Rick Gates Testifies That He Committed Crimes With Paul Manafort

Larry Hoffman
August 7, 2018

That's what the former Trump campaign chairman's "right-hand man", Rick Gates, told jurors in Manafort's financial fraud trial.

Rick Gates, a longtime business associate of U.S. President Donald Trump's former campaign chairman Paul Manafort, on Monday testified at trial that he helped Manafort file false tax returns and did not disclose foreign bank accounts.

Gates testified that Manafort directed him to report overseas income as loans in order to lower taxable income - an allegation prosecutors have been eliciting testimony about from witnesses since last week. Prosecutors were expected to ask Gates for an inside look at what they say was a scheme by Manafort to use offshore bank accounts, shell companies and wire transfers as to avoid hundreds of thousands of dollars in tax bills. For instance, on Monday, after federal financial crimes specialist Paula Liss testified that neither Manafort nor his wife had reported foreign bank accounts to her agency, FinCEN, defense attorney Tom Zehnle asked her if a person owning less than 51 percent of a company would need to report those accounts.

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

Laporta also discussed problems that arose in February 2016 when Manafort needed cash and applied to Citizens Bank for a real-estate loan against property he owned in NY. The charges largely predate his five months on the Trump campaign but were the first to go to trial arising from Special Counsel Robert Mueller's investigation into Russian interference in the 2016 US election.

Manafort, Gates said, was probably the "most politically brilliant strategist I've ever worked with".

The prosecution's witness list still has 19 names of those who've yet to appear in court. Lawyers then met privately with the judge for a bench conference.

Prosecutors said they still have about three hours of questions for Gates. The White House says Mr. Trump feels his former campaign chair is being treated unfairly.

But Laporta's testimony raised the stakes for Manafort, legal experts said.

In court today, prosecutors walked Gates through his plea agreement and the charges he had faced before he pleaded guilty and began cooperating with the government.

Manafort's defense has sought to blame Gates for any illegal conduct and accused him of embezzling millions of dollars from Manafort.

One accounting trick saved Mr Manafort $US500,000 ($676,907) in taxes, she said. Gates said he made the government aware of the scheme, which was not among the initial charges he faced before pleading guilty, as part of his cooperation with prosecutors.

The trial is set to resume Monday afternoon in federal court in Alexandria, Virginia.

Mr Mueller is also investigating possible coordination between Trump campaign members and Russian officials in the election campaign, but the charges against Mr Manafort do not address that.

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