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CNN SPECIAL REPORTS

Hush Money - Trouble for Trump?. Aired 10-10:30p ET

Aired April 14, 2018 - 22:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


[22:00:02] DONALD TRUMP, PRESIDENT OF THE UNITED STATES: You have to ask Michael Cohen. Michael is my attorney.

SARA SIDNER, CNN CORRESPONDENT: He's been called Donald Trump's pit bull.

GLORIA BORGER, CNN CHIEF POLITICAL ANALYST: Cohen, as someone said to me, knows where all the bodies are buried because he may have buried a lot of them.

SIDNER: The ultimate Trump loyalist.

MICHAEL COHEN, PRESIDENT TRUMP'S PERSONAL ATTORNEY: I protect Mr. Trump.

WOLF BLITZER, CNN ANCHOR: Happening now, breaking news, Trump's lawyer raided.

ERIN BURNETT, CNN ANCHOR: The agents armed with multiple search warrants.

SIDNER: Raided by the FBI.

DON LEMON, CNN ANCHOR: They came in early Monday morning. They stuck their foot in the door so he couldn't close it.

SIDNER: How big of a deal is it?

UNIDENTIFIED MALE: It's a huge deal.

SIDNER: What were they searching for?

JENNIFER RODGERS, FORMER FEDERAL PROSECUTOR: They're looking for evidence of hush payments to women.

SIDNER: Is the pattern of payoffs to protect a billionaire?

ANDERSON COOPER, CNN ANCHOR: You're going to get $150,000 for it.

KAREN MCDOUGAL, ALLEGES HAD AN AFFAIR WITH PRESIDENT TRUMP: The side deal was, oh, we're squashing the story.

SIDNER: Who isn't just a billionaire anymore.

MICHAEL AVENATTI, STORMY DANIELS' ATTORNEY: He was a candidate for the president of the United States. UNIDENTIFIED MALE: Any violation of the Federal Campaign Finance laws

that's done knowingly and willfully is a crime.

SIDNER: A new line of investigation and it's not part of the Russia probe.

UNIDENTIFIED MALE: If you look at the scope of the authority he's been granted, you could drive a mud truck through it.

SIDNER: Where could it lead? Tonight a CNN's Special Report, HUSH MONEY: TROUBLE FOR TRUMP?

BLITZER: We are following breaking news, the FBI raids the office of President Trump's personal lawyer and long time fixer, Michael Cohen.

SIDNER: Monday morning inside the iconic 30 Rock Building in Midtown Manhattan. And the FBI is radiating the law office of President Trump's personal attorney, Michael Cohen.

JEFFREY TOOBIN, CNN CHIEF LEGAL ANALYST: Searches of lawyers' offices are incredibly rare. So my initial reaction was wow, they must have something very serious on Michael Cohen.

SIDNER: Additional federal agents raided the Park Avenue Hotel where Cohen had been staying.

LEMON: They stuck their foot in the door so he couldn't close it. He was holding his phone. They immediately took his phone away from him.

TOOBIN: The first thing they do when they walk into a room today is they say, give me your phone. They're very polite but they tell you go sit over there and don't touch anything because your possessions are our possessions now.

SIDNER: How big of a deal is it that Michael Cohen, the lawyer for Donald Trump, in personal matters has been raided when it comes to the FBI?

JOSH CAMPBELL, CNN LAW ENFORCEMENT ANALYST: I think the fact that the FBI went and raided his office is a very big deal. So I think for Mr. Cohen, he's in serious jeopardy.

SIDNER: The agents arrived with a warrant that had President Donald Trump's name in it according to sources familiar with the matter. It's the first known direct mention of the president in a warrant.

LEMON: There is a source close to the investigation I spoke to who told me what they took in. And it was financial documents, computers, files. It was an extensive and exhaustive search not only of his hotel room but his office and his home as well.

SIDNER: The search warrant referenced an investigation into wire fraud, bank fraud and campaign finance violations.

BLITZER: A source says some of the documents seized have to do with the porn star Stormy Daniels. SIDNER: CNN has learned they were looking for information related to

a payment Cohen made to the adult film actress Stormy Daniels. She says she had sex with the president in Lake Tahoe in 2006.

LEMON: Did you want to have sex with him?

STORMY DANIELS, ALLEGES SHE HAD AN AFFAIR WITH PRESIDENT TRUMP: No. But I didn't -- I didn't say no. I'm not a victim. I'm not --

COOPER: It was entirely consensual?

