Giuliani Digs Trump’s Hole Deeper
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Giuliani Digs Trump’s Hole Deeper

His Efforts to Explain Away the Stormy Daniels Payoff Further Complicate the Matter

The emergent storyline after a day of pundits kicking around Rudy Giuliani’s explosive, televised remarks to Sean Hannity—and now everyone else—that Trump knew about and paid out the $130,000 in hush money lawyer Michael Cohen provided to adult film star Stormy Daniels for her silence in a sex affair is that Giuliani may have worsened Trump’s legal issues.

No one knows for sure about any of the motivations and maneuvering by Trump and Giuliani, the former New York mayor who is Trump’s new legal adviser. The smart thinking seems to be that Giuliani was trying to get ahead of disclosures expected to come out in court proceedings against Cohen.

But even that is speculative, as is much of what people are saying to try to get a fix on just what matters here. After all, Trump supporters make clear they are sticking by their man, and all of this is just so much fulminating. Paying off a porn star on the eve of the election with hush money seems not to be a serious problem.

Indeed, the president continues to describe himself as more or less a victim of a runaway Justice Department and a liberal and biased elite. Trump and Giuliani are waging a political war while the Justice Department is pursuing the more traditional route of investigating possible criminal wrong-doing.

Nevertheless, here’s what I’ve put together for myself about the legal jeopardies involved, which may or may not be more important than the political optics.

  • Trump lies. By flip-flopping repeatedly and significantly on the various explanations offered in this seemingly less-than-world beating case about Stormy Daniels, aka Stephanie Clifford, the president shows again a habit he has about recalling truths or even his own story, making a coming clash with Special Counsel Robert S. Mueller III more treacherous, despite which questions are asked in which forum. It looks terrible for the president, but that is not a crime. And it does seem to augment Daniels’ attorney’s desire to depose the president.
  • Campaign election woes. By ’fessing up to the payoffs, Trump and Giuliani insist that Trump “did not use” campaign funds, as if that is the issue. Legally, it is not. Trump’s use of personal funds, washed through various entities, and Cohen’s payments of the money to Daniels, could be considered in-kind contributions in the days before the election to maintain the candidate’s image. For Cohen, there is a direct legal problem; for Trump, whether he argues that he did not know of the specifics of the deal with Daniels, he could be considered part of a conspiracy to elude campaign funding laws. In any event, Trump certainly now faces jeopardy because he never formally reported a loan from Cohen to make the $130,000 payment to Daniels, repaid over months. Later, there undoubtedly will be tax issues as well. Still, most campaign election problems resolve in fines, not jail.
  • Processing the money. Again, according to the multiple Giuliani statements, Cohen moved the money for the hush payment through a variety of known and shell corporations, all the while hiding the purpose from having obtained a home-equity loan to front the money. The experts suggest that this points to bank fraud by Cohen, almost certainly triggering the recent FBI raids on Cohen, and, again, raises the specter of conspiracy charges to defraud for the president.
  • Comey firing. Giuliani also worsened Trump’s explanations for firing FBI Director James Comey, offering yet a new one. “He fired Comey because Comey would not, among other things, say that he (Trump) wasn’t a target of the investigation,” Giuliani told Hannity. That is different from previous explanations and will prompt more Mueller questions.

In a Slate.com commentary, Richard L. Hasen, a law professor at University of California, Irvine, concludes:

“If what Giuliani says is true, and if the payments were made to help the campaign and not (just) to help Trump personally, the campaign may be implicated in illegal activity. If Trump knew that Cohen was advancing him a $130,000 loan for campaign purposes, that would have to be reported by the campaign, as would the payments Giuliani said Trump made in installments to Cohen. These would be campaign expenditures that the committee has to keep track of. As Philip Bump notes, if the Trump Organization facilities were used to help make these payments, then there may be additional campaign violations related to the use of corporate resources for campaigns.

“Although many campaign finance violations are handled just as fines, as Giuliani seemed to suggest in his Hannity interview Wednesday night, that’s not true for willful violations of campaign finance law, especially those implicating the public interest. Those can lead to criminal liability. If there was an unreported six-figure loan to the campaign to pay off someone who had an affair with a presidential candidate, with repayments facilitated through corporate resources, that seems like a serious enough violation to merit review by the Justice Department.”

In his own tweets, Trump said such non-disclosure agreements are “very common” among celebrities and “people of wealth,” adding that this one was used to stop “false and extortionist accusations.” So much for the forgotten middle class.

While Giuliani concludes that his explanation clears the air for Cohen and Trump and tries to send interested parties elsewhere for scandal, there are substantial questions remaining. In an interview with The Washington Post, Giuliani said Trump’s repayments to Cohen occurred after the election and were mostly completed in 2017, but might have included an installment this year. Giuliani said he did not know when the president learned of the nature of the payment Cohen made on his behalf to Daniels, but he said Trump gleaned new details in the past two weeks.

It’s a lot, given that all this is in the sideshow. The main event of the Trump-Mueller battle still looms.

May 4, 2018