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Cohen claims Trump in multiple criminal acts. TRANSCRIPT: 2/28/19, The Rachel Maddow Show.

Guests: Neal Katyal, Lanny Davis

JASON JOHNSON, MSNBC CONTRIBUTOR:  -- they are hated by his people.  Now I`m part of the team.  Now, I`m one of the cool guys. 

CHRIS HAYES, MSNBC HOST, "ALL IN":  Yes.  We should say, Justin Amash stood out yesterday for not being like that, who asked some really good straightforward questions. 

JOY REID, MSNBC NATIONAL CORRESPONDENT:  You know how many there are?  One. 

HAYES:  Joy Reid and Jason Johnson, thanks for being with us. 

That is "ALL IN" for this evening. 

THE RACHEL MADDOW SHOW starts right now.

Good evening, Rachel.

RACHEL MADDOW, MSNBC HOST:  Good evening, Chris.  Thanks, my friend.  Appreciate it.

HAYES:  You bet.

MADDOW:  Thanks to you at home for joining us this hour.

If you start in -- in Manhattan and you go north from Manhattan, the first thing you hit is the Bronx.  If you keep going north through the Bronx, the next thing you hit is Westchester County, New York.  With great towns you`ll hit first on the road like Yonkers and New Rochelle. 

But if you keep going north, keep going deeper into sprawling Westchester County, New York, you will eventually get to a place called Bedford.  And Bedford, New York, is pretty.  I have been there. 

It`s a nice part of the state of New York.  It`s a nice part of the country.  Bedford also has some interesting historic sites.  It`s got a place called Stepping Stones, this home.  This is the preserved home of Bill W. 

If you`re in AA, if you know anybody who has ever been in AA, you know what Bill W. means, including the fact it`s just the last initial.  Bill Wilson was the founder of Alcoholics Anonymous and his home is preserved in Bedford, New York.  It is a national historic site. 

Not far from there is the massive Bedford hills correctional facility, which is actually why I have been to Bedford, New York.  I used to work on prison reform issues in a previous life, so I have been to that prison.  It`s the only maximum security women`s prison in the New York state correctional system. 

Bedford, New York, was also briefly the focus of national and even international attention in 2009 when then-Libyan dictator Moammar Gadhafi made plans to travel to the annual meeting of the U.N. General Assembly.  He sent a large advanced party to pitch him a tent on the grounds of an estate in Bedford, New York.  Literally, they were going to pitch a tent on the lawn of that estate and Gadhafi and his entourage planned to stay in that tent while he was in New York visiting the U.N. general assembly.  That was the plan until town officials in Bedford decided they were not into that idea at all. 

They sent somebody from the town over to inspect like the extension cords and the other little temporary electrical connections they had set up to service Gadhafi`s would-be living quarters in that sent on the lawn and the town upon inspecting those electrical facilities issued a stop work order.  So even though the Libyan government rented that place for him, the Libyan dictator, Moammar Gadhafi, never actually ended up staying in that tent on that lawn at that estate in Bedford, New York. 

But the specific location of that weird three-day sort of small-scale diplomatic crisis over Moammar Gadhafi and his extension cords, the specific location of that in Bedford, New York, was a place called seven springs.  That was -- that was the estate where Gadhafi planned to stay on the lawn. 

At the time of that Gadhafi controversy, Seven Springs was own and it is still owned today by President Donald J. Trump.  And that tonight is where we get to the crime part of this story, the maybe crime part, or at least the crime question. 

This property in Bedford, New York, Seven Springs.  As you can see, it`s a big mansion.  It`s just over 200 acres.  Mr. Trump bought the property in 1995. 

When Trump bought it in 1995, he paid $7.5 million for it.  And there`s good evidence, reliable public records evidence that that property, that silver -- sorry, that Seven Springs property has appreciated nicely over time.  "The Washington Post" reports that by 2013, so less than 20 years after Trump first bought it in 1995, that property had more than doubled in value.  It was assessed in 2013 at $18.9 million.  Nice, right? 

The local paper, "The Westchester County Journal News" says by 2017 the process -- the property was assessed even a little bit higher.  It was assessed at $19.6 million. 

President Trump in his federal financial disclosure form for last year, 2018, he didn`t have to give a precise valuation for the property on those kinds of federal ethics forms.  You just have to give a range of value.  When President Trump filed his financial disclosure form last year, he said the value of that property in Westchester County was in the range of $25 to $50 million. 

Now, even $25 million is considerably more than what we know that property was assessed at in terms of its value just one year before, but, eh, what are you going to do?  What is value, really, right?  These things can always be fudged a little bit, but basically the same thing, ballpark figure. 

