Prosecutors cut deal with Enquirer parent company over hush $$ to model claiming Trump affair

Former Playboy model Karen McDougal was paid by a tabloid magazine for the rights to her story about an alleged affair with President Trump.

Federal prosecutors announced Wednesday they will not pursue charges against the parent company of the National Enquirer for spending $150,000 during the 2016 election to buy, then conceal, ex-Playboy model Karen McDougal’s story claiming a past affair with Donald Trump.

The announcement by the U.S. Attorney's Office for the Southern District of New York followed a federal judge sentencing former Trump lawyer Michael Cohen to three years in prison for several different crimes, including over his role in arranging payments to two women -- McDougal and Stormy Daniels -- who claimed past affairs with Trump.

In its statement Wednesday, the office said it reached a “non-prosecution agreement” with American Media, Inc., which publishes the National Enquirer and is cooperating with prosecutors. A copy of the agreement, released to the media, shows it was signed in September.

According to the U.S. Attorney's Office, the company admitted it made the $150,000 payment to McDougal “in concert with a candidate’s presidential campaign, and in order to ensure that the woman did not publicize damaging allegations about the candidate before the 2016 presidential election.”

The news release also said American Media, Inc. “further admitted that its principal purpose in making the payment was to suppress the woman’s story so as to prevent it from influencing the election.”

The U.S. Attorney's Office said American Media, Inc. has also agreed to “provide cooperation in the future.”

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Cohen pleaded guilty in August to breaking campaign finance laws by helping orchestrate payments to silence McDougal and adult film actress Daniels, who said they had sexual encounters with Trump while he was married. Trump has denied the affairs.

In the case of McDougal, Cohen arranged for American Media, Inc., to buy her story. This practice of "catch and kill" is when the rights to a story are bought with the intention of not publishing them, as a favor to the story’s subject. David Pecker, the CEO of American Media Inc., is known as a Trump ally.

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Prosecutors said Cohen orchestrated payments to McDougal and Daniels at Trump's direction. The case has raised questions about whether prosecutors may eventually pursue charges against the president.

But in a tweet this week, Trump denied the payments to Daniels and McDougal were campaign contributions, instead calling them a “simple private transaction.”

Speaking to Fox News by phone Wednesday, Trump attorney Rudy Giuliani argued the payments were not campaign contributions.

“They are trying to make a personal expense a crime,” he said. “It is not a violation of campaign finance law.”

Fox News’ Bill Mears and Catherine Herridge contributed to this report.