Greedy Liar or Flawed Family Man? Cohen Fate Rests on Answer

(Bloomberg) -- A Manhattan federal judge will have to decide between two competing portraits of President Donald Trump’s longtime fixer, Michael Cohen, at a sentencing hearing on Wednesday: The greedy lifelong liar or the family man who made some mistakes.

Cohen confessed nine crimes this year after federal prosecutors said that he had concealed income and evaded taxes, orchestrated a scheme to violate campaign finance laws at the height of the 2016 U.S. presidential election, and lied to banks and Congress. He faces as long as five years behind bars. His lawyers have asked U.S. District Judge William Pauley to spare him prison time.

Greedy Liar or Flawed Family Man? Cohen Fate Rests on Answer

Hours before the sentencing began, media trucks lined the street outside the lower Manhattan courthouse, and Michael Avenatti, the Trump agitator and lawyer for one of two women who Cohen helped pay off in the run-up to the election, appeared in court to watch the proceeding.

Manhattan prosecutors, in a scathing 40-page memorandum, describe Cohen, 52, as a cheater who used his knowledge of the law to live a “double life” marked by deception and threatened people to get his way.

“Cohen knew exactly where the line was, and he chose deliberately and repeatedly to cross it,” the prosecutors wrote in a Dec. 7 filing.

Cohen’s lawyers and his dozens of friends, in letters to the judge, describe a devoted husband and father who slipped up by relying on others and went too far out of zealous loyalty to his demanding boss.

“I suspect the pain his mistakes have caused his wife and children is a very real and incalculable punishment he must live with for the remainder of his life,” wrote Andrew Dworkin, a partner at the Vedanta Capital private equity firm whose daughter was a college roommate of Cohen’s daughter.

Lost Business

Defense lawyers wrote that Cohen, who has been a lawyer since 1992, has already suffered from his actions. He lost all of his consulting business and numerous financial agreements, and several long-term friends abandoned him, the lawyers wrote.

Not long ago, Cohen’s future looked bright. He was boasting to associates about his role in launching Trump’s political career and helping him attain the nation’s highest office, prosecutors said. A plum job in Trump’s administration was sure to follow, he told associates in the aftermath of Trump’s election to the White House.

The offer never came. Instead, in early 2017 Cohen left Trump’s family company and held himself out as Trump’s personal attorney. He opened a consulting firm and began pitching potential clients on hiring him for his insight into a new administration unfamiliar to much of corporate America. Blue-chip firms such as AT&T Inc. and Novartis AG hired him.

But the political success Cohen thought he’d helped engineer had cast a shadow over his new career. A series of moves to silence two women claiming years-old affairs with Trump through secret payoffs near the November 2016 election drew notice from federal investigators, and a drumbeat of news reports raised questions about Cohen’s conduct.

FBI Raid

About 18 months later, in April 2018, agents from the Federal Bureau of Investigation raided Cohen’s premises and took millions of pages of documents and numerous electronic devices.

Within months, Cohen, who once famously said he’d “take a bullet” for Trump, signaled publicly that he was open to cooperating with Special Counsel Robert Mueller, who is investigating Russian interference in the 2016 election, and other federal prosecutors. In a July television interview he declared, “I put family and country first.”

By that point Trump had walked away from his longtime fixer. On July 27, Trump wrote on Twitter that Cohen appeared to be “trying to make up stories in order to get himself out of an unrelated jam.”

The following month Cohen pleaded guilty to eight felony charges including five counts of tax evasion, one count of lying to a bank and two campaign finance violations. The next day, Trump declared on Twitter that “if anyone is looking for a good lawyer, I would strongly suggest that you don’t retain the services of Michael Cohen!”

Hush Payments

In a hearing before Judge Pauley, Cohen admitted to hiding millions of dollars in income from the Internal Revenue Service and lying to a bank to obtain credit. He also took responsibility for his role in making hush-money payments totaling $280,000 to adult actress Stormy Daniels and former Playboy model Karen McDougal to keep them from talking about their claims they’d had sex with Trump.

Cohen told Pauley the payments were made “in coordination with and at the direction of a candidate for federal office,” implicating Trump in a campaign-finance crime. Cohen was then interviewed seven times by Mueller’s team and twice more by the prosecutors in Manhattan.

Then, in a surprise court hearing, Cohen pleaded guilty to a ninth felony, filed by Mueller, that he lied to Congress about plans for a Trump Organization development in Moscow. A former associate, Felix Sater, said that Cohen and others had considered giving President Vladimir Putin of Russia a $50 million penthouse to generate interest in the planned residential tower.

Mueller told Pauley that Cohen had “gone to significant lengths” to assist his investigation. He recommended no additional prison time on the charge of lying to Congress.

‘Minimal’ Remorse

But Cohen’s cooperation had limits.

The Manhattan prosecutors wrote in a Dec. 7 filing that Cohen had failed to fully come clean on the crimes he may have participated in or been aware of. He repeatedly declined to do so, they said. He even tried to distance himself from crimes he already admitted committing, they said.

“This signals that Cohen’s consciousness of wrongdoing is fleeting, that his remorse is minimal, and that his instinct to blame others is strong,” the Manhattan prosecutors wrote, requesting a “substantial term of imprisonment” for Cohen.

Cohen’s crimes, they said, “reveal a man who knowingly sought to undermine core institutions of our democracy.” His decision to plead guilty “does not make him a hero,” they wrote.

Prosecutors also pointed to Cohen’s familiarity with election law and tax law to undercut his attempts to minimize his crimes as missteps. None of this will endear him to Pauley, a Bill Clinton appointee with a flair for lively written opinions and for asking lawyers uncomfortable questions in his Manhattan courtroom.

‘License to Steal’

In sentencing a 76-year-old lawyer to 6½ years in prison in an unrelated 2016 case, the judge pointedly noted that the attorney “converted his law license to a license to steal.”

Cohen, who declined to comment for this article, may have calculated that full cooperation wasn’t worth it, said Harry Sandick, a former federal prosecutor who’s now a partner with Patterson Belknap Webb & Tyler LLP. But that won him no favors from prosecutors.

“If they let him get credit for cooperating with a half-way measure, in their view, then everyone’s going to want that,” Sandick said. “Securities fraud, drug cases, you name it. Everyone’s going to come in and say ‘Just give me that Michael Cohen deal.’”

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