It`s getting assessed at $19 million, $20 million within the last few years.  He puts it at a range of $25 to $50 million.  Well, at least the range starts at $25 million.  But can we put that value up over time?  Yes, we`ve done this on this little graph. 

Now, remember, this is all for this one same property.  As far as we know, there have been no massive changes to this property over the time that Trump has owned it.  I mean, Gadhafi did send his dudes to go put up a tent there for him, but then they had to take the tent down and go home so as we know, nothing really has changed. 

You can see the progression there of the value, right?  This is a happy real estate valuation story.  You buy it for $7.5 million in 1995, by 2013, it`s up to 19 million, by 2017 it`s up to $20 million.  By 2018, you are somewhat plausibly saying it`s worth $25 to $50 million. 

All right.  So that`s the public record.  That`s where we thought we were on this.  If you were at all interested in that particular Donald Trump property, this is what you would find in terms of the value of that property.  But now we as a country have got something quite new about that property, and it turns that sort of boring, you know, vaguely happy real estate valuation story into a suspenseful cops and robbers crime draw that potentially comes a major chapter in American presidential history and between great power and independent American law enforcement. 

Because in his riveting day-long testimony before the House Oversight Committee yesterday, one of the things the president`s longtime personal lawyer Michael Cohen made public was a short stack of financial information.  These are documents that were apparently among the materials that were seized from Michael Cohen`s home and office when the FBI raided him last year to serve multiple search warrants on him.  These documents were seized by the FBI.  They have since been returned to Mr. Cohen by the government. 

He says in preparation for his testimony.  He went through those boxes of returned material and he was thus able to hand over, among other things, these financial statements as part of his testimony yesterday.  He then yesterday at his testimony explained what these statements were and what they were used for, and he did it in pretty blunt terms. 


MICHAEL COHEN, FORMER TRUMP LAWYER:  I am giving to the committee today three years of Mr. Trump`s personal financial statements from 2011, 2012 and 2013.  Which he gave to Deutsche Bank to enquire about a loan to buy the Buffalo Bills and to "Forbes."  These are exhibits 1-A, 1-B and 1-C to my testimony. 

It was my experience that Mr. Trump inflated his total assets when it served his purposes. 

REP. LACY CLAY (D-MO), OVERSIGHT COMMITTEE:  I`d like to talk to you about the president`s assets.  Since by law these must be reported accurately on his federal financial disclosure, and when he submits them for a bank loan. 

Mr. Cohen, you served for nearly a decade as then businessman Trump`s personal attorney and so-called fixer.  Did you have -- did you also have an understanding of the president`s assets and how he valued those items? 

COHEN:  Yes. 

CLAY:  To your knowledge, did the president or his company ever inflate assets or revenues? 

COHEN:  Yes. 

CLAY:  And was that done with the president`s knowledge or direction? 

COHEN:  Everything was done with the knowledge and at the direction of Mr. Trump. 

CLAY:  You have provided the -- this committee with copies of the president`s financial statements or parts of them from 2011, 2012 and `13.  Can you explain why you had these financial statements and what you used them for? 

COHEN:  So, these financial statements were used by me for two purposes.  One was discussing with media, whether it was "Forbes" or other magazines, to demonstrate Mr. Trump`s significant net worth.  That was one function. 

Another was when we were dealing later on with insurance companies, we would provide them with these copies so that they would understand that the premium, which is based sometimes upon the individual`s capabilities to pay, would be reduced. 

CLAY:  And all of this was done at the president`s direction and with his knowledge? 

COHEN:  Yes.  Because whatever the numbers would come back to be, we would immediately report it back. 

CLAY:  And did this information provided to us inflate the president`s assets? 

COHEN:  I believe these numbers are inflated. 

CLAY:  And of course inviting -- inflating assets to win a newspaper poll to boost your ego is not a crime, but to your knowledge, did the president ever provide inflated assets to a bank in order to help him obtain a loan? 

UNIDENTIFIED MALE:  You may answer that question. 

REP. ALEXANDRIA OCASIO-CORTEZ (D-NY), OVERSIGHT COMMITTEE:  To your knowledge, did the president ever provide inflated assets to an insurance company?

COHEN:  Yes. 

OCASIO-CORTEZ:  Who else knows that the president did this? 

COHEN:  Allen Weisselberg, Ron Lieberman and Matthew Calamari. 


MADDOW:  Today in the wake of this testimony, "The Daily Beast" was first to report that Trump chief financial officer Allen Weisselberg will now be summoned to testify to Congress.  "The Daily Beast" was first to report he will be called to testify before the House Intelligence Committee.  House Oversight Chairman Elijah Cummings told reporters today that if you are looking for a guide as to who else may be summoned to testify in the wake of Cohen`s testimony, a pretty good way to anticipate those witnesses would be to read through the transcript and highlight every name mentioned as to someone who could potentially provide useful information. 

