Trump-Cohen Legal Saga: What Laws Were Broken?

Former US President Donald Trump and his former lawyer Michael Cohen have been accused of breaking several laws. Cohen pleaded guilty to violating campaign finance laws, tax evasion, and providing a false statement to a bank. He admitted to paying adult film actress Stormy Daniels $130,000 in hush money to silence her claims of an affair with Trump. Cohen also created a fake shell company to send the payment and falsified business records related to the transaction. Trump was indicted on 34 felony counts, including falsifying business records, conspiracy to violate the Federal Election Campaign Act, and tax law violations. Trump has denied any wrongdoing and claimed that Cohen acted independently, but a judge ruled that Trump could still be convicted for crimes committed in conjunction with Cohen under the principle of accessorial liability.

Violating campaign finance laws

In August 2018, Michael Cohen, Donald Trump's former lawyer and fixer, pleaded guilty to breaking campaign finance laws. Cohen admitted to paying hush money of $130,000 to Stormy Daniels and $150,000 to Playboy model Karen McDougal "at the direction of a candidate for federal office" to keep quiet their allegations of affairs with that candidate, with the purpose of influencing the 2016 presidential election.

Cohen said he made the payments "in coordination and at the direction of" Trump. However, Trump denied directing Cohen to break the law, stating that Cohen was supposed to know the law as a lawyer. Trump also claimed that he was off the hook for any crime as he acted on the "advice of counsel".

In March 2023, Trump was indicted regarding the payments to Stormy Daniels. In May 2024, he was convicted on 34 felony counts, including falsifying business records, election law violations, and violating campaign finance laws.

The Federal Election Campaign Act limits the amount of money that can be contributed to a campaign. Cohen's payments to Daniels and McDougal exceeded this legal limit.

Tax evasion

Michael Cohen, former lawyer and fixer for President Donald Trump, has claimed that the former president committed tax evasion. Cohen served a three-year federal prison sentence under home confinement for crimes including tax evasion. Cohen's sentence was related to crimes involving campaign finance violations, tax evasion, and lying to Congress.

In 2020, Cohen commented on a New York Times report that alleged Trump paid $750 in federal income taxes in 2016 and 2017. Cohen stated:

> "So if I went to jail for 36 months on tax evasion, which probably should have been tax omission, Donald Trump should do 360 years, based upon the numbers."

Cohen also claimed that Trump's biggest fear is ending up with a massive tax bill and facing possible tax fraud charges. Cohen has long asserted that Trump withheld his tax returns because they show his businesses are failing and might contain evidence of tax fraud.

In 2019, Cohen testified before the House Committee on Oversight and Reform, casting doubt on Trump's excuse that he could not release his tax returns because he was under audit. Cohen stated that he was unsure if Trump was under audit in 2016 and was never able to obtain a copy of the audit.

The New York Times published an investigation in 2018 accusing Trump of fraud, claiming that he and his siblings undervalued their father's real estate business when they inherited it in 1997, allowing them to avoid hundreds of millions of dollars in taxes. While a lawyer for Trump denied the allegations, Cohen shed light on the president's efforts to reduce his tax bill by challenging property assessments across the country.

Trump has a history of attempting to avoid taxes, dating back to the 1980s when he received a $100 million tax break on Trump Tower. Cohen confirmed that Trump would "inflate and deflate his assets to reduce his real estate taxes."

In 2024, Trump was indicted in Manhattan, becoming the first sitting or former president to be indicted on criminal charges. The charges included 34 felony counts related to falsifying reimbursement checks to Cohen, who paid adult film star Stormy Daniels $130,000 before the 2016 election to cover up allegations of an affair. The checks were falsely labeled as being for legal services, and the prosecution argued that they were intended to influence the election and violate campaign finance laws.

Lying to a bank

In 2018, Michael Cohen pleaded guilty to tax evasion, making false statements to a bank, and campaign finance violations in connection to a hush-money payment of $130,000 made to Stormy Daniels, an adult film star. Cohen, who was then President Donald Trump's lawyer, admitted to opening a bank account under false pretences, describing the account as being for a management consulting company, when in fact, it was meant to pay off an adult film star for a non-disclosure agreement. Cohen also admitted to using a home equity loan to pay Daniels to avoid leaving a paper trail and to avoid angering his wife.

