Manafort's lawyers press witness about his own lies, affair, embezzlement

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The tax and bank fraud charges in the current trial - the first of two Manafort is scheduled to face - however, have nothing to do with Manafort's work on the Trump campaign.

Gates testified they were not loans but compensation to Manafort. But he could be seen twitching under cross examination by Downing, blinking hard as he faced the defense lawyer and sucking in his lips. That admission came during a line of questioning from the defense about the $2.7 million to $3 million Gates admitted he embezzled from Manafort.

"WTF", Mr Manafort wrote in response, "How could I be blindsided like this". U.S. District court Judge T.S. Ellis III presides.

In his first hour on the witness stand, Rick Gates catalogued years of crimes, saying most of his wrongdoing was committed on behalf of his former boss Mr Manafort, while other crimes were for his own benefit, including the theft of hundreds of thousands of dollars.

"I acknowledge I had a period of time when I had another relationship", said Gates, who is married and has four children.

Downing also asked whether he submitted personal expenses when he worked for Republican Trump's inaugural committee.

Defense lawyer Kevin Downing guided Gates on a tour through the wide array of lies he's told, and sought to paint him as a man not to be trusted. The defense moved on. He also committed credit card and mortgage fraud, falsified a letter for a colleague involved in an investment deal and made false statements in a deposition at Manafort's direction.

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.

A clothier said he sold Manafort more than $900,000 in suits, a bookkeeper says she helped disguise foreign income as a loan to reduce Manafort's tax burden and, on Wednesday, an Federal Bureau of Investigation forensic account said Manafort hid more than 30 offshore accounts in three types of currencies from the IRS.

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In the six days since the trial began, the jury has heard from 15 witnesses including two of Manafort's former accountants and his former bookkeeper. The firm's director was known to Manafort and Gates as "Doctor K".

In a final back and forth between lawyers over Gates's credibility, the focus turned to his decision to plead guilty and cooperate with special counsel Robert Mueller's investigation, which Manafort's defence have portrayed as an attempt to save his own skin.

The case has little to do with either man's work for the Trump campaign and there's been no discussion during the trial about whether the Trump election effort coordinated with Russian Federation - the central question Mueller's team has tried to answer. But Trump has shown interest in the proceedings, tweeting support for Manafort.

Paul Manafort has pleaded not guilty to 18 charges. Both sides agreed ahead of time to limit discussion of the campaign so as not to prejudice the jury, though they had agreed to allow testimony about the overlap of a bank loan with Manafort's role in the campaign. Gates testified that Manafort asked him to float Calk, who was on Trump's economic advisory council, for Secretary of the Army. But then prosecutor Greg Andres invoked Trump's name, and Gates' and Manafort's work on the campaign became more explicitly tied to the alleged crimes at the heart of the trial.

Gates described in detail his crimes against his employer and even an extramarital affair he'd had, while turning the knife on his longtime boss by outlining the crimes he claims Manafort directed him to commit.

The email exchange about Calk occurred after Manafort left the Trump campaign but while Gates was active on the Trump inauguration committee.

Prosecutors also say the men falsified documents to lie to banks in order to qualify Manafort for loans. "Mr Manafort had the same path".

Gates admitted during testimony on Monday to embezzling money from Manafort.

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