One of the potentially provocative developments that may signal, is one or more of the president`s adult children will be included in that.  We shall see. 

But before -- before anybody else is called for questioning in the wake of Cohen`s testimony, Cohen has already handed over exhibits and documents, including the checks and the trust that controls the president`s businesses.  Those checks reimbursing Cohen for payments he made ahead of the election and for which he`s about to go to prison because they were illegal campaign contributions made as a felony campaign finance scheme, but there is also those 2011, 2012, 2013 financial statements which Cohen told Congress had been used for multiple purposes.  He said those statements were used to try to convince a magazine to call president Trump a billionaire.  Try to convince a magazine to give the president a higher net worth than he actually had. 

And, I mean, what do you do with that?  You know, pitiful, vain and sad are some of the lesser dwarves in this story, but, you know, lying to a magazine to make yourself look richer than you are is nobody`s idea of a crime.  The serious issue here is that Cohen testified that these financial documents were also submitted to insurance companies to try to get Trump`s premiums reduced on his insurance policies.  And significantly, he said these financials were submitted to a bank, specifically to Deutsche Bank to try to get himself a cash loan, what may have been as large as $1 billion cash loan to try to buy a professional football team. 

And now here is why this is a conundrum for us as a country, because go back to Trump`s big house in Westchester County, New York, right?  Up by the maximum security women`s prison.  Put up that graph again showing the value of that house. 

Again, these figures are all based on public documents.  The purchase price when Trump bought it, public assessments of the property over time, Trump`s own legal declaration and his ethics filing last year about the value of that property.  Remember, he gave that range, 25 to 50.  And again, over time you can see that property appreciating in value, starting at $7.5 million in the mid-`90s, up to $19 million and $20 million in 2013, 2017, by last year up to this range of $25 million to $50 million. 

OK.  Well, what Michael Cohen gave Congress yesterday was a set of financial statements from president Trump and the Trump Organization, including one statement from 2012, which Michael Cohen said was used to apply to a bank to try to get a large cash loan.  On that 2012 financial declaration, that same property in Westchester County, which has been valued over time $7.5 million, put that up -- $19 million, $20 million, maybe that range of 25 to 50 in his 2012 financial statement which he used to try to get a big cash loan from a bank, President Trump valued that same property at $291 million. 

Really?  That`s hilarious.  I mean, what could possibly explain, what, they thought they had discovered an amazing diamond mine in 2012 but by 2013 they realized someone had spilled a cooler full of ice cubes and those weren`t diamonds after all?  How do you go from $291 million one year and then the next year your property drops in value by $272 million?  Back to what it used to be. 

I mean, even if you just want to compare apples to apples, right, with President Trump`s own assessment of the value of this property, it literally went in 2012 from $291 million to last year 25 to 50.  I mean, that`s just his own assessment of the value of that property. 

And that`s ridiculous.  He`s going from $300 million to maybe $50 million?  When nothing change at the property? 

And if that was just about making himself appear super rich for "Forbes" magazine that would be, you know, vain and small and lying and sad, but that is not what Michael Cohen testified as to what these financials were used for. 


COHEN:  Mr. Trump`s personal financial statements from 2011, 2012 and 2013, which he gave to Deutsche Bank to inquire about a loan.  When we were dealing later on with insurance companies, we would provide them with these copies.  These documents and others were provided to Deutsche Bank on one occasion where I was with them in our attempt to obtain money. 


MADDOW:  Now, I am not a lawyer.  Statistically speaking, neither are you, I`m guessing. 

But just even as people who are occasionally watching the news during the Donald Trump presidency, we all can recognize that what`s being described here is potentially a felony, right?  For one thing, we`ve seen the president`s campaign chairman convicted of this as a felony.  Remember the financial institution scheme in the Paul Manafort indictment?  You know, when he was still being charged with Manafort and Gates, remember that? 

Manafort, Gates and others attempted to execute a scheme and art first to defraud and obtain money and property by false pretenses, reputations and promises from banks and other financial institutions.  As part of the scheme, they repeatedly provided and caused to be provided false information to banks and other lenders.  They defrauded the lenders in various ways, including lying about Manafort and his company`s income, lying about their debt, they provided doctored financial documents.

At a time when Manafort`s financial statement should have shown less than $400,000 in net income, they instead told the bank he had $4.5 million in net income, lying about that so that he could get a loan.  And lying to the bank so that he could get a loan. 

