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Trump admits Cohen payment. TRANSCRIPT: 05/16/2018. The Beat with Ari Melber

Guests: Michael Avenatti, Daniel Goldman, Neera Tanden, Michael McFaul, Liz Plank, Cheri Jacobus

Show: THE BEAT WITH ARI MELBER Date: May 16, 2018 Guest: Michael Avenatti, Daniel Goldman, Neera Tanden, Michael McFaul, Liz Plank, Cheri Jacobus

CHUCK TODD, MSNBC HOST: All right. So will this great debate -- I have to stop this or I will go crazy -- ever be resolved? Give it time. The Laurels will eventually come around and embrace the Yannies, just like they did when everyone eventually agreed this dress is white and gold, which is obviously true. It`s what Yanny wore.

That`s all for tonight. We will be back tomorrow with more MTP DAILY.

THE BEAT WITH ARI MELBER starts right now.

Good evening. Is it Ari or air-y?

ARI MELBER, MSNBC HOST: Some people say air-y. I have always done by Ari. But if you are using the name at all, I will take it. Thank you.

TODD: Well, no matter how you hear it, I heard Ari. Did you hear air-y?

MELBER: It`s a post-modern world, is what it is. Thank you, Chuck Todd.

We begin with breaking news about Donald Trump allegedly lying to federal authorities about how he paid off Stormy Daniels. Her lawyer were Michael Avenatti, is my special guest tonight. And in a moment, I`ll ask him about some of the questions that are growing out of this truly significant break in unusual story given Trump`s new admission tonight.

Now, we are also reporting out details from another revelation later tonight on the show. This is the first time that Donald Trump Jr.`s Russia testimony has been released.

Meanwhile, Bob Mueller has a new subpoena out. Word of that leaking tonight. It hit an operative who worked for Trump adviser, Roger Stone. And that would be enough news, but there`s actually more.

"The New York Times" with a huge story out right now on how the Russia probe began, why the FBI named it after a Rolling Stone lyric, and how they were helped by a potential informant with links deep inside the Trump campaign. So it is a lot.

But we begin with Donald Trump admitting he is behind the payment to Stormy Daniels, which means he admitting about lying about it previously. This is bad for Trump. And the lies could create new criminal liability which I`m going to get in to.

So why is this happening? Well, there are two big reasons. One has been all over your TV. The relentless tormenting of President Trump by Stormy Daniels and her lawyer, Michael Avenatti.

Now, look, lawyers are not like regular people. They don`t need to be liked or popular. In fact, a lawyer`s willingness to be disliked in service to their client is a key feature of their work. And lawyers don`t need to be subtle. But they do need to be effective. And at this point, even Michael Avenatti`s critics, and he has a growing chorus of critics, they admit his legal media political strategy is effective and tonight looks like another inflection point in this scorched earth campaign.

Now, the other big reason that Trump is admitting his own lies tonight is about the key tool that good lawyers are supposed to use, the law. Now, the law may not require that Donald Trump release his tax returns, but it does require him to release this.

I am holding annual disclosures, brand-new, of what Donald Trump says he has and what he says he owes. What I`m holding in my hands turns out, because of everything going on, to be nothing short of a reckoning for Trump tonight. The law requires he has to reveal a lot of things, and that means we`re learning how he paid off Stormy Daniels.

In these 92 pages, we have Trump`s financial activity last year. And while they could have still obviously tried to find a way to continue lie about the Daniels payments, he admits in here, let me show you in a footnote, that asserts while he`s not required to expose it, back in 2016, expenses were occurred by Trump`s attorney, Michael Cohen, who was then fully reimbursed by Trump in 2017 for an amount over 100k. The Daniels payment, of course, was $130k.

So what does it all mean? This is a big development. Number one, Trump`s been lying, as I say, and very recently about this, like on air force one in April.


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


UNIDENTIFIED FEMALE: Then why did Michael Cohen make it if there was no truth to the allegations?

TRUMP: You would have to ask Michael Cohen. Michael is my attorney and you`ll have to ask Michael.

UNIDENTIFIED FEMALE: Do you know where he got the money?

TRUMP: No, I don`t know.


MELBER: Lies to the public. What else does this mean?

Well, number two, if Trump and Cohen lied to other entities like banks, that`s potentially a separate crime.

And number three tonight, if Trump`s earlier financial forms deliberately lied about this to U.S. authorities, that could be another crime for the DOJ to investigate.

Now, some skeptics may ask, all right, but is anyone in the Trump ethics office going to do anything about this? The last ethics adviser left in November voicing grave concerns about Trump`s approach to ethics. And that left Donald Trump hand-picking new replacement you see there. Is he really going to be tough and call in an offense by Donald Trump?

Well, tonight I can report the answer for you. Yes, the ethics chief sending this stern letter to none other than Rod Rosenstein today, calling out Trump for not reporting this debt to Cohen, is suggesting it may have been a false filing. Telling Rosenstein, this could be quote "relevant to any DOJ inquiry on the matter." And that ethics chief that he replaced saying tonight, this is tantamount to a criminal referral.

