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Paul Manafort believed he was above the law, say prosecutors

The trial is the first to arise from Robert Mueller’s investigation into potential ties between Donald Trump’s presidential campaign and Russia.

Paul Manafort orchestrated a multi-million-dollar conspiracy to evade US tax and banking laws, leaving behind a trail of lies as he lived a lavish lifestyle, prosecutors said on Tuesday.

During his opening statement in the case against the former Trump campaign chairman, assistant US attorney Uzo Asonye told a jury that Manafort considered himself above the law as he funnelled tens of millions of dollars through offshore accounts.

That “secret income” was used to pay for personal expenses such as a 21,000 dollar (£16,000) watch, a 15,000 dollar (£11,400) jacket made of ostrich and more than 6 million dollars (£4.5 million) worth of real estate paid for in cash, Mr Asonye said.

“A man in this courtroom believed the law did not apply to him — not tax law, not banking law,” Mr Asonye said as he sketched out the evidence gathered by special counsel Robert Mueller’s team in Manafort’s bank fraud and tax evasion trial.

It is the first trial arising from Mr Mueller’s investigation into potential ties between Donald Trump’s presidential campaign and Russia. Mr Mueller was not present in the courtroom.

A man in this courtroom believed the law did not apply to him — not tax law, not banking law Uzo Asonye

Defence lawyer Thomas Zehnle said in his opening statement that Manafort trusted others to keep track of the millions of dollars he was earning from his Ukrainian political work.

He made clear that undermining the credibility of Rick Gates, his former business associate and the government’s star witness, was central to the defence strategy.

Mr Zehnle said Manafort, earning millions as a political consultant helping officials in other parts of the world, relied on Gates and others — including a professional accounting firm — to keep watch over the money.

“Money’s coming in fast. It’s a lot, and Paul Manafort trusted that Rick Gates was keeping track of it,” Mr Zehnle said. “That’s what Rick Gates was being paid to do.”

He warned jurors that Gates could not be trusted and was the type of witness who would say anything he could to save himself from a lengthy prison sentence and a crippling financial penalty.

Gates, who spent years working for Manafort in Ukraine and is also accused of helping him falsify paperwork used to obtain the bank loans, cut a plea deal with Mr Mueller earlier this year. Gates also worked as an aide on Mr Trump’s campaign.

Manafort, who has been jailed for nearly two months, wore a black suit and appeared fully engaged in his defence, whispering with his lawyers during jury selection and scribbling notes as the prosecution began its opening statement.

Before the start of jury selection on Tuesday, prosecutors filed an expanded list of its evidence exhibits, including several email chains between Manafort and Stephen Calk, a Chicago bank chairman. The added evidence also appeared to include documents related to bank accounts in Cyprus.

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Paul Manafort, left, president Donald Trump’s former campaign chairman, with this wife Kathleen Manafort (AP Photo/Jacquelyn Martin, File)

The government intends to show that Manafort funnelled more than 60 million dollars (£45 million) in proceeds from his Ukrainian political consulting through offshore accounts and hid a “significant” portion of it from the IRS.

Mr Asonye said Manafort created “bogus” loans, falsified documents and lied to his tax preparer and bookkeeper to conceal the money, which he obtained from Ukrainian oligarchs through a series of shell company transfers and later from fraudulently obtained bank loans in the US.

But Mr Zehnle disputed prosecutors’ account that Manafort was trying to conceal his earnings by storing money in bank accounts in Cyprus. He said that arrangement was not Manafort’s doing but was instead the preferred method of payment of the supporters of the pro-Russia Ukrainian political party who were paying his consulting fees.

Defence lawyers also sought to address head-on Manafort’s wealth and the images of a gaudy lifestyle that jurors are expected to see during the trial.

“Paul Manafort travelled in circles that most people will never know and he’s gotten handsomely rewarded for it,” Mr Zehnle said. “We do not dispute that.”

The judge even interrupted the prosecutor during his opening statements to caution him against suggesting there was something criminal about being a multi-millionaire.

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Kevin Downing, lawyer for Paul Manafort, leaves the Alexandria Federal Courthouse (AP Photo/Manuel Balce Ceneta)

Prosecutors made no reference to Mr Trump in their opening statement nor discussed in any way Manafort’s leadership of the Trump campaign, or the ongoing investigation into potential collusion between Russia and the president’s associates. Despite that, Manafort’s case is widely viewed as a test to the legitimacy of Mr Mueller’s ongoing probe, which Mr Trump has dismissed as a “witch hunt”.

The trial is expected to last several weeks.

Manafort has a second trial scheduled for September in the District of Columbia. It involves allegations that he acted as an unregistered foreign agent for Ukrainian interests and made false statements to the US government.

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