Flynn lied to fellow White House officials including Vice President Mike Pence over the nature of the calls, and if he lied to the Federal Bureau of Investigation, he could face felony charges.
White House press secretary Sean Spicer said that the "erosion of that trust" over the circumstances surrounding retired Gen. Michael Flynn's calls with the Russian ambassador to the USA created "a critical mass and an unsustainable situation".
Trump didn't directly address the veracity of the report during a news conference with Israeli Prime Minister Benjamin Netanyahu, but lashed out at what he called the "criminal act" of leaking information.
Spicer said the President is looking to identify where these leaks are coming from, but will not broadcast what steps he plans to take.
The administration's relationship with Russian Federation drew renewed attention on Monday after the resignation of Michael Flynn as president Trump's National Security Adviser.
Democrats and some Republicans are also asking whether Trump instructed Flynn to talk to the Russian ambassador previous year about sanctions imposed by the Obama administration to punish alleged Russian interference in the presidential election.
Senior administration officials told CNN that the front-runner for the post is former Vice Admiral Bob Harward, a former Navy SEAL who worked for Defense Secretary James Mattis at Central Command was the favorite. Earlier Wednesday, Trump tweeted that "classified information is illegally given out by "intelligence" like candy. Who in the White House knew that the Department of Justice considered General Flynn a security risk, and why didn't they fire him then?"
US lawmakers, including some leading Republicans, called for an investigation.
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"There are suspicions that have arisen about the president of the United States", Pelosi said, including behavior she called "very risky to the national security of our country" including poor judgment in appointing Flynn in the first place. At about the same time, Pence learned that the Justice Department had warned the White House last month regarding Flynn's conversations with Russian Ambassador Sergey Kislyak.
Democrats, doubting that either Trump's Justice Department or the Republican-led Congress will pursue the matter vigorously, demanded an independent investigation of possible illegal communications between Flynn and the Russian government and any efforts by Flynn or other White House officials to hide wrongdoing.
In the short term, Trump is now faced with finding a replacement for Flynn at a time of deep uncertainty over the direction of his administration, and with a new foreign policy crisis looming after North Korea's missile test at the weekend.
General Flynn's resignation as National Security Advisor is not the end of this story. Pence spokesman Marc Lotter said Pence became aware that he had received "incomplete information" from Flynn only after the first Washington Post report Thursday night. The Post also first reported last week that Flynn had indeed spoken about sanctions with the Russian ambassador.
Trump asked the former Army lieutenant general to resign Monday night amid revelations he misled Vice President Mike Pence about his contacts with Russian Federation while President Barack Obama was still in office.
However, the second official said, Flynn's departure could also reinforce the power of presidential aides Steve Bannon and Stephen Miller, whom he described as already having the president's ear. The president was informed of the warnings the same day, Spicer said.
The FBI and USA intelligence agencies continue to try to determine what the motive for the communications were.
House Democratic leader Nancy Pelosi called on the FBI to expedite an investigation into the financial, personal and political ties of Trump and members of his administration to the Russians.