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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

(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 forthe 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 wereintended 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 hewould 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 cautionhere.


(2) Cohen Pleaded Guilty to Charges That Are Not Crimes, Says Former FEC Chair


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 financeviolations. The campaign finance charges are related to a $130,000 payment Cohen made in exchange for the silence of a woman who claimsto 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 lawnarrows the scope of what can be counted as a campaign expense to exclude all payments “that would exist irrespective of the candidate’selection 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 thatdefinition 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 apayment can benefit the candidate’s personal business prospects and family life. Thus, Cohen’s payment is specifically prohibited frombeing 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, thesettlement 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 thecampaign, 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 goldwatch—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 rulingimposed “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.

-- Peter Myerswebsite: