Maria Butina charged. TRANSCRIPT: 8/23/2018, The Rachel Maddow Show
Show: THE RACHEL MADDOW SHOW
Date: August 23, 2018
Guest: Jeff Horwitz, Eric Swalwell
RACHEL MADDOW, MSNBC HOST: And thanks to you at home for joining us this
hour. Happy Thursday. Happy to have you with us.
When Robert Mueller and the special counsel`s office that he runs, when
they indicted the Internet Research Agency when they indicted that Russian
government-controlled propaganda and disinformation mill that was being run
out of St. Petersburg in Russia, that indictment was initially brought
under the auspices of the special counsel`s office. But fairly quickly,
the special counsel handed it off so that case against all those employees
of the Internet Research Agency and Russian oligarch who ran that entity
that case is now mostly being handled by the U.S. attorney`s office in
Washington, D.C. and specifically the national security division in that
U.S. attorney`s office. Interesting.
The special counsel occasionally turns up in relevant filings and stuff but
it seems like the heavy lifting being done by the U.S. attorney.
A few months later, Robert Mueller brought another indictment against a
different set of Russians. His indictment of a dozen Russian military
intelligence officers, that was again brought initially under the auspices
of the special counsel`s office. But that one right away, day one, they
handed that one off so that that ongoing prosecution is not being handled
by prosecutors who work directly for Mueller. It`s instead being handled
by career prosecutors who work at the national security division at Main
Justice, the main Justice Department in Washington, D.C.
The prosecution of Michael Cohen was also handed off from the special
counsel`s office. The inquiry into Michael Cohen, including into his
finances, that was begun initially by the special counsel`s office, by
prosecutors working for Robert Mueller, but then Mueller handed that one
off, too. Handed the Cohen case off to prosecutors working in the U.S.
attorney`s office in the Southern District of New York.
And then there`s the Maria Butina case. Maria Butina, the alleged Russian
agent is said by prosecutors to have infiltrated the NRA, the American
conservative movement and to a certain extent the Trump campaign in order
to influence the 2016 presidential election on Russia`s behalf. Her
prosecution is also not being run out of the special counsel`s office.
It`s being handled by that U.S. attorney`s office in Washington, D.C. with
assistance from the national security division at Main Justice, at least if
we can decode all the titles of the prosecutors there as well as we think
The same pattern also holds in the open criminal investigation of this guy.
“Washington Post” reported last weekend, the story that got a little bit
swamped in all the other big news about legal troubles for the president
right now. But according to the “Washington Post`s” reporting, there is an
open ongoing investigation of this Trump fund-raiser, who until recently
was the deputy finance chairman of the Republican National Committee. His
name is Elliott Broidy.
Broidy has been named in conjunction with some of the sort of – some of
the same sort of payoff dynamics with women that have now turned so toxic
for the president and Michael Cohen`s criminal case. But in addition,
Broidy has been named in a gigantic mud puddle of stories involving shady
connections to different Middle Eastern countries and different Middle
Eastern entities, what appears to be lobbying for those countries and
entities, also a still obscure business relationship he appears to have
been involved in with a convicted pedophile, pictured here with Donald
Trump, who has apparently been granted immunity in exchange for his
cooperation with the special counsel`s office and who with Elliott Broidy
was apparently involved in some sort of complex operation to influence the
White House on behalf of the United Arab Emirates and Saudi Arabia.
All the best people, right?
“The Washington Post”, again, that got a little bit swamped but the
“Washington Post” reported this past weekend Elliott Broidy, former deputy
finance chairman of the RNC, he is now the subject of an ongoing Justice
Department investigation that is being run interestingly out of the public
integrity section at the main Justice Department in Washington, D.C.
So, all of these things or at least almost all of these things appear to
have starred with the special counsel`s investigation, the special
counsel`s office. But they`ve all been handed off. Internet Research
Agency, Putin`s chef, the GRU indictments, the Michael Cohen prosecution,
this open case involving Elliot Broidy, special counsel appears to have
handed all of these off to other Justice Department prosecutors to other
Quick pop quiz, ready? What`s the one open ongoing case at special counsel
definitely has not handed off? I mean setting aside all the cases brought
by Mueller where people have already pled guilty and flipped and cooperated
and all that stuff? Out of all the cases that he`s brought where they`re
actually prosecuting people and trying to bring them to trial, what`s the
one that Mueller hasn`t handed off?
Paul Manafort. Neither the first Paul Manafort trial nor the second Paul
Manafort trial have been handed off. Both of those are being handled
directly by the special counsel`s office and by the prosecutors who are
working directly for Robert Mueller.
Why is that? Why are they holding on to that one?
In the order that appointed Robert Mueller to run the special counsel
investigation, Mueller and his team are charged with investigating the
Russian attack on the 2016 election and whether the Donald Trump campaign
colluded in that effort and, quote, any matters that arose or may arise
directly from that investigation. Well, plenty of matters have arisen from
that initial investigation, lots and lots of them. And as these matters,
these related matters have arisen and they have turned into criminal cases
they turned into indictments and prosecutions, the special counsel`s
office, the Mueller team has basically to a one fobbed those cases off on
to other offices, other prosecutors in the Department Justice. But for
some reason, they`re hanging onto the Manafort case themselves.
