AT&T Stumbles As It Tries To Explain Why It Paid $200K To Cohen's Shady Shell Company

from the dysfunction-junction dept

Stormy Daniels lawyer Michael Avenatti yesterday dropped a bit of a bombshell on DC in the form of this document (pdf), which alleges that Trump lawyer and "fixer" Michael Cohen was engaged in far deeper, shadier financial shenanigans than had so far been reported. Numerous allegations are made in the document, including claims that Cohen may have violated banking laws in setting up and funneling money through a front company by the name of Essential Consultants, including payments made by Columbus Nova, a U.S.-based affiliate of a company controlled by a Russian millionaire, Victor Vekselberg.

But buried within the document also sits allegations that numerous companies were also paying into Cohen's shell company, which had no employees and claimed to have been focused on real estate ventures. Korean Aerospace Industries, Novartis, and AT&T all managed to pay Cohen for ambiguous services, and all have been providing some comically murky explanations as to why they'd be dumping money into a shell company operated by the President's arguably-shady fixer:

"Korean Aerospace Industries confirmed to The Washington Post that it paid $150,000 to Cohen’s company, but spokesman Oh Sung-keon said that it was not aware of its connection to Trump. The company said that it paid Cohen’s firm “to inform reorganization of our internal accounting system.” The company is in contention for a multibillion joint U.S. contract with Lockheed Martin for jet trainers."

Yeah that doesn't sound suspect at all. The documents allege that AT&T also made four $50,000 payments to Cohen's shell LLC from October 2017 to January of this year (though Reuters now says that those payments could have been as high as $600,000). A statement issued to the press by AT&T attempts to claim that the company was simply seeking "insights" into the administration, which by this point had been in office for nearly a year:

"Essential Consulting was one of several firms we engaged in early 2017 to provide insights into understanding the new administration. They did no legal or lobbying work for us, and the contract ended in December 2017."

It's worth noting that while it was nice of AT&T to confirm the validity of many of the documents' claims, the company's rushed public statement not only got the timeframe of the payments wrong, but the name of the company wrong as well.

One of the theories du jour is that AT&T was trying to secure the repeal of net neutrality, the vote for which (December 14) occurred just as the payments were wrapping up. But given that the Trump FCC had already proven itself to be a mindless rubber stamp when it comes to catering to the telecom sector's biggest companies, such additional payments likely weren't necessary to ensure the vote went AT&T's way.

Granted AT&T's also been pressuring the Trump administration to "reform" NAFTA to make it easier on AT&T's telecom ambitions in Mexico. AT&T was also trying to secure the administration's blessing for its $86 billion acquisition of Time Warner. But given the Trump DOJ proceeded to sue to block that deal for anti-competitive reasons (or hey, just good old cronyism), if the payments were to grease the M&A skids AT&T certainly didn't get their money's worth.

The most likely reason is that AT&T, for some idiotic reason, thought paying a shady NYC fixer's dubious front company would help curry general favor with the Trump administration. That's certainly not out of character. AT&T is a company with pretty greasy track record, whether we're talking about the time it turned a blind eye to drug dealers running a directory assistance scam on its own users, the time it was caught helping scammers rip off telecom systems for the hearing impaired, or that time it was caught making bills harder to understand just to help crammers rip off AT&T customers.

Unless there's some legitimate reason for these payments (which seems hard to fathom), this looks like good old American graft exposed to the light. Still, there's a lot of unsolved questions here, and while AT&T's claim that it was just looking for "insight" might work with revolving door regulators like Ajit Pai, it isn't likely to hold up under deeper federal scrutiny.


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  • identicon
    Anonymous Coward, 9 May 2018 @ 11:05am

    AT&T will be fine

    After all, it's American Telephone & Telegraph, not Russian Telephone & Telegraph. There may be shady or illegal dealings here, but with no obvious Russian connection, nobody will care. :)

    reply to this | link to this | view in chronology ]

  • icon
    Roger Strong (profile), 9 May 2018 @ 11:08am

    AT&T is a company with pretty greasy track record, whether we're talking about the time it turned a blind eye to drug dealers running a directory assistance scam on its own users, the time it was caught helping scammers rip off telecom systems for the hearing impaired, or that time it was caught making bills harder to understand just to help crammers rip off AT&T customers.

