"There is no other way to say it — AT&T hiring Michael Cohen as a political consultant was a big mistake," AT&T's CEO said. | Getty AT&T, Novartis CEOs apologize for payments to Michael Cohen “There is no other way to say it — AT&T hiring Michael Cohen as a political consultant was a big mistake,” Randall Stephenson told employees.

The chief executives of AT&T and Novartis are both in damage control mode for their dealings with Michael Cohen, apologizing to employees for poor judgment in paying hundreds of thousands of dollars to President Donald Trump's personal attorney for insights into the president's thinking.

AT&T also announced Friday that its top public policy official is retiring amid the furor, which it acknowledged has hurt its reputation in Washington.


The fallout showed no signs of letting up as details continued dribbling out about the arrangements both companies made with Cohen, a longtime Trump fixer with no known policy chops. Cohen billed himself as a political consultant who could offer advice on how the new administration and its top officials think — and at a time when the new president’s policy positions were largely unknown, the companies shelled out big bucks for guidance.

Now they’re publicly regretting that decision.

"There is no other way to say it — AT&T hiring Michael Cohen as a political consultant was a big mistake," AT&T CEO Randall Stephenson told employees Friday.

Similarly, Novartis CEO Vasant Narasimhan wrote in a Thursday email: “We made a mistake in entering into this engagement and, as a consequence, are being criticized by a world that expects more from us.”

The mea culpas cap off a week that has been something of a public relations nightmare for AT&T and Novartis. The massive corporations found themselves thrust into the political drama surrounding Cohen, who is under criminal investigation for his business dealings.

Both companies acknowledged earlier this week that special counsel Robert Mueller requested information from them late last year regarding Cohen as part of an ongoing investigation into Russian meddling in the 2016 presidential election. The companies said they fully cooperated with investigators.

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Novartis is also now facing congressional scrutiny, with Senate Finance Committee ranking member Ron Wyden (D-Ore.) asking on Friday for the drug company to hand over documents about its business arrangement with Cohen.

“Novartis paid Mr. Cohen hundreds of thousands dollars more than it paid its big-shot lobbyists in Washington," Wyden said. "The American public needs to know who at the company signed off on this scheme and what were they expecting in return."

The steady drip of revelations started Tuesday when Michael Avenatti, a lawyer representing adult film actress Stormy Daniels, published bank records showing payments from a handful of clients to Cohen's shell company, Essential Consultants LLC. Avenatti contends that Cohen used funds from the consulting firm to pay Daniels $130,000 before the 2016 election to stay quiet about an alleged past affair with the president.

AT&T paid Cohen $600,000 for strategic advice in 2017 on its $85 billion merger with Time Warner, which Trump has opposed since it was first announced, as well as policy issues like net neutrality and tax reform. Documents obtained by POLITICO show Cohen had a yearlong contract starting just days after Trump's inauguration.

Whatever advice or access AT&T got from Cohen may not have fully delivered the results the company was looking for. It scored wins on net neutrality and tax reform, where Trump administration priorities aligned with big business and the GOP establishment. But Trump’s Justice Department still sued to block the Time Warner deal last year.

Meanwhile, Novartis coughed up $1.2 million in a 12-month contract in an attempt to gain insight into the Trump administration's health care plans. The drugmaker has said Cohen did not deliver as promised, but it was stuck in the contract and continued to make payments.

Indeed, Cohen has not worked in health care, telecommunications or any other policy area. He is, however, close to Trump. That has led some people to surmise that the companies turned to Cohen for access to the upper echelons of the White House rather than expert guidance. Both companies have denied that Cohen lobbied Trump on their behalf.

Rudy Giuliani, one of the president's newest lawyers, told POLITICO on Friday that he also doesn't believe Cohen talked directly to Trump about his corporate clients.

“I don’t believe that's at all possible," Giuliani said. "I don’t think it happened. If it did it, I’m sure it didn’t work.”

White House press secretary Sarah Huckabee Sanders on Friday sought to dismiss any claims of impropriety around the situation. She singled out the Justice Department's suit to block the AT&T-Time Warner merger.

“I think it's pretty clear that the Department of Justice opposed the merger, and so certainly the president has not been influenced or his administration influenced by any outside special interests," Sanders told reporters. “This is actually the definition of draining the swamp, something the president talked about repeatedly during the campaign."

Stephenson maintains the firm's actions were a "serious misjudgment" but still above board. AT&T said Cohen did not offer to arrange any meetings with Trump administration officials, instead billing himself as offering insight into "key players, their priorities, and how they think."

"To be clear, everything we did was done according to the law and entirely legitimate," Stephenson said.

Nevertheless, the telecom giant's top public policy official, Bob Quinn, will retire following the week's news, a sign of the damage that hiring Cohen has inflicted on the firm's reputation in Washington. AT&T's public policy shop will report to general counsel David McAtee for "the foreseeable future."

"David's number one priority is to ensure every one of the individuals and firms we use in the political arena are people who share our high standards and who we would be proud to have associated with AT&T," he continued.

Narasimhan said he knew employees were likely “disappointed and frustrated.” The arrangement was set up before Narasimhan took over as CEO in February.

“Personally and for my family, yesterday was also a difficult day, as unfounded stories spread through the US news. While I was not involved with any aspect of this situation, the facts did not matter. I went to sleep frustrated and tired,” Narasimhan wrote. “But I woke up this morning full of determination.”