Now, that Paul Manafort has been convicted in his first trial on eight
felony counts, he is looking at a very realistic possibility according to
sentencing guidelines that he could see his 80th birthday sitting in
federal prison. With that prison time already basically assured from his
conviction on those eight felonies this week and with lots more felony
charges coming down the pike from the same prosecutors who just got him
convicted in a neighboring jurisdiction, it is a really important question
now as to whether or not Paul Manafort might change his mind and start
cooperating with the special counsel`s office. He might see what ooh he`s
just gone through and what he`s about to face with this next trial, that
might focus his mind than what he`s been through before the jury said
guilty eight times.
And we don`t know what his thinking exactly. We don`t know what he`s going
to do, but we can see in public a lot of the factors that might affect his
thinking, right? Today, for example, that court in Virginia unsealed the
actual verdict, the handwritten verdict as it was handed in by the jury
that heard Manafort`s case in Virginia.
This is remarkable document, right? To be able to lay your eyes on there,
it`s just an incredible thing. We get the handwriting of the foreperson of
the jury. You see the check marks where the foreperson notes the charges
on which they found Paul Manafort guilty.
But then for the ten charges where they didn`t come to a verdict, the ten
charges on which there was a hung jury and therefore, a mistrial, the
foreperson of the jury did this very unusual thing. And didn`t just write
down no consensus or could not come to agreement, didn`t just leave it
blank. The foreperson of the jury actually wrote down no consensus and
then 11-1. And labeled the 11 “G” for guilty and the one “N ” for not
guilty to specifically spell out for the judge that it was not like they
were split down the middle on any of those remaining ten counts where they
said they couldn`t come to consensus. This is the foreperson going out of
his or her way to make clear it was just one person holding out.
Prosecutors we talked to about this today told us that judges specifically
instruct jurors to not do anything like that on sheet where they fill out
their verdict, to not give the numbers of decided versus undecided jurors.
For whatever reason, this jury or at least this foreperson chose to spell
it out. And because that happened, we all now know that on those ten
counts where the jury couldn`t come to consensus, it was close. It was 11-
1. And now the prosecutors in the special counsel`s office know that, too.
And knowing how close they got to getting Manafort convicted not just on
eight felonies but on 18 felonies, that presumably factors into the
prosecutor`s decision about whether or not they`re going to try again,
whether or not they`re going to retry Paul Manafort on those ten counts for
which there was a mistrial. They can do that if they choose to.
Prosecutors from the special counsel`s office have less than a week now
before they have to make that decision whether or not they will retry
Manafort on those 10 counts. The announcement about whether or not they`re
going to retry him on those other 10 felonies is due next Wednesday. Now,
on the other side of the ledger, of course, Manafort`s defense team, they
also have a decision to make whether or not they`re going to file an appeal
for the eight counts on which Manafort was convicted.
Now, the defense has a longer amount of time to make that decision about
whether or not they`re going to appeal the eight guilty counts. The judge
is apparently giving them 30 days. It looks like they`re going to get 30
days to respond.
One of the consequences of that is by the time Manafort`s legal team has to
announce its decision whether or not they`re going to appeal Manafort`s
eight guilty verdicts, by the time they have to do that, Paul Manafort`s
second federal felony trial will already be under way in federal court in
And here`s the thing that I think is important for us all to know about
that second trial. It`s important for us to know about that second trial
just anticipating what`s going to be happening in the news over the end of
the summer and this fall, but I think it`s also important in terms of the
president and his own legal jeopardy right now and how the president may be
thinking about that.
Paul Manafort`s first trial, the one that ended had week, that was, of
course, about bank fraud and tax evasion. And the president has made a
stream of public statements now both during the trial and after the trial
about basically what a tragedy it is that Paul Manafort was convicted by a
jury on bank fraud and tax fraud charges. But in the next trial for
Manafort, he`s going on trial for being an unregistered agent of a foreign
power while he was running Donald Trump`s campaign to become president.
His co-defendant for some of the charges he`s about to face in his next
trial is his Russian speaking Soviet born long-time business partner who
the FBI says is linked to Russian intelligence and who is believed by
prosecutors to have fled to Moscow ahead of him being charged alongside
Paul Manafort with some of the felony charges that have led to this next
trial that Manafort`s about to face.
Old bank fraud and tax fraud charges back in the day? OK. But being a
secret foreign agent running a presidential campaign and committing
felonies in cahoots with your Russian speaking Russian military
intelligence linked business partner as recently as this year? That`s
going to be a different kind of case.
And we don`t know if the president has anything to worry about in terms of
what may come out in that second trial of Paul Manafort or if the president
has anything to worry about if Manafort in fact decides to change his mind
and start cooperating with prosecutors in order to lessen his prison time
and the pending charges against him. We do not know if the president has
anything to worry about.
