New York prosecutors are pursuing charges. But how strong is their case?
Amid the many investigations of former President Donald Trump that are going on right now, a new — or rather, an old — one has gained some unexpected momentum.
This week, the New York district attorney’s office began presenting evidence to a grand jury about whether Trump violated the law in connection with a $130,000 hush money payment to Stormy Daniels, the New York Times reports.
You may be thinking: “Stormy Daniels… That’s a name I’ve not heard in a long time.” Indeed.
The world first learned of Daniels in 2018, when the Wall Street Journal broke news that Trump Organization lawyer Michael Cohen had arranged the payment, made shortly before the 2016 election so the adult film actress wouldn’t go public with her claim to have had an affair with Trump. Cohen, already under investigators’ scrutiny, eventually pleaded guilty in August 2018 to violating federal campaign finance laws with that payment and others, in charging documents that famously identified Trump as “Individual-1.”
Cohen claimed he’d made the illegal payment at Trump’s direction, so there was much speculation about whether Trump was on the hook for violating campaign finance law too.
But instead, the case fizzled out. A federal investigation was closed in 2019, and the New York district attorney’s office looked into it but seemed to lose interest in favor of pursuing a sprawling probe of Trump’s business dealings.
So why is it back now, in 2023?
Only Manhattan district attorney Alvin Bragg truly knows the answer to that. But some context is that when Bragg first took office early last year, he put the brakes on the Trump business probe — a decision that spurred two prosecutors to resign and was intensely criticized.
Amid this backlash, and intensifying legal jeopardy for Trump federally and in the state of Georgia, Bragg appears to have rethought his earlier hesitancy. And he’s now embraced what the Times reports had become known in his office as the “zombie theory” — of pursuing charges based on the hush money.
But whether these possible charges, if filed, will prove strong enough to survive court scrutiny is far from clear.
It’s been a while. What was the hush money scandal about, again?
In October 2016 — weeks before the presidential election, as Trump was being publicly besieged by a series of sexual harassment or assault accusations from many different women — adult film actress Stormy Daniels was preparing to come forward with her own story about a consensual sexual encounter she’d had with Trump in 2006. But, her representatives let it be known, she’d also be willing to accept payment for her silence.
Earlier in the campaign, Cohen had worked with American Media Inc. — the parent company of the National Enquirer — to “catch and kill” unflattering stories about Trump, in which AMI would pay accusers for the exclusive rights to their story, and then not publish those stories. AMI executives were involved in the discussions about paying Daniels too, but they ultimately balked — so Cohen had to take care of it himself.
The problem, federal prosecutors in the Southern District of New York later alleged, was that this violated campaign finance law. They argued that since that this money was spent to help Trump win the election, it should have been disclosed as campaign spending and subject to legal limits on donations. Cohen pleaded guilty to this charge as part of a larger plea deal, so the case was never tested in front of a jury.
Yet prosecutors’ theory wasn’t universally accepted. The New York Times described it as a “somewhat novel use of campaign finance law,” and Attorney General Bill Barr sharply questioned it after he took office. In any case, SDNY prosecutors told a judge in July 2019 the case was closed, in part because Trump was the sitting president and per Justice Department policy he could not be indicted.
As Trump was about to leave office in 2021, though, SDNY prosecutors revisited the case, discussing whether they should reopen it when he no longer had presidential immunity. According to CNN legal analyst Elie Honig’s recent book Untouchable, prosecutors were split on the strength of the case.
“Some believed the evidence was more than enough to charge in an ordinary case, while others thought it was still a close call, though still chargeable,” Honig writes, continuing, “Even if the evidence was sufficient to support a charge, it also wasn’t a slam-dunk case in the majority view.”
He adds that some on the team believed the hush money scheme was “serious, but not the end of the world,” and that it seemed “somehow trivial and outdated” compared to his later acts like trying to overturn Joe Biden’s election win. So ultimately, SDNY decided to let it lie.
So how did this move to the Manhattan district attorney?
But the investigation soon sprawled outward.
First there was the real estate valuations case. Vance’s prosecutors developed a theory, backed by public evidence and Cohen’s testimony, that Trump overvalued certain properties when he sought loans and insurance policies, but undervalued those assets for tax purposes, so he’d owe less in property taxes. They explored charges over tax fraud, bank fraud, and insurance fraud.
But the problem was proving Trump knew his company was breaking the law, since he could have argued that everything his company did was approved by his chief financial officer and legal team, who were experts in such matters. So prosecutors zeroed in on that CFO, Allen Weisselberg, pressuring him for months to flip on Trump. Weisselberg did not do so.
So next came the “fringe benefits” case. In July 2021, Vance’s office charged Weisselberg and several Trump business entities with tax fraud. The company had paid apartment and car leases for Weisselberg and private school tuition for his grandchildren, without subjecting it to taxes. Trump himself was not charged, and the maximum penalties for Trump’s company were relatively small, so this wasn’t all that threatening a case.
With that trial pending, Vance left office, and Bragg, the newly elected district attorney, inherited the Trump probes in early 2022. After being briefed on the real estate valuations case, he reportedly wasn’t impressed. Per the New York Times, Bragg told the two lead prosecutors that he had doubts about moving forward with the case, and paused grand jury activity. Those two lead prosecutors resigned in February, and one, Mark Pomerantz, has a book coming out next week giving his account of what happened.
Bragg, elected as a criminal justice reformer, then faced intense criticism in the media and from Democrats for being too lenient toward Trump. He said little at first, but by April he said the real estate valuations case was still moving forward. The fringe benefits case, meanwhile, was still heading for trial, and in August, Weisselberg agreed to change his plea to guilty (though he still didn’t flip on Trump, and was sentenced to five months in jail). Trump’s businesses were then convicted at the trial, and sentenced to pay a $1.6 million fine.
And at some point last year, Bragg’s office turned back to where the Manhattan DA’s investigation all started: the hush money. It recently convened a grand jury to hear evidence, and brought in Cohen for yet another round of talks.
We don’t know why exactly they have returned to the hush money, and we also don’t know how strong the case is. Importantly, the DA can only charge violations of New York state law, so federal campaign finance charges aren’t relevant here.
According to New York Times reporters William Rashbaum, Ben Protess, Jonah Bromwich, and Hurubie Meko, though, prosecutors have a theory about how to charge it. The key is that when Trump paid Cohen back for the hush money, he classified it as legal fees. Prosecutors want to argue that that amounted to illegal falsification of business records.
But since that would only be a misdemeanor and hardly worth charging, they also want to argue this was done in violation of New York state election law, which makes it a felony. “That second aspect has largely gone untested, and would therefore make for a risky legal case against any defendant, let alone the former president,” the Times reporters write.
This seems to pose the possibility that the hush money case is a bit of a reach, a “zombie” legal theory being resurrected now that Bragg has seemingly realized he’ll benefit more politically from being seen as trying to take Trump down — though we can’t say for sure without understanding more about his evidence and legal reasoning.
For now, it can simply be added to the pile of other legal problems Trump has, with no end yet in sight.