Prosecutors contacted AT&T, Novartis over their dealings
with Trump's lawyer
By Nicole Hong, Jonathan D. Rockoff and Drew FitzGerald
This article is being republished as part of our daily
reproduction of WSJ.com articles that also appeared in the U.S.
print edition of The Wall Street Journal (June 15, 2018).
Federal prosecutors in Manhattan are investigating whether
Michael Cohen, the longtime personal lawyer for Donald Trump,
illegally engaged in secret lobbying, people familiar with the
investigation said, as part of the government's broader probe into
Mr. Cohen's business dealings.
In the course of that investigation, the prosecutors have
contacted companies that hired Mr. Cohen as a consultant after Mr.
Trump won the 2016 presidential election, including AT&T Inc.
and Novartis AG, according to other people familiar with the
matter. The companies paid a total of about $1.8 million to Mr.
Cohen in 2017 and early 2018 for his insights into the Trump
administration.
Investigators in the U.S. attorney's office for the Southern
District of New York are examining whether Mr. Cohen violated any
federal disclosure laws in connection with his consulting deals,
including whether he lobbied for domestic or foreign clients
without properly registering, the people familiar with the
investigation said.
Federal prosecutors in New York have been investigating Mr.
Cohen for bank fraud, campaign-finance violations and other
possible crimes, The Wall Street Journal has previously reported.
Mr. Cohen hasn't been charged with any crime, but the array of
possible charges against Mr. Cohen could put additional pressure on
him to cooperate with prosecutors, according to defense
lawyers.
Mr. Cohen has previously denied any wrongdoing. Neither he nor
his lawyer, Stephen Ryan, responded to a request for comment.
Mr. Cohen has never registered as a domestic or foreign
lobbyist, according to federal databases. Under federal law,
individuals are required to file a federal disclosure form if they
contact public officials to try to influence specific policies or
legislation on behalf of their clients. Individuals lobbying on
behalf of foreign governments must register with the Justice
Department. Violating this law carries penalties of up to five
years in prison.
Companies commonly hire consultants to explain new presidential
administrations, and such consultants can work for clients without
registering as lobbyists as long as they avoid pitching elected
officials to adopt specific policies.
Special counsel Robert Mueller contacted Novartis, which is
based in Basel, Switzerland, and Dallas-based AT&T late last
year in the course of his investigation into whether Mr. Trump's
associates colluded with Russia to interfere in the 2016 elections,
both companies have said. The companies have said they cooperated
with his requests and considered the matters closed. Mr. Trump has
repeatedly said there was no collusion between his campaign and
Russia.
In April, Federal Bureau of Investigation agents raided Mr.
Cohen's office, home and hotel room in New York, seizing millions
of documents and more than a dozen electronic devices belonging to
Mr. Cohen, according to court documents.
Evidence from the seized materials and the public disclosure
last month of the companies' contracts with Mr. Cohen likely led
federal prosecutors to seek more information from AT&T and
Novartis. The companies were contacted by Manhattan federal
prosecutors in recent weeks, people familiar with the matter
said.
Mr. Cohen entered into the consulting agreements with the two
companies using the Delaware-registered company Essential
Consultants LLC, the same entity through which he arranged a secret
payment of $130,000 to former adult film star Stephanie Clifford --
professionally known as Stormy Daniels -- in exchange for her
silence about an alleged sexual encounter with Mr. Trump. Mr. Trump
has denied any such encounter took place.
After the 2016 election, Mr. Cohen was among a handful of
longtime Trump aides shopping their access to the White House as
companies sought inroads to the new administration.
Mr. Cohen pitched himself aggressively, telling prospective
clients they should fire their strategic advisers and hire him
because "I have the best relationship with the president on the
outside," according to a person familiar with his approach, The
Wall Street Journal previously reported.
Novartis, one of the world's largest drug companies by sales,
paid Mr. Cohen $100,000 a month for the 12 months ending in
February, for a total of $1.2 million. The company believed Mr.
Cohen could help it understand "how the Trump administration might
approach U.S. health-care policy matters," a spokeswoman said last
month.
Novartis executives realized early on that Mr. Cohen couldn't
help with health policy but continued to pay him because his
12-month contract could be terminated only for cause, the
spokeswoman has said.
Federal prosecutors in Manhattan haven't interviewed any
Novartis employees, and the requests were focused on Mr. Cohen
rather than any conduct at Novartis, a person familiar with the
matter said. The company is cooperating with the U.S. attorney's
office, the person said.
Novartis's general counsel, Felix Ehrat, stepped down over the
payments, saying in May that although "the contract was legally in
order, it was an error."
AT&T paid Mr. Cohen's company $600,000 from 2017 to early
this year for "insights into understanding the new administration."
The company has said Mr. Cohen's company "did no legal or lobbying
work for us."
AT&T hired Mr. Cohen as it was seeking government approval
for an $85 billion takeover of Time Warner Inc. The Justice
Department later sued to block the deal. A federal judge ruled
against the government on Tuesday, paving the way for the
acquisition to close. Aside from mentioning the acquisition, Mr.
Cohen's contract with the company also called for consulting on
other legislative and regulatory matters.
Last week the Justice Department said department officials had
no known contact with Mr. Cohen regarding the deal.
Randall Stephenson, AT&T's chief executive, told employees
last month that hiring Mr. Cohen was a "big mistake." Bob Quinn,
who oversaw Mr. Cohen's contract as the company's policy chief, was
forced to leave over the payments to Mr. Cohen, the Journal has
previously reported.
Mr. Cohen also expressed interest in pitching foreign
governments, the Journal previously reported, and sought money from
Qatar officials on at least two occasions.
In December 2016, he solicited $1 million from Ahmed al-Rumaihi,
who at the time was head of the Qatar Investment Authority's
investment division, Mr. al-Rumaihi told the Journal. Mr. Cohen was
also hired recently by a major donor to Mr. Trump's inauguration to
pitch a nuclear-power investment to the Qatar Investment Authority,
according to people familiar with the matter. Qatar has said the
state has never been a client of Mr. Cohen.
Other Trump associates have been investigated for foreign
lobbying violations. Former national security adviser Mike Flynn,
as part of his guilty plea for lying to the FBI, has admitted to
false statements and omissions made in his forms disclosing his
lobbying for Turkey. Former Trump campaign chairman Paul Manafort
and former campaign aide Rick Gates were both charged by Mr.
Mueller's office with failing to register as foreign lobbyists for
their work with Ukrainian politicians.
Mr. Manafort has pleaded not guilty to that charge and other
charges, ahead of a September trial in Washington. Mr. Gates
pleaded guilty in February to two other charges.
Write to Nicole Hong at nicole.hong@wsj.com, Jonathan D. Rockoff
at Jonathan.Rockoff@wsj.com and Drew FitzGerald at
andrew.fitzgerald@wsj.com
(END) Dow Jones Newswires
June 15, 2018 02:47 ET (06:47 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
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