Trump attorney Cohen is being investigated for possible bank fraud, campaign finance violations - The Washington Post
2018-04-10 — washingtonpost.com
Michael Cohen, the longtime attorney of President Trump, is under federal investigation for possible bank fraud, wire fraud and campaign finance violations, according to three people with knowledge of the case.
FBI agents on Monday raided Cohen's Manhattan office, home and hotel room as part of the investigation, seizing records about Cohen's clients and personal finances. Among the records taken were those related to a 2016 payment Cohen made to adult-film star Stormy Daniels, who claims to have had a sexual encounter with Trump, according to a fourth person familiar with the investigation.
Investigators took Cohen's computer, phone and personal financial records, including tax returns, as part of the search of his office at Rockefeller Center, that person said.
In a dramatic and broad seizure, federal prosecutors collected communications between Cohen and his clients -- including those between the lawyer and Trump, according to both people.
The raids -- part of an investigation referred by special counsel Robert S. Mueller III to federal prosecutors in New York -- point to escalating legal jeopardy for a longtime Trump confidant who is deeply intertwined in the president's business and personal matters.
Two of the potential crimes being investigated -- bank fraud and wire fraud -- suggest prosecutors have some reason to think Cohen may have misled bankers about why he was using particular funds or may have improperly used banks in the transfer of funds.
Cohen has acknowledged facilitating a $130,000 payment in October 2016 to Daniels, who claims she had a sexual relationship with Trump in 2006.
Trump made his first comments about the payment last week, saying he did not know about the transaction.
Cohen has said he used a home-equity line of credit to finance the payment to Daniels and said that neither the Trump Organization nor the Trump campaign reimbursed him for the payment.
Banks don't usually require much explanation from customers about how they use such credit lines. However, Cohen may have been asked to provide explanation for the large-dollar transfers he made when he moved the money to a shell company and then to a lawyer for Daniels.
To serve a search warrant on a practicing attorney, federal prosecutors are required to obtain approval from top Justice Department officials. That means the acting U.S. attorney in Manhattan, Geoffrey S. Berman [A Trump supporter], who was appointed to his role by Sessions in January, as well as Justice Department officials in Washington, probably signed off.
To pursue criminal charges against Cohen for breaking federal election law, prosecutors would have to prove that he made the payment to Daniels to influence the election, rather than for personal reasons -- to protect Trump's reputation, for example, or his marriage.
At some point, Cohen's New York bank, First Republic, flagged the transaction to the Treasury Department as a suspicious payment, according to the Wall Street Journal.
Cohen used his Trump Organization email in negotiating the agreement with Davidson and in communicating with his bank about the funds.
In February, after a watchdog group filed a complaint about the payment with the Federal Election Commission, Cohen released a statement saying he "used my own personal funds to facilitate" the payment. He rejected the idea that the payment should have counted as a campaign contribution.
This article has very comprehensive background with all you need to understand the possible basis for RICO-type charges against Trump, Cohen, and associates.
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