Trump likely to be indicted by Manhattan US Attorney

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The major takeaway from the 40-page sentencing memorandum filed by federal prosecutors Friday for Michael Cohen, President Trump’s former personal attorney, is this: The president is very likely to be indicted on a charge of violating federal campaign finance laws.

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Trump likely to be indicted by Manhattan US Attorney

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Contributors such as Cohen made were limited in 2016 to a $2,700 donation, but there is no limit on a candidate’s spending. Thus, the argument goes, even if the hush-money payments vastly exceeded Cohen’s legal ceiling, Trump himself could have made them legally.

There are flaws in this theory.

To begin with, the campaign finance laws do not just prescribe limits on spending; they mandate disclosure. This is a leitmotif of the sentencing memo: Congress demanded transparency. A candidate may spend unlimited amounts on the campaign, but the amounts spent must be reported to the Federal Election Commission.

The sentencing memo for Cohen argues that the hush money payments were not merely unreported. It states that Cohen and the Trump organization – the president’s company – went to great lengths to conceal them by fraudulent bookkeeping.

Equally significantly, Cohen was not charged with merely making illegal donations. He was charged in the first campaign finance count with causing a company to make illegal donations.

This was the offense centering on Playboy model Karen McDougal. It involves David Pecker, a longtime friend of the president and of Cohen. Pecker runs American Media, Inc., which controls the National Enquirer.

According to prosecutors, Pecker arranged with Cohen that the Enquirer would buy McDougal’s story for $150,000 and bury it. Although it was contemplated that Cohen would reimburse Pecker (and then be reimbursed by Trump), the reimbursement did not happen.

Cohen, therefore, pleaded guilty not to making his own excessive contribution but to causing a third party to make an illegal contribution.

Cohen says he was operating at Trump’s direction. Logically, then, if this is true and Cohen caused the third-party illegal contribution, so did the president.

Notably: prosecutors have given Pecker and another American Media executive, Dylan Howard, immunity from prosecution. Do you think prosecutors did that to tighten up the case against Cohen? I don’t.

As for the second campaign finance charge, that involves an illegal payment by Cohen – the $130,000 to Stephanie Clifford (who goes by the stage name “Stormy Daniels”). There are two things to bear in mind about it.

First, as we’ve just seen, it is a felony to cause another person to make an illegal contribution. Since, under the claim by prosecutors Trump was directing Cohen, Trump could be accused of having caused Cohen to make an illegal payment.

The fact that Trump could have made the payment himself without violating the law does not excuse allegedly causing Cohen to violate the law.

Trump’s point that he had no personal limit on spending is also undermined by the facts that (a) the payment was not reported, and (b) the purpose of the transaction was to distance him from the payment (which is why the non-disclosure agreement employs pseudonyms rather than referring to Trump and Clifford by name).

Second, the violation to which Cohen pleaded guilty is not merely making illegal expenditures; it also includes making such expenditures “in cooperation, consultation, or concert, with or at the request or suggestion of, a candidate.” (Section 30116(a)(7)(A) of the election laws).

Again, this is why Cohen was pushed at his guilty plea proceeding to state that he acted “in coordination with and at the direction of” Trump. It is an assertion the prosecutors emphasize in the sentencing memo. The thrust of their allegation is that Cohen and Trump are confederates in an illegal contribution that Cohen made only because Trump directed him to do so.

This is not to suggest that the president is without cards to play. Campaign finance violations have a high proof threshold for intent. President Trump could argue that because there was no spending limit on his contributions, he did not think about the campaign-finance implications, much less willfully violate them.

There is, furthermore, a significant legal question about whether the hush-money payments here qualify as “in-kind” campaign contributions. There is nothing illegal per se in making a non-disclosure agreement; they are quite common. The criminal law comes into play only if the non-disclosure payment is deemed a donation for purposes of influencing a political campaign.

Arguably, the payment is not a donation if it was made for an expense that was independent of the campaign – that is, money that would have had to be paid even if there were no campaign.

Cohen chose to plead guilty and forfeited the right to contest this point. That concession is not binding on Trump. If the president is charged, I expect he would vigorously argue that the payment was not a campaign contribution.

There are other salient issues to consider. Justice Department guidance holds that a sitting president may not be indicted. If prosecutors in the Southern District of New York believe they have a case against the president, must they hold off until after he is out of office?

If President Trump were to win re-election, he would not be out of office until 2024, when the five-year statute of limitations on a 2016 offense would have lapsed.

More importantly, do campaign finance violations qualify as “high crimes and misdemeanors,” which is the constitutional standard for impeachment? It is hard to imagine an infraction that the Justice Department often elects not to prosecute is sufficiently egregious to rise to that level, but the debate on this point between partisans would be intense.

Those are all questions for another day. The point for this day is that the Cohen case in New York City is not about Cohen. The president is in peril of being charged.

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