Transcript for Prosecutors say Trump allegedly directed illegal payments during campaign

Federal prosecutors in New York arguing president trump's former personal attorney and fixer, Michael Cohen, should get substantial prison time. Prosecutors going so far as to say that Cohen made illegal payments to two women who claimed they had affairs with Donald Trump and that he did so under direction from trump himself. A key allegation there. Meanwhile the office of the special counsel Robert Mueller weighing in on the case of Paul manafort, trump's former campaign manager, saying manafort lied to investigators despite his cooperation deal. We begin here with ABC news senior national correspondent Terry Moran who is right there at the white house this morning. Terry, good morning to you. Reporter: Good morning, guys. Well, this is a crucial point in these investigations. With these new court filings we're getting a clearer sense of how prosecutors are advancing on two fronts in this investigation. One, hush payments to alleged trump mistresses which may have violated campaign finance laws and, two, new details about connections between the trump campaign, the trump business organization and Russians claiming to be acting on behalf of the Kremlin. Mike, what do you think is going to happen today? Reporter: For the first time in a court filing, prosecutors are alleging Michael Cohen violated campaign finance laws acting in coordination with and at the direction of trump himself. The man who once said he would take a bullet for his longtime boss -- I'm obviously very loyal and very dedicated to Mr. Trump. Reporter: -- Flipped earlier this year pleading guilty to crimes including tax evasion and making illegal campaign contributions. Michael, what's your message to the president? Reporter: He even admitted to making hush payments to stormy Daniels and "Playboy" playmate Karen Mcdougal to cover up their alleged affairs with Donald Trump. It drew harsh criticism from the president who denied the affairs or knowing of the payments until after they were made. Did you know about the $130,000 payment to stormy Daniels? No. Reporter: But the New York attorney denounced Michael Cohen's extensive, deliberate and serious criminal contact saying he sought to influence the election from the shadows motivated by personal greed and ambition. Cohen lobbied the court for little to no jail time but Cohen's cooperation paled in comparison to his crimes arguing he should get substantial prison time. Cohen previously sat down for more than 70 hours of interviews with special counsel Robert Mueller and for that assistance in the Russia investigation, Mueller has submitted his own court filing saying he and Cohen struck a deal with Cohen pleading guilty to a separate charge of lying to congress about the president's business dealings with Russia during the campaign. But Mueller did not make a sentencing recommendation telling the court Cohen has gone to significant lengths to assist the special counsel providing useful information concerning russia-related matters core to its investigation. Any reaction, Mr. Manafort? Reporter: All this comes as the special counsel is taking action against another former trump aide, the one-time chairman Paul manafort. Paul manafort has done an amazing job. He's here some place. Where's Paul? Reporter: Prosecutors writing in a heavily redakked memo manafort had previously agreed to cooperate fully, truthfully, completely and forthrightly but instead prosecutors say he lied at least five times to federal investigators. The special counsel is now looking to terminate that deal and he could seek to try manafort on charges in D.C. Federal court for tax evasion and fraud. So, the new information on the Russia front, Michael Cohen has told special counsel Robert Mueller that in November 2015 while president trump then candidate trump was beginning his presidential campaign, Cohen was in contact with a Russian national claiming to be representing the Russian government trying to set up a meeting between trump and Putin at the U.N. And Cohen says trump knew about it. Now, Terry, the president tweeting overnight in response to all of this, quote, totally clears the president, thank you. But does it really? Well, in his mind it does because he says Michael Cohen is lying and in fact the corroboration, if there is any, has not been released yet so we don't know if Cohen has any backup evidence. For his claims right here, for now the president says you still haven't got me. Terry Moran in Washington, D.C., thank you. Prosecutors are speaking to many other people in trump's orbit and one presumes they are getting corroboration from other sources. So much to discuss here so let's bring in Matthew dowd. One thing is clear as we sift through the news and the white house is pointing it out as well, nowhere in these filings do we see any evidence that Donald Trump himself colluded or conspired with the Russians. Well, I think we have to look at Bob Mueller like a producer of the series "Scandal" and all of us want to binge-watch it and get to the end but he's allowing us to only see one episode at a time. Let's keep in mind thing, all of these filings yesterday an the filings we've seen over the course of the last two weeks point to people very close to the president who were talking to the Russians in the course of this, who were working with the Russians in the course of this and the only open question today cover up those -- and they actually tried to cover up those meetings and conversations or lie about them, that Mueller is alleging all of that in these filings but we don't know yet if individual one who is mentioned in the filings who is the president was in direct contact with those people about what the Russians were doing. I think it's fair to say there's some smoke here but not necessarily a smoking gun that would link the president himself to the Russians. That's one angle that includes not only Robert Mueller's team but also the prosecutors here in New York in the southern district. So let me switch to that investigation which involves among other things, hush payments to stormy Daniels and one other woman who say they had an affair with the president. So, the justice department in that case is now saying that they're essentially accusing the president of a crime of directing Michael Cohen his then attorney to deliver these -- this hush money. But their policy at the doj is not to indict a sitting president. So, he seems to be accused of a crime but it's probably not going to be indicted so where does that leave us? Well, it's an unbelievably fascinating thing and basically say that Michael Cohen committed a felony at the direction of the president of the United States. For any other person in America, but the president, they would probable already have been indicted and be in a process -- a judicial process in the course of this. The justice department's policy since the '70s and it's a policy, it's not a law, it is a policy says that you can't indict a president. Other presidents and other justice departments have confirmed this. It's still an open question, never been decided by the courts. But, again, let's keep in mind, if this wasn't the president of the United States, in all likelihood that person named individual one would have already been indicted on a crime by directing somebody else to commit a crime. So do you think there will be political ramifications based on just what we know right now that the doj is saying the president committed a crime here? Do you think the Democrats who are about to take over will push for impeachment? Well, I think there's huge political ramifications for all of this and I think the midterm elections which gave the Democrats the house and power that comes with the committees which then could lead to impeachment, I think most of the members of the democratic house including the likely speaker, Nancy Pelosi, does not want to go through impeachment unless it's bipartisan. But as we see in these filings, I think the pressure is going to continue to build in a movement towards that. I still think that the leaders are reluctant to go towards impeachment unless they have Republicans on board. But as each one of these shoes drops, I think the pressure builds and builds and builds and I think impeachment becomes more and more likely in the democratic house but as you know we have a senate that is held by Republicans and unless you get Republicans, it's not going to mean anything other than a political equation, so I think the pressure is building but until Republicans get on board with it, I think it doesn't go anywhere past that. Yeah, headline, more political turmoil on the way most likely. Matthew dowd, great to have you weighing in on this huge morning in the various investigations swirling around the president of

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