Federal prosecutors have given immunity to the company that publishes The National Enquirer in connection with the $150,000 hush-money payment the supermarket tabloid gave Karen McDougal, the Playboy model who claims she had an affair with President Donald Trump.
That payment to McDougal was made shortly before the 2016 presidential election and was done "to influence" that election, which sent Trump to the White House, according to the United States Attorney's Office for the Southern District of New York.
The SDNY revealed its "non-prosecution agreement" with Enquirer publisher American Media Inc. on Wednesday, shortly after Trump's former lawyer Michael Cohen was sentenced to three years in prison in U.S. District Court in Manhattan. The agreement, which was signed on Sept. 21, requires AMI to cooperate fully with the SDNY's investigations.
Read the non-prosecution agreement with the publisher of The National Enquirer
Cohen's crimes included his playing a key role in getting AMI to pay off McDougal and his personally paying another purported paramour of Trump's, porn star Stormy Daniels, right before the election to keep quiet about their alleged past trysts with Trump.
One of the counts against Cohen was "causing an unlawful campaign contribution" to be made; that count relates to AMI's payment to McDougal. Another count related the payment to Daniels. The White House has denied Trump had sex with either woman.
AMI admitted it paid off McDougal to keep her from publicizing her "damaging allegations" of having had a lengthy affair with Trump a decade before the 2016 election, the prosecutors' office said.
The company also admitted "it made the $150,000 payment in concert with" Trump's campaign, according to the SDNY.
"AMI 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," prosecutors said.
AMI did not immediately respond to a request for comment from CNBC.
Former federal prosecutor Mimi Rocah told MSNBC that AMI's admission cripples Trump's ability to claim that the payment to McDougal was not about the election, and thus not subject to federal campaign finance law rules.
In a similar case involving former Democratic presidential contender John Edwards — the only other time campaign finance charges were filed in a case involving payments to a mistress — the people who were paying Edwards' lover argued that the money was not intended to influence the election.
Edwards was acquitted at trial in 2012 of a single criminal count, but a jury deadlocked on the other five charges, which led to a mistrial being declared. The Justice Department later declined to seek a retrial.
Prosecutors, Cohen and AMI all now say the payments to McDougal were made to affect the election.
If AMI continues complying with the agreement, prosecutors will not bring charges against the company for the payment to McDougal.
The agreement acknowledged AMI's "substantial and important assistance in this investigation, and its agreement to provide cooperation in the future," prosecutors said.
The company also agreed "to implement specific improvements to its internal compliance to prevent future violations of the federal campaign finance laws."
Read American Media Inc.'s non-prosecution agreement with federal prosecutors here: