On October 3, 2016, the Donald J. Trump Foundation was issued a “notice of violation” and directed to cease soliciting funds. Exactly two weeks later, on October 17, Michael Cohen established Essential Consulting LLC.
There might not seem to be an immediate connection between a charitable foundation supposedly created to channel contributions to worthy causes, and a shadowy company for which Cohen solicited contributions from both US and foreign corporations. Except that both seemed to serve the same purpose: Provide Donald Trump with a means to spend other people’s money while dealing with his legal issues.
Less than two weeks after the election, while the nation was still reeling from the idea that Donald Trump had lost the popular vote, but was still headed for the White House, the Trump Foundation admitted to several instances of self-dealing. Many of those instances were detailed in the Pulitzer-winning, crowdsource-assisted reporting of David Fahrenthold. That reporting helped open up the details of Trump’s foundation, showing that it was less a charitable fund, and more a way for people to funnel money to Donald Trump to do so while taking a tax credit in exchange. Two weeks later, Trump quietly announced that he was shutting down his “charitable” foundation—though the actual closure of the Donald J. Trump Foundation did not happen for a year because of the pending legal action.
Trump treated the funds that landed in his foundation as an all-purpose slush fund. He bought football memorabilia and several genuinely hideous portraits of himself. He also made sizable political contributions out of the fund, both in New York and in Florida. But the biggest self-dealing that Trump did from his “charity” was in covering his personal legal fees. That included covering the legal expenses after Trump welched on a golf bet. The foundation had to admit this usage when it was closed down, and Trump paid penalties both for self-dealing and for using the fund for political contributions.
While this was happening, Michael Cohen was not only Donald Trump’s personal attorney, he was definitely aware of how Trump used his foundation. In fact, it may have been Cohen who encouraged Trump to tap into that fund for needed cash. And Cohen who provided Trump with an alternative when that source was closed to him.
It was certainly Cohen who personally solicited a payment to Trump after he gave a speech for a Ukrainian billionaire. The payment that Cohen demanded for that event didn’t go to the Trump Organization, it went, by instruction, to the Trump Foundation. Why Trump didn’t simply ask for a payment to himself for this arrangement remains unclear, as does most of his use of the Trump Foundation for what are clearly personal purchases. Both Cohen and Trump had to be aware that the way the foundation was being used was simply illegal.
But for some reason Donald Trump wanted a way to accept and make payments that never officially touched his business or personal accounts. The reasons for that may simply be that Trump liked the idea of burning other people’s money. However, there’s a more obvious reason—one connected to the Trump’s refusal to release his tax forms even when it seemed failure to do so might cost him the election. The most obvious possibility is simply that Donald Trump was broke. He spent money from the Trump Foundation because he didn’t have any elsewhere, and he routed money through the Trump Foundation either because his normal accounts were in some way encumbered, or he feared that they would be.
In any case, there seems to be a connection between the arrival of Michael Cohen, and the blatant use of the Trump Foundation as a general-purpose slush fund. Michael Cohen left his previous job to become a full-time attorney for Donald Trump at the end of 2006. Within weeks, Donald Trump used funds taken from the Trump Foundation to settle a legal dispute with the city of Palm Beach. It was also just after Cohen’s appearance that Trump bought a six foot portrait of himself using foundation cash. However, it’s not completely clear if these actions—the first of several instances of self-dealing admitted by the Trump Foundation—were directed by Cohen.
But if Cohen’s appearance at the Donald J. Trump Foundation and the use of that foundation to serve Trump’s needs is coincidental, that’s not the case with the other Trump foundation. Because at that other foundation, Cohen was definitely involved in helping Trump route money meant for sick kids into his own pocket.
Trump’s second son, Eric, has his own foundation. Until 2010, that foundation seems to have operated normally, raising capital, and sending most of it to children’s charities. But in 2010, the mostly outside board of the Eric Trump Foundation was swapped out for a new board consisting of Trump family members and staff—including Michael Cohen. With this new board in place, the foundation fundamentally changed the way it operated.
It continued to make charitable donations, but only to groups that agreed to spend part of those donations at Trump facilities. In effect, Trump levied a fee on all the money leaving the Eric Trump Foundation. And it could be a very substantial fee. Because while both Donald and Eric Trump continued to behave as if Trump’s facilities were part of what they were giving away, in truth they charged the charities unconscionable rates. In one notable instance, over $1.2 million dollars that was intended to go to sick kids, ended up in Donald Trump’s pocket—for a one day golf tournament.
Yes, money continued to move through the Eric Trump Foundation to genuine charities doing genuinely good work. But it was not Eric Trump’s money or Donald Trump’s money, and even the money that did get paid out did so only after Trump skimmed a very sizable percentage. The new board—including Michael Cohen—had converted the Eric Trump Foundation from a charity, into a profit center.
By the time the order to stop soliciting donations to the Donald J. Trump Foundation came at the start of October 2016, it was clear that the foundation was no longer serving its purpose as a viable slush fund for Trump. Not only were Fahrenthold and a legion of volunteers crawling through the foundation’s books, checking to see how many of the mentioned organizations had actually received a check, but the order to stop taking contributions wrecked the real purpose to the organization. After all, Trump hadn’t contributed to the fund himself since 2009.
