The White House said the President’s transition team was told that former National Security Adviser Michael Flynn might need to register as a foreign agent before accepting the role, but that the President had not been aware.
The team was told before Inauguration day that Mr Flynn would have to alert the Justice Department due to his previous career of lobbying work with foreign countries, according to a White House official and a person with direct knowledge of discussions between transition lawyers and Mr Flynn's representatives.
Mr Flynn registered this week with the Justice Department, identifying his firm, Flynn Intel Group Inc, and that he worked for a Turkish company that could have helped the government.
He reportedly registered due to pressure from Justice Department officials. It is a felony not to register but the Justice Department rarely files such charges.
The move from Mr Flynn to get his papers in order comes too late for the Trump team - weeks after he was forced to resign in light of revelations that he held phone calls with the Russian ambassador Sergey Kislyak before the Inauguration, and around the time that former President Barack Obama imposed sanctions on the country.
The White House did not confirm when exactly it was told of Mr Flynn’s previous work.
He was paid $530,000 by a Turkish company. The lobbying contract was from August through November last year and ended after the election.
White House Press Secretary Sean Spicer said Thursday he did not believe that Mr Trump knew of Mr Flynn's foreign agent work before his appointment.
On Friday, he insisted the President had not been aware of what advice Mr Flynn's personal lawyer had been given by the Trump transition lawyer. When asked why the President was not made aware of this exchange, Mr Spicer compared the situation to someone asking the Internal Revenue Service about tax advice and being instructed to approach a tax lawyer.
"But this was a personal matter, a business matter, it's not something that would be appropriate for a government entity to give someone guidance on when they should file as an individual citizen, as a private citizen."
Vice President Mike Pence said on Thursday said the news was "an affirmation of the president’s decision to ask General Flynn to resign".
He told Fox News he did not know about Mr Flynn’s failure to file with the Justice Department. Mr Pence was also reportedly misled by Mr Flynn about the calls to Russia. Mr Trump knew about the calls for three weeks and Mr Pence 11 days before reporters exposed the phone calls to the public and Mr Flynn resigned.
In the days after he left the White House, questions were raised over Attorney General Jeff Sessions’s contact with the Russian ambassador as he and Mr Flynn sat on the same national security transition council.
Mr Sessions said this week he would recuse himself from any Justice Department investigation on ties between the Trump campaign and Russia.
It is the second time Mr Sessions has recused himself, as the highest person of law enforcement in the US, in just over two months. He said he would also not be involved in any investigation of Hillary Clinton’s alleged misuse of her personal email server when she was secretary of state.