Federal prosecutors are investigating whether President Trump’s personal lawyer, Michael Cohen, broke campaign finance laws in paying Trump’s alleged former mistress, Stormy Daniels, $130,000 to keep quiet in the last weeks of the 2016 campaign. Trump admits that Cohen was representing him, and his new lawyer, Rudy Giuliani, has just claimed Trump reimbursed Cohen. The media are currently ablaze with speculation—or wishful thinking—that the Stormy Daniels scandal could spell the end of the Trump presidency.
Yet tawdry, disgusting, and harmful to the nation and its offices as the scandal has been to date, it probably won’t.
Cohen and Trump have less to worry about than many suppose, which may be why Giuliani seems, in this case anyway, mostly to know what he is doing in trying to defend the President. Former Democratic and Republican members of the Federal Elections Commission have opined that “third party” payments to or for a candidate’s mistress are not campaign contributions subject to the $2,700 limit and public disclosure requirements. And in the absence of clear guidance from the FEC prosecutors might struggle to convince a jury—or a Senate weighing impeachment—that the payoff was intended to influence the election.
On these matters, there is no better recent reference than the 2012 criminal case U.S. Government v. Johnny Reid Edwards. The former Senator and vice presidential nominee was charged with violating campaign finance laws over payments for his pregnant mistress during his unsuccessful pursuit of the 2008 Democratic presidential nomination. His trial ended in a hung jury, with a significant majority favoring acquittal.
A principal question jurors faced was whether the law prohibited the candidate’s close political associates and friends from contributing large amounts of money to keep his mistress out of the news as the primaries approached. If it did not, then Edwards could not be convicted of violating it.
The government contended that $725,000 provided by his largest political donor for “non-campaign” expenses, and $194,000 spent by the campaign’s Finance Chair to hide the mistress right before the Iowa and other January primaries, were political contributions because they met the legal standard of being “for the purpose of influencing” a federal election. By accepting them, Edwards, a veteran candidate who was fully aware of the individual contribution limit, “willfully” broke the law.
However, defense counsel Abbe Lowell told the jury, “Every witness you heard from, whoever had any experience with this area of the law, said how the payment by a third party to another third party, not to John . . . concerning the issues of a mistress and an affair would never come up as being a contribution.” In developing what he called “this critical case deciding point,” Lowell emphasized the testimony of not only the campaign’s chief financial officer but also former Democratic FEC Chairman Scott Thomas, who had spent 30 years with the commission. Thomas confirmed that these specific issues had never come up as “a topic that needed to be addressed under the Federal Election Campaign Act.” Acting in “good faith,” Lowell concluded, Edwards would not have regarded such payments as “contributions.” So, he did not “willfully” violate the law.
One can imagine how Lowell’s argument would be grasped by counsel defending Cohen and Trump. So would other statements about the Edwards case by former FEC Commissioners. Before the trial, Thomas and another Democratic Commissioner retained by the defense were shown the government indictment charging that Edwards orchestrated the payments for electoral purposes. Nevertheless, they wrote, the payments “would not be considered campaign contributions or expenditures under the law” and the FEC would agree “if asked.” At the same time, Republican Commissioner (and current White House counsel) Don McGahn agreed the donations were “not reportable.” Concerning the Daniels payment, President Trump has stated, “There were no campaign funds going into this.” This is the Edwards defense: “third party” financial arrangements over an alleged affair outside the formal campaign are never contributions.
Prosecutors attempted to surmount this legal argument by showering the jury with facts and inferences indicating that one purpose of the payments was to influence the election. But they lacked “smoking guns”: strongly corroborated witnesses, thoroughly incriminating recorded conversations and documents, self-damning testimony from the principals (Neither donor appeared—one had died and the other, a 101-year-old, was excused—and Edwards declined to testify). The defense cast “reasonable doubt” on the donations’ having anything to do with elections. It challenged the truthfulness of eyewitness testimony by Edwards’ close aide. Most important, it offered evidence of donors’ strong personal friendships with Edwards, suggesting that they might have helped him regardless of the campaign and asserted that Edwards’ only purpose was to hide the affair from his wife.
In a trial today, Cohen could be expected to stress his long history of personal loyalty to Trump, including his 2011 efforts to squelch Daniels’ story and deep concern about its potential impact on Trump’s marriage, family, and reputation. Trump would expand on the latter in any impeachment proceeding. Could prosecutors produce enough “smoking guns” to erase reasonable doubt about the presence of electoral concerns?
In my view, Trump’s behavior was illegal. The payoff was made less than two weeks before the election. It is not credible that the election was not one of the purposes of the payment. While Trump can donate as much as he wants to himself, he is legally bound to report it. He never has. But reasoning it out is one thing; proving it in a courtroom beyond reasonable doubt or in an impeachment trial is another. And that points us back to the Federal Election Commission.
Beneath the surface, the FEC and its Commissioners act to weaken campaign finance law. Even after the Edwards saga, the agency has offered no specific guidance concerning the factual circumstances in which a third-party payment for a candidate’s mistress—or other personal expenses—would or would not be a contribution. It’s a standing invitation for candidates to fashion additional loopholes.