that the White House communicated to them that the story would be spiked if they apologized to the president. Kushner, according to New York magazine and other publications citing unidentified sources, was one of the messengers. Kushner’s representatives declined to comment at the time.

Prosecutors in the Southern District of New York, who charged Cohen in August, signaled at that time their intention to pursue their probe into campaign finance violations wherever it leads.

--With assistance from Shahien Nasiripour, Patricia Hurtado, Chris Dolmetsch, Gerry Smith and Bob Van Voris.

To contact the reporters on this story: Greg Farrell in New York at gregfarrell@bloomberg.net;David Voreacos in federal court in Newark, New Jersey, at dvoreacos@bloomberg.net;Polly Mosendz in New York at pmosendz@bloomberg.net

To contact the editors responsible for this story: Jeffrey D Grocott at jgrocott2@bloomberg.net, Peter Blumberg

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