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ibusinesslines.com August 18, 2018


Six bombshells from Rick Gates' testimony in the Paul Manafort trial

09 August 2018, 08:24 | Erica Roy

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Paul Manafort

During his review, he said, he discovered that numerous foreign wire transfers did not appear on general ledgers for Manafort's political consultancy and therefore, "I was not able to trace it into the tax return".

Judge TS Ellis III called both legal teams to the bench for a private conference.

Those who dealt with Manafort's taxes also testified that even though they asked Manafort whether he maintained any bank accounts overseas, he told them no. He was so desperate, prosecutors say, that he allegedly falsified loan application documents to keep himself afloat. So frequent were Gates's crimes that he could not answer definitively when asked if he had stolen money from the Trump inauguration committee, for which he served as deputy chairman.

Paul Manafort's former business partner, Rick Gates, is on the stand for the third straight day in Manafort's bank and tax fraud trial as prosecutors and defense lawyers wage their battle over Gates' credibility.

Speaking of Ellis, the 78-year-old U.S. District Court judge overseeing the Eastern Virginia trial renewed his angry tone with prosecutors Wednesday.

Paul Manafort hid more than 30 offshore accounts in three types of currencies from the IRS, according to an Federal Bureau of Investigation forensic accountant testifying in the former Trump campaign chairman's trial.

"I think the jury will hate (Gates), but they should still convict (Manafort) because of the testimony of other witnesses and the other documents that do put all of this on Manafort".

Gates laying out a roadmap on how he and Manafort allegedly dodged US taxes. after admitting Monday they committed numerous crimes as business partners.

Gates admitted during testimony on Monday to embezzling money from Manafort.


He told the jury that Manafort, Trump's former campaign chairman, loaned himself money between two Cypriot accounts because "he was trying to decrease his taxable income".

In one such email, Manafort instructed Gates to proceed with plans to transfer funds from one of his shell companies, Leviathan Advisors Limited, to their consulting group, DMP International. Gates, a married father of four, faced tough questioning under cross-examination on Tuesday about leading a "secret life".

But the defense team has taken on the the daunting task of convincing jurors that Gates, who was in constant communication with Manafort and carrying out his wishes, is an unreliable witness who had simply gone rogue and independently chose to boost his boss' personal income over a period of several years. He pleaded guilty to charges in February and is cooperating for the possibility of a reduced sentence.

Manafort defense attorney Kevin Downing tried to confront Gates over whether he had engaged in four extra-marital affairs and failed to disclose them to prosecutors before becoming a witness for the government.

Meanwhile, Downing on Wednesday afternoon tried to draw the jury's attention back to admissions by Gates that he had embezzled funds from Manafort, asking Welch if his client could claim a business embezzlement deduction.

The trial is the first stemming from special counsel Robert Mueller's 14-month investigation of Russian interference in the 2016 election and possible collusion between the Trump campaign and the Kremlin.

After Gates described his theft as "unauthorized transactions" instead of embezzlement, Downing prodded him to use the latter term - and Gates ultimately relented, saying, "It was embezzlement from Mr. Manafort". He said there were 15 secret accounts. He initially tried to avoid admitting he purposefully lied to the Federal Bureau of Investigation about a 2013 meeting Manafort attended with a USA congressman and tried to avoid using the term "embezzled" in relation to the inflated expense reports he submitted for reimbursement during his employment with Manafort. Gates said the man schooled them on how to shield their operations from scrutiny by tax collectors.

"Yes, because I'm here to tell the truth and take responsibility for my actions", Gates replied.

Gates explained that Manafort's financial difficulties worsened in 2014, when Viktor Yanukovych was no longer in power and the Party of Regions disintegrated.



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