    Oddly, none of these were predicted in AT&T's You Will commercials.

    reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 9 May 2018 @ 11:15am

      Re:

      Karl forget to mention that time when AT&T was found to be abusing its monopoly position, forcibly broken up, and then started to reconstitute itself it complicated ways.

      reply to this | link to this | view in chronology ]

  • icon
    DB (profile), 9 May 2018 @ 11:12am

    Former writer for 'House of Cards' gets last laugh

    I can see The Onion article now: "They fired me saying that my plot twists weren't even close to believable. Now who's laughing?"

    reply to this | link to this | view in chronology ]

  • identicon
    citizen, 9 May 2018 @ 12:42pm

    Any aspiring mob boss would need a consigliere through which fealty can be paid.

    reply to this | link to this | view in chronology ]

  • icon
    Ninja (profile), 9 May 2018 @ 12:45pm

    "inform reorganization of our internal accounting system"

    Very lousy translation for the Korean equivalent of "conducting shady business in order to gain unfair advantage over competing companies", no?

    "provide insights into understanding the new administration"

    It would be cheaper if they watched Fox News. Oh wait. In that specific case it would be more effective if they bought advertisement space on Fox News.

    reply to this | link to this | view in chronology ]

  • icon
    Anonymous Anonymous Coward (profile), 9 May 2018 @ 1:13pm

    Criminal instruction for corporations

    A new industry. Or maybe an old one. Either way, these companies failed their how to be obtuse classes.

    What these companies forgot is to have a cutout. Like Trump did. Trump hired Cohen as his cutout (didn't work very well). These companies should have hired another sleazy (insert favorite type of sleazy character here, could be a lawyer, could be someone else's grandmother) to make those payments. The deal is actually done in a dark, empty parking garage at 0 dark thirty in the morning, with untraceable payments made soon after.

    With all their practice, you would think they could get this right.

    reply to this | link to this | view in chronology ]

  • identicon
    BroD, 9 May 2018 @ 1:55pm

    "0 dark thirty in the morning"

    reply to this | link to this | view in chronology ]

  • This comment has been flagged by the community. Click here to show it
    icon
    Richard Bennett (profile), 9 May 2018 @ 5:03pm

    Shocking!

    I'm shocked, I tell you shocked, that heavily-regulated industries would lobby the government.

    Why can't they just buy entire law schools as Silicon Valley innovators do?

    reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 9 May 2018 @ 6:27pm

      Re: Shocking!

      Finally decided to log in, did we?

      When a Silicon Valley company harasses children and grandmothers on the scale the RIAA has, you let me know.

      reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 9 May 2018 @ 6:35pm

      Re: Shocking!

      I'm shocked, I tell you shocked, that someone who thinks net neutrality is a "paranoid conspiracy theory" engages in embarrassing whataboutism.

      reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 9 May 2018 @ 8:07pm

      Re: Shocking!

      This isn't lobbying.

      If it was then all these companies would have described it as such since lobbying is legal in the US. But no, they all went out of their way to say it was anything BUT lobbying.

      Besides, paying a front company created by the fixer lawyer of the president of the United States is exactly how NOT to lobby. That's called bribery and that IS illegal.

      Try again Richard.

      reply to this | link to this | view in chronology ]

  • icon
    Shel10 (profile), 9 May 2018 @ 7:33pm

    Porn Lawyer

    What laws did the Porn Lawyer break in either obtaining this information or publishing this information?

    reply to this | link to this | view in chronology ]

  • identicon
    Sir Pantsalot, 10 May 2018 @ 1:26pm

    mysterious ways

    "...it isn't likely to hold up under deeper federal scrutiny."

    errr.... deeper federal scrutiny...