Lying to the bank about his real financial situation so he could get a loan -- that`s part of the reason Paul Manafort is going to jail.  It`s also part of the reason Michael Cohen is about to go to jail, right?  Remember the criminal information outlining Michael Cohen`s crimes? 

Michael Cohen, the defendant, willfully and knowingly made false statements for the purpose of influencing the action of a financial institution in connection with an application for a home equity line of credit, which is a loan.  Quote, Cohen made false statements to bank three about his true financial condition. 

Remember the hearing the day that Cohen is there giving his allocution in court.  The judge interrupts Michael Cohen while he`s pleading guilty and explaining all his crimes.  The judge makes sure he understands he`s pleading guilty to bank fraud and why. 

The judge says, quote: well, you knew it was false, that it falsely depicted your financial condition, did you not?  The defendant, Michael Cohen: yes, your honor.  The judge: and you omitted those statements, did you not, for the purpose of influencing action by a financial institution?  The defendant, Michael Cohen, yes, your honor, yes, I understand this is felony bank fraud to lie to the bank for the purpose of getting a loan, to lie to them about my real financial situation. 

I mean, even if all you`ve been doing for the last couple of years is occasionally watching the news about this administration, which means you`ve occasionally been watching people connected to the president go to prison for felonies.  One of the things we`ve become intimately aware of is the types of financial crimes for which people go to prison sort of on the regular.  And now what we have as a country is we`ve got this testimony under oath of the president`s longtime personal lawyer, we`ve got his testimony and we`ve got some documentary evidence to back it up, which would seem to indicate that the president potentially has done the same kind of bank fraud that his campaign chair and his lawyer are already going to prison for. 

I mean, what Cohen testified to and what these documents showed appears to be the wild over-inflation of the value of an asset, right?  His $7 million house is how now a $291 million house.  According to a financial document he submitted to a bank for the purpose of trying to get a loan from that bank.  According to Michael Cohen, this same information has been submitted to at least one insurance company as well for the purpose of reducing his insurance premiums.  Lying to a financial institution for the purpose of influencing that institution`s behavior can be felony financial fraud. 

"The Washington Post" today put this set of facts to a former -- a commissioner of the Securities and Exchange Commission, Joseph Grundfest, who is now a law professor at Stanford.  He told them, quote, Michael Cohen`s testimony opens another line of inquiry into blank fraud. 

And, you know, the devil`s in the details and context is everything.  "The Post" reports that in one copy of this same 2012 financial statement that they obtained independently, Trump`s accountants appended a long disclaimer to the financial statement, so maybe that`s important.  Disclaimer or not, if this was potentially going to be investigated as possibly felony bank fraud, you`d need to see what the bank actually received from Trump, how these materials were presented by Trump and his business and for what purpose.  As the former SEC commissioner put it to "The Post" today, quote, to determine whether fraud occurred requires a careful look at the text of the statutes but also at the documents submitted to the bank. 

Well, the question was whether there was a knowing attempt to defraud the bank.  Well, the bank in question here, according to Michael Cohen, is Deutsche Bank.  Did President Trump try to get a loan out of deutsche bank by randomly adding more than $250,000 million to the value of his house up by the prison, pretending it was on, like, hills made of gold or sitting on a secret diamond mine that one year? 

I mean, publicly we don`t know.  There were reports December of 2017 that federal prosecutors from the special counsel`s office had subpoenaed Deutsche Bank for documents detailing the bank`s relationship with president Trump.  The reported subpoena of that bank was apparently occasioned one of the great reported presidential freak outs concerning the special counsel`s office, including what was reported by "The New York Times" to be the first concerted effort by President Trump to fire special counsel Robert Mueller, specifically in response to those reports that Mueller`s office had subpoenaed Deutsche Bank. 

Now, that reporting about Mueller subpoenaing Deutsche Bank was later walked back.  It`s still not clear whether or not the special counsel`s office did subpoena Deutsche Bank for their Trump-related records.  We know that Democrats in Congress tried to elicit information from that bank about their relationship with Trump over the past couple of years.  Republicans at the time were in control of both houses of Congress.  They were not interested in pursuing those lines of inquiry themselves, and Deutsche Bank therefore didn`t have to respond to any of those requests. 

Now, though, the Democrats control the House, and today the chair of the Financial Services Committee in the House, Congresswoman Maxine Waters, told that Deutsche Bank is now cooperating for the first time.  She said, quote, they are just now being cooperative.  They had not been.  But she says now they are being cooperative and they are handing over documents at the request of her committee. 

So here`s my question.  I mean, this thing involving this property in Westchester County, the testimony by Cohen and the financial statements concerning the property and what he says those financial statements were used for.  This inexplicable $200-plus million that pops up on that financial statement, that financial statement that he says was tried to use to get a loan and try to affect Trump`s insurance rates. 