That is a lot. I`m going to begin with Richard Painter for a legal view of this will before we turn to Mr. Avenatti. Mr. Painter, of course, was White House ethics chief for George W. Bush.

Number one, is it a problem if there was a failure to originally report this accurately by Donald Trump?

RICHARD PAINTER, CHIEF WHITE HOUSE ETHICS LAWYER UNDER GEORGE W. BUSH: If he intentionally failed to report it. He covered it up, he lied, that`s a violation of the false statements statute, 18 United States code 1,001, that`s a criminal offense and can be prosecuted as a felony.

MELBER: Let`s put that up for the viewers, for your analysis. If anyone knowingly and willfully makes a materially false, fictitious, or fraudulent statement, and that is something we have seen bob Mueller use, are you saying just doing that about Stormy Daniels in this financial disclosure is actually something the DOJ could use?

PAINTER: If he intentionally concealed the payment on -- prior financial disclosure form, he intentionally lied, yes, he could be prosecuted for that. That is one of many lies and crimes committed by this President. We have just seen evidence just this week of his being brought by the Chinese government. We have a very serious crisis in this country. We have a new lie every single week.

MELBER: Richard, take a listen to another lawyer people may have forgotten, but we are not forgetting and I don`t think Mueller has forgotten, which was the person claiming to represent Michael Cohen with a defense about this, that also was obviously a lie. Take a look.


UNIDENTIFIED FEMALE: You are claiming that Michael Cohen, the President`s lawyer and fixer, Ray Donovan character, never, ever told Donald Trump.

UNIDENTIFIED MALE: Center ever told him.

UNIDENTIFIED FEMALE: And Michael Cohen dispensed $130,000 of his own money and never sought reimbursement?

UNIDENTIFIED MALE: Hundred percent.


MELBER: So we are going to move that from a hundred to zero. What`s the significance of that to you tonight?

PAINTER: Just one more lie. And repeated lies, repeated instances, and Bob Mueller doesn`t have to be the person who investigates all of this all alone. The United States House and Senate should be investigating. They should be convening. The House and Senate Judiciary Committee to move toward impeaching this President.

They are sitting around doing absolutely nothing. I don`t know why both parties, they need to focus on the clear violations of law, violations of the constitution, and criminal lies by the President. And they are not willing to do it, the members of the House and the Senate. And if I`m there, I`m going to do something about it. Because Americans are fed up. We are not going to tolerate a President who behaves this way. This is just one more lie, one more criminal lie, if it was intentional, and we are hearing about new ones every week. It`s a new thing or two things. We heard about the collusion and the Trump tower with the Russians yet again. More details on that. And once again, the payout from the Chinese. It goes on and on and on and it`s going to keep on going on until Congress does something.

MELBER: Richard Painter, thank you for being part of our special coverage tonight.

Now I turn, as promised, to Stormy Daniels` lawyer, Michael Avenatti.

What does this mean? Why is this happening? And is it partly because of your litigation?

MICHAEL AVENATTI, STORMY DANIELS` LAWYER: Well, Ari, I think there`s no question that it largely stems from our litigation and the amount of pressure that we have put on the administration, Mr. Trump, and Mr. Cohen over the last eight to ten weeks. I mean, you know, some people take an issue with the way that we have approached this case. I stand behind it 110 percent. I think it yielded tremendous results on a number of different fronts.

But, look, what does this show? Here`s what it shows. It shows that the American people have been repeatedly lied to by Michael Cohen, by David Schwartz, the gentlemen that was interviewed by Megyn Kelly. I mean, he lied on this network repeatedly, lied on CNN repeatedly, lied on panels that I was with him repeatedly. They have been lied to by White House spokespeople. And they have been lied to by their President. The President stood on air force one, on videotape.

And you had me on that day. I remember it very, very well. You had me on this show, the day that he made that statement. And I told you at the time that it was going to be proven to be false. And now it has proven to be false. It was proven to be false when Mr. Giuliani addressed it a week or two ago. And now we also know that Mr. Giuliani statements to the American people over the last ten days have also proven to be false because what he said was, when he was called to the carpet on when the President knew, he claim the President only found out after the statement on air force one this year. We know that not to be true, because according to the financial disclosure, all of these payments were made in 2017. None of them occurred in 2018. So this whole thing --

MELBER: You just said something so important. There`s so many things flying around. Let`s play Rudy Giuliani and then dig into the timeline you just hit because legally, that matters. Here`s Rudy.


RUDY GIULIANI, PRESIDENT TRUMP`S LAWYER: Having something to do with paying some Stormy Daniels woman $130,000, I mean, which is going to turn out to be perfectly legal.

UNIDENTIFIED MALE: They funneled it through a law firm.

GIULIANI: Funneled it through a law firm and then the President repaid it.

