ALEXANDRIA, Va. — Special counsel Robert Mueller’s team hammered away at Paul Manafort and his “lies” on Wednesday, as the case against the former campaign chairman in a suburb of Washington, D.C., nears its conclusion.
Prosecutor Greg Andres outlined the federal government’s case against Manafort in closing arguments to the jury that spanned nearly two hours. Manafort’s defense will have two hours maximum to give their argument, and Andres is allowed a 17-minute rebuttal.
“This is a case about Mr. Manafort and his lies — his lies on his tax returns and his lies to bank after bank after bank,” Andres told the jury of six men and six women. “When you follow the money, the trail is littered with lies.”
He added: “Mr. Manafort lied to keep more money when he had it and he lied to get more money when he didn’t.”
Andres walked through the government’s case against Manafort, who is facing 18 counts of tax and bank fraud in the Eastern District of Virginia.
[More: Rick Gates tells Paul Manafort jury tales of embezzlement, tax fraud, and an extramarital affair]
Judge T.S. Ellis III listened to Andres’ remarks stoically, as did a blue-suited Manafort, who sometimes conferred with his team of lawyers during the course of the remarks.
Jurors heard testimony from more than two dozen witnesses over the trial’s 11 days, which Andres said demonstrated that Manafort made more than $60 million for political consulting work in Ukraine for President Viktor Yanukovych and the Party of Regions.
That money, Andres said, was concealed in 31 bank accounts in three countries — Cyprus, Saint Vincent and the Grenadines, and the United Kingdom.
“He owned them, and he controlled them,” Andres said of the offshore accounts tied to entities Manafort controlled, at one point referencing a series of emails in which Manafort referred to the offshore accounts as “my” accounts.
Millions of dollars from Manafort’s overseas accounts flowed to vendors based in the U.S. to pay bills for high-end clothing, luxury cars and real estate, Andres said, pointing to testimony to Morgan Magionos, a forensic accountant with the Federal Bureau of Investigation, who traced the flow of Manafort’s money to the U.S.
In all, Manafort failed to pay taxes on more than $15 million.
Manafort’s seven-figure lifestyle has often been a point of contention between Ellis and prosecutors during the proceedings, as jurors heard from a host of witnesses during its early days who testified as to the amount of money Manafort spent with them. Many of his payments to those vendors coming by international wire transfer from foreign bank accounts.
Andres made a point to address a warning Ellis gave earlier in the trial, noting that despite living a life of luxury from the millions of dollars he earned and concealed, Manafort is not on trial for being rich.
“This case is not about Mr. Manafort’s wealth,” Andres said. “It is not a crime in this country to be wealthy. It is not a crime to have nice things. We’re not in this courtroom today because Mr. Manafort is wealthy.”
Andres detailed how Manafort not only submitted false tax returns by underreporting his income to the tax agency, but also noted that he misrepresented two “loans” from Peranova Holdings, an entity Manafort controlled, and Telmar Investments Ltd.
Manafort received $1.5 million from Peranova Holdings, which was classified as a loan on his tax returns when it was actually income he earned from Ukrainian oligarchs for his political and policy work.
Rick Gates, Manafort’s former business associate, told the court the $1.5 million was classified as a loan to lessen Manafort’s tax exposure.
However, the “loan” became an issue for Manafort when he eventually sought mortgage loans from banks. To resolve the outstanding debt, the “loan” was forgiven, thus making it income.
“A loan is not income, and income is not a loan,” Andres told the 12-member jury, before reminding them that arriving at such a conclusion is “common sense.”
Throughout the duration of the trial, Manafort’s lawyers have attempted to tie the alleged wrongdoing to Gates, telling the jury that Manafort mistrusted his former business associate who had access to much of his financial dealings.
But Andres asked the jury whether it was possible for another person such as Gates to open bank accounts overseas, deposit $60 million into those accounts, and then use $15 million to pay expenses for Manafort and his family.
“Does that make any sense at all? We should all be so lucky,” Andres said.
Gates’ testimony against Manafort spanned three days, during which it was revealed he engaged in an extramarital affair more than 10 years ago and embezzled thousands of dollars from Manafort while working from him.
Andres acknowledged Gates’ affair, but indicated to the jury that the defense’s questions about it were in an effort to distract their attention from the allegations against their client.
“Does that make Mr. Manafort less guilty of the tax fraud?” he asked.
Andres also admitted that in selecting Gates as a business associate who would help him engage in criminal wrongdoing, Manafort “didn’t choose a Boy Scout.”
“Mr. Manafort is a mentor to Mr. Gates, particularly to his own criminal activity.” Andres said.
While Gates was considered the prosecution’s star witness, Andres sought to direct jurors’ attention to the other witnesses’ testimony and the tranche of documents admitted as evidence in the case to prove Manafort’s guilt beyond a reasonable doubt.
“The star witness in this case is the documents,” Andres said.
Those documents, he said, detail how Manafort submitted loan applications to three different banks that included false information and forged documents.
In seeking millions of dollars in loans from Citizens Bank, Banc of California, and The Federal Savings Bank, Manafort submitted doctored profit-and-loss statements from his firm, Davis Manafort Partners International, and failed to disclose outstanding mortgages on two properties he owned in New York.
He also told two of the banks of the forgiven $1.5 million “loan,” Andres said, and lied about an outstanding balance of more than $200,000 for New York Yankees season tickets on his American Express card, which Manafort attributed to Gates using his credit card.
Manafort’s efforts were in an effort to make him appear more creditworthy to banks, he said, but also broke the law.
Andres noted that Manafort often used financial jargon that demonstrated his knowledge of tax law, which proved, in part, his intent to skirt federal statutes.
Manafort’s tax returns were false from from 2010 to 2014, he continued, and Manafort never filed reports of foreign bank and financial accounts — known as FBAR — from 2011 until 2014, as required on by law. He also failed to disclose to the IRS his offshore accounts.
Andres detailed Manafort’s capabilities to the jury, painting him as a savvy political operative with a law degree who revived Yanukovych’s political career and was fully aware of the alleged wrongdoing taking place.
“Mr. Manafort is capable and bright,” Andres said.
In attempting to separate Manafort from Gates and demonstrate to the jury that Manafort was fully aware of the wrongdoing taking place, Andres reminded the court that Manafort was a “wildly successful, international consultant.”
“This is a case about Paul Manafort and Paul Manafort’s money,” Andres said in his conclusion. “The government asks you to return the only verdict that is consistent with the evidence, which is, guilty on all charges.”