DANIELS: Yes.

SIDNER: The White House denied Trump ever had a relationship with her. But Michael Cohen set up an LLC and then used it to pay Daniels $130,000 to keep her from telling her story to the press. He claims the money was his own pulled from a home equity loan. The payment was made just 13 days before the election which could be a violation of campaign finance law.

RODGERS: I think they're looking at campaign finance or election law violation where a benefit goes to the campaign in the form of silencing some of these people and that benefit is not reported. And I think they're also looking at associated bank fraud and potentially money laundering crimes where these payments were funneled through shell companies.

TOOBIN: Paying women for their silence in and of itself is not a crime.

SIDNER: The full scope of what the FBI took is unclear. But sources tell CNN agents obtained voice recording of Cohen talking to Stormy Daniels' former attorney, Keith Davidson. Cohen spoke to Davidson many times for various reasons. Just some of the many things he did on Mr. Trump's behalf.

[22:05:03] BORGER: He did everything for Donald Trump. He was the fixer.

DAVID SCHWARTZ, ATTORNEY FOR MICHAEL COHEN: He's a street lawyer, he's a fighter, he's tenacious. And that's what Donald Trump loves about Michael Cohen.

BORGER: Cohen, as someone said to me, knows where all the bodies are buried because he may have buried a lot of them.

SIDNER: The question is, what if anything did Cohen bury in the lead up to the 2016 election and could it land him in prison?

CNN anchor, Don Lemon, spoke with Cohen earlier this week.

LEMON: He's worried not because he thinks he did anything illegally. He thinks in the end that it will be proven that everything he did was legal. He's worried because he thinks that they will look for something to charge him with.

SIDNER: And what about the president? If Cohen ends up charged with a crime, what does that mean for him?

TOOBIN: Michael Cohen is the man who kept Donald Trump's secrets and now the FBI has access to every single one of those secrets. That's a big deal.

SIDNER: In addition to the information about Stormy Daniels, sources tell CNN agents were also looking for other ways Cohen may have tried to suppress negative information before the election including material connected to Karen McDougal, the former Playmate who told CNN's Anderson Cooper she had a 10-month affair with Trump in 2006 which the White House says he denies.

COOPER: Were you in love with him?

MCDOUGAL: Goes, yes.

COOPER: And you think he was in love with you?

MCDOUGAL: He was yes. He always told me he loved me.

SIDNER: And CNN has learned the agents sought communications between Cohen and the president regarding that now infamous "Access Hollywood" tape.

TRUMP: Grab them by the (EXPLETIVE DELETED), you can do anything.

SIDNER: The tape surfaced in October 2016, a month before the election.

TOOBIN: The timing of the release of the "Access Hollywood" tape does give rise to certain suspicions.

SIDNER: It went public about 4:00 p.m. on October 7th, 2016, one-half hour after the Justice Department blamed Russia for hacking the DNC. And one-half hour before WikiLeaks began tweaking links to hacked e- mails from Hillary Clinton's campaign chair John Podesta.

TOOBIN: Now the question may be, did Trump or anyone with the Trump campaign do something with WikiLeaks, with the Russians who hacked into the Clinton campaign's e-mails to get that stuff released and distract from the release of the "Access Hollywood" tape?

SIDNER: Steven Ryan, a lawyer for Michael Cohen, called the search on Monday completely inappropriate and unnecessary.

TRUMP: So I just heard that they broke into the office of one of my personal attorneys, good man, and it's a disgraceful situation. It's a total witch hunt. It's frankly a real disgrace, it's a -- an attack on our country in a true sense. It's an attack on what we all stand for.

BORGER: And it drove Trump crazy because he believes that it's a violation of attorney-client privilege.

SIDNER: Attorney-client privilege is dead, the president tweeted. But there are exceptions to attorney-client privilege. AVENATTI: If that communication relates to the commission of a crime,

a criminal act, that that communication is no longer subject to protection.

SIDNER: The potential violation of the president's privileged communication isn't the only thing that had Mr. Trump steamed.

UNIDENTIFIED REPORTER: Why don't you just fire Mueller?

TRUMP: Why don't I just fire Mueller?

UNIDENTIFIED REPORTER: Just fire the guy.

TRUMP: Well, I think it's a disgrace what's going on, we'll see what happens.