I mean, this is basically just one little case study of the potential criminal exposure we are now cottoning to when it comes to this president.  I mean, there`s lots of things that we could have chosen and told you a story like this about the president, right?  Let`s just pick this one about the valuation of this property for the purposes of illustrating the question and the conundrum we are now in as Americans, because, right, these financial statements have now been handed over by Cohen to Congress. 

They`re now in the hands of Congress.  We believe these financial statements have already been through the hands of the FBI and therefore they have been seen by federal prosecutors.  We`ve also now got Cohen`s blunt under ocean assertions as to what those financial documents were used for.  If Deutsche Bank is now handing over documents to the Democratic- controlled congressional committees, then presumably we will soon know if Michael Cohen was right in his testimony yesterday, and if these documents were in fact used in a loan application to deutsche bank or if they were used with insurance companies or if they were used with any other financial institutions. 

I mean, clearly there appears to be something wrong with that 2012 financial statement.  Clearly that is not a $291 million property, as nice as it may seem.  I say that it`s not a $291 million property not because I can tell at a glance what a property is worth. 

I say that because that`s what Donald Trump says.  Trump doesn`t even claim it`s a $291 million property.  Not when he knows people are watching.  When he filed hi financial disclosure form as a public official in 2018, he said it was worth 25 to 50.  Well, then how is it worth 291 million in 2012?

I mean, if that quarter billion dollar magic trick he tried to play with that financial statement is in fact evidence of felony bank fraud, at far as I can tell, we`re well within the ten years of statute of limitations for a crime.  As a country now we have all just been shown evidence of this potential felony bank fraud by the president and we know Congress has it and we believe federal prosecutors have it. 

But here`s the question.  Who does what with that information?  I mean, as a country, it`s not cool to just, like, know about the felony, right?  I mean, in the wake of Michael Cohen`s testimony yesterday, there`s a whole bunch of different potential avenues for evidence that may lead to overt criminal exposure for the president.  This financial fraud thing is just one of them. 

I mean, to the extent that the president`s potential criminal exposure is about Russian interference in the election, potential conspiracy or cooperation with that interference, the relevant prosecutors, at least for now, would seem to be the prosecutors at the special counsel`s office.  To the extent that the president`s criminal exposure may be about the campaign finance felonies for which Michael Cohen is already going to prison -- well, those felonies have thus far been prosecuted by the U.S. attorney`s office in the Southern District of New York. 

If the president is also criminally exposed for other garden variety financial fraud, say the kind of bank fraud that Manafort and Cohen were both convicted of already this past year, that too could easily be at the center of the bullseye for prosecutors in SDNY.  That`s the kind of bread and butter white collar financial crime that SDNY prosecutors bring to court every darn day. 

I mean, everything from high-profile cases like WorldCom, that famous case where that company radically overvalued itself, right?  To everyday crooks like Michael Cohen trying to get his home equity line of credit, misstating his financial status to the bank in order to do it.  That`s what they do.  Those cases come up every day.  Big cases.  Small cases.  Cases people care about.  Cases people don`t. 

We spoke to the former deputy chief of that U.S. attorney`s office, Joon Kim, today from SDNY.  He told us that, in fact, this is the day in day out run of the mill prosecutorial work of the U.S. attorney`s office in the Southern District of New York.  He told us today, quote, people who inflate their financials, for example, to obtain a mortgage and who deflate their financials, for example, to pay less taxes, those people are engaging in very common schemes and have been prosecuted regularly. 

If Trump Organization documents and deutsche bank documents and whatever other evidence we`re about to have publicly aired, if that evidence paints a compelling at least public picture that the president appears to have engaged in pretty clear instances of financial crimes, financial felonies, financial fraud schemes of the kind that are routinely prosecuted against all sorts of people and companies and entities in this country -- well, who prosecutes it when it comes to him?  Who prosecutes it when it comes to him?  Would it be an act of bravery or an act of sort of political high wire walking in order to prosecute it when it comes to him? 

If somebody is going to try to prosecute him for this stuff, when, and where and how?  Because even with just what we`ve seen publicly, it sort of feels like we are there. 


MADDOW:  Our first guest tonight in 1999 wrote the department of justice regulations that defined the office of the special counsel.  In effect, that`s the document that allowed for Robert Mueller to be appointed special counsel last year, and you know what`s happened since then.  The former acting solicitor general in the Obama administration, the man who wrote those regulations is Neal Katyal. 

Neal, thank you for being here.  Nice to see you.

NEAL KATYAL, FORMER ACTING SOLICITOR GENERAL:  Thank you so much.  Nice to see you.