But the Manafort case is the one case that is actually being tried by the
special counsel`s office, that the special counsel`s office has held on to
prosecute itself with its own personnel. And the president today and his
lawyers stopped just hinting around the idea that the president might
pardon Paul Manafort to get him off hook and instead started floating the
idea to reporters as they do that the president maybe has already had
discussions with his legal team about how exactly he would pardon Paul
If you are thinking about that prospect today and I think we should all
start thinking about that prospect today in terms of imagining what the
national response is going to be, if you want to get your head around the
potential risks for the president, right, like what kinds of things Paul
Manafort might be able to say about Donald Trump and the way he might say
them if, you know, he ends up – well, there is a reason that this 12-
second clip from the campaign has been circulating widely online over the
last few days. I do think it helps to focus the mind when you think what
Paul Manafort might have to say and how he might say it about Donald Trump.
(BEGIN VIDEO CLIP)
INTERVIEWER: So to be clear, Mr. Trump has no financial relationships with
any Russian oligarchs?
PAUL MANAFORT, FORMER TRUMP CAMPAIGN CHAIRMAN: That`s what he said. I –
that`s what I – that`s obviously what the – our position is.
(END VIDEO CLIP)
MADDOW: That was how good Paul Manafort was at answering Russia related
questions concerning Donald Trump when he was still Donald Trump`s
presidential campaign chairman.
I generally treat the White House including this president and his lawyers
as kind of a silent movie where I try to mostly ignore what they say and
instead just watch what they do. I find it is more efficient. In this
case, I think they have said enough about Paul Manafort that they are
perhaps actually signaling what they`re going to do and – or at least
floating the possibility to see what the reaction will be.
A pardon for Paul Manafort is worth thinking through before it happens if
it happens. It is worth watching the White House closely on this. My
sense is that they are going very wobbly on this question. I think it also
matters in terms of our thinking about the importance of the Paul Manafort
case to note for the record that the special counsel`s office has held this
Paul Manafort case very close even as it has let all of these consequential
prosecutions be handled by people at arm`s length.
And then we got the big news of today which is about this unfamiliar
character. I guess he`s probably familiar by now. If you know who he is,
I know what you`re thinking. I know you`re giggling.
His name is Pecker. His last name is Pecker. It makes every news story
about him a little giggly and distracting.
You know, listen, I`m 45 years old. As far as I`m concerned, that just
means I`m 9 years old times five. I get it. It`s funny, his name is
Pecker. That`s funny.
But when it comes to the pickle that Mr. Pecker has put the president in, I
think it is – it is sort of worth letting it out, giggle through it. Let
that happen. Acknowledge that it`s funny.
But then you do still have to kind of soberly grapple with the fact that
this guy, Mr. Picker, has long been a really central part of Donald Trump`s
life and particularly Mr. Trump`s carefully managed public image. During
the presidential campaign, it became desperately unsubtle. It became
impossible not to notice. You could not buy a quart of milk without being
confronted with the unsubtlety of this relationship.
Because David Pecker`s media empire includes the “National Enquirer.” And
you can watch the progression of Donald Trump`s quest for the presidency
over the course of the covers of the “National Enquirer.” I mean, when it
came to the end of the Republican presidential primary where the last man
standing against Ted Cruz standing against him was Ted Cruz, this was the
“National Enquirer” cover at the end of the primary. Ted Cruz` father
linked to JFK assassination, right? And that`s crazy in the middle of a
presidential campaign to see a supermarket tabloid trying to help their
favorite candidate by putting it out something loony toons like this about
his last remaining serious primary opponent.
But this was not just a loony toons thing on the periphery. This was not
an unwelcome intrusion into the campaign by this publication. But
candidate himself was totally on board with this.
(BEGIN VIDEO CLIP)
DONALD TRUMP, THEN PRESIDENTIAL CANDIDATE: There was a picture on the
front page of the “National Enquirer” which does have credibility. And on
the cover of the “National Enquirer”, there was a picture of him and crazy
Lee Harvey Oswald having breakfast.
This was a magazine that, frankly, in many respects should be very
respected. I mean, if that was “The New York Times,” they would have
gotten Pulitzer Prizes for their reporting. I`ve always said why didn`t
the “National Enquirer” get the Pulitzer Prize.
(END VIDEO CLIP)
MADDOW: That`s my favorite photographic imagery of Mike Pence as he`s
absorbing what Donald Trump is saying about the national – Lee Harvey –
Pulitzer Prize. He said Pulitzer Prize again.
Donald Trump perfectly in his element talking about the “National Enquirer”
and Mike Pence swallowing his tongue thinking, wow, this is going to be my
new life. Mother – so thus ends the Republican presidential primary in
2016 on that high note and thus starts the general election.
In July, they`ve got their main story obviously is their bread and butter
mean celebrity exploitation stuff, dying Cher broke and alone. But then
you see on the side politics, hey, some politics. There`s Trump, how I
will save America from terror.
The following week, this is very subtle, Hillary Clinton corrupt, on the
take, fraud and bribes, crooked Hillary. Where I have heard that phrase
crooked Hillary before?
