Yellen says blanket financial institution deposit insurance coverage is just not being mentioned

The US Treasury Secretary testifies before the Senate Appropriations Subcommittee on Financial Services March 22, 2023 in Washington, DC.

Win Mcnamee | Getty Images

WASHINGTON — Federal bank regulators are not considering plans to insure all U.S. bank deposits without congressional approval, Treasury Secretary Janet Yellen told members of a Senate Appropriations subcommittee on Wednesday.

Several banking groups and consumer advocates have called for some form of universal deposit insurance after the government refunded most uninsured deposits at two California banks that collapsed earlier this month Silicon Valley Bank and based in New York signature bank.

When asked directly whether the Treasury Department would bypass Congress to insure all deposits, Yellen replied, “I have not considered or discussed anything to do with blanket insurance or guarantees on all deposits.”

Yellen was speaking to senators during a hearing on Capitol Hill to review the Treasury Department’s 2024 budget proposal.

The statement caused the stock market to fall and regional bank stocks to fall.

Congress has sweeping authority over the FDIC insurance limit, currently set at $250,000 under the Dodd-Frank financial reforms. Congress can also temporarily suspend the limit, as it did in 2020 as part of the government’s response to Covid-19.

This time, only a handful of Democrats have openly suggested that Congress consider raising the limit on all deposits. Meanwhile, an influential bloc of Republicans in the House of Representatives has already spoken out against a rate hike. This makes it difficult to imagine how a bill raising the limit would pass through the GOP-controlled House.

In Washington, the emergency deposit guarantees for SVB and Signature have sparked heated debate over whether big banks that have taken excessive risks will get a special bailout, while smaller institutions are being forced to face a rush of withdrawals – sparked by public fears big banks – will be without special help.

“I’m very concerned,” said Republican Maine Senator Susan Collins. “It seems to me that all deposits are guaranteed [at SVB] that you create a situation where they are immune to losses… in a way that puts the well-run community bank at a competitive disadvantage. So I guess my question to you is, how is that fair?”

Yellen said regulators didn’t think about giving one bank an advantage over another at the time. At the time, they were thinking about “the impact on the broader banking system due to the potential for contagion,” she said.

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However, this explanation was not enough to satisfy small and medium-sized banks.

“If policymakers decide to offer unlimited deposit insurance to some institutions, they can’t leave out others — certainly not the community banks, which, as always, have been operating on a safe and sound footing,” said Rebeca Rainey, CEO of the Independent Community Bankers of America , said in a recent statement.

While Yellen ruled out universal blanket guarantees for deposits, she seemed open to other ways to help smaller banks offer additional insurance for large deposits.

A voluntary idea of ​​West Virginia Senator Joe Manchin was the creation of a system where depositors holding cash over the $250,000 limit set by the Federal Deposit Insurance Corp. could pay slightly higher bank charges, similar to an insurance premium, secure an increased level of FDIC coverage.

“Shouldn’t I be able to buy or pay a slightly higher bank fee to get protection … capped at maybe $10 million?” Manchin told Yellen near the end of her testimony. “We talked…some senators talked back and forth…and I don’t think we should [craft legislation] without you all being involved and showing us how to structure it.”

“I think it’s very worthwhile for you and your colleagues to discuss what is appropriate here,” Yellen replied. “And we’d be more than willing to work with you to think this through.”

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She added: “Right now we are trying to stabilize the situation with the means at our disposal.”

Those efforts are beginning to bear fruit, Yellen told a group of bankers on Tuesday. She said that “total deposit outflows from regional banks have stabilized.”

But while trends are moving in the right direction, the amount of money banks borrowed from the Fed’s discount window in the week ended March 15 set a record $153 billion, according to the Fed’s weekly bulletin, a total which indicates that the banking sector is not yet entirely stable.

Clarification: This story has been updated to clarify that Yellen made her comment about “flat-rate insurance” when answering a senator’s question about whether the Treasury Department would bypass Congress to insure all deposits.

FDA advisers vote in opposition to efficacy of Biogen’s ALS drug

A pedestrian walks past Biogen Inc.’s headquarters in Cambridge, Massachusetts, on Monday, June 7, 2021.

Adam Glanzmann | Bloomberg | Getty Images

The Food and Drug Administration’s independent advisory panel voted against the effectiveness of on Wednesday biogenic ALS drug under investigation for a rare and aggressive form of the disease.