MADDOW:   Let me ask you about Mr. Cohen`s testimony yesterday.  The reason I wanted to have you here tonight is because I feel like we are as a public, as a country sort of in this moment where we`re now seeing a lot of evidence, a lot of serious allegations about potential criminal behavior by the president.  And we`re all taught to believe that when that happens impeachment proceedings follow, if there is compelling evidence that a president has committed crimes while in office. 

But in this case, there is this law enforcement aspect of it outside the impeachment process that is proceeding apace.  And I guess I want to know if people should be expecting that there will be a law enforcement response to potential illegal behavior by the president or if we should see that as off the table? 

KATYAL:  I do think they should.  I think kind of the big thing yesterday is almost cultural.  It`s not squarely legal.  And what I mean by that is, I`m as guilty of this as anyone, I keep thinking Mueller, Mueller, Mueller, Mueller is the center of everything. 

What we saw yesterday with Cohen and what your story just now about the real estate deal just showed is actually there are all of these other investigations.  There is rampant legal investigations, because there is a lot of potential law breaking, and the Southern District of New York with campaign finance, now these tax and bank fraud allegations.  You have congressional committees.  You`ve got all of those different things. 

So it`s a mistake to just think of Mueller.  Now, then you ask, like, is there ever going to be some sort of justice?  And, you know, I want to sound an optimistic note on this because I feel like, you know, sometimes I get dispirited and the like, but the genius of the American system I think was on display yesterday.

I mean, if you think about it, Cohen testifying against a sitting president of the United States.  In most countries, authoritarian countries certainly, he never would have been able to do that.  Even you and I wouldn`t be able to have this discussion that we`re about to have about the president committing crimes, and we have now because of our founders multiple overlapping investigations, congress, the executive branch through U.S. attorneys offices and the special counsel. 

And now, we`ve got states as well.  So we`ve got all of these different nodes.  Because of that, I am optimistic ultimately that justice will be done. 

MADDOW:  Let me ask you -- let`s go -- let`s talk a little bit about the scenario that I just ahead out.  I laid out that potential bank fraud allegation not because I think it`s the most important thing to know about this president, but it seems like a discreet incident that we might be able to gain out in terms of what -- where justice might happen. 

Let`s say that those financial documents that Cohen provided in keeping with his testimony, they were provided to a bank to try to get a loan, and documents from Deutsche Bank or testimony from Deutsche Bank backs that up, and those congressional committees thereby collect information that indicates that a serious financial fraud may have been committed.  And I say serious because there are some reports from the president himself that the bank loan he might have been looking for might have been as much as $1 billion.  So that`s the size of bank fraud for which there could be significant penalties. 

If that committee decided we want to make a criminal referral for this for prosecution, what would happen? 

KATYAL:  Yes, so I love this example because, you know, look, this is not the biggest crime in the world and this is not the biggest real estate deal in the world, but it`s a representative example of what Trump is alleged to he done.  And there are so many others, but it`s a really good one.

And it`s a good one in two ways.  One, there is potential criminal activity that we`re talking about, and I`ll go through that in a second.  Second, there are some judgment issues.

I mean, first of all, you showed that graph, $291 million down to $50 million.  Look, if I had to bet on anybody who could run something down from 291 to 50, I`d bet on Trump.  He`s trying to do that to the country.

But I think, you know, bank fraud, the Supreme Court just three years ago in the Shaw case said bank fraud is a really serious crime and it`s actually a lot easier to prove than a lot of the other fraud felonies in our criminal statutes.  And here if he was giving information to a bank for the purposes of getting a loan, it`s classic straight bank fraud.  As you just showed from Joon Kim, the former acting U.S. attorney for the Southern District, that`s what people get prosecuted for all the time. 

MADDOW:  So a criminal referral from the committee would go to the Justice Department and they would say jurisdictionally, this goes to SDNY, you`re allowed to pursue this, or is the attorney general stop that, catch it, and effectively kill it because it pertains to the president? 

KATYAL:  So the attorney general could kill it.  Our constitutional system is one that reposes, you know, for better or worst the prosecution power, the federal prosecution power in the attorney general.  Now, you could have remedies against the attorney general, including impeachment or something like that. 

MADDOW:  Mmm-hmm. 

KATYAL:  But that is -- but there is one other big thing, which is don`t forget the states and localities.  And bank fraud has counterparts in New York state and other states and localities as well.  And there the attorney general of the United States cannot stop such a prosecution or an investigation. 

MADDOW:  Neal Katyal, former acting solicitor general of the United States -- Neal, thanks for being here.  It`s been too long.  It`s good to see you. 

KATYAL:  Good to see you.

MADDOW:  Thanks. 

We`ll be right back.  Stay with us. 