Two weeks later, Hillary failed secret FBI lie detector. New email
scandal, bombshell, damning report inside, the shocking bribe.
Here`s August 15th, 2016. Donald Trump`s revenge on Hillary and her
puppets. Who are her prophets? Barack Obama apparently is one of her
puppets. That`s interesting.
Mob connections, shady billion dollar deals. Gay double life. It`s a
little weird how they put the mob connections bullet point right under
Donald Trump on this cover, but I`m quite sure from the context they mean
to imply that the mob stuff and the gay stuff and the shady billion dollar
deals are all things you`re supposed to attribute to Hillary Clinton.
Here`s the following week, again, very subtle. Clinton`s secret health
crisis. Mental break down. Eating herself to death and Bill Clinton has
Alzheimer`s and Parkinson`s.
By mid-September, the “National Enquirer” reports that it has obtained
Hillary Clinton`s full medical file. They also found that nice picture of
her to accompany that headline. In her medical file, according to “The
National Enquirer”, there is news of her violent rages, her liver damage
from booze, three strokes and also Alzheimer`s. Then down at the bottom,
not sure if this is directly derived from the medical file but jail Clinton
now. It`s also there on the front page.
Right before the election, this was the “National Enquirer`s” Halloween
special, explosive story that will change the election, 24 years of cover-
ups and crimes exposed. Hillary hitman tells all. Smoking gun proof that
Hillary paid hush money to hookers? Wait. Hush money, who now? Who now
This was the following week. Part two of Clinton`s hitman`s explosive tell
all. Hillary hooked on narcotics? Also, gay sex sting, something
involving Hillary being gay in a motel. Hillary blackmailed the FBI, not
blackmailed by the FBI, but she blackmailed the FBI. That`s a number.
Then there was their election special. This was their masterpiece. This
was on the news stands in basically every grocery store in America when
Americans went to the polls for election day.
They boiled down for the final push. Hillary corrupt, racist, criminal.
Look at the middle section on the bottom there. Hillary used the “N” word
and hates black people.
That`s in every grocery store in America, right? And even but don`t buy
it, that`s the cover.
And then Trump wins the election. And the “Enquirer`s” cover takes a
remarkably sunny turn. This is their first post-election cover. We told
you so. Donald Trump, my first 100-days. My plan to insure world peace.
And then week after week, it was more of the same. Illegals caught
invading America but president-elect`s construction plans and blueprints
inside because Trump must build the wall. Even before he was sworn in,
Trump was able to expose the Muslim spies in Obama`s CIA. They were
infesting Obama`s CIA.
Still, before he was even sworn in, merry Christmas, Christmas Eve, the
“Enquirer” was trumpeting that Bill Clinton is down to 117 pounds and
dying. One of the Obama daughters has hit rock bottom. That`s classy.
And Trump has taken charge.
Again, this is still during the transition but he`s taken charge. He`s
tearing up dangerous deals. Arranged peace between Israel and its enemies.
He slapped down arrogant China.
And then this is how they started 2017. A glamour shot of America`s new
first family, inside Trump`s White House.
This is not just a pro Donald Trump publication. This is not like Fox
News. This is like Fox News on drugs, right?
But David Pecker who runs the “National Enquirer”, who runs the media
entity that controls the “National Enquirer”, he has been on this train for
a long time. In the late 1990s, David Pecker ran a magazine that was
literally called Trump style, just a whole magazine about Trump and style
and Trump stylishness. As long ago as 2010, the “Associated Press” reports
that David Pecker had promoted a possible Trump presidency.
And, you know, maybe David Pecker just loves Donald Trump. That is no
crime. But if that`s what it is, it is a very deep and long-standing love.
“Washington Post” reports that during the 2016 campaign, Pecker allowed
Donald Trump to personally direct and select stories like these ones,
Hillary six months to live and Hillary`s full medical file for the cover of
the “Enquirer”. Trump got to pick those and dictate those.
“The Wall Street Journal” also in a remarkable series of reporting over
months pieced together the finances behind Pecker and his company buying up
rights to damaging stories about Donald Trump`s sex life, so those stories
would be kept quiet before the campaign. Scandal turned up in that
reporting has now turned into criminal consequences with guilty pleas from
Trump lawyer Michael Cohen this week. Cohen pled guilty to making illegal
payments to influence the campaign at the direction of Donald Trump and in
conjunction with David Pecker and Pecker`s company American Media.
The criminal information in Cohen`s case also says that as early as the
summer of 2015, Pecker coordinated with Cohen and with one or more members
of the Donald Trump campaign, to develop a system in which Pecker and the
“National Enquirer” would assist the campaign in identifying and
neutralizing negative stories about Trump. So, there`s all sorts of
interesting questions whether or not American Media as an entity might get
in trouble now that they`ve been named as a participant in that criminal
conspiracy, the company itself. There`s lots of interesting questions
about the Trump Organization, the Trump business having been involved in
that scheme, people on the Trump campaign having been involved in that
scheme, the president himself directly described by Cohen under oath in
court as directing and participating in that criminal scheme.
