Longtime Manafort deputy Rick Gates admits embezzlement

07 August, 2018, 04:54 | Author: Katrina Soto
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Paul Manafort's former business partner, Rick Gates, took the witness stand on Monday for what may be the most critical testimony in Manafort's bank and tax fraud trial.

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

Rick Gates has been regarded as a crucial government witness ever since he pleaded guilty a year ago and agreed to cooperate in special counsel Robert Mueller's investigation.

"Did you commit any crimes with Mr. Manafort?" the prosecutor asked.

Gates, whose testimony in federal court in Alexandria, Virginia, was continuing, was expected to be a star witness in the government's case, having pleaded guilty in February and agreed to cooperate with prosecutors under a deal that could lead to a reduced sentence.

Gates testified that Manafort directed him to report overseas income as loans in order to lower taxable income and that at Manafort's request, did not disclose foreign bank accounts, which is required by law.

While Gates already pleaded guilty to charges of conspiracy against the United States and lying to the FBI, Monday's testimony marked his first time stating he committed crimes with another former Trump associate. 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. 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.

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Among the crimes Gates testified to doing with Manafort include: knowingly hiding 15 foreign accounts from the government; stealing hundreds of thousands of dollars from Manafort by filing false expense reports, which were paid from Manafort's offshore accounts; and filing false tax returns, in which the men under-reported their income, created fake loans and failed to disclose their foreign accounts.

The jury has heard how Manafort made tens of millions of dollars for political work with pro-Russian politicians in Ukraine. One came after a September 15, 2015, conference call in which Gates balked at the amount of taxes that Manafort's political consulting firm owed for 2014.

What's Gates telling the court?

One is a bank employee who appears ready to address an alleged deal between his boss and Manafort, after the bank executive sought a role in the Trump campaign.

Gates testified that he and Manafort had 15 foreign accounts they did not report to the US government, and knew that was illegal.

Since the trial started before U.S. District Judge T.S. Ellis last Tuesday, Manafort's lawyers have kept their cross-examinations brief and at times refrained from attempting to rebut damaging testimony in detail.

When asked who was in charge in the relationship, Manafort's longtime tax accountant Phillip Ayliff told the jury: "Oh - Mr. Manafort". Laporta said she didn't believe the loan had actually been forgiven.

Gates said he repeatedly lied to hide the bank accounts and, at Manafort's direction, he would classify money that came in as either a loan or income to reduce Manafort's tax burden.

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