UNIDENTIFIED MALE: Oh, I didn`t know -- he did?


MELBER: Now, what you are saying is, at the time of that statement, Donald Trump had actually and literally already transferred the funds, so he knew?

AVENATTI: There`s no doubt. And after Mr. Giuliani made that statement, he then tried to backtrack on it and tried to claim that the air force one statement was accurate, because the President did not repay it or did not start or know that he had repaid it until after the air force one statement in April of this year, which made no sense at the time, but now has conclusively shown to be false.

But Ari, I want to put a focus on what I think the real issue is here and what we really need to look at.

In May of 2016, when the prior financial disclosure was filed, there is no question that other people, other than Mr. Trump were consulted in connection with that, OK? Mr. Trump, that`s not a form that he would fill out on his own. It would make no sense. So other people surrounding him that would know of liabilities and assets would have been consulted. There`s little question in my mind that Michael Cohen would have been consulted at that time, because he would have intimate knowledge of a lot of the details. The President at that point had only been in office four or five months. And furthermore, all of that would have related to the year 2016, which we know that Michael Cohen was intimately involved with.

So Michael Cohen would have been consulted. And what I think the big question is, what did Michael Cohen tell whoever was filling out the form, relating to this liability, if any. That`s the first question. And the second question is, what communication did Michael Cohen have with the President relating to this liability around the time that that form was completed? Because if they discussed purposefully excluding this liability from that form or if any acts were taken to further keeping it off the form, that would be a serious, serious problem for the President.

MELBER: When did you first figure out that this would be an avenue for you? And if part of your job is to litigate and figure out what moves your opponents are contemplating, can you make sense of the strategy like this that has blown up in their face with this footnote? Because Donald Trump may not keep track of the law, but even his own people got him to do this, and this is out tonight because they understood that further lying about this to the authorities would be worse. So if they know that, and you know that, why did they end up basically hurting themselves this badly?

AVENATTI: Because they`re not smart and they don`t -- they play -- they play tic-tac-toe.

MELBER: You think it is incompetence?

AVENATTI: I think it is complete incompetence. And I also don`t think they are going to get caught on it. Now, as it relates to when I found out, I checked the prior financial disclosure form before we even file the case back in March. So I know what the financial disclosure --.

MELBER: So you knew that liability, according to the theory of your case, at that time was not reported and that would hurt them later if you could keep your case going?

AVENATTI: That is true, yes. I knew that if they claimed that it was reimbursed after the fact or that it had not been paid -- well, I knew that they had not reported it in connection with the campaign, which in and of itself was a problem. And then I also knew they had not listed it as a liability or expenditure on the financial disclosure form. So I firmly believed that either way, they were going to have an issue. And lo and behold, guess what, they have an issue now, some might argue, in both arenas.

MELBER: Now, let me push you on your role here. And we had Donald Trump`s former lawyer on last night. He made --

AVENATTI: I saw it.

MELBER: You saw it? You watch THE BEAT?


MELBER: He made the allegation which you`ve heard and you can respond to, that in his view, you are going beyond your mandate with your client to do other things. And let me speak to that in a little more depth. This very interesting filing from the ethics office to Rod Rosenstein tonight cites a good government group, crew, for their complaints about all of this.

But Stormy Daniels doesn`t necessarily benefit one way or the other, and thus may not care whether or not the election law issues are pursued. How is that relevant to what you`re doing, if it is, and why should people care this is going over to Rosenstein now?

AVENATTI: Well, this issue is directly relevant to my case and the issue of my client because it goes to the issue of whether Mr. Trump knew of the payment and when he knew of it, all of which goes to whether they can enforce the NDA or the NDA gets tossed out, as we have alleged.

So there`s no question that it`s tightly connected to the allegations in our case, especially as it relates to the NDA. Now I saw the comments last night on your show. And you know, with all due respect, I know he`s a very learned lawyer, at least was at one time, but most recently, he was disclosing attorney/client communications on national television, communications he had with the President a couple weeks ago --

MELBER: I will say, it`s a fair criticism, although it happens more than you might think when it comes to Donald Trump`s advisers.

AVENATTI: It`s highly questionable. He should not be communicating to the American people about what he communicated with Mr. Trump about, ever, because that should be in a lockbox. It`s called the attorney/client privilege.

So, look, have we taken a traditional approach in this case? No. Have we taken an aggressive approach? Yes. Have we taken a media-centric approach? Yes. Has it worked? I think there`s no question that it`s worked. People may have criticisms of it, but you can`t argue against the results that we have obtained.

MELBER: But I suppose to pinpoint it is, are you the lawyer for Stormy Daniels or are you the lawyer for the resistance?

AVENATTI: I`m the lawyer for Stormy Daniels in the first instance and I`m the lawyer for the truth in the second instance.

MELBER: While I have you, and I want to bring in David Corn on the Russia of it all.

