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Feds weighing if National Enquirer publisher violated non-prosecution agreement

The government agreed not to prosecute AMI for campaign-finance violations, but only if it committed no more crimes. Now the company is accused of extortion.
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Federal prosecutors in Manhattan are looking into whether American Media Inc., the company that publishes the National Enquirer, violated its non-prosecution agreement as a result of conduct alleged by Amazon CEO Jeff Bezos, according to a source familiar with the matter.

The non-prosecution agreement, signed in September 2018, describes AMI's role in a payment to Playboy model Karen McDougal, who said she had an affair with Donald Trump prior to his presidential candidacy. Former Trump lawyer Michael Cohen pleaded guilty to a campaign finance violation for arranging a hush-money payment to McDougal, and AMI agreed to cooperate with prosecutors rather than face similar charges for helping to facilitate the payment.

Bezos published a post on the blogging site Medium on Thursday in which he quoted e-mails and correspondence that he said showed that AMI threatened to publish intimate photos of Bezos and his girlfriend if he did not stop investigating how AMI had obtained them.

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Jeff Bezos speaks onstage at WIRED25 Summit on Oct. 15, 2018 in San Francisco.Matt Winkelmeyer / Getty Images for WIRED25 file

AMI's non-prosecution agreement makes it clear that the company can be prosecuted for any crime that may have occurred after the agreement was signed.

"It is understood that should AMI commit any crimes subsequent to the date of signing of this agreement," says the agreement, "AMI shall thereafter be subject to prosecution for any criminal violation of which this Office has knowledge."

The agreement also explicitly states that the non-prosecution deal only applies to crimes related to the payments associated with Cohen's guilty plea.

According to Chuck Rosenberg, a former U.S. attorney who is now an NBC News analyst, AMI's alleged interactions with Bezos are "arguably a violation of the extortion statute."

Added Rosenberg, "[Prosecutors] must also assess whether AMI has put its non-prosecution agreement with the Justice Department (given its written promise not to commit additional crimes) at risk."

Mimi Rocah, a former assistant U.S. attorney in the Southern District of New York and an NBC News analyst, said AMI's interactions would likely invalidate the non-prosecution agreement if the firm clearly committed a crime.

"It doesn't have to be a federal crime," said Rocah. "It could be a state crime."

Rocah also points out that the agreement requires AMI not to give "false, incomplete, or misleading testimony or information."

"Depending on when this conduct happened and what communications they were still having with prosecutors or agents," said Rocah, "their conduct could violate that provision as well."

When Cohen pleaded guilty in August 2018, he said he had made the 2016 hush money payments to McDougal and Stormy Daniels, an adult film actress, at the direction of Trump, then a candidate for president.

The AMI agreement was largely intended as a reward for what prosecutors called "substantial and important assistance to the investigating agents and prosecutors" during its investigation of the payments.

AMI publisher David Pecker, a longtime Trump associate, admitted to prosecutors that the National Enquirer had "worked in concert" with the Trump campaign by buying McDougal's story of having a sexual affair with Trump, and then not publishing it.

Trump denies having an affair with McDougal.

AMI said Friday that it will investigate Bezos' claims that he was extorted and blackmailed, though it said it "acted lawfully in the reporting of the story of Mr. Bezos."

"At the time of the recent allegations made by Mr. Bezos, it was in good faith negotiations to resolve all matters with him," the statement read. "Nonetheless, in light of the nature of the allegations published by Mr. Bezos, the board has convened and determined that it should promptly and thoroughly investigate the claims."