Rick Gates says he and Manafort disguised foreign income as loans

Paul Manafort's associate says 'hundreds' of emails prove former Trump campaign chief directed fraud

Manafort Lawyer: 'So Many Lies' Gates Can't Keep Up

Rick Gates has been the government's star witness in Manafort's financial fraud trial, testifying how, at the behest of his longtime boss, he helped hide millions of dollars in foreign income and submitted fake mortgage and tax documents.

U.S. President Donald Trump's one-time campaign aide Rick Gates testified for a third day on Wednesday at the trial of his former boss Paul Manafort, whose lawyers chipped away at his credibility for admitting he lied and stole money.

Gates told the court Manafort requested he not tell a bookkeeper about payments made from accounts he held in Cyprus, testifying that hundreds of emails show Manafort approved payments out of those accounts, which he said at one point held almost $6 million.

His defence team is seeking to pin the blame on Gates, who they say was responsible for day-to-day operations of the business. He agreed to cooperate with federal prosecutors and has pleaded guilty to conspiracy and lying to the FBI. Manafort welcomed more than $65 million from Ukrainian political backers' foreign entities into his own secret Cypriot and other offshore accounts during Ukrainian President Viktor Yanukovych's four years in office, according to Magionos.

The 46-year-old former political consultant told jurors how Manafort asked for tickets to Trump's inauguration so he could give them to a banker involved in approving a loan at the center of his financial fraud trial.

"They failed to check the box that Mr. Manafort had a foreign bank account", IRS agent Michael Welch said, later adding: "He should have marked the box, 'Yes'".

"The only answer I was told was to tell the truth", Gates replied.

A day earlier, Gates acknowledged having a single extramarital relationship in London while working for Manafort.

"While the firm believes that her actions were related only to work she performed for Mr. Manafort, and that no other client was affected, a detailed, independent internal review is being conducted to confirm that her activity was isolated", the firm said in the statement.

After Gates struggled to recall precisely what he had told Mueller's team, Downing asked if he had been confronted with "so many lies" that he can't keep his story straight.

Although the allegations of collusion between Donald Trump and Russian Federation are not at issue in this trial, any significant blows to the government's case are likely be seized on by the president's defenders, including conservative media, to support his contention that Mueller's investigation is a "rigged witch-hunt".

The questioning is part of the Manafort defense strategy of presenting Gates to the jury as someone who lies and can not be trusted.

After Mr Gates described his theft as "unauthorised transactions" instead of embezzlement, Mr Downing prodded him to use the latter term - and Mr Gates ultimately relented, saying: "It was embezzlement from Mr Manafort". Gates said that these loans were actually income. Gates and Manafort were not targets of the Federal Bureau of Investigation at the time of the interview.

"It actually kind of shows in real time the course of months of investigation where they painstakingly did a jigsaw puzzle of records", former US prosecutor Harry Litman said of Magionos' testimony. Prosecutors had previously said that Manafort's interactions with Calk were the only part of the trial expected to overlap with his Trump campaign role. "I'm taking responsibility for it".

Gates made the statement under cross examination by Manafort attorney Kevin Downing. Gates said the man schooled them on how to shield their operations from scrutiny by tax collectors.

Paul Manafort's protege on Wednesday wrapped up his testimony after implicating the former Trump campaign chairman and himself in financial crimes and also enduring stinging attacks on his character and credibility.

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