But before we do that, as if there wasn`t enough news going on, and David, hang with me, you are also in a pitched separate battle before Judge Kimba Wood and Mr. Cohen. As you know, the federal judge here is basically asking Cohen`s attorneys now to respond to your letter filed in court which builds back to some of the material that has come out. And they didn`t challenge all of the voracity of it, but they did make the point that maybe you shouldn`t be leaking stuff. And that`s up for debate.

I want to read now Kimba Wood`s response and get yours. The judge directing Michael Cohen to respond to your letter, saying Mr. Cohen`s response should include citations to quote "any legal authorities that support his position." Your view?

AVENATTI: Well, in the initial request to bar us from participating in the case, they did not have any legal authority whatsoever for their position that we should be barred, and quite honestly, I thought it was a very weak filing. And I thought it was done strictly for media purposes. And I think the judge, now having read our suspicion, which pointed out the deficiencies in their position and there`s a litany of them, I think the judge wants them to account for them. And I don`t think they`re going to be able to account for them. And I`m confident that I`m going to be admitted to practice before that court.

MELBER: Right, so -- I mean, the difference here that you are talking about, the difference between TV and court is you can say almost anything on TV, and people will decide what they think about it. And in court, the only things that you say in a judge proceeding like this that matters is what you can say that`s supported by precedent. You are confident that Cohen won`t have the precedent to sanction you for the leaks or keep you out of court?

AVENATTI: I couldn`t agree with you more. I`m confident in our position. I think I`m going to be admitted to that court. I`ve been admitted to that court before without incident. There`s no reason why it shouldn`t be admitted before the court. And I think at the end of the day, Mr. Cohen and his attorney are going to look very bad when their efforts are denied.

MELBER: Let me bring in David Corn, who, as promised, is part of our coverage tonight.

Number one, David, if you have any confidential attorney/client communications that you want to disclose on THE BEAT, that`s fine. Consider doing it. And number two, put in context for us how all of this news tonight relates to the wider Russia probe. One, obvious, next is being that the shell company, essential consultants that was used to pay Mr. Avenatti`s client is also linked in other nefarious allegations. And two, after your analysis, if you have a thought or question for Mr. Avenatti, we welcome it.

DAVID CORN, WASHINGTON BUREAU CHIEF, MOTHER JONES: Well, I give Michael credit for helping to bring a hush payment scandal together with a pay-to- play scandal with a Russian scandal. We have had this convergence in the last week or two here.

And, you know, a lot of this all goes back to finances. You know, that`s part of the deal with the Russian scandal. Donald Trump`s closeness, his - - working with oligarchs in Russia for all sorts of reasons, led to the Trump tower meeting of which we have more information about today. And we do -- we do see with the payments that were made to Michael Cohen`s company, essential consultants, a link to an American-affiliated company of a company called Renova, which is run by a major oligarch named Viktor Vekselberg, who is also working with Wilbur Ross and a bank of Cyprus that was full of Russian money.

I mean, I feel like Kerry Mathison a little bit on "Homeland." He need a big board and lots of string to put all of this together. And we see with the financial disclosure form coming out today. And you know, that footnote is very telling. The only thing different between what they saw last year and this year is Michael`s intervention. And I think they were obviously trying to cover up some of that last year and they couldn`t do it anymore, because the payments have become public.

But with the whole financial disclosure issue, with Donald Trump has been from the beginning, not revealing his taxes, and even with these forms. They are highly, highly limited, what they tell us about the loans he has, from overseas sources like deutsche bank and from other places, so you can never get a good grip on his overall finances and who he owes money to, let alone hush money payments.

MELBER: Right. And any thought for Michael or no?

CORN: Well, I just want to know, what`s next, Michael? Come on. Let us - - but seriously, I mean, the question I want to know to a degree here is, where is the money going that`s coming into essential consultants? Because that`s, you know, you`ve got to follow the money -- if we follow the money, in and out, so where`s --

MELBER: Michael, do you have these clues?

CORN: Is it just going to Michael Cohen`s personal benefit?

MELBER: Michael?

AVENATTI: Well, we certainly know more information than we have disclosed thus far and I don`t want to disclose any more than what we have disclosed right now. But I will tell you that as this continues to unravel, it`s going to get much more ugly.

MELBER: You think it`s going to get more ugly?

AVENATTI: No question.

MELBER: Do you have -- in your role, given the number of things going on and the number of allegations, I mean, we had the Trump lawyer -- former lawyer last night wasn`t just criticizing you, he was asking the question of whether Michael Cohen`s role was to deal with the mafia for Donald Trump. I mean, he said that, and he`s a Trump lawyer. Do you have any -- when you say "ugly," do you have concerns about your own role, your own safety, your own precautions?

AVENATTI: Well, I certainly have concerns about the safety of me and my client. I mean, those concerns have been present. They have reached a heightened level over the last two weeks, relating to death threats and the like.

But Ari, we are not going to go away. We are not going to pack up and go home. We are going to see this through to conclusion. I think we have incredible momentum right now. We are going to continue to search for the truth. We are going to gather information. And when it`s appropriate, we are going to disclose that information. The American people, and they can make their own determinations as to what consequences result, if any.

