AT&T Payments to Trump's Lawyer Draw Bipartisan Hill Interest, Some Skepticism

AT&T in a companywide email Wednesday said it hired Cohen and other consultants in early 2017, as Trump was taking office, to provide insights on how the administration might approach such issues as FCC regulatory reform, tax reform and antitrust enforcement. "Companies often hire consultants for these purposes, especially at the beginning of a new Presidential Administration, and we have done so in previous Administrations, as well," AT&T said. The telco said Cohen did no legal or lobbying work for it, and the contract with Cohen expired at the end of 2017. AT&T said it was unaware of "the current controversy surrounding Cohen" until January.

Lawmakers divided in initial reactions. Several Republicans said they need to understand the details of the company's dealings with Cohen but questioned whether the issue requires a full-scale investigation. “It's all new information” and “we're digesting it,” Senate Commerce Committee Chairman John Thune, R-S.D., told reporters. AT&T's “answer is they pay a lot of consultants,” he said, but he and other lawmakers will hopefully be able to “make some more sense” of the claims. It's unclear whether Senate Commerce would need to launch an investigation, Thune said. “Is there anything illegal about it?” Consultants and lobbyists “are paid by their clients all the time,” said Sen. John Kennedy, R-La. “Probably a hundred times a nanosecond.”

Senate Consumer Protection Subcommittee ranking member Richard Blumenthal, Conn., and other Democrats were adamant Wednesday that an investigation is warranted. AT&T has “a lot of explaining to do,” said Senate Communications Subcommittee ranking member Brian Schatz, D-Hawaii, in an interview. “It is hard to imagine why a person with no government relations experience to speak of would get such a fat retainer.” Schatz is particularly interested in whether AT&T was seeking to influence the outcome of federal reviews of the Time Warner deal, noting he “can't imagine what else” AT&T was “doing with that money.”

The Senate Judiciary Committee should investigate the AT&T payments and “other payments that may well have been used to influence [Trump] using Michael Cohen and shell companies as conduits,” Blumenthal said during a news conference to announce filing of a petition to discharge from Senate Commerce Committee jurisdiction a Congressional Review Act resolution aimed at reversing the FCC order to rescind its 2015 net neutrality rules (see 1805090065). “I'm concerned” about the potential impact that AT&T was seeking to make “on a variety of issues” via its payments to Cohen, Blumenthal later told us. AT&T “may have an interest” on policy issues ranging from AT&T/TW to net neutrality that are “obvious points for investigation,” he said.

Sen. Ed Markey, D-Mass., told reporters the disclosure shows how much influence ISPs have over policymaking. Cohen “has not been noted over the years as a telecommunications policy analyst,” Markey said. “Maybe we will find it is true on every issue that he got paid to provide insight into the internal workings of the Trump White House. But, nonetheless, I agree with [Blumenthal] that it must be investigated.”

Critics Concerned

Judging at face value AT&T's explanation it was paying Cohen for insights into the incoming administration would point to seeking political intelligence, not illegal or subject to disclosure, emailed Public Citizen government affairs lobbyist Craig Holman. But it seems unlikely the payments were strictly for political intelligence, since Cohen is a key Trump adviser and "fixer" and AT&T has business before the administration "such as seeking lucrative government contracts," he said. "It is far more likely these payments were made to get Cohen to bend the president’s ear in their favor, which would constitute unreported and illegal lobbying expenditures," he said. "It is also possible that these payments were made to buy access to Trump or, worse yet, to bribe government officials." Holman said such political intel "is the shady activity" of lobbyists and corporate operatives paying government officials for insider information, often with the goal of cashing in on that information. While a provision of 2012's Stop Trading on Congressional Knowledge (Stock) Act would have required political intelligence consultants to register and disclose their activities, that "was scuttled by Congress at the last minute," he said.

A Campaign Legal Center spokesman emailed that the AT&T-Cohen ties are "a troubling example of special access given to special interests." CLC said there could be legal issues if Cohen should have registered as a lobbyist but didn't do so. If Cohen used funds from AT&T and others rather than his own or Trump's money to pay Daniels and that payment was found to be a campaign contribution, that money would be impermissible under the law, CLC said.

The AT&T payments to Cohen, with the last coming just after FCC voted to rescind the 2015 net neutrality rules, are "certainly fishy and worth looking into," Fight for the Future wrote.

“I don’t see any legal or ethical liability for AT&T in making the payments," said Brookings Institution Senior Fellow Blair Levin. "The big question is what were they paying him for.” He said the broader issue is about a heightened need for transparency “when you have a president continuing to have business interests and you have business associates holding themselves out for such assignments, but that’s on Cohen and the president.”