But today, first, “Vanity Fair” and then “The Wall Street Journal” reported
that David Pecker and his chief content officer, his top editor, a man
named Dylan Howard, they have both now flipped and are cooperating with the
special counsel`s office. Pecker said to have immunity in exchange for his
cooperation. David Pecker is not a random or peripheral figure in the
president`s life. This is probably the president`s greatest ally in
building his public image over the last couple of decades.
This is the guy, this is the company that specifically has managed Trump`s
public image in part by aggressively managing secrets that Trump believed
would be most damaging to him if they were publicly exposed. And now, that
is who is talking to federal prosecutors. And once you`re cooperating with
federal prosecutors, you don`t just get to telltales about, you know,
Michael Cohen. You don`t get to choose any one thing you cooperate about.
Once you`re cooperating, particularly if you`ve been given immunity in
exchange for your cooperation, you`re cooperating on everything, which in
this case may turn out to be fascinating.
Once Trump was elected president, I just want to note here for the record,
the “National Enquirer” and American Media took a few really strange little
turns, including this spring when they published this. This is a big
glossy publication that has no advertisements. It is priced at $13.99. It
was put on the shelf at Walmarts around America.
It`s basically a mash book declaring the awesomeness of Saudi Arabia and
the hunkiness of its new crown prince. This thing literally describes
Saudi Arabia as the magic kingdom. Throughout the book, that`s how Saudi
Arabia is described, magic kingdom. Disney might have something to say
This AMI publication from earlier this year includes this photo of this odd
duck guy in the Oval Office posing with Donald Trump behind the resolute
desk. This guy is an adviser to the Saudi crown prince. He reportedly got
into the Oval Office at the invitation of David Pecker from American Media.
What the heck is the “National Enquirer” doing promoting the interests of
Saudi Arabia and its crown prince to unsuspecting Walmart shoppers all over
America and something they must have lost a gazillion dollars? And what
does that have to do with them getting Saudi interests into the Oval Office
to meet with the president?
Again, once are you cooperating with federal prosecutors, you don`t pick
and across what it is you`re cooperating about. It`s everything.
And now, tonight, the “Associated Press” has just reported that at the
“National Enquirer”, at American Media, turns out they kept all their best
stuff including all their best Trump stuff locked up in a safe that
everybody knew about. That story has just broken. We`ve got the reporter
who broke it, next.
MADDOW: So this is just out tonight from the “Associated Press.” Put this
up there. Yes, you see the headline there. “National Enquirer”” kept safe
with damaging Trump stories.
Here`s the lead. The “National Enquirer” kept a safe containing documents
on hush money payments and other damaging stories it killed as part of its
cozy relationship with Donald Trump leading up to the 2016 presidential
election. People familiar with the arrangement told the “A.P.”
The detail came as several media outlets reported today that federal
prosecutors had granted immunity to “National Enquirer” chief David Pecker,
potentially laying bare his efforts to protect his long-time friend Donald
Quote: Court papers in the Cohen case say Pecker offered to help deal with
negative stories about Trump`s relationship with women by among other
things assisting the campaign in identifying such stories so they could be
purchased and their publication avoided. Several people familiar with
“National Enquirer`s” parent company, American Media Incorporated, AMI,
people who spoke to the “A.P.” on condition of anonymity because they
signed nondisclosure agreements, those several people said the safe was a
great source of power for David Pecker, the company`s CEO. But after “The
Wall Street Journal” initially published the first details of “Playboy”
model Karen McDougal`s catch and kill deal, shortly before the 2016
election, those assets became a liability.
Fearful that the documents might be used against AMI, Pecker and the
company`s chief content officer Dylan Howard removed the documents from the
safe in the weeks before Trump`s inauguration, according to one person
directly familiar with the events. Quote: The “A.P.” cannot say whether
the documents were destroyed or simply removed to a location known to fewer
Joining us now is the reporter who broke the story, Jeff Horwitz.
Mr. Horwitz, thanks very much for being with us tonight. I appreciate you
joining us on short notice.
JEFF HORWITZ, REPORTER, ASSOCIATED PRESS: No problem.
MADDOW: So, is this a safe that only contained damaging and/or suppressed
information about Donald Trump or was this a safe where they kept sort all
of the company treasures?
HORWITZ: No, this was sort of the high value catch and kill stuff. I
mean, there may have been other things in there. But basically when the
“National Enquirer” wanted to suppress a story and then sort of trade upon
the influence it gained by having suppressed a story, that`s where those
documents would apparently go.
And this was a long-standing practice. We`re talking like a literal vault
with a combination lock on it. And that was sort of where both Trump stuff
and things about other celebrities that the “National Enquirer” bought up
dirt on and then buried it, that`s where all ha stuff went.
MADDOW: And from your story, it`s clear that a number of people knew about
this. Obviously, it was, I don`t know if they had it hidden behind like a
fake book case or something. But it sounds like something people could see
and that they knew about it.
You also describe it as a source of power for the AMI chief executive David
Pecker. How was it a source of power for him? And how – did can he sort
of lord the existence of the safe over other people? Is that how other
people knew it existed?
