Manafort defense questions star witness Gates about 'secret life'

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The prosecution flashed a December 2011 email on the TV screens in the Alexandria, Virginia, courtroom Tuesday between Gates and Manafort about a wire transfer. At one point, as Gates had trouble recalling the details of his confession, Downing asked him, "Have they confronted you with so many lies that you can't even remember them?"

"They were documented as loans, but in reality they were funds moving between the accounts".

Paul Manafort (L), former campaign chairman for U.S. President Donald Trump, in Washington, DC, U.S., December 11, 2017, and Rick Gates, former campaign aide to Trump, in Washington, U.S., December 11, 2017 are pictured in this combination photograph. The charges are not related to Manafort's work with the Trump campaign.

When Yanukovych lost power, Gates testified that "decreased the income stream" significantly for Manafort, and his financial situation "substantially decreased" from prior years.

After saying Monday that he committed crimes with Manafort, including concealing offshore accounts to avoid reporting them to the USA government at tax time and claiming false income to get loans, Manafort defense attorney Kevin Downing asked the witness, "This jury is just supposed to believe you after all the lies that you've told and the fraud you've committed?"

In applying for a loan from Banc of California, Gates said the income from Manafort's company was inflated by $6 million.

Downing wondered aloud why Gates had shown "perfect recollection" during examination by the government but was now much less precise under cross-examination by Manafort's defence. Under the deal, he admitted to helping Manafort evade taxes, violate US lobbying laws, and hide foreign bank accounts. Manafort's trial is the first on charges brought by Mueller's office, who is also investigating whether Trump campaign members coordinated with Russian officials.

Under questioning from Downing, Gates acknowledged he had to plead guilty to false statements after lying during a February interview with federal investigators. Gates testified that Manafort asked him to float Calk, who was on Trump's economic advisory council, for Secretary of the Army.

Gates said he and Mr Manafort had 15 foreign accounts they did not report and they knew it was illegal.

Rick Gates clarified various aspects of the government's case against his former boss Paul Manafort during extensive direct testimony on Tuesday. Prosecutors allege that he failed to pay taxes on millions he made from his work for a Russia-friendly Ukrainian political party, then lied to get loans when the cash stopped coming in.

Manafort and Gates were the first two people indicted in Mueller's investigation into potential ties between Russian Federation and the Trump campaign. Prosecutors had previously said that Manafort's interactions with Calk were the only part of the trial expected to overlap with his Trump campaign role.

Prosecutor Greg Andres pointed out he had created a "loan forgiveness letter between Mr. Manafort and Mr. Manafort".

Gates, who testified Monday and returned to the witness stand Tuesday, detailed years of alleged lawbreaking at Manafort's political firm and admitted to stealing money from secret overseas bank accounts. But Trump has shown interest in the proceedings, tweeting support for Manafort and suggesting he has been treated worse than gangster Al Capone. "WTF", Manafort wrote in an email to Gates, according to testimony, after learning accountants had added liabilities.

He also admitted to embezzling money from other employers in the past. When the trial broke for lunch, Manafort looked back at his wife, sitting in the front row, smiled and winked at her, followed by a quick shake of his head, seeming to indicate he was unfazed by the morning's testimony.

Presented with a copy of his plea agreement, Gates said he conspired with Mr Manafort to falsify his tax returns. He also said he committed credit card and mortgage fraud, falsified a letter for a colleague involved in an investment deal and made false statements in a deposition at Manafort's direction.

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