Prosecution rests in Manafort trial

ALEXANDRIA, Va. — Prosecutors on Monday rested their tax-evasion and bank-fraud case in the trial of former Trump campaign chairman Paul Manafort, closing two weeks of testimony that depicted him as using millions of dollars hidden in offshore accounts to fund a luxurious lifestyle — and later obtaining millions more in bank loans under false pretenses.

The trial of the longtime Washington operator now turns to Manafort’s defense team, which has so far blamed any wrongdoing on Rick Gates, the former Manafort protege who testified he and his former boss committed crimes together for years. Defense attorneys have called Gates a liar, philanderer and embezzler as they’ve sought to undermine his testimony.

Manafort’s lawyers have not yet said whether they will call any witnesses or present other evidence in the case. They will have to disclose that information Tuesday.

The trial is the first to emerge from special counsel Robert Mueller’s investigation, but it does not relate to any allegations of Russian election interference or possible coordination with the Trump campaign.

The government says Manafort hid at least $16 million in income from the IRS between 2010 and 2014 by disguising money he earned advising politicians in Ukraine as loans and hiding it in foreign banks. Then, after his money in Ukraine dried up, they allege he defrauded banks by lying about his income on loan applications and concealing other financial information, such as mortgages.

Before the government rested its case Monday afternoon, the court heard testimony from a bank executive who said he found several red flags with Manafort’s finances while he was being considered for more than $16 million in bank loans.

James Brennan, a vice president at Federal Savings Bank, says Manafort failed to disclose mortgages on his loan application. He said he also found several “inconsistencies” in the amount of income Manafort reported for his business.

That information led senior executives to reject one of the loans. But Brennan said Federal Savings Bank chairman Stephen Calk overruled that decision.

“It closed because Mr. Calk wanted it to close,” Brennan said.

Other witnesses have said Calk pushed the loans through because he wanted a post in the Trump administration.

Brennan said the Chicago-based bank lost at least $11.8 million because it had to write off the two loans, which he said were the two largest loans the bank had made at that time.

The prosecution also recalled Treasury Department agent Paula Liss — over the objections of Manafort’s defense team — to testify that two of his companies hadn’t filed any reports disclosing the foreign bank accounts as required by federal law.

Liss’ testimony came after Manafort’s attorneys signaled they intend to argue that the offshore accounts that he used to pay for millions of dollars in personal expenses were actually controlled by the company and not him personally.