ALEXANDRIA, Va. — Lawyers for Paul Manafort on Wednesday tried to discredit the federal government’s case by asserting the special counsel’s office selectively prosecuted their client and relied on testimony from Rick Gates, a business associate who has admitted to committing criminal acts for his own financial gain.
Richard Westling and Kevin Downing of Manafort’s defense team also told jurors in their often erratic closing arguments that the federal government had not met the burden of proof to convict their client in the Eastern District of Virginia.
“Hold the government to that burden of proof,” said Westling.
[More: Prosecution blasts Paul Manafort’s ‘lies’ in closing remarks to federal jury]
The six-man, six-woman jury will now deliberate on whether to convict or acquit Manafort of some or all of the 18 criminal counts of tax and bank fraud he has been charged with by special counsel Robert Mueller.
Manafort is accused of concealing millions of dollars from the Internal Revenue Service he made working in Ukraine for President Viktor Yanukovych and the Party of Regions. The government estimated Manafort made $60 million for that political and policy work.
But when the spigot of funds from the Ukraine work ran dry, prosecutors say he resorted to defrauding banks to secure millions of dollars in loans.
Westling, though, rejected the idea that Manafort needed money because he had an adjusted net worth of $21.3 million at the end of 2016. Manafort also had “substantial holdings,” his lawyer said.
Westling argued that Manafort did not do his work alone, but rather “turned to other people to work together as a team,” including his bookkeeper, accountant, and business partner Rick Gates.
“That’s not consistent with someone attempting to commit a fraud,” Westling said.
[Related: Rick Gates tells Paul Manafort jury tales of embezzlement, tax fraud, and an extramarital affair]
The pair argued Manafort had not orchestrated a grand scheme to conceal millions of dollars from the IRS, but rather had disclosed his foreign bank accounts and financial statements, including during an interview with the FBI in 2014 as part of a separate investigation.
His email messages, profit and loss statements, and loan applications were what Manafort thought to be true “at the time” or what he thought he would accrue in income later, argued Westling.
Furthermore, no banks had complained about the alleged fraud, argued Westling, “until the special counsel showed up and started asking questions.”
“The goal was to stack up the counts [against Manafort],” said Westling, adding that some of the charges against his client are rare and that “people do not get prosecuted by typical Justice Department prosecutors” for the charges Manafort faces.
Westling added that Manafort’s inconsistencies on a loan application dealing with the use of a property in New York City did not mean he defrauded the bank from which he sought a loan.
“I submit to you that if this were fraud, we would have courts across the country filled with bank fraud,” he said, adding, there are “plenty of things that have not come out in this courtroom that leave significant doubts about this evidence.”
Downing used much of his closing argument to undermine the credibility of Gates.
Gates, who already pleaded guilty, was “somebody that Mr. Manafort trusted.”
“What a big mistake that was,” Downing said.
Downing said that while Gates had been coached by the government ahead of his testimony, he “fell apart and proved himself to be the liar that he is” during cross-examination.
“That is the real Rick Gates, and that is the Rick Gates Mr. Manafort did not know about,” said Downing.
During cross-examination, Gates revealed he had engaged in an extramarital affair more than a decade ago and embezzled hundreds of thousands of dollars from Manafort by falsifying expense reports to Manafort’s consulting firm, Davis Manafort Partners International.
Downing said Gates had difficulty keeping his story straight with the jury about the money he received from Manafort and suggested during cross examination he received bonuses but also stole funds.
The government, he said, was so “desperate to make a case against Mr. Manafort” that they made a deal with Gates.
“How was he able to make the deal he got?” asked Downing of Gates’ plea deal. “He’s just fabricating it to get his probationary deal.”
Gates was among the more than two dozen witnesses who were called by the government to testify during the 11-day trial. He admitted while on the stand to committing criminal acts with Manafort and said he falsified documents submitted to banks at Manafort’s direction.
Downing admitted in his argument that there were offshore bank accounts that Manafort controlled, but shifted the blame to Gates for maintaining signature authority over them — and then eventually embezzling money from them.
He also took issue with testimony from Cindy Laporta, a former tax preparer for Manafort, who testified under immunity. Laporta told the court she was involved in discussions to classify income Manafort received as loans, despite not believing representations about the funds.
During her testimony, Laporta indicated she knew that classifying the income as loans was wrong, but did so anyway because she did not want to open her firm up to litigation and knew Manafort was a long-term client.
But Downing said Laporta’s firm had reclassified income as loans before and said it was when the FBI started asking questions of her that she began to feel she did something wrong.
As Manafort’s lawyers concluded their two-hour-long remarks, they asked the jury to find Manafort not guilty of all charges.
“The government has not met their burden,” Downing said.
In a short rebuttal, federal prosecutor Greg Andres passionately proclaimed that Manafort committed the crimes and “he’s to blame for all of Mr. Manafort’s crimes.”
Hours prior, Andres outlined the federal government’s case against Manafort for nearly two hours.
“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. “When you follow the money, the trail is littered with lies.”