The drug Tofersen was developed to treat a rare genetic form of amyotrophic lateral sclerosis, or ALS. Three advisers voted for effectiveness, five against, and one abstained.

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“Unfortunately, the presented study did not meet the primary and secondary endpoints,” said Dr. Liana Apostolova, a professor of neurology at Indiana University School of Medicine, who voted against Tofersen’s effectiveness.

However, the panel unanimously agreed that the drug could have clinical benefit by reducing a protein linked to the severity of the disease.

Michelle Mielke, a professor of epidemiology at Wake Forest University School of Medicine who voted for the drug, acknowledged the data is not entirely conclusive, but said, “There are several aspects of the data that point to strong clinical evidence .”

“And again, my decision also took into account the fact that there really is an unmet need,” she added.

Expedited approval is an FDA designation that approves drugs faster when they meet an unmet medical need for a serious medical condition. Such approval would require Biogen to further study the drug to confirm its clinical utility.

The FDA generally follows the advice of its advisory committees, but is not required to do so. A final decision will be made on April 25th.

ALS, most commonly known as Lou Gehrig’s disease, is a progressive and fatal neuromuscular disease that causes nerve cells in the brain and spinal cord to deteriorate over time, causing people to lose muscle control, they need to move, talk, breathe and eat. The disease eventually leads to paralysis and even death, and generally affects people between the ages of 40 and 70.

The drug targets a form of ALS in people with mutations in a specific gene that is passed down through generations within families. These mutations can cause a protein called SOD1 to build up to toxic levels, which can ultimately damage the nervous system and lead to the development of ALS.

According to Biogen, only a few thousand people worldwide have been diagnosed with this SOD1 mutation, or about 2% of the 168,000 people who have ALS worldwide. In the US, that number is even lower, with about 330 people affected by the SOD1 mutation. The median survival time from diagnosis with the rare form of ALS to death is 2.7 years, according to the company.

The SOD1 mutation is associated with 20% of cases occurring within families.

Families affected by ALS are hoping the drug could pave the way for more research to tackle the disease’s cause, potentially leading to new treatments for the estimated 5,000 new people in the US diagnosed with ALS each year. Globally, researchers at the National Institutes of Health expect ALS cases to increase by almost 70% to approximately 376,000.

Review of mixed efficacy data

The FDA accepted Biogen’s application for full approval of Tofersen in July. In October, the agency extended the review of the application by three months.

The advisory panel relied on controversial data from a phase III clinical trial of Tofersen. The drug failed to slow the progression of ALS in this study, but both Biogen and FDA staff noted the potential limitations of the study. The duration of the study was 28 weeks, which may not have been enough time to observe the effect of Tofersen on disease progression.

The panel focused on evaluating Tofersen’s effect on key proteins associated with the development of ALS. According to an FDA review of the company’s data, the SOD1 protein levels of patients in the study who received Tofersen decreased by 26% to 38% compared to those who received placebo.

But the panel specifically focused on the drug’s effect on another key protein called neurofilament light, or NfL. High levels of the protein are found in a variety of neurological conditions, such as ALS, and are linked to disease severity and progression in patients, according to the FDA review.

Biogen’s phase 3 study found that people who received Tofersen experienced a 55 percent reduction in NfL levels by week 28 of the study, compared with an average increase of 12 percent for people who received placebo. An ongoing study of Tofersen had similar results: People who received the drug in the phase 3 study maintained their lowered NfL levels over time.

Those who received a placebo during the phase 3 study but switched to Tofersen in the extension study saw a 44% drop in NfL levels, the FDA review added.

In a unanimous vote, the panel said Tofersen’s reduction in NfL likely predicts the drug’s clinical utility in people with SOD1-ALS.

“It appears that NFL is bad for neurons and is associated with neuronal death, so if it’s lower then neuronal death should be lower,” said Dr. David Weisman, Director of the ANA Clinical Research Center.

The FDA staffers, who presented their review of Biogen’s data ahead of the panel vote, also said these “convincing reductions” in NfL are expected to result in a slower decline in patients.

The panel also considered Tofersen’s safety data. In the phase 3 study, the most common adverse events associated with the drug were pain in the joints and muscles, and fatigue.

According to the FDA review, about 18% of people who received Tofersen experienced serious adverse events compared to 14% of people who received the placebo. However, FDA staff noted that many of the reported events are related to “underlying disease progression” and not to Tofersen use. None of the adverse events were fatal.

