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Manafort's accountants appear just as confused about his finances as you are

Barreling along even faster than observers had expected, prosecutors have said they plan to wrap the case against President Trump’s former campaign chairman by next week.

by Greg Walters and Jack Brewster
Aug 3 2018, 7:32pm

ALEXANDRIA, Virginia — After showing off Paul Manafort’s exorbitant lifestyle of eye-popping luxury, prosecutors in his federal case are now drilling into his finances.

The trial resumed Friday morning with prosecutors pressing Manafort’s former tax preparer, Philip Ayliff, about his foreign bank accounts. They focused on whether Ayliff had ever heard of any of the oddly-named companies, based on the Mediterranean island of Cyprus, that covered his personal expenses.

Barreling along even faster than observers had expected, prosecutors have said they plan to wrap the case against President Trump’s former campaign chairman by next week.

Key to that aggressive timeline will be briskly laying out evidence that Manafort misled, or kept in the dark, the financial professionals he employed to work on his books. These nitty-gritty details are at the heart of the government’s case against Manafort, who may spend the rest of his life in prison if convicted.

Manafort stands accused of hiding millions in income from U.S. tax authorities while working as a political consultant for the former president of Ukraine, and then, afterwards, once that regime collapsed, taking out big loans from U.S. lenders with fraudulent applications to continue funding his lavish lifestyle.

Manafort’s defense team has argued that he never deliberately broke the law. The crux of his defense appears to blaming his former sidekick, Rick Gates, for any wrongdoing. On Friday, Manafort’s attorney Keith Downing offered another defense tactic: questioning whether Manafort ever actually tried to hide his overseas wealth.

Downing told judge T.S. Ellis he wanted to ask Ayliff, in cross-examination, whether the accountant had received documents with the names of those foreign companies. He suggested that if Manafort had showed them to his accountant, that would indicate he wasn’t trying to hide them.

“Only a fool would give that kind of information to his accountant if he was trying to conceal his accounts,” Downing said.

The prosecution, for their part, has spent the better part of two days this week showing, in painstaking detail, how companies in Cyprus sent millions in wire transfers directly to retailers and workmen in the U.S. to pay for Manafort’s fancy suits, landscaping, luxury cars and even his high-end karaoke system.

Read: Manafort has a new scapegoat in his defense against Mueller

Ayliff told the court that he either hadn’t heard of those Cyprus entities, or thought that some — like Lucicle Consultants Ltd or Global Highway Ltd — were actually Manafort’s clients. He said he didn’t know, as the government alleges, that Manafort controlled them himself.

As prosecutors pick through the details of Manafort’s wardrobe choices and personal accounts, Manafort has sat quietly at a table in the front of the room next to his lawyers. At times he has slouched noticeably, such as during the prosecution’s opening statement. He has occasionally appeared to be trying to buck up his wife, Kathleen, who sits a few feet behind him.

On Thursday morning, after Manafort sat down next to his lawyers, he turned and gave Kathleen a broad, confident grin, and a big wink.

MANAFORT’S FOREIGN BANK ACCOUNTS

But Manfort has little to feel confident about. He faces hundreds of years in prison for allegedly committing a raft of financial crimes. Prosecutors claim he didn’t pay taxes on much of the income he earned working in Ukraine, and that he illegally failed to disclose foreign bank accounts holding vast sums.

On Friday, Ayliff told the court that he’d sent Manafort an email asking directly whether Manafort, his wife or his children held any foreign bank accounts. Manafort allegedly wrote back to his accountant: “No.”

Ayliff told prosecutor Uzo Asonye that as an accountant, he’d need to know about any foreign accounts in order to properly do his job, “because I would want to be sure that income is picked up and recorded correctly.”

Read: Paul Manafort spent decades pushing the envelope of what's legal. His trial strategy is just as high-risk.

Manafort’s defense, so far, appears to rest on putting the blame for any wrongdoing on his former deputy, Rick Gates, who has already pled guilty to two counts and agreed to cooperate with special counsel Robert Mueller’s team of investigators.

Gates has been expected to take the stand as the government’s star witness against Manafort. Prosecutors confirmed Thursday that they likely will call Gates to testify, despite saying Wednesday that they might not.

Prosecutors’ plan to wrap their case by next week means the most dramatic and highly-anticipated scene in Manafort’s trial — the testimony and cross-examination of Gates, his longtime assistant and now bitter foe — could happen soon.

Cover image: Paul Manafort, former campaign manager for U.S. President Donald Trump, departs after a hearing at U.S. District Court in Washington, DC, U.S., April 19, 2018. REUTERS/Brian Snyder/File Photo