“It’s not campaign money,” he told Fox News’ Sean Hannity. “No campaign finance violation.”
The settlement with Daniels, made by Trump’s personal lawyer Michael Cohen in the fall of 2016, was a “personal thing,” Giuliani later told The Washington Post.
“Was the president really wise to take it out of personal funds rather than from campaign funds?” he added. “Thank God he did, [or else] he’d get a campaign finance violation they’d try to drum up into a felony or something. The president is personally protected.”
But under federal campaign finance rules, a contribution is “anything of value given, loaned or advanced to influence a federal election.”
A “knowing and willful” violation of those rules can lead to criminal charges.
Campaign finance experts said that the then-secret payment to Daniels — which was already the subject of complaints to the Federal Election Commission and the Justice Department — could be problematic, particularly after Giuliani’s extensive public comments.
“This was for personal reasons. This was, the president had been hurt personally ... so much and the first lady, by some of the false allegations. ... It was to save their marriage — not their marriage, so much, but their reputation.” — Giuliani on “Fox and Friends,” May 3
If the payment were “wholly personal, as in made to help Trump’s marriage but not his campaign,” it would not amount to a campaign finance violation, according to Richard Hasen, election law expert at the University of California at Irvine.
But the fact that it was made so close to the election raises questions, experts say. Cohen struck the secret settlement with Daniels in October 2016, shortly after the “Access Hollywood” tape in which Trump bragged about grabbing women by their private parts.
“It was right before the election. Previously, he didn’t make the payoff when it was a mere embarrassment,” said Matthew Sanderson, who was a campaign finance lawyer for the 2008 McCain-Palin campaign.
Sanderson said the timing of the payment “strongly suggests it was related to the election, and therefore is either a contribution, or at least a reportable expenditure by the campaign.”
“Imagine if that came out of October 15, 2016, in the middle of the last debate with Hillary Clinton . . . Cohen didn’t even ask. Cohen made it go away. He did his job.” — Giuliani on “Fox and Friends,” May 3
Even as he insisted the payment was solely for a personal purpose, Giuliani suggested that it served another function: to quash an embarrassing story so close to the presidential election.
His statements call into question Giuliani’s argument that Trump made the payment only to protect his reputation, some experts said.
“That is an explicit acknowledgment that this payment was about the election and was about hiding information from voters immediately before the presidential election,” said Paul S. Ryan, vice president of policy and litigation at watchdog group Common Cause, which filed a legal claim over the payment. “That’s what makes all of this a campaign finance violation.”
But Charlie Spies, who served as counsel for Mitt Romney’s 2008 presidential campaign, said Giuliani’s comments must be weighed against Trump’s history of aggressively protecting his corporate and personal reputation.
“Everyone knows that Donald Trump fights to protect his reputation,” Spies said. “Remember, at this time, people didn’t expect him to win, so his business and personal reputation were much more important.”
“He trusted Michael and Michael trusted him. Michael knew when he laid out the $135,000 he’d get it back and the president was always going to make sure he got it back — and enough money to pay the taxes.” — Giuliani to The Washington Post, May 3
Under campaign finance requirements, loans to campaigns must be reported in federal disclosures. Giuliani’s statement — which, in this instance, overstates the amount that Cohen paid Daniels — raises questions as to whether Trump and Cohen intentionally skirted the requirements, some experts said.
Ryan, of Common Cause, said Giuliani’s comments suggested a willful violation of campaign finance law.
“He raises the exposure for the president, because Giuliani acknowledged that Trump and his campaign may have had a duty to report it,” Sanderson added, “which wasn’t necessarily the case under the prior narrative where Michael Cohen was the lone actor, giving from his own funds, didn’t run it by anybody before or after until it hit the press.”
Further, if the payment were a loan from Cohen, Trump may have had a duty to report it in his June 2017 financial disclosure form to the Office of Government Ethics, said Trevor Potter, a former Republican FEC commissioner and founder of campaign finance advocacy group Campaign Legal Center, in a statement.
“He didn’t disclose it and, if the omission was intentional, he could be subject to civil or criminal penalties,” Potter said.