Jury set; Manafort taxes trial in motion
Prosecutor says millions stashed
ALEXANDRIA, Va. — Prosecutors Tuesday laid out their case against Paul Manafort, saying President Donald Trump’s former campaign chairman orchestrated a multimillion-dollar conspiracy to evade U.S. tax and banking laws, leaving behind a trail of lies as he lived a lavish lifestyle.
Manafort’s trial on bank and tax fraud charges got off to a quick start as U.S. District Judge T.S. Ellis III seated a jury, and told prosecutors and defense lawyers to deliver opening statements.
During his opening statement, Assistant U.S. Attorney Uzo Asonye told the jury that Manafort considered himself above the law as he funneled tens of millions of dollars through offshore accounts. That “secret income” was used to pay for personal expenses such as a $21,000 watch, a $15,000 jacket made of ostrich skin and more than $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.
It’s the first trial arising from Mueller’s investigation into Russian meddling in the 2016 election and
whether the Russians had ties to Trump’s presidential campaign. Mueller was not present in the courtroom.
Defense 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, Manafort’s former business associate and the government’s star witness, is central to the defense 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 told jurors that Gates can’t be trusted and is the type of witness who will say anything he can 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.
Manafort, who has been jailed for nearly two months, wore a black suit and appeared fully engaged in his defense, whispering with his attorneys during jury selection and scribbling notes as the prosecution began its opening statement.
Manafort has maintained his innocence and has shown no public inclination to seek or agree to a plea deal.
Before the start of jury selection Tuesday, prosecutors filed an expanded list of its evidence exhibits, including several email chains between Manafort and Stephen Calk, a Chicago bank chairman. The added evidence also appears to include documents related to bank accounts in Cyprus.
Prosecutors have listed more than 400 exhibits and said they might call nearly three dozen witnesses, including Gates.
The government aims to show that Manafort funneled more than $60 million in proceeds from his Ukrainian political consulting work through offshore accounts and hid a significant portion of it from the Internal Revenue Service.
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 from the supporters of the pro-Russia Ukrainian political party that was paying his consulting fees.
Defense 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 traveled 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 interrupted the prosecutor at one point during his opening statement 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,” Ellis 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 whether there was 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 investigation, which Trump has dismissed as a “witch hunt.”
“There was No Collusion (except by Crooked Hillary and the Democrats)!” Trump
tweeted early Tuesday.
Manafort has said he knows nothing about any Russian involvement in the election.
The trial is expected to last several weeks.
At jury selection earlier Tuesday, the pool faced questions from the judge and both sides as they tried to weed out potential prejudice in what has become a highly publicized and politically divisive investigation. Setting a fast pace for a complicated trial, Ellis repeatedly urged lawyers for both sides to speed up their decision-making so the jury could be seated.
A jury of six men and six women was ultimately selected, along with four alternate jurors.
Manafort has a second trial scheduled for September in the District of Columbia. It involves allegations that he acted as an unregistered foreign agent for Ukrainian interests and made false statements to the U.S. government.
The other 31 people charged by Mueller so far have either pleaded guilty or are Russians seen as unlikely to enter an American courtroom.
Three Russian companies have also been charged. One of those companies has pleaded innocent and is fighting the allegations in federal court in Washington.
Information for this article was contributed by Chad Day, Eric Tucker and Stephen Braun of The Associated Press; and by Sharon Lafraniere and Emily Baumgaertner of The New York Times.