REP. ADAM SCHIFF (D-CA), CHAIRMAN, HOUSE INTELLIGENCE COMMITTEE:  He has obviously had three very long days.  He`ll be returning on March 6th for additional testimony and I think we all feel it was a very productive interview today where he was able to shed light on a lot of issues that are very core to our investigation. 


MADDOW:  Yesterday was Michael Cohen`s testimony in public, but today, he was testifying again, this time behind closed doors.  House Intelligence Committee took testimony from Cohen again today.  Was cut a little bit shorter than we might have expected, but afterwards that because the committee`s chairman told reporters Cohen is coming back for another round next week, Wednesday of next week. 

The week after that, he also said the committee will call in Trump associate Felix Sater on March 14th for what`s described as a partially closed, which means partially open hearing, March 14th, Felix Sater.  We also learned today that the House Intelligence Committee plans to call in the Trump organization`s chief financial officer, Allen Weisselberg, so they can get testimony from him. 

We also have reports that, gulp, the president`s adult children, Donald Jr. and Ivanka Trump they should not be surprised if they too get called before Congress some time soon, along with anybody else who Michael Cohen named in his testimony yesterday before the oversight committee.  Lawmakers appear to be serious and quick about following up and getting in additional witnesses after everything Cohen said yesterday. 

So if Michael Cohen said your name yesterday, you should be watching your inbox.  Michael Cohen`s legal adviser Lanny Davis, who you saw sitting just over Cohen`s shoulder throughout his testimony yesterday is going to be our guest here next live. 

Stay with us.


MADDOW:  In 1974, when impeachment articles were drafted against President Nixon in the Watergate scandal, the House accused Nixon of approving, condoning, acquiescing in and counseling witnesses with respect to the giving of false or misleading statements, `74.  We saw it again in `98 when the House drew up articles of impeachment against then President Bill Clinton.  The House accused him of efforts to influence the testimony of witnesses and to impede the discovery of evidence.

Influencing witness testimony, counseling witnesses to lie -- it is against the law.  It is also documented in the history books more than once as grounds for impeachment proceedings against a sitting president, which means if you are the president or perhaps one of the president`s lawyers, you might have had some alarm bells going off, given what Michael Cohen just said to Congress. 


REP. JACKIE SPEIER (D-CA), OVERSIGHT COMMITTEE:  On page 5 of your statement, you say, and I quote, you need to know that Mr. Trump`s personal lawyers reviewed and edited my statement to Congress about the timing of the Moscow Tower negotiations.  Who were those attorneys? 

COHEN:  Jay Sekulow -- from the White House? 

SPEIER:  Yes. 

COHEN:  Jake Sekulow.  I believe Abbe Lowell as well. 

SPEIER:  And do you have a copy of your original statement that you can provide to the committee? 

COHEN:  I can try to get that for you. 

SPEIER:  Having the original statement means you can compare it to what he ultimately delivered, which should tell you what the president`s lawyers advised him to change.  Gulp. 

Joining us now is Lanny Davis, Michael Cohen`s legal advisor.

Mr. Davis, I really appreciate you being here tonight.  I know that you have been having a pretty busy week. 

LANNY DAVIS, MICHAEL COHEN`S LEGAL ADVISOR:  Well, first of all, this is the second time, Rachel, my first out-of-the-box after intense Michael Cohen experience is your show, so maybe we`ll go for a third one. 

MADDOW:  Maybe we`ll make this a tradition.  Let me ask you about the intensity of Mr. Cohen`s experience right now.  We saw he spoke with the House Intelligence Committee today behind closed doors but then they announced he`s coming back next week.  Had that been the original plan or was that a change that was made today? 

DAVIS:  It was not the original plan.  In a way, Michael was more effective today than he even was yesterday when he exceeded all of our expectations in working with him because today, new information was developed that really could be game-changing and Chairman Schiff and everybody in the room who wasn`t partisan Republican praised him for his honesty and forthrightness and the development of this information is the reason that he`s coming back next Wednesday. 

MADDOW:  Obviously, you can`t tell us in detail about the nature of the testimony, that`s why it was behind closed doors.

DAVIS:  Right.

MADDOW:  But in general terms when you say new information, is this core to the Russia investigation or is this new information about the kinds of things that he talked about in detail yesterday? 

DAVIS:  I would say it`s not core to the Russia investigation but Mr. Trump has missed the big picture.  There is plenty of evidence of a conspiracy to collude with Russia.  But this is about lying and obstruction evidence and I think that the Trump White House and Mr. Trump himself doesn`t seem to have read the definition of obstruction of justice or of suborning perjury and that`s about the best I can tell you.  But it`s pretty explosive. 

