Prosecutors say Manafort’s wealth was fueled by lies to IRS and banks

prosecutors charged that his personal fortune was propped up by years of lies to tax authorities and banks.

.. “A man in this courtroom believed the law did not apply to him,” Assistant U.S. Attorney Uzo Asonye told the jury. “Not tax law, not banking law.”

.. The defense, in rebuttal, said that Manafort was a victim of the deceptions of his former partner, now a government witness, and that any failure to pay taxes was inadvertent.

.. Manafort faces 18 charges of financial fraud, as prosecutors say he failed to pay taxes on some of the millions of dollars he made working as a strategist for a political party in Ukraine, and then lied to banks to get loans when those payments stopped.

.. Manafort collected more than $60 million between 2010 and 2014 from his Ukraine work, where President Viktor Yanuko­vych, an ally of the Kremlin

.. When Yanukovych had to flee Ukraine for Russia in 2014, Manafort’s “cash spigot” was shut off, the prosecutor said, and the political strategist set out to generate money by lying to banks on loan applications.

.. Asonye’s efforts to paint Manafort as a free-spending tax cheat were interrupted more than once by U.S. District Judge T.S. Ellis III, who noted “it isn’t a crime to be profligate in your spending.”

.. The prosecutor said the charges boil down to “one simple issue: Paul Manafort lied.”

.. Manafort’s defense lawyer Thomas Zehnle said the case was about “taxes and trust,” and that the real liar was not Manafort, but his former right-hand man, Rick Gates.

.. “Mr. Manafort placed his trust in the wrong person,” Zehnle said, arguing that his client built “one of the most successful political consulting and government relations shops in Washington,” while also working on “the global stage.”

.. Zehnle said Manafort’s work for Yanukovych was to “bring the country closer to Western democracies after decades of Soviet rule” — toward the European Union and away from Russia. That comment was met with audible sneers from a few members of the gallery. Protests in Ukraine were first triggered in late 2013 by Yanukovych’s decision to not sign an E.U. association agreement, an embrace of the West that Russia opposed.

.. Zehnle said Manafort also never intentionally deceived the IRS about his income and that his client made mistakes, not realizing he needed to file certain forms and make certain declarations.

“This is not a case where someone flew to Switzerland and stashed money in an account,” Zehnle said. The lawyer also said that earlier in the investigation, Manafort willingly sat down with FBI agents investigating the misuse of funds in Ukraine

.. Manafort’s defense strategy appears aimed at the credibility of Gates, the star witness against him, by accusing Manafort’s ­onetime protege and partner of embezzling millions of dollars.

“Rick Gates had his hand in the cookie jar, and he couldn’t take the risk that his boss might find out,” Zehnle said. He said Gates prevented other people involved in Manafort’s finances — accountants and bookkeepers — from sharing information about the accounts with each other.

.. Manafort had hired great people, he said, and had “substantial resources. . . . I was really impressed by him.”

Devine said Yanukovych won the presidency in 2010 because of the “excellent campaign that Paul ran.” Devine said he produced TV commercials and wrote speeches for Yanukovych, earning $500,000 and a bonus of $100,000 when Manafort’s client won.

.. While working on the campaign, Devine met other Manafort associates who have since come under investigation, including Gates and Konstantin Kilimnik, a Russian citizen. At the time, Devine said, Kilimnik worked as a translator. Prosecutors have said Kilimnik has ties to Russian intelligence, and they accused him and Manafort of trying to tamper with witnesses earlier this year.

Devine said Manafort was clearly the boss in his relationship with Gates, though they were partners.

“Paul was in charge,” Devine said. “Rick worked for Paul.”

The Stormy Daniels payment isn’t the story. Michael Cohen is.

the more compelling and consequential issue is the Trump-Cohen relationship.

.. given Trump’s odd account that he repaid Cohen for his services “sometimes” and not others, he may well argue that he did not, in the first instance, recognize an obligation for the Daniels payment

.. Rudolph W. Giuliani, Trump’s lawyer, said earlier this month that Trump’s “reimbursement” was in the neighborhood of $470,000, considerably more than three times the sum paid to Daniels.

.. It is far less threatening than questions of bribery, extortion, mail or wire fraud, or direct or indirect indebtedness to a foreign power.

Mueller Owes It to Prosecutors Nationwide, and to His Own Cases, to Uphold Justice Department Standards

Mueller’s tactic of charging sensational offenses and pleading them down to comparatively trivial crimes flouts guidelines that are prescribed in the U.S. Attorney’s Manual and that are followed by responsible U.S. attorneys’ offices.

.. the plea deal of Richard Gates, who faced two indictments alleging financial-fraud felonies involving over $100 million in the aggregate, but was permitted to plead guilty to minor charges

.. Kerr’s description of my claim that Mueller is “breaking the rules” suggests that I’ve accused the special counsel of violating the law. No, I’ve accused him of abusing his discretion.

That this is not actionable does not make it right.

.. A defendant should be required to plead guilty to “the most serious readily provable” offense charged

.. The “most serious readily provable” standard applies to plea agreements regardless of whether cooperation is in the mix.

.. Requiring such a guilty plea not only ensures that the defendant is held appropriately accountable and is not given favorable treatment in comparison to others similarly situated; a plea to “the most serious readily provable charge” also makes the defendant a more compelling cooperating witness. By contrast, failing to require a plea to the most serious offense degrades the defendant’s testimony, which is usually offered to prove against other defendants the same serious offense on which the cooperating defendant has been given a pass.

Special counsel Mueller files new charges against Manafort, Gates

Paul Manafort was using fraudulently obtained loans and tax-cheating tricks to prop up his personal finances as he became chairman of the Trump campaign in 2016, according to a new 32-count indictment filed against him and his business partner Thursday.

The indictment ratchets up pressure on Manafort and his deputy, Rick Gates, who were already preparing for a trial

.. Mueller accused the men of lying on their income-tax returns and conspiring to commit bank fraud to get loans.

.. these are two fellows on a multiyear tear of lying to every bank they could find about their income. To a federal prosecutor, it’s fairly crude. It’s extensive and bold and greedy with a capital ‘G,’ but it’s not all that sophisticated.”

.. there was one hero in the special counsel’s tale — a bookkeeper who refused an alleged request by Gates to falsely inflate a revenue claim

..  they could be facing de facto life prison sentences.

.. from 2006 to 2015, Manafort, with help from Gates, avoided paying taxes on income from Ukraine by disguising it as loans from offshore corporate entities

.. using foreign bank accounts to make payments to businesses in the United States on Manafort’s behalf.

.. unidentified co-conspirator wrote that a document looked doctored and asked them to “do a clean excel doc” and send that instead.

.. When Manafort joined the Trump campaign as an adviser in early 2016, he agreed to work with no pay

.. prosecutors alleged Manafort was taking out multimillion-dollar loans in those same months, including $5.5 million that he sought in the same month he joined the campaign.

.. Manafort was under significant financial pressure even as he ascended to the top of the Trump campaign in mid-2016.

.. One bank lender “questioned Manafort about a $300,000 delinquency on his American Express card, which was more than 90 days past due. The delinquency significantly affected Manafort’s credit rating score.”

.. On Oct. 25, 2017 — just days before the first indictment was revealed — Gates submitted a false tax document for the 2013 tax year

.. Three of his lawyers had asked to leave the case

.. Thomas C. Green

.. Green is an experienced white-collar attorney with a reputation for cutting plea deals on behalf of his clients.