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Federal Prosecutors Are Closely Examining if AMI Committed a Crime — the Consequences Would Be Far-Reaching


A plot twist in the real life drama we call 2019 that no one saw coming was Amazon CEO and Washington Post owner Jeff Bezos getting out ahead of American Media Inc.’s (AMI) apparent extortion plot, publishing in lurid detail what was threatened and why.

Law&Crime dug into this at length after the news broke on Thursday evening, exploring what–if any–crime AMI, the parent company of the National Enquirer, might have committed. The thesis of the article, as revealed in the headline, was a simple and straightforward one: “If AMI’s Jeff Bezos Shakedown Was Criminal, They Can Kiss Their Non-Prosecution Agreement Goodbye.”

AMI, for its part, has released a statement defending its actions and saying it believed that it acted “lawfully”:

American Media believes fervently that it acted lawfully in the reporting of the story of Mr. Bezos. Further, at the time of the recent allegations made by Mr. Bezos, it was in good faith negotiations to resolve all matters with him. 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 investigated the claims. Upon completion of that investigation, the Board will take whatever appropriate action is necessary.

It doesn’t really matter, at this point, what AMI believes because, as expected, federal prosecutors in the Southern District of New York (SDNY) are closely examining what happened here.

From Bloomberg:

Prosecutors in the Manhattan U.S. attorney’s office have been provided with information about key exchanges of concern to Bezos, the founder of Inc. In a jaw-dropping public blog post Thursday night, Bezos published letters from lawyers representing National Enquirer’s publisher, American Media Inc., who demanded he drop a private investigation into the media company, or else it would publish more embarrassing photographs about the wealthy businessman. Bezos accused the National Enquirer publisher of extortion.

The authorities are now reviewing the matter for potential criminal activity. If they find any, they must also weigh whether the conduct breached AMI’s previous deal to assist prosecutors. AMI agreed not to commit crimes as part of that deal to avoid prosecution over hush-money payments to women who claimed relationships with President Donald Trump. Michael Cohen, Trump’s former lawyer, played a pivotal role in some of the payments and has pleaded guilty to related charges.

The Associated Press confirmed the story.

After ex-Trump lawyer Michael Cohen was sentenced to three years in prison in December for bank fraud, tax fraud, campaign finance violations, and lying to congressional investigators, prosecutors in the SDNY announced in a press release that it “previously reached a non-prosecution agreement” with AMI. The SDNY successfully prosecuted Cohen and got him to admit that then-candidate Donald Trump “directed” him to commit campaign finance violations.

AMI admitted that it was involved in the Karen McDougal hush payment. The practice known as “catch and kill,” in which a publication buys a damaging story just to bury it, prevented the McDougal affair story from going public. Pecker got an immunity deal first, but, remarkably, SDNY also authorized a non-prosecution agreement for AMI.

AMI admitted to paying McDougal “in concert” with the Trump campaign to prevent damaging allegations from influencing the election. The problem with yesterday’s news was obvious from the start.

The non-prosecution agreement says that “it is understood […] should AMI commit any crimes subsequent to the date of signing of this Agreement [emphasis ours] …  AMI shall thereafter be subject to prosecution.”

If SDNY determines that a crime was committed, the non-prosecution may be voided and any testimony AMI provided will be “admissible in evidence in any criminal proceeding brought against AMI.”

This has potential far-reaching consequences. As Law&Crime has noted before, Pecker wasn’t the only Enquirer-affiliated individual cooperating with SDNY. The New York Times‘s Adam Goldman reported that COO Dylan Howard was cooperating and was “known to have a recording device in his office.”

This is the same Dylan Howard who sent Bezos an email detailing the comprising photos AMI claimed to have in their possession. This included a  “d*ck pick,” a photograph of Bezos’ mistress Lauren Sanchez simulating “oral sex,” a photo of a “semi-erect” Bezos, and more.

As multiple federal prosecutors noted at the time the Pecker immunity deal occurred, immunity deals aren’t just handed out. Law&Crime Network host and former head New Jersey prosecutor Bob Bianchi explained that prosecutors granting immunity is done “sparingly.”

“Before they will even consider it, they want to ensure the person has substantial and credible information that will assist in an investigation. Once they feel there is value after a ‘proffer’ session with that person, will they grant it,” he said.

No one knows, at this point, the extent of the statements AMI might have made over the course of the Cohen-Trump hush payment inquiry.

The simple fact of the matter is that any statements AMI made admitting a role in the scheme Cohen already pleaded guilty to can and will backfire if the investigation of the Bezos situation voids the non-prosecution deal. The non-prosecution deal plainly says AMI would be “subject to prosecution for any federal criminal violation of this Office has knowledge, including perjury and obstruction of justice.”

[Image via Stephanie Keith/Getty Images]

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Matt Naham is the Senior A.M. Editor of Law&Crime.