Stormy Daniels: The Legal Battle And Broken Laws

In 2018, it was revealed that Stormy Daniels, an adult film actress, was paid $130,000 by former U.S. President Donald Trump's lawyer, Michael Cohen, to keep quiet about an alleged affair with Trump in 2006. While hush money payments are not inherently illegal, the way the payment was structured and reimbursed by Trump may have broken the law. Cohen pleaded guilty to campaign finance violations and other charges, and Trump was indicted on 34 counts of falsifying business records. The payment raised questions about potential campaign finance law violations, as it was made during the 2016 election cycle and exceeded campaign contribution limits. The scandal resulted in the first criminal trial of a former U.S. president, with Trump being found guilty on all counts and becoming a convicted felon.

The $130,000 payment to Stormy Daniels was not illegal in itself

In the case of the Stormy Daniels payment, the act of paying her to keep quiet is not what led to legal scrutiny. Instead, the focus is on the source and reimbursement of the funds used in the transaction. The payment was made by Trump's ex-attorney, Michael Cohen, who used a private company he created and a home equity line of credit to facilitate the deal. Cohen then sought reimbursement from Trump for the payment, which was made through the Trump Organization and Trump's personal bank account. The reimbursement was allegedly falsely labeled as legal services through a retainer agreement.

The controversy surrounding the payment centres on whether it violated campaign finance laws and whether the funds were properly disclosed. The timing of the payment, just before the 2016 election, and the amount, which exceeded the contribution maximum for an individual, raised questions about potential campaign finance violations. Additionally, the reimbursement of Cohen through the Trump Organization and the alleged false labelling of the payments as legal services further contributed to the legal scrutiny.

While the payment itself may not have been illegal, the manner in which it was facilitated, reimbursed, and potentially disguised as something else, is what led to legal issues for those involved.

Hush money is only illegal if it covers up a crime or is non-consensual

In 2023, former US President Donald Trump was indicted on 34 counts of falsifying business records in relation to a $130,000 payment made to adult film actress Stormy Daniels during his 2016 election campaign. The payment, made by Trump's ex-attorney Michael Cohen, was intended to cover up allegations of an affair between Daniels and Trump in 2006.

While the "hush money" payment may have been at the centre of Trump's alleged misdeeds, the act of paying Daniels to keep quiet is not what's under legal scrutiny. In fact, "hush money" agreements that both parties enter into consensually are perfectly legal. University of Pennsylvania law professor Tess Wilkinson-Ryan noted that hush money payments can be illegal if they're done to cover up a crime or if the agreement isn't consensual, such as in cases of blackmail or bribery.

In Trump's case, he wasn't charged with making the payment or reimbursing it. Instead, he was indicted for falsifying business records, as his reimbursement payments to Cohen were allegedly disguised as legal payments. This crime is typically classified as a misdemeanour but is elevated to a felony when it's done to facilitate another crime. Manhattan District Attorney Alvin Bragg argued that the falsely labelled payments were done to cover up other crimes, including Cohen's campaign finance crimes and alleged tax issues.

Trump pleaded not guilty to the charges, calling the case a "witch hunt". His attorneys argued that his reimbursement cheques to Cohen were not unlawful, as they were made using his personal bank accounts.

Trump was charged with 34 counts of falsifying business records

In 2023, former US President Donald Trump was charged with 34 counts of falsifying business records in the first degree, a felony in New York. The charges were related to hush money paid to adult film actress Stormy Daniels to conceal an alleged sexual encounter between the two in 2006. Trump's former lawyer, Michael Cohen, made a payment of $130,000 to Daniels in October 2016, just before the 2016 US presidential election, to buy her silence.

Trump was accused of falsifying business records to conceal the reimbursement of this payment to Cohen. The total reimbursement amount was $420,000, which included the $130,000 payment to Daniels, an additional $50,000 for unrelated work, and a $60,000 bonus, with the amount doubled to offset taxes. The reimbursement was made through a series of monthly payments of $35,000 over the course of 2017. Trump was found guilty on all 34 counts in May 2024.

Each of the 34 charges corresponded to a specific business document, including invoices, ledger entries, and checks, dated from February 2017 to December 2017. The falsified documents were related to Trump's payment to Stormy Daniels and were listed as legal expenses payable to Michael Cohen, whereas the indictment alleged that they were to reimburse Cohen for the payment to Daniels.

Under New York law, falsifying business records is a felony when the records are altered with the intent to defraud and to commit or conceal another crime. In Trump's case, prosecutors argued that the other crime was a violation of New York election law, which makes it illegal for "any two or more persons" to "conspire to promote or prevent the election of any person to a public office by unlawful means."

Trump pleaded not guilty and maintained his innocence throughout the trial, claiming that the payments to Cohen were for his work as Trump's attorney and not reimbursements for the Daniels payment. Trump's defence team also portrayed Cohen as a liar and argued that he was an unreliable witness. However, the jury rejected these arguments and sided with the prosecution.

The payment could be considered a campaign finance crime

The $130,000 payment to Stormy Daniels could be considered a campaign finance crime because it was made just before the 2016 election and was well in excess of the maximum legal contribution to a campaign. The payment was not disclosed by the Trump campaign, and it was made by Trump's longtime personal lawyer, Michael Cohen, who claimed it was not a campaign contribution. However, Cohen later pleaded guilty to federal campaign finance violations, stating that he made the payment "in coordination with and at the direction of a candidate for federal office".

The payment to Daniels and the way it was facilitated also raised legal and ethical questions. The payment was made through a private company Cohen created, and the money came from a home equity line of credit. Additionally, the timing of the payment—just before the 2016 election—suggested an attempt to prevent Daniels from going public with her story before voters cast their ballots.

The payment to Daniels is not the only instance of hush money paid during Trump's 2016 campaign. American Media (AMI), which publishes the National Enquirer, also paid a doorman $30,000 to conceal a story about Trump fathering a child out of wedlock and paid model Karen McDougal $150,000 to "catch and kill" her allegations of an affair with Trump.

While "hush money" agreements entered into consensually are legal, they can be illegal if they cover up a crime or are not consensual, such as in cases of blackmail or bribery. In the case of the payment to Daniels, it was the way the payment was made and its potential impact on the election that led to questions about campaign finance violations.

Trump's lawyer used a Trump Organization email to arrange the payment

In March 2018, it was revealed that Trump's lawyer, Michael Cohen, used his Trump Organization email while setting up a $130,000 payment to adult film actress Stormy Daniels. Cohen, who was also an executive vice president at the Trump Organization, used his work email address to correspond with the bank, representing himself as "Special Counsel to Donald J. Trump".

Cohen initially denied the existence of the affair on behalf of his client, but later acknowledged the payment. Cohen stated that he made the payment with his own funds and that neither the Trump Organization nor the Trump campaign reimbursed him. However, in April 2018, Trump admitted for the first time that Cohen had represented him in "the Stormy Daniels deal". The following month, Trump's new lawyer, Rudy Giuliani, confirmed that Trump had reimbursed Cohen for the payment.

The use of the Trump Organization email account by Cohen raised questions about possible campaign finance law violations. In August 2018, Cohen pleaded guilty to eight criminal charges, including a campaign finance violation for the payment to Daniels. He stated under oath that he made the payment "in coordination with and at the direction of a candidate for federal office".

Trump denied directing Cohen to make the payment and claimed that he only knew about it "later on". He also asserted that the payment did not come from campaign funds, but from his personal funds. However, the payment and the subsequent reimbursement to Cohen were found to be falsely labeled as legal payments, leading to Trump's indictment on 34 counts of falsifying business records.

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