Prosecutors summoned Gates to give jurors the first-hand account of a co-conspirator they say helped Manafort carry out an elaborate offshore tax-evasion and bank fraud scheme. "You know. Yeah, because on the one hand Gates stole money from him but on the other hand he clearly learned everything that Manafort taught him".
"In Cyprus, they were documented as loans".
Downing sought to portray Gates as an inveterate liar, raising questions about whether he has been truthful with Mueller's office even after cutting a plea deal in February.
Gates was hired by Manafort to serve as deputy campaign chairman and later had a role on Mr Trump's inaugural committee.
Manafort and Gates were the first two people indicted in Mueller's investigation into potential ties between Russian Federation and the Trump campaign.
After saying Monday that he committed crimes with Manafort, including concealing offshore accounts to avoid reporting them to the USA government at tax time and claiming false income to get loans, Manafort defense attorney Kevin Downing asked the witness, "This jury is just supposed to believe you after all the lies that you've told and the fraud you've committed?"
Four employees at Dr. K's firm established and named the entities - Leviathan Ltd. and Peranova Ltd. are two of the more high-profile examples - where Manafort and Gates held millions of dollars of payments to Manafort's Davis Manafort Partners (DMP) and DMP International from their overseas political clients. If convicted on all counts, Manafort could face eight to 10 years in prison based on federal sentencing guidelines, according to sentencing expert Justin Paperny.
The 46-year-old, who has pleaded guilty to conspiracy and is cooperating with the government, began the day by describing how he helped Manafort evade U.S. taxes on millions of dollars earned from political consulting work they did in Ukraine.
The email exchange about Calk occurred after Manafort left the Trump campaign but while Gates was active on the Trump inauguration committee.
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He also admitted he had flown first class and stayed in luxury hotels during the relationship, using money embezzled from Manafort.
Gates said Monday that over the years, Manafort directed him to make payments through wire transfers. He's expected to go for at least another hour in questioning with Manafort's attorney's. He has pleaded not guilty to all charges. Gates also worked on the campaign. Gates also said Manafort floated banker Stephen Calk's name for consideration as Secretary of the Army, a post he ultimately did not get. Gates was asked about 11 Cypriot accounts, and he testified that they were all owned by Ukrainian businessmen.
Rick Gates is seen on the witness stand as a message between he and his former boss, Paul Manafort, appears before the court during Manafort's trial in Virginia.
He has pleaded guilty to helping Manafort hide payments from Manafort's consulting work with pro-Russia politicians in Ukraine to dodge taxes. But Trump has shown interest in the proceedings, tweeting support for Manafort and suggesting he has been treated worse than gangster Al Capone.
Gates proved essential to prosecutors' attempt to tie Manafort to the dozens of foreign bank accounts in Cyprus, the United Kingdom, and St. Vincent and the Grenadines where he allegedly hid millions of dollars of taxable income from the IRS for almost a decade.
He has already admitted embezzling some funds from Manafort.
Manafort to Gates in 2015, "WTF?" Gates did not have a chance to respond to those allegations Monday.
For this Manafort was paid US$4million a year, in quarterly payments of US$1million, Gates recalled, though at some point the currency switched from USA dollars to Euros. When the trial broke for lunch, Manafort looked back at his wife, sitting in the front row, smiled and winked at her, followed by a quick shake of his head, seeming to indicate he was unfazed by the morning's testimony.
"The government raised an issue whether or not we were going to cross-examine Mr. Gates about specific acts of marital infidelity", Downing told Judge Ellis.