Public Requests for Consent

During public comments, Alison Burell said her family believes Tofersen significantly slowed the progression of the disease in her husband Cory, who died from the rare form of ALS in 2019. He participated in Biogen’s early clinical trial on Tofersen and continued taking the drug after the trial was completed, which Burell believes extended his life by another six months.

“Tofersen gave Cory time with his boys, made memories and showed them that they never give up,” Burrell said. “I ask that you commend your agreement to support Tofersen. Please give hope to others with SOD1.”

Cassandra Haddad also asked the panel to recommend approval, noting that her family has a SOD1-ALS “body count” of 33. She said her late mother was the youngest member to be diagnosed with the rare form of the disease, but took Tofersen to extend her life by several months and “gave us this precious time together.”

“It’s a miracle, the miracle of having access to a drug that specifically targets our genetic mutation and extends our lives,” Haddad said. She added that she herself participated in Biogen’s ongoing Tofersen study called ATLAS and is being monitored for ALS symptoms.

“We all know that early intervention leads to better outcomes. Without Tofersen, I have no chance of survival and no hope,” Haddad said, adding, “Today, you have the power to help me and the legacy of my family’s death.”

Further research on Tofersen ahead

Biogen outlined its plans to review Tofersen’s benefits if the drug receives accelerated FDA approval. The company will collect data from ATLAS, which aims to study whether the drug can help delay the onset of ALS in patients with the SOD1 mutation.

The study started in 2021 and includes 150 participants, which is nearly 50% of the SOD1-ALS population to date, Biogen said. The Company also plans to continue evaluating data from the ongoing extension of the Phase 3 clinical trial, which is expected to conclude in 2024.

“Biogen is committed to confirming the clinical utility of Tofersen in SOD1-ALS as soon as possible,” said Stephanie Fradette, Biogen’s director of clinical development and leader of the ALS portfolio.

Correction: FDA advisors voted against Tofersen’s effectiveness. A previous version of this story misrepresented the exact nature of this vote.

42 Dugg needs to be sentenced to five years imprisonment after pleading responsible

It looks like Detroit-raised rapper 42 Dugg may be facing a long prison sentence.

RELATED: 42 Dugg arrested after failing to surrender to serve six-month jail sentence

The Detroit News reports that 42 Dugg, whose government name is Dion Hayes, has officially pleaded guilty after pleading guilty to illegal possession of a firearm last year and serving a six-month prison sentence.

42 Dugg has been behind bars anywhere from 6 months to 5 years

While prosecutors have agreed to recommend a six-month sentence for the rapper, the presiding judge – William Ray II – may be able to override the recommendation and sentence Hayes to up to 5 years in prison.

In addition, upon his release, 42 Dugg agreed to participate in a 30-day inpatient drug treatment program. This is followed by a 30-day outpatient program.

The sentencing is scheduled for May 10 and there are no further updates at this time.

4️⃣2️⃣ pic.twitter.com/9aKDLLpXRy

— 42Dugg (@42_Dugg) February 17, 2021

42 Dugg got into trouble after the ATF received a tip

According to The Detroit News, these legal troubles date back to November 2019, when the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) received a tip that Dugg — who had previously served time on carjacking and firearms charges — had a gun fired at a shooting range in Atlanta.

This allegation was confirmed by CCTV footage, and the rap star was eventually arrested and charged with gun possession in March 2020.

He was later sentenced to three years probation. However, after being caught repeatedly violating the terms of his parole, he was ordered to surrender in a federal prison camp for 6 months.

Ultimately, his failure to comply with that order landed him in further trouble, although the exact implications will not be clear until he is sentenced later this year.

What are your thoughts on the legal situation of 42 Dugg?

FAA broadcasts plan to keep away from flight delays in NYC, DC this summer season

A United Airlines at LaGuardia International Airport in New York.

Adam Jefferies | CNBC

The Federal Aviation Administration on Wednesday announced measures to try to avoid a repeat of disruptions at airports serving New York City and Washington DC this summer as they deal with a shortage of air traffic controllers at a key facility in the area has to fight.

The agency said it will reduce flight requirements for airline takeoff and landing rights to avoid congestion. Airlines have until April 30 to submit requests to give up take-off and landing slots.

The waiver would last from May 15 to September 15.