MELBER: Michael Avenatti, thank you, as always for being here on THE BEAT. David Corn, my thanks to you.

That a big story I mentioned, so we are coming up for the first time from Don Junior, the other story I mentioned. New details about the first hours of the Russia probe and FBI agents making a secret trip abroad.

Also, why Rudy Giuliani is asking bob Mueller to take a cue from, guess who, James Comey and the link between the FBI and the rolling stones. You know that`s a story for THE BEAT.

I`m Ari Melber. We will be right back.


MELBER: What exactly did Donald Trump know about the Trump tower meeting with Russians? Well, the Senate today releasing transcripts from the interviews they had done about the meeting. Donald Trump Jr. admits that he did wants the dirt from the Russians, but he says his father didn`t have a clue. Trump Jr. testifying he didn`t inform his dad about the meeting before and after because he didn`t want to waste his time and he says they never discussed it. Investigators also noting that Trump Jr. Was in contact with a blocked phone number while there were calls placed that were planning the meeting.

Now, some Democrats on the committee speculated that number could have been Donald Trump. But let`s be clear. Nothing in the new disclosures today adds evidence to that theory. They asked Trump Jr. if his dad used a blocked number, and he said, I don`t know.

Nos. skeptics note, a reasonable person would know when their dad called and you look at your phone, whether it says "dad" or blocked number. But even an evasive answer, to be fair and clear, doesn`t mean that Donald Trump was the person on the other end of the line. Trump junior also evasive when he said he doesn`t remember anyone encouraging the Russians to hack Hillary Clinton`s emails.


TRUMP: Russia, if you`re listening, I hope you are able to find the 30,000 emails that are missing.


MELBER: The big issue, though, is not Trump Junior, it`s the candidate himself, as you saw there. And as we also saw when three hours after Donald Trump Jr. did confirm the Trump tower meeting in an email, candidate Trump said this.


TRUMP: I am going to give a major speech on probably Monday of next week. And we are going to be discussing all of the things that have taken place with the Clintons. I think you are going to find it very informative and very, very interesting. I wonder if the press will want to attend. Who knows?

Hillary Clinton turned the state department into her private hedge fund. The Russians, the Saudis, the Chinese all gave money to bill and Hillary and got favorable treatment in return.

I`m joined by former federal prosecutor Daniel Goldman and Neera Tandem, a former top aide to Hillary Clinton, president of the Center for American Progress.

And Neera, you lived on this. What`s striking there was both the tease to the speech and the reference to Russia, China, the type of things we believe they were offered at the time according to the contemporaneous evidence.

NEERA TANDEN, PRESIDENT/CEO, CENTERS FOR AMERICAN PROGRESS: Yes. And I have to say, I find it really odd that just hours after that phone call between Donald Trump and a Russian, who wanted to set up this meeting, Donald Trump used actually very similar language. Very interesting information.

And, you know, I know we don`t know who placed that call to Donald Trump Jr. or that four-minute call, that four-minute infamous blocked call, but the idea that Donald Trump Jr. doesn`t remember who he spoke to is laughable. And I`m sorry, just not credible. And it seems odd to me he cannot remember it. And if -- and if he cannot remember who it was, it should be -- we should all be a little skeptical that it is not Donald Trump himself.

And I would just say one additional point, which at this point, we know of 74 contacts between the Trump campaign and Russians. And so this just takes place against a backdrop of extensive interactions between the Trump campaign and what looks like obvious efforts to collude with Russia to affect the election.

MELBER: So, Daniel, putting that in a legal context, there`s, whether that`s enough to form conspiracy and how you look at people`s recollections. And one of the biases of investigations, as you know, is no matter what side you`re on, everything looks more significant later once you have zeroed in on the key dates. And saying you don`t remember can be -- can strike people as evasive, but at the time, it may not have seemed as important. How do you parse that in this analysis?

DANIEL GOLDMAN, FORMER FEDERAL PROSECUTOR: You have to look at it in the whole. And if he actually says, I don`t remember 103 times and, you know, it`s clearly an attempt to be evasive. If he says, and you pointed this out, I don`t know whether my father used a blocked call, a blocked phone number, that`s something that you would remember. If you don`t remember a specific phone call on a specific day when it wasn`t so important, that might -- that may make sense.

But the problem that Donald Trump Jr. runs into is that he has such obviously evasive answers by saying, "I don`t recall," which, by the way, many witnesses are prepped by their lawyers to say, if you`re not 100 percent certain of something, say you don`t recall because you don`t want to get trapped down the road and if it`s sort of an easy out. It`s very hard to charge someone with false statements for saying, "I don`t recall," because it`s a present sense impression, it`s not what you thought at the time. So even if there`s contradictory evidence then, that doesn`t necessarily mean that what you`re saying when you say "I don`t recall" is false. But in the whole thing, and in the whole transcript, you start to get a sense that he`s trying to avoid something. And that`s potentially problematic, I think, more for others than maybe for Don Junior, because he`s -- it`s -- there`s a spillover prejudice, so to speak, against some of the other people who are more involved in the campaign, than he was.

