Manafort trial winds up; jury to begin work

Lawyers for both sides say lies at heart of proceeding

ALEXANDRIA, Va. — Paul Manafort lied to keep himself flush with cash and later to maintain his luxurious lifestyle when his income dropped off, prosecutors told jurors Wednesday in closing arguments at Manafort’s financial fraud trial. Jurors are to begin deliberations today.

The government’s case boils down to “Mr. Manafort and his lies,” prosecutor Greg Andres said.

“When you follow the trail of Mr. Manafort’s money, it is littered with lies,” Andres said as he made his final argument that the jury should find President Donald Trump’s former campaign chairman guilty of 18 felony charges.

Attorneys for Manafort, who is accused of tax evasion and bank fraud, argued that Manafort left the particulars of his finances to other people, including his former deputy Rick Gates.

After the closing arguments were finished, U.S. District Judge T.S. Ellis III told jurors that they will begin deliberating today.

Manafort’s trial is the first to emerge from special counsel Robert Mueller’s Russia investigation, but it does not relate to Russian election interference or possible coordination with the Trump campaign — the main topics of Mueller’s probe.

Neither Manafort nor Gates has been charged in connection with Trump campaign work. But Mueller’s legal team says that as a result of the ongoing investigation, it discovered that Manafort was hiding millions of dollars in income.

Manafort, 69, is accused of failing to pay taxes on $15 million from 2010-14, money that was in overseas bank accounts that he kept hidden from his accountants and the Internal Revenue Service. He earned that money working as a consultant for Ukraine’s then-president, Viktor Yanukovych. Yanukovych fled Ukraine in 2014 amid street protests, causing Manafort’s income to dry up, according to witnesses.

In their final appeal to the jury, Manafort’s lawyers said it defied common sense for Manafort to cheat the IRS or banks when his net worth still exceeded $21 million.

“Given this evidence, how can we say he didn’t have money?” Richard Westling, Manafort’s defense attorney, asked.

Westling told jurors that the fact that Manafort employed a team of accountants, bookkeepers and tax preparers shows he wasn’t trying to hide anything. The lawyer appeared to be trying to blunt the effect of testimony from some of the people who handled Manafort’s finances, including his bookkeeper, who said he concealed offshore bank accounts and lied to them.

Westling said the evidence against Manafort has been cherry-picked by Mueller’s team and doesn’t show jurors the full picture.

“Nobody came forward to say we’re concerned about what we’re seeing here, not until the special counsel showed up and started asking questions,” Westling said, suggesting the special counsel “cobbled together” information to “stack up the counts” against Manafort and overwhelm the jury.

“It is not enough that wrong information or false information was given,” Westling said, telling the jurors that to convict his client, they had to be convinced that Manafort intended to deceive banks and the IRS.

Westling questioned whether prosecutors had shown criminal intent by the former Trump campaign chairman, and pointed to documents and emails that the defense lawyer said may well show numerical errors or sloppy bookkeeping but no overt fraud.

During the prosecution’s arguments, jurors took notes as Manafort primarily directed his gaze at a computer screen where documents were shown. The screen showed emails written by Manafort that contained some of the most damning evidence that he was aware of the fraud and not simply a victim of underlings who managed his financial affairs.

Andres highlighted one email in which he said Manafort sent an inflated statement of his income to bank officers reviewing a loan application. He highlighted another in which Manafort acknowledged his control of one of more than 30 holding companies in Cyprus that prosecutors say he used to funnel more than $60 million he earned advising politicians in Ukraine.

Prosecutors say Manafort falsely declared that money to be loans rather than income to keep from paying taxes on it.

Andres repeatedly asked the jurors to rely on their common sense when analyzing the hundreds of exhibits presented by the government. “Ladies and gentlemen, a loan is not income. Income is not a loan. You don’t need to be a tax expert to understand that,” he said.

He also asked why Manafort would pay an accounting firm $100,000 a year to pay his bills, but pay more than $15 million of them himself out of foreign bank accounts. “The answer? He wanted to hide those accounts,” he said. “Use your common sense.”

Manafort chose not to testify or call any witnesses in his defense. His lawyers have tried to blame their client’s financial mistakes on Gates, calling him a liar and philanderer.

Gates, who struck a plea deal with prosecutors, told jurors that he helped conceal millions of dollars in foreign income and submitted fake mortgage and tax documents. He was also forced to admit embezzling hundreds of thousands of dollars from Manafort and having an extramarital affair.

Defense lawyer Kevin Downing launched a blistering attack on Gates’ credibility, urging the jury Wednesday to

discount his testimony.

“To the very end, he lied to you,” Downing told the jury. “The government, so desperate to make a case against Mr. Manafort, made a deal with Rick Gates.”

Manafort had mistakenly trusted his deputy and applied little oversight to him, Downing argued.

“He did not know the Rick Gates that you saw,” Downing told the jury. “Mr. Gates was orchestrating a multimillion-dollar embezzlement scheme” and trying to keep it from the accountants, Downing said.

“If the accountants had picked up the phone, maybe none of us would be here right now,” Downing told the jurors before asking them to find Manafort innocent of all charges.

Andres said the government isn’t asking jurors to like Gates or take everything he said at “face value.” He said the testimony of other witnesses and the hundreds of documents are enough to convict Manafort on tax evasion and bank fraud charges.

“Ladies and gentlemen, the star witness in this case is the documents,” Andres said.

Referring to charts compiled by an IRS accounting specialist, Andres told jurors that Manafort declared only some of his foreign income on his federal income tax returns and repeatedly failed to disclose millions of dollars that streamed into the U.S. to pay for luxury items, services and loans.

In 2012, Manafort’s most successful year during his Ukrainian work, he reported $5.3 million. But he told the government nothing about another $9.2 million that went to pay for loans and other items, prosecutors said.

The prosecutor said Manafort should have been well aware each time he signed tax and financial documents indicating that he had no foreign accounts to declare. “Mr. Manafort was willful,” Andres said.

“It wasn’t a clerical decision. It wasn’t ‘forgot to check a box,’” he said.

Leaving the courthouse, Downing said he felt “very good” about Manafort’s chances of being acquitted.

“Mr. Manafort was very happy with how things went today,” he said.

Information for this article was contributed by Chad Day, Matthew Barakat, Stephen Braun, Mary Clare Jalonick and Anne Flaherty of The Associated Press; by Rachel Weiner, Matt Zapotosky, Lynh Bui, Devlin Barrett and Tom Jackman of The Washington

Post; and by Sharon LaFraniere of The New York Times.