HORWITZ: It wasn`t so much the safe as what was it in it. And in
particular, the way that catch and kill worked and many AMI employees,
“National Enquirer” employees told us this and “The Wall Street Journal”
and other outlets that did sort of ground breaking work on this, that this
catch and kill was about getting an advantage for the “National Enquirer”
and other AMI publications.
So, it wasn`t just that you were happening to buy up dirt on a celebrity or
presidential candidate out of the goodness of your heart. You were buying
it up because that person would know that you had some damaging material
sitting in a safe somewhere. And as a consequence, they might be pretty
nice to you.
This is how it worked with Bill Cosby, for example. Ami paid for some dirt
related to Bill Cosby and in terms of his sexual assault history. And the
company basically then sort of got Bill Cosby to appear on a lot of
magazine covers shall we say.
I mean, this was kind of – it wasn`t blackmail but it was a very friendly
relationship based on having done someone a solid already. And that`s the
MADDOW: Now that David Pecker reported to not only be cooperating with
prosecutors but to have been granted immunity in conjunction with doing so,
it – and the type of leverage you`re describing here relates to the
serving president of the United States, it raises all sorts of very big
questions that are more than about the “Enquirer`s” competitive advantage
in the marketplace. One of the things I`m wondering here, Jeff, is whether
there`s a financial element here, whether there`s a business element here?
I mean, I find it hard to tell whether or not AMI is like in good shape as
a company. I don`t really understand who owns them. I don`t understand if
there might be some serious money issues that could be associated with this
in terms of this being part of their business practice.
HORWIZ: So I think that – I mean, you`re right. Because sort of AMI and
the “National Enquirer”, some of those covers are as ridiculous as you
pointed out earlier, people in the press, “The A.P.”, and other outlets we
didn`t I don`t think take seriously the AMI as a business and one that was
capable of making bad stories about the president go away.
And to your question as to sort of ownership and all of that, they`re owned
by a hedge fund out of New Jersey. I mean, while David Pecker is sort of
held out as the king of AMI, you know, the guy who sort of you know makes
all the decisions, these guys are owned by a company called Chatham Asset
Management. It`s a hedge fund in Chatham, New Jersey, and the – that
company is close to Chris Christie, got a lot of public pension money
during the Christie administration and actually, Anthony Melchoirre, the
head of Chatham, attended the White House with David Pecker at one point.
So, it`s – the question as to what Chatham, what interest they would have
had in this and whether they would have had any curiosity how the editorial
process was being run in terms of a political slant is a really interesting
one. I don`t know what exactly the benefit would be but definitely they`re
the money behind AMI.
MADDOW: And if that ends up being relevant to the story, that story will
now be told to federal prosecutors if Mr. Pecker is cooperating under a
promise of immunity.
Jeff Horwitz, reporter with “Associated Press”, with really interesting
scoop tonight – Jeff, thanks for being here. Congratulations on this.
HORWITZ: You`re welcome.
All right. And actually while I was talking to Mr. Horwitz, we have more
breaking news concerning a new potential prosecution. It`s kind of a big
stack. We`ve had just some news broken in the “New York Times”. You`re
going to want to see this. We will have it for you right after this break.
We`ll be right back.
MADDOW: So this has just broken in the “New York Times”, with the
president`s lawyer pleading guilty this week on federal felony charges,
naming the president and others as participating in those crimes with him,
we have been wondering since that plea if there will be other people or
entities actually prosecuted in conjunction with those crimes or anything
related to them. Or you can see this new headline in the “New York Times”
as of moments ago, Manhattan D.A. eyes criminal charges against Trump
Here`s the lead. The Manhattan District attorney`s office is considering
pursuing criminal charges against the Trump Organization and two senior
company officials with Michael D. Cohen`s hush money payment, excuse me –
excuse me. Considering pursuing criminal charges against the Trump
Organization and two senior company officials in connection with Michael D.
Cohen`s hush money payment to an adult film actress. “The Times” tonight
citing two officials with knowledge of the matter.
“The Times” goes on to report that investigation would center how the Trump
Organization accounted for reimbursement to Mr. Cohen for the $130,000 that
Mr. Cohen paid to Stormy Daniels during the campaign. Now, there`s
actually a second story that is nutted in here, as well. About halfway
through the story, “The Times” reporter William Rashbaum also says this.
As the Manhattan District Attorney Cyrus R. Vance Jr. considers opening the
investigation I just described, in addition to that, the New York state
attorney general`s office has moved to open a criminal investigation into
whether Michael Cohen has violated state tax law. That`s an inquiry that
would be unrelated to the federal tax evasion charges he pled guilty to on
According to a person with knowledge of that state matter, the Attorney
General Barbara Underwood in recent days sought a referral from the State
Department of Taxation in New York which is needed to conduct such an
inquiry and to prosecute any violations of state tax law it might uncover.
Such requests are seldom denied.
