Rick Gates, testifying in Manafort trial, admits to affair, London apartment

Rick Gates, testifying in Manafort trial, admits to affair, London apartment

Rick Gates wrapped up his testimony Wednesday in the trial of his onetime friend and boss, former Trump campaign manager Paul Manafort, reiterating that the two men conspired to lie on their taxes and defraud banks.

After Gates left the stand on Wednesday, the jury heard from Morgan Magionos, a forensic accountant with the Federal Bureau of Investigation. So frequent were Gates's crimes that he could not answer definitively when asked if he had stolen money from the Trump inauguration committee, for which he served as deputy chairman.

Gates also said Mr Manafort had directed him to report money wired from his foreign bank accounts as loans to reduce Mr Manafort's taxable income.

"In essence, I was living beyond my means", Gates said. After Yanukovych lost power in 2014, "I would say it decreased the income stream", Gates, wearing a blue suit, told the court matter-of-factly.

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?"

Manafort's political work included advising Viktor Yanukovich on policy after he won the Ukrainian presidency, Gates said.

Greg Andres, a prosecutor on special counsel Robert Mueller's team, somewhat softened the blows Manafort's attorney had inflicted during his cross examination.

Downing then asked about what he called "the secret life of Rick Gates", inquiring whether Gates kept an apartment in London and if he engaged in an extramarital relationship there.

Andres questioned: "Did you tell the Federal Bureau of Investigation there was hidden income in those accounts?"

In an aggressive cross-examination on Tuesday, Manafort's lead attorney Downing said to Gates: "You stole from Mr. Manafort".

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The lawyer, Kevin Downing, was trying to counter earlier testimony that Manafort had encouraged Gates to deceive authorities by directing him to help hide his foreign income and to submit phony mortgage and tax documents on his behalf. And Manafort made millions of dollars working as a political consultant for a pro-Russia party in Ukraine before he worked for the Trump campaign, which could raise questions about Trump's friendly rhetoric towards the country.

Manafort and Gates were the first two people indicted in special counsel Robert Mueller's investigation into potential ties between Russian Federation and the Trump campaign.

Manafort's defense team's primary strategy has been to pin much of the blame for financial crimes on Gates, and some observers felt Downing made some headway toward that goal on Tuesday.

During this period Gates said he falsified the firm's financial statements to support mortgage loan applications and misled bankers by submitting old home insurance policy information to make it appear Manafort owned the property, although current policy showed a mortgage loan.

Gates pleaded guilty in February to conspiracy and making false statements in exchange for his testimony against Manafort and cooperation with the Special Counsel's office.

FBI forensic accountant Morgan Magionos walked jurors through her special counsel-ordained investigation that revealed how Manafort purchased luxury goods back in the USA through foreign bank accounts.

The tough questioning of Gates came after he spent hours telling jurors how he disguised millions of dollars in foreign income as loans in order to lower Manafort's tax bill.

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 United States dollars to Euros. Manafort has pleaded not guilty to the charges.

So far, 18 witnesses have testified in the former Trump campaign chairman's trial.

After Gates described his theft as "unauthorized transactions" instead of embezzlement, Downing prodded him to use the latter term - and Gates ultimately relented, saying, "It was embezzlement from Mr. Manafort".

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