Star Witness Gates Testifies He Committed Crimes With Manafort

Casey GreeneAug 07, 2018

The fifth day of former Trump campaign chairman Paul Manafort's trial, after a weekend break, surprised the attendees in the courtroom when prosecutors called Manafort's longtime deputy Rick Gates to testify.

Gates was expected to be a star witness in the government's case against Manafort having pleaded guilty in February and agreed to co-operate with prosecutors under a deal that could lead to a reduced sentence.

In stunning testimony at Manafort's trial on tax and fraud charges, Gates stated he and Manafort had 15 foreign accounts they did not report to the federal government, and knew it was illegal.

Gates did not make eye contact with Manafort as he took the stand wearing a yellow tie and navy blue suit.

Mr Manafort's attorneys signalled they would seek to blame Mr Gates and had accused him of embezzling millions of dollars from Mr Manafort.

"It's kind of leading up to Gates" testimony that, "Yep, this is what he was telling me to do, '" the former US prosecutor said. Later, they say, when that income dwindled, Manafort launched a different scheme, shoring up his struggling finances by using doctored documents to obtain millions more in bank loans. Gates himself did not benefit from those loans, he said.

The jury had heard testimony on Friday and Monday from accountant Cynthia Laporta, who described how Manafort and Gates doctored financial statements and backdated loans. "He said that he was indicted with Paul Manafort on bank and tax fraud charges, and he is guilty of all those charges".

Downing will probably focus on Laporta's interactions with Gates, who pleaded guilty and is cooperating with Mueller.

Prosecutors say Manafort used those companies to stash millions of dollars from his Ukrainian consulting work, proceeds he omitted year-after-year from his income tax returns.

Though the names of those companies appeared on wire transfers and at times on his bookkeeper's ledger, both Manafort's accountants and his bookkeeper say they never knew that the companies - and corresponding offshore bank accounts - were controlled by Manafort.

Gates said that Manafort had indicated to him that the Ukrainian businessmen who were funding their consulting work had directed him to set up the accounts in Cyprus, where they also had bank accounts.

The prosecution didn't confirm that Gates, a prosecution witness, would be next.

But Laporta's testimony raised the stakes for Manafort, legal experts said. Laporta said she didn't believe the loan had actually been forgiven.

Similar to prior witnesses, Ms Laporta testified Mr Gates and Mr Manafort were in lockstep but that Mr Manafort was in charge. The defense introduced its own documents to the jury for the first time - rather than relying on the prosecutors' binders of evidence - and showed that Manafort had paid $8 million in taxes over 10 years. With an enormous salary serving his expensive lifestyle (earlier in Manafort's trial, we learned about his taste for ostrich jackets), Manafort had a pretty good racket going on, until he plunged into debt and made the fateful decision to run President Trump's long-shot campaign in 2016.

On Monday, Prosecutors quickly got to the heart of the case.

"We are at the heart of the matter", Andres shot back. Lawyers then met privately with the judge for a bench conference.

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