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A team from The Wall Street Journal uncovered secret payoffs that Donald Trump and his associates arranged during the 2016 presidential election campaign to suppress sexual allegations from two women, including a porn star known as Stormy Daniels.
The Journal’s series of exclusive reports, most of which were published in 2018, prompted a federal investigation into campaign-finance abuses and implicated the president in a federal crime. Trump’s former personal attorney, Michael Cohen, pleaded guilty last year to a string of crimes, including violating campaign finance law by arranging large payments to two women who had alleged affairs with Trump. In late February 2019, Cohen testified before a House committee that Trump helped him coordinate the payment to Daniels.
The Journal first reported on a Trump-related payoff right before the 2016 election. On Nov. 4, 2016, journalists Joe Palazzolo, Michael Rothfeld and Lukas Alpert broke the news that the company that owns the National Enquirer, American Media Inc., agreed to give former Playboy model Karen McDougal $150,000 for her story of an extramarital affair with Trump a decade earlier. But the company, headed by a longtime friend of Trump, did not publish the story, the Journal reported.
“We didn’t know at that time the extent to which Trump was involved or Michel Cohen was involved,” Palazzolo said during a recent podcast interview with Heidi Legg, special projects director at the Shorenstein Center, which runs Journalist’s Resource.
After that first story, Rothfeld and Palazzolo worked for more than a year to investigate secret hush payments. Their next article, published in January 2018, reported on a $130,000 payment Cohen made to Daniels to keep her quiet a month before the election. Days later, Rothfeld and Palazzolo followed with another story detailing how Cohen used a shell company to make the payment to Daniels’ lawyer.
The Journal ran several more articles in 2018 that focused on Trump’s relationship with Cohen, Trump’s role in the payoffs and how Cohen turned on the president, publicly implicating him.
The series, titled “Trump’s Hush Money,” “fundamentally altered the trajectory of Mr. Trump’s presidency,” the Journal wrote in the paperwork it submitted to enter this year’s contest for the prestigious Goldsmith Prize for Investigative Reporting. The series recently was chosen as a finalist. The Journal also pointed out that once Cohen turned state’s evidence against the president, Cohen began cooperating with special counsel Robert Mueller’s ongoing investigation into Russian election tampering.
To learn more about the series and how it was reported, Journalist Resource reached out to several reporters who had worked on it. In an interview by e-mail, Palazzolo spoke to us about how the team tracked down key details and handled tricky questions such as whether to rely on anonymous sources. He also offered tips for journalists interested in doing investigative reporting at a national level.
Below are our six questions and Palazzolo’s answers. We made a few minor edits for clarity or to accommodate Journalist’s Resource’s editorial style.
Denise Ordway, Journalist’s Resource: How did you find the shell company that Mr. Cohen used to make the hush payment to Stormy Daniels? And what steps did you take to confirm the information before publishing it?
Joe Palazzolo: “We learned from a source that Michael Cohen used a shell company, but our source didn’t know the exact name. The source said it was something obvious, like ‘Damage Control LLC.’ We didn’t know where the company was incorporated. We had a general sense of when Cohen paid Daniels. Michael Rothfeld began requesting records from state agencies of all companies formed in September and October of 2016. We suspected Delaware, given its reputation for corporate secrecy and proximity to New York.
Delaware’s Division of Corporations produced a report for us with thousands of LLCs [Limited Liability Companies]. We also got records from Nevada and Wyoming. We pored over them for likely candidates. Another source suggested we try looking for a company with ‘Resolution’ in the name.
Presently, we found a Delaware company called Resolution Consultants LLC. Delaware’s online database offers scant information about corporations, except the incorporation service used and the date or formation. But you can request the formation documents from the Division of Corporations. We did, and sure enough, there was Michael Cohen, listed as the company’s “Authorized Person.” We then called the incorporation service Cohen used to confirm he was the right Michael Cohen. They had Cohen’s New York address on file.
But Resolution Consultants LLC was formed on Sept. 30 and dissolved on Oct. 17, before the payment to Daniels, according to our sources. We figured Cohen had made an error in setting up the company or needed to change the company’s name for whatever reason. So we went to the spreadsheet of companies formed in Delaware that we’d created and narrowed our search to corporations that were created on Oct. 17, the same day Resolution Consultants was dissolved.
Michael, myself and our editors, Mike Siconolfi and Ashby Jones, picked through the records, hundreds of them, for likely candidates. We all made lists. One company had struck all four of us as a possible match: Essential Consultants LLC. The next morning, we pulled the formation documents, and Michael Cohen’s name was on them. It took us another couple of days to confirm with our sources that Cohen used Essential for the payment.”
*The winner of the 2019 Goldsmith Prize for Investigative Reporting was awarded on March 12, 2019, to J. David McSwane and Andrew Chavez of the Dallas Morning News, for their series “Pain and Profit“.
