Melania infamously sparked outrage after wearing a jacket with the words "I really don't care, do u?" on a flight to meet detained immigrant children.
Mrs Newman - a former star of The Apprentice who was sacked after a stint as a White House adviser - claimed that Mr Trump was recorded using the word while working on the show he hosted for 11 years. The former reality star also said even if the president had used the slur, it wouldn't impact his base. On the tape, Kelly said he's been made aware of "significant integrity issues" about her, including issues that made her "open to some legal action". But Manigault-Newman says she was offered a salary for a "job" that required no work-only her signature on an NDA.
The former White House staff member went on to say: "As a student of fashion and keenly image-conscious woman, she knows that every one of her style choices will be scrutinized and debated".
What's in the Omarosa tapes?
Her book explosively claims that a tape exists of Trump using the N-word during recordings of The Apprentice - the reality show in which he starred and she participated.
But while Trump's move from Democratic donor and NY libertine to über-conservative GOP cult leader took years to execute, Manigault Newman's evolution feels like it's happening in real time. Before becoming president, Trump himself had a reputation for quietly recording conversations during his business dealings in NY.
Like the president she used to serve, Manigault Newman is a consummate shape-shifter and carnival barker. "Yes, she is a liar and a backstabber with no credibility - exactly like everyone else in the Trump administration".
The source claimed: "Melania is exhausted of being quiet and hiding inside the White House".
After Guthrie expressed the hope that Manigault Newman would indeed stay on to answer more questions - the author at the top of the interview had indicated clearly that they had plenty of time to cover everything - Manigault Newman apparently had a change of heart. She refused to reveal how she recorded her conversation with Kelly in the Situation Room, but repeatedly mentioned how she was "locked" into the conference room.
"He's not only exhibiting the same kinds of characteristics, but he praises them and he gives them the power and emboldens them to mimic what he does and what he tweets out everyday", she said.
Trump has been accused of racist behavior many times over the past two years since he took office. On The Apprentice Omarosa revelled in her character as a scheming, dog-eat-dog character who played to win at all costs.
This obviously is a frustrating legal stumbling block for the president, who has long made clear his preference for non-disclosure agreements to silence anyone who was once within his inner circle.
How has the president reacted?Mr. Trump also denied the existence of any such tapes of him using the N-word, and called the former staffer "wacky", "deranged" and a "lowlife."
"When you give a crazed, crying lowlife a break, and give her a job at the White House, I guess it just didn't work out", Trump said.
Omarosa also proceeded to inform me that she had officially submitted her resignation to General Kelly and that I should promptly do the same before the audio surfaced.
She accused Kelly of "false imprisonment", telling Guthrie to "wait" and "calm down" whenever the interviewer attempted to interject. "She's a physically intimidating presence", a male former colleague of Omarosa's told me.
"I loved him [talking to her] on the phone".
When Matthews asked her if the source who recorded this video was a Democrat, she said she didn't have information regarding the person's political affiliation.