Cohen's actions were in violation of the law that states that misstating your assets or income on a bank loan application is considered fraud. Cohen's testimony also implicated Trump, who was accused of falsifying reimbursement checks he paid to Cohen, which were labelled as legal services. Trump was charged with 34 felony counts of falsifying business records, for allegedly disguising payments to Cohen as legal expenses when they were in fact reimbursements for paying off Daniels.

Cohen's testimony revealed that he kept Trump aware during every step of the process of paying off Daniels, and that he always ran "everything by the boss" immediately. Cohen's criminal record, history of lying to Congress, and public criticism of Trump made him a flawed witness. However, his testimony was crucial for prosecutors in establishing Trump's alleged direct knowledge of the payoff scheme.

The outcome of the trial could have significant implications for Trump, including renewed congressional interest in his tax returns and business practices, as well as potential criminal charges.

Cohen's admission of guilt

On 21 August 2018, Michael Cohen, Donald Trump's former lawyer, pleaded guilty to violating campaign finance laws at a Manhattan court. Cohen admitted to being aware of his actions before pleading guilty to the charges, stating that he worked "at the direction of the candidate" when he attempted to buy the silence of Karen McDougal, a former Playboy playmate who claimed to have had an affair with Trump in 2016. Cohen also admitted to working "with and at the direction of the same candidate" to deliver a $130,000 payment to adult film actress Stormy Daniels to silence her claims about an affair.

Cohen's admission came minutes after the jury found Trump's former campaign manager, Paul Manafort, guilty of eight counts of bank and tax fraud. Cohen's close relationship with Trump meant that his admission of guilt could potentially create substantial legal issues for Trump, whose 2016 presidential campaign was being investigated by special counsel Robert Mueller for collusion with Russia.

Cohen's guilty plea also shed light on Trump's involvement in the hush money payments to Stormy Daniels and Karen McDougal. Cohen stated that he acted "in coordination and at the direction of" Trump to influence the 2016 presidential election in Trump's favor. Cohen's admission contradicted Trump's claims that he had no knowledge of the payments and that they were not illegal.

In addition to the campaign finance violations, Cohen also pleaded guilty to five counts of tax evasion and one count of providing a false statement to a bank. Cohen's sentencing was scheduled for December 2018, and he faced the possibility of prison time and substantial financial penalties for his crimes.

Trump's denial

Trumps Denial

Donald Trump has denied directing his former lawyer and fixer, Michael Cohen, to break the law. In a tweet, the president said, "I never directed Michael Cohen to break the law. He was a lawyer and he is supposed to know the law." Trump went on to claim that he "did nothing wrong" and that the charges against Cohen were cooked up to "embarrass" him.

Trump has offered varying responses to the allegations, at times claiming he had no knowledge of the payments, arguing that they were not illegal, and suggesting that even if they were, they should be treated as a civil matter rather than a criminal one. Trump also asserted that he is off the hook for any crime because he acted on the "advice of counsel," implying that Cohen, as his lawyer, should have known better.

In an interview with Fox News, Trump reiterated his stance, stating, "I never directed him to do anything wrong... He's a lawyer. A lawyer who represents a client is supposed to do the right thing... I never directed him to do anything incorrect or wrong." Trump expressed regret for hiring Cohen, attributing it to Cohen doing him a favor in the past and stating that Cohen primarily handled public relations rather than legal work.

Trump also attempted to distance himself from Cohen, downplaying their relationship and suggesting that Cohen's work for him was "very low-level." He further claimed that Cohen pleaded guilty to the campaign finance charges to embarrass him and receive a reduced sentence, insisting that Cohen was "guilty on many charges unrelated" to him. Trump's denial and attempts to shift blame onto Cohen come as Cohen cooperates with authorities, providing valuable information to the investigation into Russian interference in the 2016 election and potential collusion with members of Trump's campaign.

While Trump denies any wrongdoing, Cohen's admissions and cooperation with authorities have created substantial legal challenges for the former president and raised questions about his conduct during the 2016 election campaign.

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