Manafort believed he was above law: prosecutor
Accused of ‘secret income’, false tax returns, defrauding banks An ‘extravagant lifestyle’ and he bought a $15K ostrich jacket, court hears Defence argues that he trusted others to keep track of his money
ALEXANDRIA, VA .• Paul Manafort orchestrated a multi million-dollar conspiracy to evade U.S. tax and banking laws, leaving behind a trail of lies as he lived a lavish lifestyle, prosecutors said Tuesday as they laid out their case against the former Trump campaign chairman.
During his opening statement, Assistant U.S. Attorney Uzo Asonye told the jury that Manafort considered himself above the law as he funnelled tens of millions of dollars through offshore accounts. That “secret income” was used to pay for personal expenses such as a US$21,000 watch, a US$15,000 jacket made of ostrich and more than US$6 million worth of real estate paid for in cash, Asonye said.
“A man in this courtroom believed the law did not apply to him — not tax law, not banking law,” Asonye said as he sketched out the evidence gathered by special counsel Robert Mueller’s team in Manafort’s bank fraud and tax evasion trial.
It’s the first trial arising from Mueller’s investigation into potential ties between Donald Trump’s presidential campaign and Russia. Mueller was not present in the courtroom.
Defence attorney Thomas Zehnle said in his opening statement that Manafort trusted others to keep track of the millions of dollars he was earning from his Ukrainian political work.
He made clear that undermining the credibility of Rick Gates, his former business associate and the government’s star witness, is central to the defence strategy. Zehnle said Manafort, earning millions as a political consultant helping officials in other parts of the world, relied on Gates and others — including a professional accounting firm — to keep watch over the money.
“Money’s coming in fast. It’s a lot, and Paul Manafort trusted that Rick Gates was keeping track of it,” Zehnle said. “That’s what Rick Gates was being paid to do.”
He warned jurors that Gates could not be trusted and was the type of witness who would say anything he could to save himself from a lengthy prison sentence and a crippling financial penalty.
Gates, who spent years working for Manafort in Ukraine and is also accused of helping him falsify paperwork used to obtain the bank loans, cut a plea deal with Mueller earlier this year. Gates also worked as an aide on Trump’s campaign.
The government intends to show that Manafort funnelled more than $60 million in proceeds from his Ukrainian political consulting through offshore accounts and hid a “significant” portion of it from the IRS.
Asonye said Manafort created “bogus” loans, falsified documents and lied to his tax preparer and bookkeeper to conceal the money, which he obtained from Ukrainian oligarchs through a series of shell company transfers and later from fraudulently obtained bank loans in the U.S.
But Zehnle disputed prosecutors’ account that Manafort was trying to conceal his earnings by storing money in bank accounts in Cyprus. He said that arrangement was not Manafort’s doing but was instead the preferred method of payment of the supporters of the pro-Russia Ukrainian political party who were paying his consulting fees.
Defence lawyers also sought to address head-on Manafort’s wealth and the images of a gaudy lifestyle that jurors are expected to see during the trial.
“Paul Manafort travelled in circles that most people will never know and he’s gotten handsomely rewarded for it,” Zehnle said. “We do not dispute that.”
The judge even interrupted the prosecutor during his opening statements to caution him against suggesting there was something criminal about being a multimillionaire.
“It isn’t a crime to have a lot of money and be profligate in your spending,” U.S. District Judge T.S. Ellis III said.
Prosecutors made no reference to Trump in their opening statement nor discussed in any way Manafort’s leadership of the Trump campaign, or the ongoing investigation into potential collusion between Russia and the president’s associates. Despite that, Manafort’s case is widely viewed as a test to the legitimacy of Mueller’s ongoing probe, which Trump has dismissed as a “witch hunt.”
The trial is expected to last several weeks.