Cohen Pleaded Guilty
to Charges That Are Not Crimes, Says Former FEC Chair
Newsletter published on August 23, 2018
(1) Those payments to
women were not a campaign expense - Bradley Smith, former FEC chairman
(2) Cohen Pleaded
Guilty to Charges That Are Not Crimes, Says Former FEC Chair
(1) Those payments to
women were not a campaign expense - Bradley Smith, former FEC chairman
Those payments to women were unseemly. That doesn’t mean they
were illegal.
By Bradley Smith
August 22 at 6:35 PM
Bradley Smith, a former chairman of the Federal Election
Commission, is chairman of the Institute for Free Speech and a visiting
fellow in the James Madison Program
at Princeton.
If a candidate for public office decided to settle a private lawsuit to get
it out of the news before Election Day, would that be a campaign
expenditure? If a business owner ran for political office and decided to pay bonuses to his
employees, in the hope that he would get
good press and boost his stock as a candidate, would that be a campaign expenditure, payable from
campaign funds?
Under the theory that then-candidate Donald Trump’s personal
attorney Michael Cohen violated
campaign finance laws by arranging hush-money payments to women accusing
Trump of affairs, the answer would seem to be yes. We should probably think twice
before accepting that answer.
The U.S. attorney for the Southern District of New York has
extracted a guilty plea from Cohen for
“knowingly and willfully” violating campaign finance laws by arranging for
payments to two women accusing
Trump of extramarital affairs. Cohen admitted he did so under the direction of “a candidate” — obviously
referencing Trump — to “influence”
an election. Cohen was facing multiple tax and fraud charges that could have landed him in
jail for the rest of his life, even
if he beat the campaign finance allegations. By pleading guilty, he limits his jail
time to just a few years.
However, regardless of what Cohen agreed to in a plea
bargain, hush-money payments to
mistresses are not really campaign expenditures. It is true that
“contribution” and “expenditure” are
defined in the Federal Election Campaign Act as anything “for the purpose of influencing any election,”
and it may have been intended and
hoped that paying hush money would serve that end. The problem is that almost anything a candidate does can be
interpreted as intended to “influence an election,” from buying a good watch
to make sure he gets to places on
time, to getting a massage so that he feels fit for the campaign trail, to buying a new
suit so that he looks good on a
debate stage. Yet having campaign donors pay for personal luxuries — such as expensive watches, massages
and Brooks Brothers suits — seems
more like bribery than funding campaign speech.
That’s why another part of the statute defines “personal use”
as any expenditure “used to fulfill
any commitment, obligation, or expense of a person that would exist irrespective
of the candidate’s election
campaign.” These may not be paid with campaign funds, even though the candidate might benefit from the
expenditure. Not every expense that
might benefit a candidate is an obligation that exists solely because the person is a candidate.
Suppose, for example, that Trump had told his lawyers, “Look,
these complaints about Trump
University have no merit, but they embarrass me as a candidate. Get them settled.” Are
the settlements thus “campaign
expenses”? The obvious answer is no, even though the payments were intended to benefit Trump as a
candidate.
If the opposite were true and they were considered campaign
expenses, then not only could Trump
pay them with campaign funds, but also he would be required to pay these
business expenses from campaign funds.
Is that what campaign donations are for?
But let’s go in that direction. Suppose Trump had used campaign funds to
pay off these women. Does anyone much doubt that many of the same people now after Trump for using
corporate funds, and not reporting
them as campaign expenditures, would then be claiming that Trump had illegally diverted campaign funds to
“personal use”? Or that federal
prosecutors would not have sought a guilty plea from Cohen on that count? And that gets us to a troubling
nub of campaign finance laws: Too
often, you can get your target coming or going.
Yes, those payments were unseemly, but unseemliness doesn’t
make something illegal. At the very
least, the law is murky about whether
paying hush money to a mistress is a “campaign expense” or a personal
expense. In such circumstances, we would not usually expect prosecutors to charge the individuals
with a “knowing and willful”
violation, leading to criminal charges and possible jail time. A civil fine would be the normal response.
But Cohen is not the normal defendant, and prosecutors
almost certainly squeezed him to
plead guilty on these charges, in part, for the purpose of building a case for
possible criminal or impeachment charges
against the president, or even, daresay, “influencing the reelection” of Trump.
Laws, once stretched from their limited language and proper
purpose, are difficult to pound back
into shape. We should proceed with caution here.
(2) Cohen Pleaded
Guilty to Charges That Are Not Crimes, Says Former FEC Chair
BY IVAN PENTCHOUKOV
Updated: August 23, 2018
Michael Cohen, formerly an attorney for President Donald
Trump, pleaded guilty on Aug. 21 to
campaign finance charges that are not
crimes, according to former Federal Elections Commission chair Bradley Smith.