ARI MELBER, MSNBC HOST: Neera, final thought?

NEERA TANDEN, PRESIDENT, CENTER FOR AMERICAN PROGRESS: I guess I`d say the fact is that Donald Trump himself, his family, everyone connected to this investigation really does act like they have something to hide and I assume that Robert Mueller could actually figure out who this blocked call is, but the fact that they act so much like they`d never want to get the facts out themselves I think is part and parcel why people are so skeptical.

MELBER: Neera Tanden and Dan Goldman, thank you both. Up ahead, Donald Trump blowing up his own claims about Stormy Daniels with those financial disclosures. We have more on that. But first, government informants, a rolling stone song in this new report about the secretive dawning of the Trump-Russia probe when we`re back in just 60 seconds.


MELBER: The other top story tonight, a New York Times investigative report that goes deep inside the origins of the Trump-Russia probe. You don`t see details like this every day. The Times learning about an informant feeding the FBI red-hot material on Trump adviser`s ongoing contacts with Russia and what was in top FBI officials` minds when they began this super-secret probe. Here`s a clue from none other than Mick Jagger. "I was drowned, I was washed up and left for dead. I fell down to my feet and I saw they bled. Yes, yes, yes, I was crowned with a spike right through my head." If you know those plaintive lines, they are from the rolling stone classic, Jumping Jack Flash, and they are relevant tonight because that was the FBI`s secret codename for the Russia probe, Crossfire Hurricane. It`s from the first line of that ballad. So we know the agents in charge were at least feeling the stones and that they saw a hurricane about to hit the bureau from being right in the middle of the political crossfire. And the Times reports this began in earnest about 100 days before the election. FBI agents going abroad to meet with a foreign diplomat, Alexander Downer, who was reporting evidence of a Trump adviser who got a secret heads-up about, yes, the looming Russian meddling designed to hurt Hillary Clinton. And that aide, well, he`s now pled guilty, it`s George Papadopoulos, and he`s cooperating with Mueller, which means Mueller is going to know what he knows. The Times also revealing in the new report tonight that the FBI was basically duping Trump advisers by sending a secret government informant to meet several times with Carter Page and Papadopoulos to find out if they were colluding with Russia. I`m joined by Ambassador Michael McFaul and Malcolm Nance. Malcolm, what do you think of that tool, the FBI, and we only know a little bit, but more than we did before today started, using some kind of informant to glean real-time information from those individuals associated with Trump?

MALCOLM NANCE, MSNBC TERRORISM ANALYST: Well, I think it speaks to the fact that they felt that they had a very, very serious situation going on. Papadopoulos, by speaking to Downer, did tip off the FBI through, you know, human intelligence, all the way around from Australian intelligence to us, that they were looking for these Russian e-mails and they were -- that he was communicating with them to find them. But we know from other reporting that there were other sources of intelligence. And when intelligence that comes out of our community gets to the FBI, they have to task out agents and assets to turn that into evidence. And I think by the time that you reach that 100-day point before the election, they were hot on the trail between Carter Page and Papadopoulos and probably the other indicators they were getting from the Steele Dossier. They really needed to run this down to the ground. And that -- and that means they have to use agents in the field, who are handling assets.

MELBER: Ambassador McFaul, reading from this report about Carter Page, who folks have heard about, it`s just unbelievable. Russian spies had already tried to recruit page in 2013 and then he was dismissive when U.S. agents warned him about it, that warning even went back to Russian intel leaving FBI agents suspecting Page had reported their efforts to Moscow. Now, I don`t know how you say double agent in Russian, but that wouldn`t seem to be someone you want on the inside of a U.S. campaign, seeking the presidency.

MICHAEL MCFAUL, FORMER U.S. AMBASSADOR TO RUSSIA: Correct, Ari, yes, of course, you wouldn`t want that.

MELBER: It`s my thing. I say obvious stuff on the news.

MCFAUL: But it`s good to say the obvious stuff every now and again because I think people forget just how extraordinary all of this is, that Carter Page was warned, as you said, and that`s the way it works. You know, I`ve been in this world for decades. When that -- they reach out, the FBI reaches out to let you know what they`re doing, because maybe you don`t understand that world. But for him then to dismiss it and move on with these contacts, why anybody should have any contacts with any Russians to talk about presidential elections is mysterious to me. But this is a very strange story, of which we learned some of the details again today.

MELBER: Let me read, Malcolm Nance, from another key part of this report because there`s so much in here to digest. FBI agents considering and then rejected interviewing key Trump associates, which might have sped up the investigation, a good thing, but risked revealing the existence of the case. And when agents did take a bold investigative steps like interviewing the ambassador, of course, they were shrouded in secrecy. Now, Malcolm, I`m sure you know the expression "real G`s move in silence like lasagna," maybe real G men also move in silence but at what point was this too much concern about secrecy and not enough concern about catching a potential international conspiracy?