Donald Trump was in need of a place where people who wanted to route money to him could do so without being under the eye of those pesky journalists, or blocked by pesky court orders. Or, for reasons still unknown, having those funds entangled with the Trump Organization.
And that’s the moment when Michael Cohen opened Essential Consultants.
True, Essential Consultants is not a charity. Not even a pretend charity. But it is an LLC, meaning that both its ownership and its business dealings can be deliberately vague. Both Michael Cohen and Donald Trump were certainly no strangers to the anonymity and protection an LLC can provide. The Trump Organization itself includes over 500 LLCs, almost all of them listing the same scant information and all of them owned by Trump. Some of them exist only to own other LLCs within the organization, making it ditheringly impossible to figure out the legitimacy of some of Trump’s reported expenses. Some of Trump’s LLCs have purposes that can be guessed at by looking at their names—though not necessarily. Some of them exist for no obvious reason at all.
Which is the point. These LLCs are impenetrable in most instances. Even the names don’t have to match what they do. As several people have noted, everything about the name Essential Consultants is a lie—right down to the “s” in Consultants.
Michael Cohen has also long been an LLC fan. In addition to his 16 taxi companies, Cohen has created several other LLCs. Many of these were created while Cohen was working for Trump, and just as with Trump’s own LLCs, their purpose, ownership and dealings are anything but transparent. Or at least, that’s true of those LLCs where attorney Michael Avenatti hasn’t inexplicably produced a detailed list of transactions.
And, of course, both Trump and Cohen had long been beneficiaries of LLCs. Trump not only mysteriously bounced back from bankruptcy by moving real estate to LLCs at well above market rates, he’s continued to do so while sitting in the White House. Of the $35 million in real estate the Trump Organization sold in 2017, the great majority was sold to LLCs whose ownership still remains in question. Michael Cohen also got in on the action, selling four apartments for a $20 million profit to the unnamed owners of LLCs.
The Trump Foundation offered tax benefits. Essential Consultants LLC made up for that issue with secrecy.
In the end, both funds served the same purpose: Provide Donald Trump with a fund from which he could deal with personal issues without touching his own personal money. The payment to Stormy Daniels may seem extraordinary, but it fits directly in with the type of payments that were being made from the Trump Foundation before it was closed. And it fits into the pattern of actions by Cohen, who as far back as 2011 told ABC News that “If somebody does something Mr. Trump doesn’t like, I do everything in my power to resolve it to Mr. Trump’s benefit.”
Trump also had his comments about Cohen. Speaking to Fox, Trump said “I don’t know his business. But this doesn’t have to do with me. Michael is a businessman. He has got a business. He also practices law. I would say probably the big thing is his business. And they are looking into something having to do with his business. I have nothing to do with his business.”
Which seem to be very strange comments considering that Cohen is, or was, both Trump’s personal attorney and had been an employee of the Trump Organization for more than a decade. It seemed clear that, even before Avenatti began dumping documents on Twitter, Trump knew all about Cohen’s sell company.
But Trump may not have needed Essential Consultants for long. Just a few months later, Trump had another fund, one that allowed him to take other people’s money in much larger amounts and with even less transparency. Trump aggressively solicited donations for his inaugural fund, including several overseas donations now under investigation. That effort generated a record $107 million. Trump may have been lying when he claimed to have had more people at his inauguration, but he took in far more money, and he did so while having far fewer events. The leftover amount, whatever it might be, was promised to charities … but seems to have gone to Trump.
Throughout the campaign, Trump monetized donations in the same way he monetized the Eric Trump Foundation, by feeding all funds back through Trump facilities and extracting a percentage. Since moving into the White House, Trump has done the same with the government. Maybe he really likes to play golf … but maybe he just really, really needs the funds generated by dragging hundreds of people to Mar-a-Lago as often as he can.
Between what he’s able to pocket from the inaugural fund, and what he’s able to charge for hotel rooms, food and Secret Service golf carts, it’s likely Trump won’t miss any monies that were coming to him from Essential Consultants in that time between the election and his change of address.
Though of course, we can’t be sure. Because we still haven’t seen Trump’s taxes. The yawning chasm in the Trump Organization may be deeper than most people can imagine, or there may still be some reason that Trump needs to put his hands on ready cash without putting his name on the account. Considering how Trump used the Trump Foundation, it would be almost surprising if Michael Cohen had not made other payments from his latest LLC that benefited Trump.
In fact, by an astounding coincidence, the $1.6 million that Cohen paid out that’s been identified as payments to protect Republican donor and RNC official Elliott Broidy, isn’t actually connected to a contract with Broidy’s name. The name on that hush money agreement is “David Dennison.” Just as it was on the contract between Trump and Stormy Daniels. That Cohen would use the same false name for two different men seems … odd.
But for Donald Trump, Cohen’s LLC might really have been essential.