Star witness Rick Gates’ testimony ends after Paul Manafort lawyer’s attacks

08 August, 2018, 21:44 | Author: Trevor Moore

When asked if he took "unauthorized expenses" from Manafort to "fund your separate secret life", Gates replied, "yes, I acknowledge I had a period of time where I had another relationship".

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".

Manafort, a former Trump campaign chairman, has pleaded not guilty to 18 counts of bank and tax fraud and failing to disclose foreign bank accounts. Gates, Manafort's longtime business partner and Trump's deputy campaign chairman, was working on the transition team and the inauguration.

Manafort's former bookkeeper Heather Washkuhn testified last week that Manafort falsely reported to Federal Savings Bank that his company DMP International pulled in $3 million the first nine months of 2016 when it actually lost more than $1 million from January through November.

Presented with a copy of his plea agreement, Gates said he conspired with Mr Manafort to falsify his tax returns.

"Did you commit crimes with Mr Manafort?" prosecutor Greg Andres asked Gates.

For this Manafort was paid US$4million a year, in quarterly payments of US$1million, Gates recalled, though at some point the currency switched from USA dollars to Euros.

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.

Gates implicated himself in broad criminal conduct on the stand, an apparent strategic decision by prosecutors to take some of the steam out of defense questioning. Gates testified that Manafort asked him to float Calk, who was on Trump's economic advisory council, for Secretary of the Army. Both sides agreed ahead of time to limit discussion of the campaign so as not to prejudice the jury, though they had agreed to allow testimony about the overlap of a bank loan with Manafort's role in the campaign. 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.

In a dramatic moment before the jury, Manafort's defence counsel, Kevin Downing, put it to the government's star witness: "There's another life, right, the other Rick Gates?"

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When Downing questioned why Gates had embezzled money from his boss, he used it as an opportunity to issue a public apology.

Rick Gates has been the government's star witness in Manafort's financial fraud trial, testifying how, at the behest of his longtime boss, he helped hide millions of dollars in foreign income and submitted fake mortgage and tax documents.

Gates testified Tuesday that Manafort hit the roof when faced with an enormous tax bill.

Manafort's accountant was asked about a purported $10 million loan from Russian oligarch Oleg Deripaska.

She said even though she worked with Gates a lot, it was clear to her that Manafort "knew what was going on" in most instances.

Gates' ongoing testimony on Tuesday - the sixth day of Manafort's fraud trial - came one day after he testified that he'd committed crimes with Manafort. "In reality, it was basically money moving between accounts", Gates said.

On Wednesday, Downing sought to counter earlier testimony that Manafort had encouraged Gates to deceive authorities by getting Gates to acknowledge that Manafort told him to be truthful about offshore shell companies and bank accounts during a 2014 interview with the Federal Bureau of Investigation.

Gates also acknowledged creating a fraudulent letter for movie producer and political operative Steven Brown, who pleaded guilty in April to participating in a scheme that defrauded investors of over $9.5 million involving false documents.

In detailed testimony, Gates walked prosecutors through the step-by-step process on how he and Manafort doctored and backdated documents.

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