Manafort trial: Star witness testifies against ex-Trump aide

Manafort trial: Star witness testifies against ex-Trump aide

Kerry Wise
August 8, 2018

Rick Gates, Paul Manafort's former deputy, testified on Tuesday that he helped Manafort provide false information to banks in order to obtain loans.

Prosecutors will turn to Gates for first-hand support of their accusations that Manafort concealed millions of dollars in foreign income and later lied when he applied for bank loans.

Manafort's lawyers doubled down Monday on their main line of defense: that Manafort placed too much trust in Gates, who abused that trust by putting Manafort's money in legally compromising environs and embezzled gobs of cash from him.

On Monday and earlier Tuesday, Gates testified that he and Manafort had engaged in numerous improper financial manoeuvres involving their work in Ukraine, but Gates, 46, pinned the majority of the responsibility on Manafort. They were the first two people indicted by Mueller's grand jury.

The government's star witness in the financial fraud trial of Paul Manafort testified today that he embezzled hundreds of thousands of dollars from the former Trump campaign chairman - and told jurors he and Manafort committed crimes together. Gates' admission, on his first day of testimony under a plea deal with Special Counsel Robert Mueller, is key to rebutting the prime counter-narrative that Manafort is trying to tell the jury: that.

Manafort, facing charges of bank and tax fraud related to his work in Ukraine, has pleaded not guilty to the charges. They said Mr. Gates did everything from approve expense reimbursements to draft business plans. The prosecution, however, has maintained that while Gates committed embezzlement, that doesn't make Manafort any less guilty of the crimes he's accused of.

"A lot of these loan agreements are backdated", Gates said.

But she said she believed Manafort was directing Gates' efforts to disguise loans and hide income, noting that Manafort was copied on her email traffic with Gates.

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It would be notable if there had been any ties between Manafort and Poroshenko, because Poroshenko's administration was criticized by Trump's supporters for targeting Manafort during the presidential campaign in an effort to help Hillary Clinton.

When one of the defense lawyers tried to suggest to Manafort's tax accountant Monday that Gates had kept Manafort in the dark about his own finances, the accountant, Cynthia Laporta, pushed back.

Gates, who also served in a senior role in Trump's presidential campaign, said he repeatedly lied to hide the bank accounts and, at Manafort's direction, would classify money that came in as either a loan or income to reduce Manafort's tax burden.

"I assisted Mr. Manafort in filing false tax returns", Gates testified.

Gates testified that he and Manafort had 15 foreign accounts they did not report to the USA government, and knew that was illegal.

Gates and Manafort were charged with a combined 32 counts of tax and bank fraud in February, after which Gates accepted a plea deal which included testifying against Manafort.

USA district Judge T.S. Ellis III presides as Manafort attorney's including Kevin Downing, left, Thomas Zehnle, third from left, listen.

All told, prosecutors allege that Manafort failed to report a "significant percentage" of the more than $60 million they say he received from Ukrainians. Laporta testified that she saw no evidence that the loan was ever repaid.