GREENSBORO, N.C. - The lawyer for an heiress who provided secret payments intended to help John Edwards testified Friday that the former presidential candidate acknowledged the money had been given for his benefit.

Alex D. Forger said that Edwards' then-lawyer Wade Smith told him in the fall of 2008 that the former candidate agreed that the $725,000 given by 101-year-old Rachel "Bunny" Mellon had been provided to help him. It wasn't clear from Forger's testimony at Edwards' criminal trial precisely when Edwards learned about the checks given to his aide, Andrew Young.

Some of Mellon's money was used to hide Edwards' pregnant mistress as he sought the White House in 2008. Whether Edwards had knowledge of the cover-up is a key question in his prosecution on charges related to campaign finance corruption.

Edwards has denied knowing about the secret payments from Mellon. Young testified last week his former boss directed the scheme from the start.

Forger, a semiretired lawyer from New York, has helped manage Mellon's financial affairs for decades.

He recounted the 2008 conversation with Smith, a long-practicing North Carolina defense lawyer who had years earlier hired a novice Edwards at his Raleigh firm.

Forger said that in the fall of 2008, Smith and Charlotte defense lawyer Jim Cooney called him to give a "heads up" that federal investigators had launched a probe into Edwards' campaign.

Forger told the lawyers working for Edwards that he had been concerned for months about $725,000 in checks from Mellon that had been written to a Charlotte interior designer and labeled as being for chairs, tables and bookcases. Forger had learned those checks were endorsed by the designer and then deposited into an account controlled by Andrew Young.

Forger also knew Young was a fund-raiser for Edwards, and was concerned about whether his client had violated any laws. Individual contributions to political candidates were then limited to $2,300 an election cycle.

"I knew Mrs. Mellon was not buying furniture," Forger testified. "Was this a scam? Was this a criminal matter where funds had been siphoned off from her? I didn't know."

Forger said he asked the Edwards lawyer whether his client agreed the money was intended for his benefit. Smith replied that he didn't know but would find out.

A short time later, Smith called back.

" 'Yes, John acknowledges now that these were for his benefit,' " Forger quoted Smith as saying.