Prosecutors in the trial of Paul Manafort urged jurors to “follow the money” as they sought to paint Donald Trump’s former campaign manager as a tax-dodging liar with extravagant tastes.
Uzo Asonye, a federal prosecutor, said in his opening statement on the first day of the trial that Mr Manafort had lied to his accountants, book-keepers and the tax authorities about his income and foreign bank accounts.
He called Mr Manafort a man who got “whatever he wanted”, pointing to $6m worth of “luxury real estate”, a $21,000 watch and a $15,000 jacket “made from an ostrich”.
Mr Manafort, 69, who ran the Trump campaign for three months in 2016, is accused of tax and bank fraud in the eastern district of Virginia.
Although his is the first trial resulting from special counsel Robert Mueller’s investigation of Russian meddling in the presidential election, the charges against him largely involve his previous work as a consultant promoting pro-Russian forces in the Ukraine.
All of the charges boil down to one single issue. Paul Manafort lied
Mr Asonye said the defendant made tens of millions of dollars from Ukrainian oligarchs before the money dried up following the 2014 ouster of Mr Manafort’s client, Viktor Yanukovich, the former pro-Russia president of Ukraine.
“The cash spigots closed and Paul Manafort was on the hunt for a new source of money to fund his huge lifestyle,” said Mr Asonye, alleging that Mr Manafort turned to bank fraud. “All of the charges boil down to one single issue. Paul Manafort lied.”
Thomas Zehnle, an attorney for Mr Manafort, responded by calling his client a “talented political consultant and a good man” who had openly co-operated with the FBI when questioned about his Ukraine activities in 2014.
Mr Zehnle attacked Rick Gates, a former close associate of Mr Manafort and the former deputy campaign chair for the Trump campaign. He has pleaded guilty to lesser charges and is due to appear as a witness against his former boss.
Mr Zehnle accused Mr Gates, who worked for Mr Manafort’s consulting company, Davis Manafort, of embezzling funds from the business, claiming Mr Gates’ desire to hide this alleged activity was the reason for any discrepancies in the tax disclosures.
“This is the person the government now wants you to trust,” he said.
Mr Zehnle said Mr Manafort had trusted Mr Gates and others to handle his tax affairs.
“His trust in Rick Gates was misplaced,” said Mr Zehnle, adding that Mr Manafort used offshore bank accounts because it was required by his clients in Ukraine.
“This was the way they requested it be done,” he said.
The court also heard from the first witness in the case, Tad Devine, who was Bernie Sanders’ chief strategist during the Vermont senator’s campaign for the Democratic presidential nomination in 2016.
Mr Devine discussed his work with Mr Manafort in Ukraine from 2005-10 and again in 2014. He is not accused of any wrongdoing.
He testified that Mr Manafort had a close relationship with Mr Yanukovich and praised his work in Ukraine. “I was deeply impressed by him and the people around him. The campaign [in Ukraine] seemed to be well resourced,” said Mr Devine, who pointed to Rinat Akhemtov, a Ukrainian businessman, as a funder of Mr Manafort’s work for Mr Yanukovich and his Party of Regions.
Mr Devine, under questioning by prosecutors, said he never set up an account in Cyprus. The government claims Mr Manafort funnelled money through bank accounts on the island.
Earlier, a jury of six men and six women were selected after counsel for both sides used all of their allowed challenges to dismiss 20 potential jurors. Three women and one man were chosen as alternates.
Judge TS Ellis ensured the process moved along swiftly, calling on lawyers for both the government and Mr Manafort to hurry up.
The former Trump campaign chair has been in jail awaiting trial after his bail was revoked in June by a judge in Washington, where Mr Manafort is due to strand trial in another case. He previously worked on the Republican presidential campaigns of Gerald Ford, Ronald Reagan and George HW Bush.
Mr Mueller’s prosecutors have said that Mr Manafort earned more than $60m in Ukraine between 2005 and 2014 through his work for Mr Yanukovich.
Mr Manafort is accused of hiding at least $30m of that money from US tax authorities in offshore bank accounts in Cyprus, Saint Vincent & the Grenadines and the Seychelles.
Between 2015 and 2017, when his income from Ukraine dried up following Mr Yanukovich’s ousting from office in the Orange revolution of 2014, Mr Manafort is alleged to have fraudulently obtained almost $25m in loans from three banks.
The US government claimed that he misrepresented his income and that of his consulting company, and failed to disclose existing loans on his properties when seeking additional mortgages.
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