NANCE: Well, first off, the very fact that they wanted to move at that speed and that they had to be exceptionally careful tells you the level of intensity of the investigation itself. That indicates to me that this is one of the most serious investigations that has been done in modern history.

MELBER: But to do Monday morning -- to do Monday morning quarterbacking, and I know you`re an intel guy, so you don`t want to pass too much judgment on these tough calls, but were they too concerned about secrecy and not enough about doing on things that might have caught this before November?

NANCE: Well, we are the ones who gave this the you know, the "catch this before November" timeline. The FBI, the counterintelligence officers there, they don`t work at that -- at that pace. They work at the pace of where they can marry up that global intelligence to turn it into evidence, to get what they may believe is a foreign spy. And that`s how this whole thing started, right, with American citizens in contact with foreign intelligence agencies. So to them, this is all (INAUDIBLE) right, the CIA spy. This is them hunting down what they believe is the ultimate insider threat. They would have to actually see information or already believe that the information they would have about Donald Trump, Paul Manafort, or whoever else could possibly be extrapolated from the involvement with Carter Page. That would take extraordinary measures. They would take phenomenal measures to make sure that this case was the post solid case in the history of America.

MELBER: Ambassador, as a diplomat who`s talking about representative American values abroad, I have to ask you of course about the other development here in Senate Intel today, moving forward on Trump`s pick to run the CIA, Gina Haspel. She famously destroyed the torture tapes. She got forward today on a 10-5 vote with two Democrats, voting yes. That includes Senator Mark Warner, who many people have recognized as contra Trump on other issues. Ambassador, what do you think of that? Was this the right call? Does it concern you that someone so involved in the Bush torture era is getting a promotion?

MCFAUL: Well, it concerns me, but Ari, I just need to say one more thing on the earlier story because remember, you know, I used to be the recipient of intelligence when I worked in the government and there is always this intention, even between Malcolm and I right now about folks that are running the case and us that want to use the information in real time to do policy work. And I just want to remind your viewers, we could have found out about this counterintelligence investigation. We found out about another FBI investigation about Secretary Clinton. And the fact that we found out about one, and not the other, that`s inexcusable to me. Either you tell the American people both because this is way more extraordinary, what we`re talking about than what happened with Clinton.

MELBER: No, I think you raise an important and that`s in the Times article as well. As for -- as for the CIA, sir?

MCFAUL: I think it`s a hard call, because when you`re in the government, how much authority do you have when your bosses are telling you to do one thing. I know when I served in the government, even as a U.S. Ambassador, I did what team wanted, and if you don`t --

MELBER: What if the team -- what if the team wants to destroy tapes that allegedly show torture?

MCFAUL: I would have resigned. I would have --

MELBER: So should she get promoted?

MCFAUL: That would not be my -- that would not have been what I had -- would recommend. I do not support this.

MELBER: And I wanted to just get in on that and I know it`s something that both of you know a lot about. Ambassador McFaul and Malcolm Nance, thank you very much. We have a lot more when we`re right back.



MELBER: Are you the lawyer for Stormy Daniels or are you the lawyer for the resistance?

MICHEAL AVENATTI, LAWYER, STORMY DANIELS: I`m the lawyer for Stormy Daniels in the first instance, and I`m the lawyer for the truth in the second instance.


MELBER: A lawyer for the truth. Michael Avenatti, moments ago on THE BEAT, he says he is here to do a lot and he`s getting results. That`s amid, of course, shifting public statements from Trump world and many lies about the Daniels payment. The 2016 deal, of course, was first outed in January. The next month, Michael Cohen said he, "facilitated the payment, but neither the Trump Campaign or organization was involved." In early April, Trump denied any knowledge of it.


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


UNIDENTIFIED FEMALE: Then why did Michael -- why did Michael Cohen make it if there was no truth to the allegations.

TRUMP: You would have to ask Michael Cohen. Michael is my attorney and you`ll have to ask Michael.

UNIDENTIFIED FEMALE: Do you know where he got the money to make that payment?

TRUMP: No, I don`t know.


MELBER: That was not only false, it was a lie. The difference being it`s not only false information, which we all know, but we now have the evidence, where did I put it, right here, disclosed that proves a money trail that Donald Trump had paid it and knew it. And by late April, Trump was revealing at least he knew about the deal.


TRUMP: He represents me like with this crazy Stormy Daniels deal, he represented me and you know, from what I see, he did absolutely nothing wrong.


MELBER: And then it was only days later that Rudy Giuliani said Trump knew about the deal and did repay Cohen.


RUDY GIULIANI, LAWYER, DONALD TRUMP: Sorry, I`m giving you a fact now that you don`t know. It`s not campaigning money. No campaign finance violation so they funneled it through a law firm, funneled through a law firm and the President repaid it.