SIDNER: At this point, firing Robert Mueller, the special prosecutor investigating Russia's meddling, would not get rid of the investigation into Cohen. That's because the federal agents who raided his hotel room and his office were not sent by the special counsel. Instead, the case was referred to the U.S. attorney of the Southern District of New York.

RODGERS: You now have a whole another investigative team separate and apart from the special counsel's office working on this issue.

SIDNER: And they have been working on it for months. Court papers disclosed Friday reveal an astonishing fact. Prior to the raid, federal prosecutors had already obtained secret search warrants for several of Michael Cohen's e-mail accounts.

Ahead, the two women and the doorman. Who are they? And what did Michael Cohen know about them?

(COMMERCIAL BREAK)

[22:12:56] SIDNER: Michael Cohen may look like he doesn't have a care in the world, but looks can be deceiving. We now know agents carrying out Monday's raid were looking for communications connected to efforts to squash negative information about Donald Trump, a source tells CNN.

There were at least three attempts to conceal negative stories in the lead up to the election. One of them, Stormy Daniels, the porn star who says she had sex with Mr. Trump after swatting him with a rolled up magazine.

DANIELS: I was like, turn around, drop them.

COOPER: You told Donald Trump to turn around and take off his pants?

DANIELS: Yes.

COOPER: And did he?

DANIELS: Yes. So he turned around and pulled his pants down a little. He had underwear on, and I just gave him a couple of swats. SIDNER: The White House has denied the affair. But Daniels and

Michael Cohen agree that she was paid $130,000 just before the presidential election. Daniels says it was to keep silent about her claims.

This is her non-disclosure agreement. Mr. Trump was supposed to sign under DD, according to Daniels, but never did. But the president says he knew nothing about his deal with the porn star which is difficult for some to believe.

MICHAEL D'ANTONIO, AUTHOR, THE TRUTH ABOUT TRUMP: No one in Donald Trump's universe acts without Donald Trump's knowledge. So for Michael Cohen to say that he wrote $130,000 check out of his own bank account or out of a bank account he established just for this purpose and paid off this woman is laughable.

SIDNER: Republican Ken Cuccinelli, the former attorney general of Virginia, doesn't share that view.

KEN CUCCINELLI, FORMER ATTORNEY GENERAL OF VIRGINIA: You know, so he wants to protect Donald Trump, his friend, he is perfectly allowed to do that. There is nothing wrong to do that. And he may make the judgment, you know, I think he's better off not knowing about this and so I am going to go do this myself. But he's not acting as a lawyer when he does that. He's just a contracting party.

SIDNER: Daniels is now suing to get out of her deal and has already appeared on national television when she spoke with Anderson Cooper.

[22:15:07] DANIELS: The exact sentence used was they can make your life hell in many different ways.

SIDNER: The lawyer who broker it for Daniels is this man. Keith Davidson. He says he represented Daniels in 2011 and called her again in 2016 after getting a call from Michael Cohen.

KEITH DAVIDSON, FORMER ATTORNEY FOR DANIELS AND MCDOUGAL: He said hey, remember that matter that we dealt with in 2011? It's resurfacing again. Can you find out what's going on?

SIDNER: Another client of Davidson's was Karen McDougal. The woman who says she loved Donald Trump and dated him for 10 months in 2006.

COOPER: Did you think maybe this would lead to a marriage?

MCDOUGAL: Maybe.

SIDNER: She says American Media Incorporated, the parent company of the "National Enquirer" paid her $150,000. McDougal said she thought she was signing on to a deal that would buy her silence and allow her to publish a few health and fitness columns for AMI Publications. She now believes there was a larger conspiracy at work between AMI, her then attorney Keith Davidson, and Michael Cohen.

Let me ask you about these coincidences. Karen McDougal and Stormy Daniels, both in the situations where they both had deals that involved allegations of an affair with Donald Trump, both of those deals with silenced. It just seems like an awfully strange coincidence that they both landed in your lap. Don't you think?

DAVIDSON: No, not at all.

SIDNER: Why not?

DAVIDSON: No. I mean, I have a very active practice. There are a few attorneys that would go against large corporations, powerful celebrities, that's one thing that I'm known for. And these two ladies came to me from two different -- completely different places.

SIDNER: Davidson does seem to have a niche practice involving celebrities and sex scandals. But that doesn't explain why he'd called Michael Cohen in 2016 after McDougal signed her deal with AMI.

DAVIDSON: I think I called him as a professional courtesy to let him know that a matter was resolved and that as a professional courtesy that may or may not have involved his client.