Cohen pleaded guilty to eight charges in a Manhattan court to
charges of tax evasion, making false
statements to banks, and campaign finance violations. The campaign finance charges are related to a
$130,000 payment Cohen made in exchange for the silence of a woman who
claims to have had an affair with
Trump more than a decade ago. The
prosecutors allege that the payment constitutes a campaign contribution and
thus violates the law because it exceeds the individual contribution limit and was
made using a corporation.
In charging Cohen, the prosecutors cited a broad legal
definition of what constitutes a
campaign contribution but failed to mention a specific prohibition on the personal use of campaign
funds, which disqualifies the payment as a contribution.
Under the broad definition in federal law, anything of value
used to influence any election for
federal office constitutes a campaign
contribution. Yet a personal-use prohibition under the same law narrows the scope of what can be
counted as a campaign expense to
exclude all payments “that would exist irrespective of the candidate’s election campaign.”
“The prosecutors in these cases always want to just focus on
the idea that it’s for the purpose
of influencing the campaign,” Bradley said. “Many of them are not even aware of
the other provision in this statute–the
prohibition on personal use–that would seem to narrow that definition down.”
For example, a tailored suit might make the candidate look
good on the campaign trail, but is
an expense that would exist irrespective
of his campaign for office, Bradley explained. The law specifically lists
a number of examples of such
expenses, including clothing purchases,
country club memberships, or tickets to a sporting event.
Under the same statute, a payment securing the silence of a
woman could also exist irrespective of the campaign. For
example, such a payment can benefit
the candidate’s personal business prospects and family life. Thus, Cohen’s payment is
specifically prohibited from being
counted as a campaign expense and is not
a campaign contribution.
As an example, Bradley said that if Trump settled the
lawsuits against Trump University
with the intention of benefiting his campaign, the settlement would clearly not count as
a campaign expense, since the
lawsuit existed irrespective of the campaign and the settlement could exist for other reasons.
“When you run for office and you buy TV ads, or you rent a
campaign headquarters office space,
or you hire a campaign manager or a
campaign accountant, or you buy phones your staffers are to use on the campaign, those are all things done
because you’re running for office,”
Bradley said.
“There are many other things that you do or that you spend
money on that benefit your campaign,
that you may even plan on them benefitting your campaign, hope that they benefit
your campaign, but they are not
campaign expenditures because they’re obligations that would potentially exist whether you were
running for office or not.”
The distinction between what is and what is not a campaign
expense is crucial for preventing
candidates from using campaign funds for
anything other than their campaigns—like a new car or a gold watch—with the intention of personally
benefiting from the purchase.
“Michael Cohen plead [sic] guilty to two counts of campaign
finance violations that are not a
crime,” Trump wrote on Twitter on Aug. 22. “President Obama had a big campaign
finance violation and it was easily
settled!”
Donald J. Trump ? @realDonaldTrump Michael Cohen plead guilty to two counts of
campaign finance violations that are
not a crime. President Obama had a big campaign finance violation and it was easily
settled!
11:37 PM - Aug 22, 2018 89.2K 75.9K people are talking about this Twitter Ads info and privacy Smith agreed with the president.
“My assessment would be that yes, Michael Cohen pleaded
guilty to things that probably are
not crimes,” Smith said.
In his message, Trump referred back to a $375,000 fine for
campaign finance violations paid by
then-President Barack Obama, one the
largest fines ever imposed on a presidential campaign.
Judges have struggled for years with the broad definition
the prosecutors are citing in the
Cohen case. In 2012, former Sen. John
Edwards was charged with campaign violations in connection to payments to a woman with whom he had an
extramarital affair. The trial revolved
largely around what constitutes a campaign expense. The jury could not reach a verdict and the Justice
Department dropped the case.
The Supreme Court ruled in 1976 to strictly narrow the
definition of what constituted an
independent campaign expenditure in terms of speech. The broad scope of the law as
it stood before the ruling imposed
“direct and substantial restraints on the quantity of political speech” and was
“unconstitutionally vague,” the court said.
“The courts have always faced a challenge in how do we narrow
that definition down to something
that is actually usable, that doesn’t
leave everybody on the hook for everything they do that’s connected to politics,” Smith said.
In pleading guilty, Cohen said that Trump instructed him to
make the payment to the woman in
question. But the plea is not a binding legal precedent, according to Smith.
“It doesn’t affect the ability of the Trump folks to raise
defenses,” he said.
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