Whether the indictment Alvin Bragg brought against former President Donald Trump is politically motivated is a matter of perspective. Rather than wade into that subjective controversy, it is more useful to focus on the three pivotal questions:
Are non disclosure agreements (NDAs) legal?
A unilateral non disclosure agreement, which constitutes a contract between two parties where one party receives compensatory consideration, is legal as long as the activity covered under the agreement is not illegal. That is why the Bragg indictment does not include the NDA itself as the basis for any of the felony charges. Rather, a primary focus of the indictment is on how the compensatory consideration Stormy Daniels received was recorded for accounting purposes and whether it violated tax law.
How are payments made in consideration of someone entering into an NDA to be treated for accounting and tax purposes?
It is notable that in all the reporting on this matter there is no mention as to how such a payment is actually supposed to be accounted for under accounting rules or for tax reporting purposes. Trump’s accountants recorded the repayment to Michael Cohen (of the money he had paid to Stormy Daniels) on Trump’s behalf as a legal expense.
In fact, non disclosure agreements are essentially settlement agreements which, under the tax code, allow related payouts and attorney’s fees to be deducted as legal expenses for tax purposes. This would be determinate in how such a payout would be characterized from an accounting standpoint.
Moreover, it was not until January 1, 2018 that Section 162 of the Internal Revenue Code was amended to prohibit such tax treatment if the payments are made under an NDA related to sexual harassment or sexual abuse. Notwithstanding that Trump’s payments to Cohen were, in fact, not related to sexual harassment or sexual abuse, any attempt to characterize them as such would fall short of a violation of the law since all of the payments to Cohen occurred in 2017. It is also notable that Bragg is, to my current understanding, not charging Trump with state tax fraud.
Does the NDA between Trump and Daniels and the payment made to Daniels constitute a violation of the federal election law prohibition relating to concealment of material facts that could affect an election?
It is Bragg’s assertion that hiding the payment is a violation of federal election law that is his basis for escalating the charges to felonies. This begs the question whether a candidate has a right to protect his or her reputation from disputed and embarrassing claims that can unfairly harm his or her reputation. The operative word here is “disputed” because Trump denies he had an affair with Daniels and, with no proof on either side, this is nothing more than a “he said, she said” situation.
We also know that in the realm of public opinion the concept of innocent until proven guilty is turned on its head. The fact is that federal election law defines election interference to include concealment of a material fact or making any false, fictitious or fraudulent statements or representations. In that context, a disputed and unprovable claim is not a material fact and would not preclude it from being concealed.
As this case against Trump moves forward, it would seem these questions would need to be adjudicated. Of course, there is also the question of whether Bragg is exceeding his jurisdiction in bringing charges related to an alleged federal election violation where both the Federal Election Commission and the DOJ have given Trump a hard pass in the matter of the Stormy Daniel payment. As mentioned above, it is this supposed violation that was Bragg’s justification for raising the charges to felonies.
Bragg’s tactic is to magnify the import of this case by bringing 34 duplicative counts. The obviousness of this approach does the opposite…it dilutes its seriousness and calls into question Bragg’s motives. Is it simply to “get Trump?” Is it Alvin Bragg himself who is interfering with a future federal election by bringing spurious allegations? Will the public spectacle and Trumps defiance serve to enhance his reputation in the eyes of his base? Will it attract others to Trump’s side because they see the charges brought as an abuse of power by Bragg? We don’t know the answers to these questions.
What we do know is that Trump is a survivor having overcome the Trump Derangement Syndrome which fueled two impeachment attempts and the Mueller investigation . Whether he survives this indictment, or not, it might very well assure a Trump redux.