U.S. President Donald Trump participates in a cabinet meeting at the White House in Washington, U.S., July 18, 2018. At the time, Trump campaign spokeswoman Hope Hicks called McDougal's claims "totally untrue".
The prosecutors working on the case had not reviewed the recording because it, along with millions of other documents and files seized in Federal Bureau of Investigation searches of Cohen's home, hotel room and office in April, was undergoing the special master process, in which an independent party reviews whether the items should be regarded as privileged and thus withheld from prosecutors.
"First, a lawyer taping a client is not illegal", said the source, adding that NY law only requires one party to consent for a recording.
President Donald Trump on Saturday described as "totally unheard of" the action of his former lawyer, Michael Cohen after it emerged that he had secretly taped a discussion about payments to a former Playboy model who claimed she had an affair with the president. Over the years, Cohen, in his dealings on Trump's behalf with journalists, opposing lawyers and business adversaries, frequently taped his conversations, unbeknown to the people with whom he was speaking. Most states, including NY, allow for recordings of phone conversations with only the consent of one party; other states require all parties to agree to a recording or have mixed laws on the matter.
Giuliani said no campaign funding was involved in the discussion between Trump and Cohen, who has distanced himself from Trump in recent months as the FBI investigates Cohen's business dealings.
On his way to his golf club in Bedminster, the president ignored several questions from reporters about why his campaign would have denied knowledge of the payments if he was on tape discussing them with Cohen.
Trump insisted on his innocence in Saturday's tweet, assuring his followers that "the good news is that your favorite President did nothing wrong!". Rudy claims the tape is "exculpatory".
Payments made to cover up embarrassing information ahead of the election could violate campaign finance law.
Current Trump attorney Rudy Giuliani said the payment was never made and the brief recording shows Trump did nothing wrong. The sources said that payment never happened.
The former Playboy model said that after their first sexual encounter, Trump tried to offer her money.
"Cohen is talking about buying the rights from AMI (American Media Inc.)", Giuliani told CNN on Friday.
"I think we need to bring this in-house", Cohen tells Trump, according to one person with knowledge of the recording.
Media captionWas Trump's Stormy Daniels payment legal?
Trump's personal lawyer Rudolph W Giuliani confirmed on Friday that Trump had discussed payments with Cohen in the recording and that it took place in September 2016.
In response, Cohen attorney Davis tweeted, "The strategy of @realdonaldtrump @potus @RudyGiuliani is flawed; just as is #Trump's false #Twitter statement made against @michaelcohen212 this morning".
The FBI investigation stemmed in part from a referral by the US special counsel's office, which is looking into possible coordination during the election campaign between Trump's aides and Russian officials.