So, again, “The New York Times” breaking news the Manhattan district
attorney`s office is considering criminal charges against the Trump
organization in terms of how they dealt with what Michael Cohen has now
said was an illegal campaign contribution that he effectuated two illegal
contributions that he said he effectuated. One of which he said was
reimbursed through the Trump organization. And in a related matter, the
New York attorney general`s office may be pursuing Cohen on state tax
Joining us by phone is Daniel Goldman, former prosecutor with the Southern
District of New York, which means that he`s a former federal prosecutor in
the New York jurisdiction.
Mr. Goldman, thanks very much for joining us tonight on very, very short
notice. I really appreciate you being here.
DANIEL GOLDMAN, FORMER FEDERAL PROSECUTOR, SDNY (via telephone: Thanks for
having me, Rachel.
MADDOW: So, we`re all becoming amateur lawyers. I think of us as
jailhouse lawyers on the loose. Those of us who don`t have a law degree
but trying to follow the contours of the president`s legal jeopardy and
what`s happening to his administration. These two inquiries described
tonight by “The New York Times,” neither of them would be federal
But it seems like they both seem to at least touch on or derive from what
we`ve just learned in the federal case with Cohen this week. Is that fair?
GOLDMAN: That`s exactly right. And there were a couple things that have
happened in the Cohen case that lead one to believe that this is natural
and a normal outflow from that. The first is, there was a lot of detail in
the Michael Cohen criminal information about the fact that his invoices to
the Trump Organization were sham invoices. That actually was unrelated to
the crime that he was charged with, the campaign finance fraud violation,
so it struck me as interesting they would include such detail.
And then the second thing, of course, is that we know that the taxi king,
Gene Freidman, is cooperating with state court in the New York D.A.`s
office, the Manhattan D.C.`s office and that he obviously is very connected
to Cohen and it likely also cooperating with federal prosecutors in
connection with the federal income tax fraud and the loan fraud that Cohen
pled guilty to.
So, there`s a lot of intertwining prosecutorial investigations related to
Michael Cohen. So, it is not that surprising that we would see state
prosecutors looking into some of this criminal activity.
MADDOW: And, Dan, I – again, as a non-lawyer, I know about famous court
cases involving business entities. I know about the Enron case. I know
about the Arthur Andersen case. I know about, you know, big environmental
cases, about oil companies and stuff like that.
I don`t know that much about what it means for there to be a criminal
charge against a business like the Trump Organization. If that happens, if
this Manhattan district attorney`s office does bring criminal charges
against the organization, against the business, does that mean that the
people who are the principals of that business essentially have to answer
for the business`s behavior if there is – if things go prosecutor`s way
and that kind of prosecution is brought, and the business entity gets in a
lot of the trouble, do the people associated with that business get in
trouble or does the business just go out of business?
GOLDMAN: So, the corporate officers, the ones who have a duty, a fiduciary
duty to the corporation can get in trouble. The reason you don`t see it
very frequently is that it naturally has a trickle down effect as to all
the employees if a company is charged. So, generally, at least in my
experience in federal court at the Southern District of New York, often you
work out deferred prosecution agreements where companies agree to pay
significant – you know, it can be in the billions of dollars of fines to
avoid prosecution because prosecutors are wary of making people lose their
I would suspect that this would also be an investigation into particular
individuals who are responsible for the accounting at the Trump
Organization and specifically executive 1 and executive 2 who are mentioned
in the Michael Cohen information and who were involved in covering up the
reimbursements to Cohen as legal expenses which Cohen has now admitted was
a complete sham.
So this is essentially a very low level accounting fraud where the Trump
organization did not properly account for disbursements that it made in
federal court, in order to have accounting fraud, you need to have
materiality. So, you need to show it would make a difference to an
investor. The Trump Organization of course, though, is private. So, there
are different laws that would apply to it. But that`s really what we`re
getting at is what is akin to accounting fraud.
And in state law where you have different levels of felonies and
misdemeanors, there`s a whole different series of crimes that can be
MADDOW: Daniel Goldman, former federal prosecutor in the Southern District
of New York, thank you for joining us to help us sort this out tonight as
we just got this breaking news. It really helps to have you here, Dan.
Thanks a lot.
GOLDMAN: Thank you.
MADDOW: I will say one of the other things because the president has been
mulling, talk about pardons and stuff at the federal level, you should know
that if a president does issue a pardon to, those are only for federal
crimes. The prospect of state level crimes being prosecuted against people
associated with the president his business entities, his family members
potentially, even himself, there`s no federal pardon that gets you out of
that when you are prosecuted at the state level.
Again, breaking news tonight from the “New York Times,” Manhattan D.A.
eyeing criminal charges against account Trump organization alongside the
New York state general apparently eyeing criminal tax charges against Trump
attorney Michael Cohen.
Stay with us.
MADDOW: Joining us now is Congressman Eric Swalwell. He`s a member of the
House Intelligence Committee, Democrat from the California.
Congressman Swalwell, we`re absorbing another night of breaking legal news
related to the president and his businesses and his campaign. It`s really
nice of you to be here with us. Thanks for being here.