Airline executives have repeatedly complained about air traffic control deficiencies, which have contributed to flight disruptions as air travel bounced back from pandemic lows in recent years. Airlines also reduced their flight schedules last summer to avoid delays as they deal with their own staffing issues and other pressures.

The FAA said it expects increased delays this summer in the New York City area compared to last year, forecasting a 45% increase in delays on 7% growth in operations.

United Airlines said it will seek a waiver for specific use of takeoff and landing contingents at the three largest New York-area airports and Ronald Reagan Washington National Airport. In a letter to FAA Acting Administrator Billy Nolen on Wednesday, United said it would deploy aircraft with more seats to compensate for the reduced number of flights and offer alternative flights to affected customers.

Delta Airlines welcomed the FAA’s action.

“Delta is reviewing our network to ensure the best customer experience throughout the summer travel season, and we are committed to working with the FAA on measures to ensure the safety and efficiency of operations at NY/NJ airports,” the airline said in an explanation .

Later this month, the FAA will hold a summit with airlines about other ways it can alleviate disruption in the region. A similar event took place in Florida last year when passengers faced delays attributed to bad weather, high demand and congestion due to issues like space launches and military exercises.

Moderna CEO Stephane Bancel testifies earlier than Senate on Covid vaccine worth hike

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Moderna CEO Stephane Bancel testifies before the Senate Health Committee Wednesday about the pricing of the company’s Covid-19 vaccine.

The Boston-based biotech plans to charge $130 per dose once the vaccination program moves to the private market as early as this fall. Sen. Bernie Sanders, I-Vt., Chair of the Health Committee, hit out Modern in a letter to Bancel in January, in which he called the price increase “outrageous”.

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After Sanders sent the letter, Moderna said it would create a utility to keep the vaccine free for people who are uninsured or underinsured.

People who have Medicare, Medicaid, or private insurance should still get the shot for free, but Sanders said the price hike “will cost taxpayers billions of dollars.”

Trump has a meltdown, principally confirming that Jack Smith has proof of his crimes

Trump responded to reports that Special Counsel Jack Smith had evidence he committed crimes by confirming the information.

ABC News reported that a federal judge found that Smith had presented compelling evidence that Trump had committed crimes and willfully lied to his attorneys about being in possession of classified documents. The special counsel was able to present evidence that Trump committed crimes.

Trump’s campaign responded by blasting ABC for reporting the leak:

Trump campaign statement on fake ABC news story pic.twitter.com/bHVLFOqvEB

— Liz Harrington (@realLizUSA) March 21, 2023

Trump complained that ABC was covering the leak, then lashed out at Russia and concluded by saying there was nothing against him.

The American people have seen this statement before. The first thing Donald Trump does when a story is true is call it false, and then he goes back to the original Trump/Russia scandal and concludes by repeating that the story is false while attacking the outlet that she reported.

Donald Trump essentially confirmed the story by attacking the information source. If the story wasn’t true, Trump could say the story was false or say nothing at all.

The first page of Trump’s playbook is to attack the report’s credibility, but every time he engages in this behavior he affirms the accuracy of the reporting.

Jason is the managing editor. He is also a White House press pool and congressional correspondent for PoliticusUSA. Jason has a bachelor’s degree in political science. His thesis focused on public policy with a specialization in social reform movements.

Awards and professional memberships

Member of the Society of Professional Journalists and the American Political Science Association

TWICE’s Chaeyoung apologizes for sporting swastikas on T-shirts

Chaeyoung offers an apology.

The South Korean rapper who is a member of girl group TWICEShe released a message after posting a photo of herself wearing a T-shirt with a swastika graphic in a now-deleted Instagram post.

“Hello, this is Chaeyoung from TWICE. My sincere apologies for the Instagram post,” the 23-year-old wrote in a statement shared on Instagram on March 21. “I didn’t quite get the meaning of the tilted swastika in the t-shirt I was wearing. I deeply apologize for not reviewing it thoroughly, which is a matter of concern.”

Chaeyoung continued by saying that she will make different decisions in the future.

“I will be absolutely vigilant in the future to ensure a similar situation doesn’t happen again,” she wrote. “Again, sincerely apologize.”

Chaeyoung’s t-shirt in the since-deleted photo featured an image from the ’70s sex gunsSid Vicious wearing a top with a swastika on it, per Billboard.

The girl group TWICE with Chaeyoung, Nayeon, jeongyeon, mummy, A lot, Ji Hyo, mine, Dahyun And tzuyuwas formed in 2015 in the reality show Sixteen created by JYP Entertainment and Mnet.