MELBER: I`m joined by Vox`s Liz Plank who`s been covering this story for us from the start and Republican Strategist, Cheri Jacobus. Liz, what does it say to you that this was so poorly done?

LIZ PLANK, SENIOR PRODUCER AND CORRESPONDENT, VOX: Yes, very sloppy. Look, at this point, I think I need like a vision board to actually keep track of all of the different contradictory versions of the story that we`ve had and all of the lies that have been told about it, right? So every time we get a new piece of information, we don`t get more clarity, there are more contradictions. And one of them is just, you know, I`m not a mathematician, but Rudy Giuliani talked about $470,000 to the New York Times as an amount that was paid to Michael Cohen, and what we have in this form, because of transparency, is $150,000 to two hundred and something thousand. So there`s money missing. And even you know, what -- the clip that you just played, saying that this wasn`t about campaigning, Rudy Giuliani also in that same or in another interview talked about the fact that you know, this was right before the election. He needed to take care of it so Michael Cohen took care of it, contradicting himself.

MELBER: Now, do you always -- do you always put bunny ears around Trump transparency --

PLANK: Those are bunny -- yes. That is -- yes, instead of saying allegedly.

MELBER: Cheri, Cheri, go ahead.

CHERI JACOBUS, REPUBLICAN STRATEGIST: Well, I won`t put bunny ears around anything, but thinking about what this means. And we know Trump lies. I think we`ve known that for a long time, so let`s stop acting surprised. But I`m thinking -- think the earth just shifted under our feet a little bit here today, in ways that maybe some people don`t realize yet. Richard Painter alluded to this a little bit earlier on your show. We`ve got Democrats who are terrified of mentioning the "I" word, impeachment, out on the campaign trail. We know Nancy Pelosi doesn`t want them calling for impeachment but now we have a series of things, and especially this one, the President potentially lying on financial disclosure forms, something for which he could be prosecuted on. Democrats can run against Republicans, refusing -- in Congress, refusing to perform their oversight function. And that is what they`re doing. And that can be a very big campaign issue. And Richard Painter seems to understand that.

MELBER: Yes, I`m sure --

JACOBUS: I think everything just shifted today as a result of that because now we have something concrete.

MELBER: I wonder, as a Republican official, you know a lot of these individuals, you`ve posted yourself online about at times when they reached out to you from Trump world about a job that you said you weren`t interested in. I wonder if you can get your analysis of the claim that Michael Avenatti makes, and he has a big dog in this fight, that he made at the bing of the show tonight.


AVENATTI: What communication -- what communication did Michael Cohen have with the President relating to this liability around the time that that form was completed? Because if they discussed purposefully excluding this liability from that form, or if any acts were taken to further keeping it off the form, that would be a serious, serious problem for the president.

What communication did Michael Cohen have with the President, relating to this liability around the time that that form was completed? Because if they discussed purposefully excluding this liability from that form or if any acts were taken --


MELBER: Cheri, that sound bite was so great, I wanted to play it twice and yet it was not the exact piece of analysis I wanted to review in. Let me just read it to you. He basically said that Trump team is not smart, they`re playing tic-tac-toe, they are incompetent, they`re going to get caught. But he is, as I say, their legal opponent. On a scale of one to ten, how much would you grade the accuracy of that assessment? You know some of these folks.

JACOBUS: Yes, I mean, he knows what he`s talking about. The Trump guys, you know, they`re bad. They`ve gotten away with a whole lot of stuff for decades, as we know. And now they may have met their match. And look, if the Republicans in Congress aren`t going to do what needs to be done and Republican leaders, then Michael Avenatti is doing it. He`s basically doing what Congress is supposed to do. So in terms of you know, Democrats even being able to hide behind the hole, let`s let Mueller wait and -- we`ll wait what he says. We now have Democrats who can take it to voters now about Republicans not performing --

MELBER: Let me take that to Liz briefly with 20 seconds. Is that also an indictment though of Democrats` inability to land these punches if they need a civil attorney from California to do it for them?

PLANK: He`s playing Trump`s game and he is the only person on the progressive side who is willing to you know not sort of respect Michelle Obama`s you know, "when they go low we go high." He`s just going in all the ways and it`s working in certain ways. But yes, I think -- and can I comment on the clip that you did play twice, you know, because you played it twice?


PLANK: You know, he talks about who knew and when did they know. We need to talk also about who in the administration knew and why Sarah Huckabee Sanders now we know has lied to the American people. And if she`s -- you know, she did it because she believed what the President said, we have an administration that is more loyal to the president than they are to the people.

MELBER: Right. And they`re taxpayer-funded public servants. Liz and Cheri, thank you and we`ll be right back.


MELBER: We had a packed show, maybe a long show, hopefully, a good show but the show is over. Thanks for watching. I`ll be back here tomorrow 6:00 p.m. Eastern. "HARDBALL" with Chris Matthews starts right now.


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