Hush Money May Prove Trump's Biggest Campaign-Finance Problem

(AP Photo/Matt Sayles)

Stephanie Clifford, who goes by the stage name Stormy Daniels

Alleged campaign-finance violations keep piling up against President Trump, but the ones that involve the paltriest sums—two payments of less than $200,000 apiece to silence women who claim affairs with Trump—may cause him the most trouble.

In one sense, Trump’s entanglements with a porn star and an ex-Playboy Bunny look like seedy side shows compared with special counsel Robert Mueller’s finding last month that a foreign power disrupted American democracy. By far the most serious campaign-finance allegation against Trump remains that he and his team illegally solicited help from and provided assistance to Russians who meddled in the 2016 election.

Trump’s hush money payments also may prove less corrosive, in the grand scheme of things, than the millions being raised and spent by a secretive nonprofit set up by officials from his campaign and his administration. That organization, America First Policies, has drawn little notice but netted $26 million in 2017. The group is violating the ban on unrestricted “soft” money, according to a complaint from Common Cause, by raising and spending unlimited contributions in coordination with the Trump campaign.

But Trump’s escalating legal battles with porn actress Stephanie Clifford, aka “Stormy Daniels,” and with ex-Playboy model Karen McDougal, put him in the gravest immediate legal jeopardy. In the big-spending world of elections, the sums involved—$130,000 for Clifford, and $150,000 for McDougal—are relatively small. Both women say they were paid to keep quiet about affairs they claim to have had with Trump more than a decade ago. (Trump denies those claims.)

But the case that both hush-money payments amount to unreported, in-kind contributions to the Trump campaign is something of a slam dunk, according to lawyers for Common Cause, which has filed two separate complaints asking the Justice Department and the Federal Election Commission to investigate the money to Clifford and McDougal.

A key player in both suits is Trump’s personal lawyer, Michael Cohen. Cohen arranged for a $130,000 payment to Clifford, and sought to cover his tracks by routing the money through an LLC called Essential Consultants. Cohen’s payment constituted an illegally large in-kind contribution to the Trump campaign, alleges the Common Cause complaint. Moreover, Cohen made the payment in coordination with Trump, states the complaint, so the campaign should have reported it as both an in-kind contribution, and as an expenditure.

Cohen now says the money came from his personal home equity line. But the complaint cites evidence that the Trump Organization, where Cohen worked at the time, facilitated the payment in violation of the ban on corporate contributions. And whatever the money’s source, the complaint alleges, the Trump campaign should have reported it.

Some argue that the case of former senator and presidential candidate John Edwards, who was charged after two donors spent $900,000 to conceal his extramarital affair with a campaign worker, suggests that Trump will not be prosecuted. Edwards was acquitted on one count, and the jury deadlocked on five others.

But the case against team Trump in both the Clifford and McDougal cases is “much stronger” than the one against Edwards, says Paul S. Ryan, vice president of policy and litigation at Common Cause. Edwards argued that the payments, made in the year prior to the election, were to spare his family and not to influence the election, and that the woman in question was not threatening to speak out. But the payment to Clifford was made just weeks before the election, and McDougal received her hush money in August of the election year. Both were threatening to go public with their stories.

Moreover, each new suit and counter-suit filed in Trump’s separate spats with the two women turns up fresh evidence to buttress Common Cause’s claim that the money was election-related. A Clifford lawsuit seeking release from her nondisclosure agreement states point blank that the purpose of her $130,000 payment was “to avoid her telling the truth, thus helping to ensure that he [Trump] won the Presidential Election.” A McDougal suit filed this week, likewise seeking release from a nondisclosure agreement, also details Cohen’s role setting up her $150,000 payment.

Trump’s woman problems, moreover, refuse to go away. Both Clifford and McDougal are going public in TV interviews, and more shoes keep dropping. Former Apprentice contender Summer Zervos, who alleges that Trump kissed and groped her, just won approval from a Manhattan judge to proceed with a defamation suit against him. (She sued after Trump called her and other women accusing him of harassment “liars.”) Her lawyers have pledged to seek a deposition from Trump as part of the discovery process, raising the possibility that still further hush payments may soon come to light.

Mueller continues to push forward with his investigation, and he may yet zero in on campaign-finance allegations involving Trump and Russia—though obstruction of justice may prove more relevant. Mueller has also asked America First Policies, the big-spending nonprofit with close links to the Trump campaign, to retain its records, suggesting that his probe may also examine “soft money” allegations. But in the short term, it’s the hush money paid to women whom Trump has attempted to silence that places him most squarely in the crosshairs of campaign-finance law.

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