(NEW YORK) — The hush money probe that resulted in charges Tuesday against former President Donald Trump had languished even as other investigations into Trump moved forward — until Manhattan District Attorney Alvin Bragg convened a grand jury to revive the probe at the start of this year, according to sources.
Trump pleaded not guilty to 34 felony counts of falsifying business records Tuesday after he was indicted Thursday by a grand jury in New York on charges that sources say are related to a hush money payment made to porn actress Stormy Daniels in the final days of the 2016 presidential race.
What is the case about?
The investigation centers around a $130,000 hush money payment to Daniels just days before the 2016 election by Trump’s then-attorney, Michael Cohen, in order to prevent her from going public with her allegations of a 2006 affair with Trump, which he has long denied.
Cohen executed the transaction through a shell corporation, Essential Consultants LLC, which Cohen had set up just days prior, according to court filings.
“Mr. Trump directed me to use my own personal funds from a Home Equity Line of Credit to avoid any money being traced back to him that could negatively impact his campaign,” Cohen testified before Congress in 2019.
When Trump reimbursed Cohen for the payment, his company logged the payments as a “monthly retainer” for Cohen’s legal services, according to Trump and court documents from Cohen’s subsequent plea deal. Prosecutors are considering whether Trump should be charged with falsifying business records, sources say.
Trump initially claimed he didn’t know about the payment to Daniels, telling reporters in April 2018 to “ask Michael Cohen” about where the money came from. But a month later he posted to Twitter that the payment to Daniels was part of a nondisclosure agreement to keep her from making false accusations.
“Mr. Cohen, an attorney, received a monthly retainer, not from the campaign and having nothing to do with the campaign, from which he entered into, through reimbursement, a private contract between two parties, known as a non-disclosure agreement, or NDA,” Trump tweeted.
“Money from the campaign, or campaign contributions, played no roll [sic] in this transaction,” he wrote.
But just weeks before Cohen delivered the payment to Daniels, the now-former attorney worked with the publisher of the National Enquirer, longtime Trump ally David Pecker, to pay another woman who claimed she’d had an affair with Trump, according to the U.S. Attorney’s Office in the Southern District of New York.
The Enquirer, in concert with the Trump campaign, paid Playboy model Karen McDougal $150,000 for the rights to her story that she’d had a 10-month affair with Trump from 2006 to 2007 — then suppressed the story “in order to ensure that the woman did not publicize damaging allegations about the candidate before the 2016 presidential election,” according to a 2018 plea deal made by the Enquirer’s publisher, AMI.
Trump has denied that he had an affair with McDougal and that he or his campaign directed the Enquirer to “catch and kill” her story.
The first investigation
Following an investigation by federal prosecutors in the Southern District of New York, Cohen pleaded guilty in August 2018 to multiple felonies for his role in orchestrating the payment to Daniels and to AMI.
The charges included two campaign finance violations related to the payments, which federal prosecutors considered campaign contributions because they were made “in order to influence the 2016 presidential election.” By law, individual contributions to a presidential campaign are limited to $2,700.
Cohen was sentenced to three years in prison.
“Today [Cohen] stood up and testified under oath that Donald Trump directed him to commit a crime by making payments to two women for the principal purpose of influencing an election,” Cohen’s attorney, Lanny Davis, said in a statement after Cohen entered his guilty plea on August 20, 2018. “If those payments were a crime for Michael Cohen, then why wouldn’t they be a crime for Donald Trump?”
But the federal investigation ended without any charges filed against Trump himself.
Trump’s attorney at the time praised the decision.
“We are pleased that the investigation surrounding these ridiculous campaign finance allegations is now closed,” Jay Sekulow said in a statement in 2019. “We have maintained from the outset that the President never engaged in any campaign finance violation. From the Court’s opinion: ‘the Government’s investigation into those violations has concluded … another case is closed.'”
In New York, the Manhattan district attorney’s office subsequently took up the matter as part of a larger investigation into Trump’s finances starting in 2021. But under then-District Attorney Cy Vance, prosecutors believed the hush money “did not amount to much in legal terms,” according to Mark Pomerantz, one of the probe’s lead investigators who later resigned from the DA’s office due to his dissatisfaction with the pace of the probes and wrote about his experience in his book, “People vs. Donald Trump: An Inside Account.”
The subsequent investigation
At the start of this year, Manhattan DA Alvin Bragg returned to the hush money probe with a focus on whether the Trump Organization falsified business records in the way it recorded the reimbursement payment to Cohen, sources familiar with the investigation have told ABC News.
Trump’s namesake company reimbursed Cohen for the $130,000 payment to Daniels through invoices that were billed as a “retainer agreement” — an arrangement that prosecutors say was a “sham” because no such retainer agreement existed. The payments, prosecutors say, were for Daniels.
Appearing on ABC News’ Good Morning America last month, Trump’s current attorney denied that any payments were recorded improperly.
“There was absolutely no false record,” Trump attorney Joe Tacopina told George Stephanopoulos. “To my knowledge there was no false records.”
Tacopina also said the payment could not have been a campaign finance violation because it was made with Trump’s personal funds.
“It’s not a contribution to his campaign,” Tacopina said. “He made this with personal funds to prevent something coming out false but embarrassing to himself and his family’s young son. That’s not a campaign finance violation not by any stretch. So personal funds and personal use of funds spending to fulfill a commitment and obligation or an expense of a person that would be existing, irrespective of the campaign, is not a violation.”
The Manhattan grand jury conducting the probe heard testimony from some of Trump’s closest allies and former aides, including former White House adviser Kellyanne Conway and Trump’s 2016 campaign spokesperson, Hope Hicks, as well as Pecker, the former National Enquirer publisher, who was among the first witnesses brought in.
Cohen, too, testified last month before the Manhattan grand jury over multiple days. And Daniels herself met with prosecutors over Zoom at the request of the DA’s office, her attorney said. Both Daniels and Cohen said they would make themselves available as witnesses if needed.
Asked on Good Morning America if he expected an indictment for Trump, Tacopina was resolute.
“I expect justice to prevail,” he told George Stephanopoulos. “If that’s the case, George, there shouldn’t be an indictment.”
ABC News’ Soo Rin Kim and John Santucci contributed to this report.
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