What you missed on Day 12 of Trump's trial: Another gag order ruling and details on how Michael Cohen was paid

Two new witnesses took the stand Monday on the 12th day of Donald Trump’s hush money trial, shortly after the judge overseeing the case again cited the former president for violating the gag order he imposed last month.

Ahead of trial testimony, New York state Judge Juan Merchan found that Trump ran afoul of the order prohibiting him from attacking witnesses and others involved in the case. Trump was fined $1,000 and warned that he could face jail time “if necessary” for any further violations.

When testimony resumed, a former Trump Organization executive and the first current employee to testify described how many of the large sums that went to Michael Cohen, for the alleged purposes of hush money payments, came directly from Trump’s bank account.

Trump has been charged with 34 counts related to falsifying business records, which Manhattan District Attorney Alvin Bragg said he engaged in to obscure hush money payments to adult film actor Stormy Daniels in the final days of the 2016 presidential campaign. Trump has pleaded not guilty to all charges. He has also denied having had an affair with Daniels.

Judge threatens Trump with jail time

Merchan started the fourth week of the trial by imposing a $1,000 fine on Trump, who was fined $9,000 last week for nine previous gag order violations.

“It appears that the $1,000 fines are not serving as a deterrent,” Merchan said in handing down the ruling.

“The last thing I want to do is to put you in jail. You are the former president of the United States, and possibly the next president, as well,” Merchan said. “There are many reasons why incarceration is truly a last resort for you.”

Merchan acknowledged the magnitude of jailing Trump and how “disruptive to the proceedings” it would be. “But at the end of the day, I have a job to do,” he said. “So as much as I do not want to propose a jail sanction … I will, if necessary.”

Trump sat and listened, saying nothing, and he showed little of the defiance that he evinces outside the courtroom, where he quickly criticized Merchan's ruling.

“Frankly, our Constitution is far more important than jail,” Trump said, indicating that he had no intention of keeping quiet despite Merchan's warnings. “I’ll do that choice any day.”

Trump’s lawyers have argued that critical statements made by Cohen, who's expected to testify, mean Trump should be able to respond. He should also be able to defend himself as a presidential candidate, Trump attorney Todd Blanche has said.

How the checks got to Cohen

The two witnesses who took the stand Monday explained the mechanics of reimbursing Cohen, Trump's former attorney and "fixer," for the $130,000 that was paid to Daniels.

The Trump Organization’s former controller, Jeffrey McConney, said that he interacted “minimally” with Cohen during his time at the company but that Allen Weisselberg, the company’s former chief financial officer, had asked him in early 2017 to send money to Cohen. In the months beforehand, Cohen had taken out a home equity line of credit to buy Daniels’ story alleging she had a sexual encounter with Trump in 2006.

Cohen was repaid during Trump’s first year as president via 11 checks that were logged as part of a “retainer agreement” to Cohen for allegedly acting as Trump’s attorney and labeled “legal expenses” in the Trump Organization’s records, according to Monday's testimony. Asked what Cohen’s position was in the Trump Organization, McConney at one point retorted, “He said he was a lawyer.”

McConney testified that $130,000 would reimburse the Daniels payment and $50,000 would reimburse a technology services payment. Notes showed that Weisselberg wrote that the payment should be “grossed up” to cover New York City taxes.

The charges against Trump apply to three types of records: invoices, checks and check stubs, and ledger entries for Trump’s personal bank account and the Donald J. Trump Revocable Trust.

On the stand, McConney authenticated the invoices that showed the payments to Cohen and described what was allegedly false about them — that they were filed as legal services.

Deborah Tarasoff, an accounts payable supervisor who worked with McConney at the Trump organization, took the stand after her former colleague and authenticated each check and check stub, as well as the general ledger entry. She then linked them to the corresponding invoices.

The Trump Organization functions like “a family business,” said Tarasoff, a 24-year veteran of the firm and the first current Trump Organization employee to take the stand.

For the first time in the trial, a check from the alleged scheme was shown in court: a $70,000 payment to Cohen for the months of January and February 2017. One payment was signed by Eric Trump, the other by Weisselberg. The payments were described as retainers, with a March payment, and they were issued from the Revocable Trust. Later payments came from the former president's personal bank account.

Weisselberg, McConney, Donald Trump and the legal department were authorized to approve expenses. But sums greater than $10,000 needed approval from Donald Trump, Donald Trump Jr. or Eric Trump, Tarasoff said.

A reimbursement check would be stapled to an invoice and taken to Trump’s longtime executive assistant, Rhona Graff, for Trump's signature.

Only Trump himself could sign off on a payment out of his personal account — and his signature was the final and ultimate approval, Tarasoff said. If Trump didn’t want to sign a check, he didn’t have to. Instead, he would simply write “VOID” across it in black Sharpie and send it back, Tarasoff said.

The final total of payments to Cohen, which reached $420,000, included not only the alleged hush money reimbursements but also Cohen’s annual bonus and additional funds to cover taxes on the amounts.

This article was originally published on NBCNews.com