The group had alleged that the company’s $150,000 payment to McDougal months before the 2016 election was effectively an illegal in-kind corporate contribution to Trump’s presidential campaign. The payment allegedly benefited Trump’s campaign by suppressing McDougal’s story of an alleged relationship with Trump before voters went to the polls.
The FEC found in May that American Media Inc. and its former chief executive David Pecker violated campaign finance law, according to documents the agency released Tuesday to Common Cause. The payment was made in consultation with Michael Cohen, Trump’s former personal lawyer, the agency found.
But the six-member commission — which often deadlocks along partisan lines — did not have sufficient votes to find that Trump and his campaign also broke the law.
Paul S. Ryan, Common Cause’s vice president for policy and litigation, hailed the news as “a win for democracy.” But he argued that the FEC’s “failure to hold former-President Trump and his campaign accountable for this violation lays bare the dysfunction at the FEC.”
He noted that the decision comes on the heels of a similar decision by the agency to drop an inquiry into whether Trump violated campaign finance laws when Cohen paid adult-film actress Stormy Daniels $130,000 in the days leading up to the 2016 election.
“The agency has again shown itself incapable of fully enforcing the campaign finance laws passed by Congress,” Ryan said in a statement.
Further details on the commission’s deliberations are expected to be released within 30 days.
In a conciliation agreement with the FEC, American Media — now known as A360Media after a merger — acknowledged the agency’s findings but said that it did not knowingly or willfully violate the law. The company initially argued that its officials were acting as journalists in making the deal with McDougal. But in 2018, the firm signed a non-prosecution agreement with the Justice Department stipulating that the financial arrangement was indeed an effort to influence the 2016 presidential campaign.
Representatives for A360Media and Trump did not immediately respond to requests for comment.
The complaint by Common Cause focused on a $150,000 payment in August 2016 from AMI to McDougal, who later told the New Yorker that she had an affair with Trump in 2006 and 2007. Trump has denied the affair.
McDougal alleged in a lawsuit she later filed against AMI that the company bought her story not to publish it, but to bury it in advance of the election, sparing Trump an embarrassing revelation.
Former AMI employees have told The Washington Post that the company would routinely pay to “catch and kill” stories about celebrities friendly with Pecker.
In her suit, McDougal alleged that AMI colluded with the Trump campaign to hide the story of her affair, citing as evidence Pecker’s friendship with Trump. She reached a settlement with the company in April 2018, leaving her no longer bound by the contract with AMI.
According to the conciliation agreement signed last month and released Tuesday, A360Media paid a civil penalty of $187,500 to settle the FEC’s inquiry.
The agreement also states that A360Media “agrees not to contest” that its payment to McDougal, “combined with its decision not to publish the story, in consultation with an agent of Donald J. Trump and for the purpose of influencing the election, constituted a prohibited corporate in-kind contribution.”
In addition, the company “acknowledges the Commission’s reason-to-believe finding that these violations were knowing and willful,” but “does not admit to the knowing and willful aspect of these violations,” according to the agreement.
Ryan noted that Cohen served time in prison for lying to Congress, breaking campaign finance laws and tax evasion, but Trump has not faced any consequences.
“The Department of Justice has until August to prosecute Trump for orchestrating this illegal campaign finance scheme,” he said.
Tom Hamburger contributed to this report.