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Manafort Prosecutors Grill Accountants About Tax Filings, Foreign Bank Accounts


Donald Trump's former campaign manager Paul Manafort (file photo)

ALEXANDRIA, Virginia -- U.S. lawyers combed through years of business documents and income-tax returns for Paul Manafort, as they built their arguments that President Donald Trump’s former campaign chairman committed tax evasion and fraud.

On day four of Manafort’s trial, prosecutors on August 3 grilled one of his long-time accountants on how Manafort reported and paid taxes on his income, much of which came from political consultancy work in Ukraine between 2010 and 2014.

Manafort’s trial, which is being held in U.S. federal court in Alexandria, Virginia, is the first arising out of Special Counsel Robert Mueller’s investigation into the interactions between Trump associates and Russian officials and agents.

The 18 charges against Manafort predate his time managing Trump’s presidential election campaign in 2016. Though the charges concern money earned from the work he did in Ukraine for former President Viktor Yanukovych, they do not directly deal with Russia, or with questions of Trump aides' dealings with Russian agents.

Prosecutors have charged Manafort with 18 counts of bank fraud, conspiracy, tax evasion, and other charges related to earnings from his work in Ukraine for Yanukovych and his pro-Russia political group, the Party of the Regions.

As he has every day since the trial began, Manafort sat quietly throughout the proceedings, dressed in a suit and tie.

Assistant U.S. Attorney Uzo Asonye spent the first half of the August 3 proceedings walking Manafort's longtime accountant -- Philip Ayliff -- through years of tax returns and bookkeeping records.

Among the allegations against Manafort are that he failed to disclose to the U.S. government the fact he had foreign bank accounts, some of which were allegedly used to hide income, and that he hid his ownership of foreign entities, many based in Cyprus, which he used to receive his Ukraine-related income.

'Lavish Lifestyle'

Prosecutors had indicated that they planned to call Manafort’s former deputy, Rick Gates, to testify on August 3, though it was unclear if indeed that would happen later in the session.

The previous day, prosecutors called a series of witnesses -- including a suit tailor, a home renovator, a real estate agent, and a landscape designer – seeking to demonstrate what they said was Manafort’s lavish lifestyle, which was funded allegedly from wire transfers from offshore accounts.

The transfers purportedly came from various shell companies -- mainly Cyprus-based -- that authorities say Manafort used to hide his income.

Prosecutors have said they intend to complete their arguments as early as next week. Once that happens, Manafort's defense team will present its case to try and convince the jury of his innocence.

If the trial continues quickly, it could wrap up before the second, more consequential, trial against Manafort is scheduled to being in September.

That trial, in U.S. federal court in Washington, D.C., focuses on allegations that Manafort failed to register as a foreign agent when he was working for Yanukovych and his Ukrainian political party.

While Manafort's is the first case that Mueller has brought to trial, the special counsel has charged 31 other people with dozens of offenses, including conspiracy, failure to register as foreign agents, and lying to federal law enforcement.

That includes 12 Russian military intelligence officers who allegedly used hacking and other tools in attempts to sway the 2016 U.S. presidential election.

Among those who have pleaded guilty to Mueller’s charges are Trump's first national security adviser, Michael Flynn.

Trump has repeatedly attacked Mueller’s investigation, denying any effort by him or his associates to collude with Russian officials to sway the election.

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