    You mean deeper scrutiny/investigation by the federal government, as in the currently Trump-controlled "federal government"?

    Methinks these pathetically weak bullshit excuses will hold up perfectly well, at least long enough for the Trumpettes to bury this fiasco in the same memory hole that all their other dismissed criminal activities and exonerated cronies now inhabit.

    You certainly have a lot more faith in the Trump-tainted "Justice System" than I do. I've never understood such blind faith - its almost religious.

    To me, it just looks like wishful thinking.

    reply to this | link to this | view in chronology ]

    • identicon
      Thad, 10 May 2018 @ 2:15pm

      Re: mysterious ways

      ...the President does not actually control the entire government.

      We know that Cohen is already being investigated by the Department of Justice, despite that being part of Trump's Executive Branch.

      Even if that were not the case, there are still state governments, which are capable of launching their own investigations and prosecutions. And private citizens are capable of civil suits. Such as the multiple civil suits brought by Michael Avenatti, the lawyer who publicly disclosed the payments made to Cohen's shell company.

      And while the president has been appointing judges at quite a rapid clip, the vast majority of judges in the United States were actually not appointed by Donald Trump.

      reply to this | link to this | view in chronology ]

  • icon
    Richard Bennett (profile), 10 May 2018 @ 2:57pm

    Nothing to worry about

    New York Attorney General Eric Schneiderman is all about net neutrality lawsuits. Wherever he finds misbehavior, he gives punishment. The's the hero of all friends of the freeish and kinda open sometimes Innernetz.

    reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 10 May 2018 @ 7:07pm

      Re: Nothing to worry about

      For someone who loves the law and demands regulation in case of pirates you sure seem to bitch a lot when law actually happens...

      reply to this | link to this | view in chronology ]

      • icon
        Richard Bennett (profile), 10 May 2018 @ 8:19pm

        Re: Re: Nothing to worry about

        So I can't say: "This law is good, this one is bad, this one needs improvement, this one makes no sense?"

        That's not very much fun.

        I wish Schneiderman all the best, of course.

        reply to this | link to this | view in chronology ]

        • identicon
          Anonymous Coward, 10 May 2018 @ 8:57pm

          Re: Re: Re: Nothing to worry about

          I wish Schneiderman all the best, of course.

          Why do I not believe you? Oh yeah, maybe because you completely dissed on him in your first comment?

          So I can't say: "This law is good, this one is bad, this one needs improvement, this one makes no sense?"

          You can, but when you lie about it and have blatantly obvious double standards, just be prepared to get called out on it.

          That's not very much fun.

          I'm sure it isn't since you are constantly on the wrong side of things.

          Try again Richard.

          reply to this | link to this | view in chronology ]

        • identicon
          Anonymous Coward, 10 May 2018 @ 10:10pm

          Re: Re: Re: Nothing to worry about

          So I can't say: "This law is good, this one is bad, this one needs improvement, this one makes no sense?"

          You tell me. When people point out that what your overlord Pai is saying makes no sense you throw a hissy tantrum that would put every toddler I know to shame...

          reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 10 May 2018 @ 8:07pm

      Re: Nothing to worry about

      As opposed to you who are champion of the completely locked down and always pay-to-do-anything internet.

      Try again Richard.

      reply to this | link to this | view in chronology ]

  • identicon
    David, 11 May 2018 @ 4:44am

    Are you that naïve?

    Unless there's some legitimate reason for these payments (which seems hard to fathom), this looks like good old American graft exposed to the light. Still, there's a lot of unsolved questions here, and while AT&T's claim that it was just looking for "insight" might work with revolving door regulators like Ajit Pai, it isn't likely to hold up under deeper federal scrutiny.

    Uh, Ajit Pai is getting buttered handshakes so that there will not be any "deeper federal scrutiny" in the first place.

    reply to this | link to this | view in chronology ]


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