On the fifth day of the trial of Mr Manafort, who has pleaded not guilty to 18 counts of bank and tax fraud and failing to disclose foreign bank accounts, prosecutors introduced the man they believe could be their star witness - the defendant’s 46-year-old right hand man and deputy, Rick Gates.
Mr Gates told the court he was appearing as part of a plea deal, having agreed to cooperate with special counsel Robert Mueller, who is investigating Russia’s alleged interference in the 2016 election. The charges against Mr Manafort relate to the period before he joined Mr Trump’s campaign for five months in 2016, and briefly become its manager in June 2016.
Rather, the indictment relates to the period from 2006 to 2016 when prosecutors allege Mr Manafort and Mr Gates “generated tens of millions of dollars of income as a result of their Ukraine work” and hid the profits from the US authorities. Mr Manafort, who denies the charge, is understood to have worked for Ukraine’s sometime president Viktor Yanukovych since 2004.
Prosecutors have listed 35 witness for the trial in Alexandria, Virginia, which is expected to last three weeks. But few are likely to be as important as Mr Gates, who entered the court and reportedly spoke quickly, looking at the prosecutor, rather than Mr Manafort. By contrast, the Washington Post said, Mr Manafort, stared intently at his former business partner as he spoke.
Mr Gates, who is hoping for a reduced sentence in exchange for his plea and his testimony against his longtime colleague, told the court on Monday: “We did not submit the required form designating he had control over an offshore account.”
When prosecutor Greg Andres asked why, Mr Gates replied: “At Mr Manafort’s direction.”
Mr Gates also testified he and Mr Manafort knew it was a crime because they had been notified by Mr Manafort's accountants in emails.
Mr Manafort’s lawyers have indicated they will seek to blame Mr Gates and have accused him of embezzling millions of dollars from Mr Manafort. The two men have known each other for two decades and ran a multimillion-dollar political consulting business. Mr Gates also worked for the Trump election campaign.
Indeed, during his testimony Mr Gates said that while helping Mr Manafort commit crimes, he also embezzled from his boss and other employees.
Mr Gates said he had authority on some of Nr Manafort’s Cyprus accounts, which were set up by a law firm in that country. “I added money to expense reports and created expense reports” that were not accurate, he said. He said he earned himself several "hundred thousand” dollars extra a year as a result.
Prosecutors on Monday went through a list of overseas corporations and Mr Gates testified that all of them were controlled by Mr Manafort and contained income earned by his political consulting work.
Mr Gates said an associate, Konstantin Klimnik, had control over the overseas accounts. Mr Klimnik is a Russian-Ukrainian political consultant who was indicted in June on charges stemming from the Mueller probe, the news agency said.
Since the trial started before US District Judge TS Ellis last Tuesday, Mr Manafort’s lawyers have kept their cross-examinations brief and at times refrained from attempting to rebut damaging testimony in detail.
The trial continues.