GameStop (GME) This fall 2022 earnings

GameStop on Tuesday posted quarterly earnings for the first time in two years and ended its fiscal year on a strong note in the holiday quarter after grappling with falling sales, inventory issues and cash flow pressures.

The company’s shares are up more than 45% during after-hours trading.

For the quarter ended January 28, net sales decreased slightly to $2.23 billion starting at $2.25 billion in the fourth quarter of last year. The video game retailer also posted a profit of $48.2 million, or 16 cents a share, compared to a loss of $147.5 million, or 49 cents, a year ago.

GameStop has not provided financial guidance and has not done so since the early days of the pandemic. The results cannot be compared to Wall Street estimates because too few analysts cover the company.

The retailer had been working to return to profitability and did so in part by cutting costs. SG&A expenses for the quarter were $453.4 million, or 20.4% of revenue, compared to $538.9 million, or 23.9% of revenue, in the prior-year period.

A GameStop store operates in a mall on March 16, 2023 in Chicago, Illinois.

Scott Olson | Getty Images

Speaking to investors, CEO Matt Furlong said the company is entering 2023 with further plans to cut excess costs, including in European markets where it has already exited and started to pull out of some countries. He said GameStop is also considering strengthening its business in higher-margin categories like toys.

GameStop had previously sustained some short-term meme-stock momentum, but that has since settled and the company has made strides in sizing its business by cleaning up its inventories and revising its cost structure.

The stock closed Tuesday’s trading at around $18 a share, a dramatic drop from its 52-week high of nearly $50 about a year ago.

GameStop’s turnaround plan was reinvigorated with a leadership reshuffle in 2021, the Furlong Amazon Veteran, at the helm and added Ryan Cohen, Tough Founder and Alumni bed bath beyond activist investor as CEO. The company also laid off employees and replaced its chief financial officer.

The retailer has been working to overhaul its real estate portfolio and grow its online business as the video game industry moves in that direction.

For the full fiscal year, GameStop reported revenue of $5.93 billion, down slightly from $6.01 billion in fiscal 2021, and reported higher revenue from its collectibles category, which the retailer expects they will support long-term growth.

Like many retailers, GameStop experienced supply chain delays that led to an inventory backlog after previously trying to meet high demand. The company is still holding inventories at $682.9 million, according to its fourth-quarter balance sheet, down from $915 million a year ago.

As part of its revival strategy, GameStop has also sought to improve its cash stash. During the quarter, its cash and cash equivalents were $1.39 billion.

In addition to handling the burdens of its brick-and-mortar presence, the company has also been working to find its digital identity. So far, these experiments have met with some missteps.

In September, it launched an ill-fated partnership with now-bankrupt crypto exchange FTX. The companies had planned to collaborate on e-commerce marketing, and GameStop wanted to sell FTX gift cards in its stores. Two months later, GameStop tweeted that it would “wind up” the partnership and issue a refund to anyone who purchased an FTX gift card from its stores.

The company has also been experimenting with an NFT marketplace since July. This launch came amid talk of a “crypto winter” as cryptocurrencies experienced a widespread cooldown from their 2021 rallies. The marketplace saw an initial surge in volume, but has since leveled off and may not be the ticket to a stable digital presence that the company was hoping for.

Still, speaking to investors, Furlong said the company is better positioned compared to 2021, when many “predicted we were heading for bankruptcy.”

“GameStop is a much healthier business today than it was in early 2021,” he said.

Fungal drug resistance is spreading quick, CDC says

A fungus that is often resistant to drugs has been spreading at an “alarming rate” in healthcare facilities across the United States, according to the Centers for Disease Control and Prevention.

Candida auris is an emerging fungus that is serious and potentially fatal for hospital patients, particularly those with multiple medical conditions.

The fungus was first identified in Asia in 2009, and the first case in the US dates back to 2013. Candida auris was limited to New York City and Chicago, but has since been detected in more than half of U.S. states and has become endemic in some areas, according to a CDC report published Monday in the Annals of Internal Medicine.

From 2019 to 2021, 17 states detected their first-ever cases of the fungus. California, the Mid-Atlantic region, the Midwest, Texas and Florida all had increased transmission during this time, according to the CDC.

Infections have increased by about 200% from about 500 infections in 2019 to more than 1,400 in 2021. The fungus has spread most strongly in long-term hospitals for people with serious illnesses who require ongoing treatment, according to the CDC.