SIDNER: Was he involved in the deal at all?

DAVIDSON: Certainly wasn't involved on our end. And there was no basis for me to believe that he was involved or had any communication with AMI. But that's something I just don't know about.

SIDNER: Do you see why Karen McDougal and her now current representation might construe that as a conspiracy behind her back that there is something else going on that Michael Cohen was behind all this being a puppet master if you will?

DAVIDSON: I think generally speaking, I mean, a conspiracy would have to involve an act that would take place before. And that simply wasn't the case. My conversation with Michael Cohen took place after Miss McDougal had already solidified the deal with AMI.

SIDNER: AMI is run by a wealthy Trump supporter named David Pecker. Ronan Farrow, a contributor to the "New Yorker" magazine, was the first to report that it was Pecker who was behind the 150 grand deal made with McDougal.

RONAN FARROW, CONTRIBUTOR, NEW YORKER MAGAZINE: That's what we report as a claim from several sources involved. You know, they said that he was calling regularly about this. Now AMI, we should point out, has flatly denied that.

SIDNER: AMI said McDougal is free to talk and the suggestion that AMI silenced her is completely without merit.

Farrow was also among the first to report that Pecker's company was instrumental in killing a 2015 story from a long time Trump doorman who claimed he heard Trump had a child out of wedlock with one of his employees in the '80s.

"I can confirm while working at Trump World Tower, I was instructed not to criticize President Trump's former housekeeper due to a prior relationship she had with President Trump which produced a child," the former doorman Dino Sajudin said in a statement released this week.

Farrow and other publications report that AMI bought the story from Sajudin for 30 grand but never published it.

FARROW: Really the crux of this for many of the sources that stuck forward was reporting was halted they alleged on direct orders from David Pecker.

SIDNER: Farrow's story also mentions Michael Cohen. Farrow writes that he spoke with two former AMI employees who said they believed that Cohen was in close contact with AMI executives while the company's reporters were looking into Sajudin's story.

AMI denies that Trump or Cohen had anything to do with it, adding, "The suggestion that David Pecker has ever used company funds to shut down this or any investigations is not true. These claims are reckless, unsubstantiated and false.

[22:20:03] RadarOnline, a gossip site owned by AMI, published its own story about Sajudin, saying AMI didn't run his story because they determined it wasn't true.

True or not, the question now is, could there be more hush money stories out there? Stormy Daniels' attorney says he's sure of it.

AVENATTI: From everything we have seen, there is a number of NDAs out there that were executed over a significant period of time. My client is not alone. I'm sure there is a number of women that have found themselves in the same situation.

SIDNER: Ahead, so what is the big deal about the raid on a lawyer's office?

TOOBIN: The Cohen's search is almost like the day that Whitewater turned into Monica Lewinsky. It's when the story takes a quantum leap into something unknowable and very different.

(COMMERCIAL BREAK)

UNIDENTIFIED REPORTER: Did you know about the $130,000 payment to Stormy Daniels?

TRUMP: No. No. What else?

UNIDENTIFIED REPORTER: Why did Michael Cohen make this, if there was no truth to her allegations?

TRUMP: Well, you have to ask Michael Cohen. Michael is my attorney and you have to ask Michael Cohen.

[22:25:02] SIDNER: Michael Cohen had been the president's virtual vault. The keeper of secrets in his business and personal life.

TOOBIN: The idea that the FBI now has access to every e-mail, every communication, every phone call that Michael Cohen made, the fixer, the Ray Donovan, Trump's closest aide for his most sensitive, dicey material, it's that big a deal.

SIDNER: The raid signals a major turning point in the Justice Department's investigations into Trump and his associates.

TOOBIN: The Cohen search is almost like the day Whitewater turned into Monica Lewinsky. It's when the story takes a quantum leap into something unknowable and very different.

SIDNER: Reminiscent of an even greater political scandal involving an American president when a White House staffer revealed one of Washington's most damning secrets.

UNIDENTIFIED MALE: Mr. Butterfield, are you aware of the installation of any listening devices in the Oval Office of the president?

ALEXANDER BUTTERFIELD, DEPUTY ASSISTANT TO PRESIDENT NIXON: I was aware of listening devices. Yes, sir.

TOOBIN: I would say the closest Watergate parallel is when Alexander Butterfield, a relatively unknown official, went before the Senate Watergate Committee and said there are tapes. There are tapes of conversations in the White House. That just changed everything.