REP. ERIC SWALWELL (D), CALIFORNIA: Thank you, Rachel.
MADDOW: So, we`ve just announced in the “New York Times” that is state
level criminal charges are being weighed against the president`s business
in New York, the Trump Organization. Also state level charges being
weighed against the president`s lawyer, Michael Cohen, who has already this
week pled guilty to eight felonies in federal court.
Let me just get your top line reaction to that news.
SWALWELL: Yes, Rachel, the president right now is facing legal liability
on multiple fronts, and not just criminally but also civilly. And now,
tonight, this news shows that much of the liability is also pardon proof.
And with investigators closing in on his family, on his businesses, on his
campaign and his administration officials, the best thing the president can
do is to just come clean with the American people, to sit down with Bob
Mueller because a lying president and obstructing president, a witness
tampering president is a weak president.
And I don`t think he can continue to lead with all of these clouds circling
around his private businesses and the White House that he must lead for all
MADDOW: Some of the clouds as you describe them do seem centered on his
business in a way that we have not seen as intensely as we are seeing right
now and certainly on people who were business associates of him, including
his long-time personal lawyer Michael Cohen. But what`s your feeling about
the seriousness of the campaign specific charges in which the president has
Mr. Cohen pled guilty to two campaign finance charges. He said that the
president directed him to commit those crimes. The president responded by
saying campaign finance violations aren`t a big deal. Nobody would get
prosecuted for them if I weren`t getting witch hunted for them. Do you
think these are serious charges?
SWALWELL: I do, Rachel. And as a former prosecutor, I don`t see how you
can separate Michael Cohen`s allocution and what he pled to and the person
who directed and cooperated with Michael Cohen. So, I believe that if
Donald Trump was not the president of the United States, he also would have
been indicted earlier this week. And also, there`s a theory in the law
called corpus delicti which is that you can`t just take a guilty plea from
a defendant unless there`s some other evidence. You can`t only rely on
that defendant`s confession.
So, that means that the prosecutors had other evidence. We`re seeing that
now with Mr. Pecker`s evidence. And I think a lot of people are asking,
how big is that safe? You know, what`s in that safe and how do we crack it
so that we know just what else is out there.
MADDOW: With so many people close to the president now talking with
prosecutors, not only his former lawyer Michael Cohen who obviously is in a
different position with regard to prosecutors than he was before these
guilty pleas, with his representatives saying openly that he`d be very
happy to talk to special counsel Robert Mueller, with this report that
we`ve got cooperation and maybe immunity for Mr. Pecker, a long time friend
of the president, somebody involved in so many of the president`s most
closely held secrets, find myself just as a citizen worried that the
president may feel very squeezed. That doesn`t give me pleasure because I
don`t want to think of him either as having done anything that he feels
worried about being exposed, nor do I want to think about the way he might
lash out if he feels very threatened.
Are you concerned that the president may take extreme action or do
something very unwise in response to all this pressure?
SWALWELL: Yes, and certainly last night, we saw him stoking, you know,
racist beliefs trying to, you know, bring up things that are just not true
going on in South Africa. And he received sharp rebuke from the South
African government. Who knows who else he could lash out at?
But right now, I think he sees he`s not going to be held accountable for
anything he does because he has a Republican Congress that is completely
unwilling to stand up to him. And I think that the best thing that we
could do for the American people is unearth the investigations that the
Republicans have buried. And not tomorrow when the Judiciary Committee in
the House meets, go back and look at Hillary Clinton e-mails, which by the
way is what we`re going to do tomorrow in a special meeting, but to look at
the conduct that`s so alarming from this president and the people around
MADDOW: Literally, the meeting tomorrow is on Hillary Clinton`s emails?
SWALWELL: They`re bringing in someone who investigated the Hillary Clinton
e-mail case. And that was scheduled the day after that Michael Cohen pled.
So, they knew what was on the line and what the American people cared about
and they chose to go in that direction.
MADDOW: Congressman Eric Swalwell, a member of the House Intelligence and
Judiciary Committees – thank you, sir. It`s very good to have you here.
SWALWELL: My pleasure.
MADDOW: Much appreciated.
Seriously. We`ll be right back.
MADDOW: Cameras on the International Space Station caught this video
yesterday. You see that monster white mass on the right-hand side there?
Look at that. This is hurricane called Hurricane Lane. It`s a category 3
storm that closed in on the Hawaiian Islands tonight.
This hurricane may not make landfall on the islands, but it`s come close
enough to make itself known. More than 20 inches of rain falling on the
big island already. Landslides already blocking at least one major
We are warned that the most damage could come from dangerous winds and
flooding over the next four to five days. But they`re saying the worst of
it will come in the next 48 hours. Hurricanes have only made landfall on
the Hawaii Islands twice since the 1950s. This is a rare thing, but
obviously this is serious.
We will be keeping eyes on this overnight and into tomorrow and over the
next couple of days.
That does it for us tonight, though. We will see you again tomorrow.
Now, it is time for “THE LAST WORD WITH LAWRENCE O`DONNELL.”
Good evening, Lawrence.
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