Published: Wed, August 08, 2018
Global News | By Stacy Ballard

Rick Gates says he and Manafort disguised foreign income as loans

Rick Gates says he and Manafort disguised foreign income as loans

On his second day on the stand in the trial of his former business partner, political consultant and former Trump campaign aide Rick Gates testified that former Trump campaign manager Paul Manafort pressed for a secretary of the Army appointment for one of the lenders who had given him money despite falsified income information on the documents.

"I'm here", Gates said from the witness chair.

Manafort's lawyer suggested that the affair - which included a London pad, first-class plane trips and luxury hotels - cost up to $3 million.

As well as being a senior aide on Trump's election campaign, Gates served as the deputy chairman of the U.S. president's inaugural committee. Instead, prosecutors for Mueller have accuse Manafort of hiding at least $30 million that he earned while representing Russia's neighboring country of Ukraine and its president, Viktor Yanukovych, an ally of Russian President Vladimir Putin.

The aggressive questioning was aimed at shifting blame from Manafort onto Gates, who pleaded guilty in Mueller's investigation and agreed to cooperate with investigators by testifying in the financial fraud trial.

"WTF", Manafort wrote to Gates in one email shown to the jury.

Ahead of that barrage, Gates has implicated himself in a vast amount of criminal conduct on the stand, an apparent strategic decision by prosecutors as they hope to take some of the steam out of the defense's questioning.

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The lawyer, Kevin Downing, was trying to counter earlier testimony that Manafort had encouraged Gates to deceive authorities by directing him to help hide his foreign income and to submit phony mortgage and tax documents on his behalf.

For this Manafort was paid US$4million a year, in quarterly payments of US$1million, Gates recalled, though at some point the currency switched from USA dollars to Euros.

Manafort has been charged with bank and tax fraud stemming from Mueller's investigation into Russian meddling in the 2016 presidential election and possible collusion between Moscow and the Trump campaign.

Prosecutors had intentionally left many of these pieces of evidence blank on an itemized list of documents they are presenting in court, signaling they could be the most sensational and attention-grabbing files in the evidence binder.

In 2015 and 2016, Gates said, Manafort "requested a team of people to pull together" documents to apply for bank loans in order to keep pace with payments to maintain his luxurious lifestyle. But inside the courtroom, trial proceedings had plodded along almost Trump-free.

Gates said he and Manafort created an elaborate operation in Cyprus to use shell companies to secretly accept the money. "In reality, it was basically money moving between accounts", Gates said.

Downing sought to portray Gates as an inveterate liar, raising questions about whether he has been truthful with Mueller's office even after cutting a plea deal in February.

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Both Gates and Manafort were indicted last October by a federal grand jury on 12 charges, including conspiracy against the U.S. Manafort has pleaded not guilty to all charges.

Manafort is on trial here facing bank and tax fraud charges.

In testimony Tuesday, Gates laid responsibility squarely at Manafort's feet for a series of crimes, as he described to jurors how he repeatedly submitted fake financial documents at Manafort's behest as his former boss became concerned he was paying too much in taxes and, later, that his funds were drying up.

Andres also used his questioning to clean up some of the other messes made during Downing's initial round of cross-examination Tuesday afternoon.

Under questioning, Gates said when Manafort did consulting work for Ukrainian politicians, he would send the money he made to accounts in Cyprus.

"The only answer I was told was to tell the truth", Gates said. Manafort broke his stare only to review government exhibits on a small monitor in front of him.

Gate's testimony was part of the prosecution's effort to prove that Manafort was responsible for financial maneuverings that he and other witnesses have testified include filing false tax returns, defrauding banks in borrowing against real estate, and failing to report foreign bank accounts.

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