SIDNER: Yet it seems there is never been a raid like this one in history. One that targeted a president's personal lawyer.

TOOBIN: I have to believe that a search like this which is so intrusive on a lawyer, on the president's lawyer, would only be allowed if there were serious crimes.

RODGERS: Each financial transaction could be its own crime.

SIDNER: Jennifer Rodgers is a former federal prosecutor. She says investigators will be looking hard at seized evidence to see if Cohen broke any laws.

RODGERS: I think they're also looking at associated bank fraud and potentially money laundering crimes where these payments were funneled through shell companies, home equity line of credit was obtained to pay off Stormy Daniels as been reported. If in getting the $130,000 line of credit Michael Cohen told the bank that he was obtaining that to say to improvements to his house, that's a lie. You're not allowed to lie on federal forms, to FDIC ensured bank. That's a crime. So that would be a crime of bank fraud.

He was committing the election law violation by giving a benefit to the campaign of the silence of Stormy Daniels. And in the course of doing that, he wired the payment to her or to her lawyer to pay her off then that would be a wire fraud.

SIDNER: Financial crimes can lead to years behind bars.

RODGERS: The bank fraud and mortgage fraud, money laundering crimes are very serious. Each of those counts is a 20-year maximum. And that's the statutory max. You know, people don't tend to get that much jail time. But it's a very serious charge. SIDNER: Former Virginia attorney general Ken Cuccinelli says the raid

was over the top.

CUCCINELLI: If you are interested where the money went, you can get that via banks, you can get that via tax statements. The necessity of raiding a lawyer's office home and hotel is not apparent. This creates all sorts of Fourth, Fifth and Sixth Amendment problems.

SIDNER: Questions have been raised as to why the Cohen raid was peeled off from Special Counsel Robert Mueller's investigations. The searches were carried out as part of an ongoing grand jury investigation conducted by the U.S. attorney's office in the Southern District of New York, and the FBI, separate from Mueller.

RODGERS: It's important for two reasons. One is that, you know, Mueller has been criticized for expanding his mandate. He's supposed to be investigating Russian interference and anything that comes from that like obstructing that investigation. To the extent that he starts to kind of edge beyond and starts to look at the Trump Organization's business, and that sort of thing, Trump and his allies are going to say he's over reaching.

SIDNER: And Rodgers says keeping Mueller on the Cohen case may have smacked of being political.

RODGERS: It's the Southern District of New York, it's headed by a Trump's appointee, a Republican who just came in in January so there is no reason to believe it's a witch hunt. It's an independent group from the special counsel's office.

SIDNER: According to a source, the president called Cohen yesterday. The two are still in touch.

So if Cohen is indicted and is offered a deal to testify against the president, would he flip? The stakes are high for Trump's right-hand man.

LEMON: I think he's really concerned about his family right now.

[22:30:03] I think that's one reason he spoke to me and whatever comes of this I think in the end Michael Cohen will do what's best for his family. I know he is loyal to the president but I'm not sure if that loyalty to the president outweighs the love he has for his family.

SIDNER: At this point, nobody knows exactly what investigators have on Cohen or how he'll react if they have enough to charge him.

CUCCINELLI: I don't know that there's a whole lot here. It certainly looks a lot more spectacular when you got the FBI going in and that has all sorts of problems when you're going in after someone who's a private lawyer of the president to presumably get things you can get other ways.

SIDNER: Michael Avenatti is the attorney representing adult film star Stormy Daniels in her case against Trump and Cohen. AVENATTI: The problem is, is that it appears that Donald Trump

entrusted some very personal secrets, some very extensive potential liability issues with entrusted Michael Cohen with that information. And I think that was a critical mistake and I think he's going to pay the price for it.

SIDNER: If his reaction to Cohen's ordeal is any indication, Donald Trump is extremely unhappy.

TRUMP: So I just heard that they broke into the office of one of my personal attorneys.

BORGER: I think the president is enraged by this on a lot of levels. And I think that he's already enraged by the Russia investigation, he's already enraged by Stormy Daniels and Karen McDougal. He's got a wife and a child at home, don't forget, who are probably very unhappy about this and then, you know, you add the Michael Cohen raid on the top of that and if you're the president, you are thinking this might be a tipping point for you.

What are these guys doing and what are they trying to get at, and what does this have to do with Russia? He believes this has crossed the red line. What he's going to do about it remains to be seen.

(COMMERCIAL BREAK)