MADDOW:  On the issue of potentially suborning perjury, I just played that short segment back where Mr. Cohen had the back and forth with Jackie Speier.  She asked if he was going to be able to provide the initial first draft essentially of his -- the letter he wrote to the Intelligence Committee in 2017 that ultimately was the basis of his guilty plea that he had provided false information to Congress. 

How should we understand the importance of that and what Mr. Cohen was offering? 

DAVIS:  Thank you for asking because if Congresswoman Speier hadn`t asked that question yesterday, I couldn`t respond because of the ground rules of an Intelligence Committee briefing.  But yes, there will be an additional amount of information comparing the first draft that Michael wrote and the reiterations called red lines that a collective group of lawyers called members of a joint defense agreement.  And then the final iteration contained an absolutely knowingly false statement not only by Michael, that he did know Russian Moscow Tower activity after the Iowa caucuses. 

And let me just tell you one example.  So Donald Trump would have a rally after the Iowa caucuses the campaign begins, as we all know.  And he`d be at a rally telling everybody no Russia, no discussions, no collusion, no Russia.  And his rally crowd would cheer and believe him. 

Within a few minutes, he`d be walking out of that rally and he would turn to Michael and say, so what`s going on in Russia?  What`s going on in Moscow?  It was that blatant.  And that much is in the public record and there will be more developed next Wednesday at the Intelligence Committee. 

MADDOW:  Mr. Davis, can you stick with us for just one second?  I have a clarification I want to ask you on that specific point and one other thing I want to ask you.  Can you stick with us for a moment? 

DAVIS:  Absolutely. 

MADDOW:  Lanny Davis will be back with us in just a moment.  Stay with us. 


MADDOW:  Back with us now is Lanny Davis, who`s an attorney for Michael Cohen. 

Mr. Davis, thank you again. 

DAVIS:  Thank you.

MADDOW:  Yesterday, after your client`s testimony, one of the president`s lawyers, Jay Sekulow, put out a flat denial, saying that neither he nor any lawyer working for the president had advised Michael Cohen that he should lie to Congress about the duration of the Trump Tower Moscow project. 

I just wanted to try to clear up with you any ambiguity about what Mr. Cohen is alleging in that regard.  When he says he got edits and a review from White House lawyers of his testimony that later was the basis of his guilty plea for providing false information to Congress, is he saying that White House lawyers advised him to give false testimony to Congress? 

DAVIS:  No, I don`t think he`s saying that anything is explicit.  I think the way he reminds everyone is that when you work for Mr. Trump or you`re around Mr. Trump as an attorney or an adviser, he speaks in code.  Just as you heard me say, when he says no Russia, no collusion, no deals, and five minutes later, he`s on his way to his car and he says what`s happening in Moscow?

He gives people the signal using codes, what he wants.  And then it`s carried along and by the time it reached the final draft, the absolute lie that everybody knew was a lie, including Mr. Trump is that he did nothing after the Iowa caucuses because that`s when the campaign began.  And that`s for sure everybody knew it was a lie.  And he was in the Oval Office and spoke to Mr. Trump.  And he was given a good job even though people knew it was untrue. 

My question for tonight, and let`s not forget the check for $35,000 that was a specific installment on the hush money plan that was misdescribed, in fact lied about as a retainer agreement when the prosecutors in the federal government said there was no retainer agreement.  That check was signed by an incumbent president of the United States paying hush money to an adult film star in order to avoid having the American people know he was doing that three days before the election. 

That is a felony.  That`s an implementation of a conspiracy to violate campaign finance laws.  So this issue of his lying about the statement to Congress is very vague because it involves using codes like Henry II said, will no one rid me of this grievous priest, and his knights ten minutes later, or sometime thereafter, cut off the head of the archbishop of Canterbury. 

Now, would anybody say that Henry II ordered that murder?  No.  But would a jury convict Henry II for a conspiracy to murder someone?  I know that this is probably the first time, Rachel, you`ve had anyone refer to Henry II on your show. 

But that was a code.  And Michael and everybody working for Trump knows these codes and follows those instructions.  And that`s what happened. 

MADDOW:  Lanny Davis, attorney for Michael Cohen -- Mr. Davis, I really appreciate you taking the time tonight, especially I know the demands on your time right now.  Thank you for being here. 

DAVIS:  Thank you, Rachel. 

MADDOW:  All right.  We`ll be right back.  Stay with us.


MADDOW:  Well, that does it for us tonight.  Doesn`t it feel like this week has already been 42 days long?  No, wait, there`s more.  We will see you again tomorrow night.

Right now, it`s time for "THE LAST WORD WITH LAWRENCE O`DONNELL".

Good evening, Lawrence. 



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