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The secret strategy behind Rudy Giuliani's 'gaffe' on the Stormy Daniels payment

Updated 7:23 PM ET, Wed May 16, 2018

(CNN) - On Wednesday, President Donald Trump acknowledged what we have known for the better part of a the last few weeks now: He reimbursed his personal attorney Michael Cohen somewhere between $100,001 and $250,000 in 2017 -- money that Cohen used as a hush payment to porn star Stormy Daniels.

How did we know Trump did this? Because Rudy Giuliani, the (new) face of the President's legal team, told us!

"The President repaid it,'' Giuliani told Fox News host Sean Hannity earlier this month, referring to the $130,000 payment from Cohen to Daniels 11 days before the election -- via a shell company known as Essential Consultants.

At the time, Giuliani appeared to have committed a MASSIVE gaffe. After all, Trump -- and his entire administration had gone waaaaay out of their way to insist that Trump didn't know anything about the Cohen payment or anything having to do with Daniels, who alleged she had an affair with Trump in the mid-2000s, at all.

Here's an exchange Trump had with reporters aboard Air Force One last month:

Reporter: Did you know about the $130,000 payment to Stormy Daniels?

Trump: No.

Reporter: Then why did Michael Cohen make [the payment], if there was no truth to her allegations?

Trump: You'll have to ask Michael Cohen. Michael's my attorney, and you'll have to ask Michael.

Reporter: Do you know where he got the money to make that payment?

Trump: No, I don't know.

It wasn't just that Giuliani's comment looked like a gaffe. It was also that it seemed to come totally out of the blue. Hannity is not exactly a tough interview for a member of the Trump administration. And he wasn't even pressing Giuliani on the Stormy Daniels stuff. The former New York City mayor just sort of blurted it out.

In fact, here's Hannity's question from which Giuliani launches into the revelation that Trump reimbursed Cohen for the $130,000:

"So my question is, are you concerned in the process of this we did discover that a foreign national, Christopher Steele, was paid through Fusion GPS, used Russian sources that not only weren't verified, were debunked -- are you concerned that that was paid for, to manipulate the American people in the lead-up to an election?"

With all the furor around Giuliani's admission of the reimbursement, many -- including me -- overlooked something he told CNN's Dana Bash on the day after the Hannity interview.

"You won't see daylight between me and the President," Giuliani told Dana. "The strategy is to get everything wrapped up and done with this so that it doesn't take on a life of its own."

"The strategy." I assumed Giuliani was just talking at that point, trying to cover his tracks for a clear gaffe.

But what if he wasn't! What if he knew that this information -- Trump's repayment to Cohen -- was going to come out, either from the investigation into Cohen in the Southern District of New York or via this financial disclosure form? And that, as painful as it might be to contradict Trump's past insistence that he knew nothing about any Cohen payment or where the money came from, it wasn't nearly as painful as reporters finding the repayment in the ethics forms for the first time.

There's strong evidence in the Office of Government Ethics financial disclosure report of just this sort of strategy at work.

As CNN's Kevin Liptak notes:

Trump's representatives said in the document that revealing the payments made to Cohen was not necessary by law, instead saying they were listing them "in the interest of transparency."

The ethics office seemed to disagree, annotating the document: "OGE has concluded that the information related to the payment made by Mr. Cohen is required to be reported and that the information provided meets the disclosure requirement for a reportable liability."

So, there was a disagreement between the Trump operation and the OGE about whether Trump was required to disclose. Which means that Trump would have almost certainly been obligated to file the repayment to Cohen -- whether he wanted to or not. Which means that that getting out in front of the fact that he had reimbursed Cohen for the Daniels payment was critical.

Giuliani was right! He was executing a strategy cooked up by himself and Trump -- and not shared with the broader senior White House staff -- aimed at defusing this bombshell as best they could. This was no random act by Giuliani. No gaffe. But rather a planned attempt to fix this problem while it would still only cause Trump a flesh wound.

Later Wednesday, Giuliani told Bash that the Fox News moment was, indeed, a strategy to get out ahead of the upcoming financial disclosure.

"And that's why the President affirmed it, yes," Giuliani told CNN when asked if the financial disclosure process was the reason he revealed Trump paid Cohen back.

"It took a couple of weeks to figure out exactly what we had to do about it and there was a bit of debate about it -- not about disclosing but about how to disclose," Giuliani said.

That is big.


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