Ex-Trump Controller Says Cohen Repaid From Personal Account
(Bloomberg) -- Donald Trump used a personal bank account to repay most of the money he owed to a former lawyer who bought the silence of adult film star Stormy Daniels before the 2016 election, a former Trump Organization finance official told a New York court.
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Former controller Jeffrey McConney on Monday offered jurors at the hush money trial their first detailed look at how Trump reimbursed Michael Cohen, his onetime lawyer. Cohen paid Daniels $130,000 to keep quiet about her claims of an affair with Trump.
Jurors saw invoices, company ledgers and checks documenting how Trump paid $35,000 a month in 2017 — while he was in the White House — to Cohen. After including other work beyond Daniels, a bonus and “grossing up” to cover taxes, the total rose to $420,000, McConney said. Cohen’s said the payments were for a retainer, but McConney said he never saw one.
Trump is on trial for allegedly falsifying dozens of business records to conceal the $130,000 payment to Daniels. Prosecutors say Trump used such payments to influence the 2016 election by hiding his conduct with women. It’s one of four criminal cases Trump faces as he campaigns to return to the White House.
McConney also discussed handwritten notes that he and former Chief Financial Officer Allen Weisselberg took after discussing the details of how to repay Cohen.
“We were going to wire the funds monthly from Mr. Trump’s personal account, President Trump’s account,” McConney told the jury in the trial’s third week of testimony.
In all, Trump paid $315,000 of the $420,000 from his personal bank account, and the other $105,000 came from a Trump trust account, according to records shown to the jury.
The accounts payable supervisor at the Trump Organization, Deborah Tarasoff, testified that she handled checks for Trump to sign from his personal account. She would staple a check to an invoice for him to sign.
In 2017, after Trump became president, he still had to sign checks from his personal account, which were sent to the White House by Federal Express, she said.
“So no one else had the authority to sign those checks?” prosecutor Christopher Conroy asked. “Correct,” Tarasoff testified.
Other witnesses have said that Trump had a high level of control over expenses. Tarasoff said he would write “Void” with a Sharpie for some expenses he rejected.
On cross-examination, Trump’s lawyers continued to develop their theme that Trump had little or nothing to do with the payments.
Defense attorney Todd Blanche asked Tarasoff: “You never had any reason to believe that President Trump was hiding things?” She said: “Correct.”
Gag Order Fine
The testimony followed Justice Juan Merchan’s ruling for a second time that Trump was in contempt of court for violating a gag order. He fined Trump $1,000 and warned he could jail him for further violations of an order intended to protect witnesses as well as jurors.
Last week, Merchan fined Trump $9,000 for multiple violations of the gag order, particularly by attacking and Daniels and Cohen, key witnesses in the case.
“It appears that the $1,000 fines are not serving as a deterrent,” Merchan said in court. “Mr. Trump, I want you to understand the last thing I want to do is put you in jail.”
The judge said he understands the significance of jailing a former president and current candidate, particularly since putting Trump behind bars would raise serious logistical issues.
“I worry about the people, the court officers, your Secret Service detail,” he said. “The magnitude of such a decision is not lost on me but at the end of the day I have a job to do and part of that job is to protect the dignity of the system.”
Trump has repeatedly attacked the gag order and claims it’s unfairly restricting his free-speech rights. Last week, Trump claimed that the order prevents him from testifying in his own defense. The next day, Merchan told Trump directly in court that the order doesn’t prevent him from taking the witness stand.
After court ended Monday, Trump told the media that the gag order means “I basically have to watch every word I tell you people.”
“Our constitution is much more important than jail,” Trump said. “It’s not even close. I’ll give that sacrifice any day.”
Three Decades
McConney spent more than three decades at the Trump Organization, where he always reported to Weisselberg, 76, who’s now serving a second state prison stint after pleading guilty to perjuring himself in an unrelated civil fraud case against Trump by the New York attorney general.
Like other witnesses, McConney disparaged Cohen when asked about what he did at the Trump Organization for more than a decade.
“He said he was a lawyer,” McConney said.
On cross examination, Trump lawyer Emil Bove tried to raise doubts about whether McConney could tie the Cohen payments to the former president.
He asked about Weisselberg’s handwritten notes detailing the terms of the Cohen payment. Bove also asked about McConney’s notes of his conversation with Weisselberg on the payment terms.
“None of the conversations you had with Mr. Weisselberg indicated that President Trump told him to do any of these things?” Bove asked.
“No,” McConney said.
After testimony ended for the day, prosecutor Joshua Steinglass told the judge that he expected the government’s witness testimony will go at least another two weeks.
‘Kid Gloves’
While Merchan has threatened Trump with jail before over the contempt issue, he “seems to actually mean it this time,” said Gene Rossi, a former federal prosecutor who is now a defense lawyer.
“The judge has treated him with kid gloves so far. He must take control of his courtroom,” Rossi said. “No other defendant in history has been treated so gingerly.”
Another lawyer, Robert Hirschhorn, said that the threat of jail time will likely cause Trump to think twice before violating the gag order again.
“I really don’t, unless he sees it as a fundraising opportunity, I don’t think he’s going to challenge this judge again,” said Hirschhorn, an attorney and jury and trial consultant.
--With assistance from Hadriana Lowenkron.
(Updates with Tarasoff cross-examination, prosecutor’s estimate on trial timing.)
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