Symptoms can vary widely depending on the type of infection, but fever and chills are the most common. People with weakened immune systems, diabetics who take many antibiotics, or who have breathing tubes, feeding tubes, and catheters are more likely to be affected.

A 2021 CDC report found that two outbreaks of the fungus, which was resistant to echinocandin, had a 30% mortality rate over 30 days. The cases studied in the outbreaks were mostly critically ill patients in long-term care facilities, so the exact contribution of Candida auris to the deaths was unclear. The outbreaks occurred in Washington, DC and Texas.

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Candida auris is often resistant to drugs used to treat fungal infections. In 2020, 86% of samples were resistant to a class of antifungal drugs called azoles, and 26% were resistant to amphotericin B, according to the CDC.

Just over 1% of samples tested in 2020 were strains resistant to the main class of drugs used to treat such infections, called echinocandins, up from 0.4% in 2018. The CDC said that although resistance to Echinocandin is still uncommon, the number of such cases increasing in 2021 has tripled compared to the previous two years.

“Even this subtle increase is concerning because echinocandins are the first-line therapy for invasive candida infections and most cauris infections,” the CDC said in its report.

The CDC attributed the rapid spread of the fungus to a decline in infection control during the pandemic due to strains on the healthcare system, from staffing and equipment shortages to an increase in patient burden and increased use of antibiotics.

“The rapid rise and geographic spread of cases is worrying and underscores the need for continuous surveillance, expanded laboratory capacity, faster diagnostic testing, and adherence to proven infection prevention and control practices,” said CDC epidemiologist Dr. Meghan Lyman, the report’s lead author.

Pornstar Stormy Daniels will dance when he is locked up

Adult film actress Stormy Daniels arrives in Berlin, Germany, 11 October 2018 for the opening of the adult entertainment fair Venus. Daniel’s attorney said she met with prosecutors investigating hush-hush funds on her behalf on Wednesday, March 15, 2023 by former President Donald Trump.

Markus Schreiber | AP

Pornstar Stormy Daniels said Tuesday that she will “dance down the street” if former President Donald Trump goes to jail over a 2016 hush money payment his ex-lawyer paid her.

Daniels, who has a history of scathing Twitter posts about Trump, made the promise in response to a fan of the real estate mogul who tweeted her an abusive message. The exchange came on the same day Trump has predicted he would be criminally indicted in the case by a grand jury in New York City.

“A disgusting degenerate prostitute accepts money to screw an innocent man!” wrote Twitter user Intergalatic Gurl. “Good luck walking the streets afterwards! @realDonaldTrump is our #POTUS and will be chosen by a landslide in 2024!”

Daniels shot back, “Sooo… Tiny paid me to frame herself?”

“You send even dumber than he did during his illiterate gossip,” Daniels added.

“And I will not go, I will dance down the street when he is ‘picked’ to go to jail,” she wrote.

Daniels has previously seen Trump’s former attorney and fixer, Michael Cohen, go to federal prison for crimes including a campaign finance violation related to his paying her $130,000 just before Election Day in 2016.

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Cohen said he gave Daniels that money to buy the actress’ silence on her testimony that she had sex with Trump one day in 2006, months after his wife Melania gave birth to their son, Barron.

That payment, and a second payment by the editor of The National Enquirer to another suspected Trump lover, were made to prevent the claims from hurting Trump’s chances of defeating Democratic presidential nominee Hillary Clinton, Cohen has admitted.

Cohen has met with investigators from the Manhattan Attorney’s Office 20 times over the years, including multiple sessions while he was incarcerated in prison. Last week, he testified before the grand jury over two days.

Former Enquirer editor David Pecker was seen entering the building where the grand jury was in session weeks ago.

Daniels spoke to prosecutors via Zoom last week.

Trump denies having sex with Daniels or his alleged former lover, Playboy model Karen McDougal. She received $150,000 from Pecker’s former company.

But the Trump Organization reimbursed Cohen for the Daniels payment and recorded the payment on its business records as legal expenses.

Misclassifying business expenses is a misdemeanor under New York law. But it can be charged as a crime if the false statement was made to cover up another crime.

In this case, Manhattan District Attorney Alvin Bragg is believed to be on the verge of prosecuting Trump for a crime, alleging that the underlying crime was to cover up a campaign finance violation.