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

Donald Trump’s former campaign chairman Paul Manafort had 15 undisclosed foreign accounts and spent years hiding millions of dollars to evade tax, his former deputy has claimed.

In a tense day in court, the campaign strategist’s longtime deputy, Rick Gates, told jurors how the pair were paid by Ukrainian oligarchs for their work as political consultants in the country.   

Mr Gates, the prosecution’s star witness, recounted how he and Mr Manafort used offshore shell companies and bank accounts in Cyprus to funnel the money, all while failing to declare the income to the US Internal Revenue Service (IRS).

In his second day of testifying against his former boss, Mr Gates said at the time he worked on President Trump’s election campaign, his salary was paid by savings and investments from Mr Manafort. 

The prosecution produced an undated email exchange between Mr Manafort and Mr Gates which outlines the amount of tax the campaign chief might have to pay. 

"WTF," Mr Manafort wrote in response, "How could I be blindsided like this".

Mr Gates told jurors that he had been “tasked” by his boss “to determine how we could lower the taxes”.

Prosecutors hope by summoning Mr Gates, described as Mr Manafort’s "right-hand man", they can give jurors first-hand evidence that Mr Manafort was in full control of his finances and the elaborate fraud scheme.

Mr Manafort’s defense team have sought to paint Mr Gates as an embezzler, liar and the instigator of any criminal conduct. He is expected to face a bruising cross-examination as the defense try to undercut his credibility and pin the blame on him.

The outcome of the trial, the first to stem from Robert Mueller’s investigation into Russian interference in the 2016 election, may well hinge on whether or not the jury finds Mr Gates to be a credible witness. 

Mr Gates has pleaded guilty to fraud and agreed to cooperate in Mr Mueller’s investigation of Mr Manafort, who has denied all the charges against him.

It emerged on Tuesday that Mr Gates met with the government 20 times to prepare his testimony ahead of his court appearance.

Mr Gates walked into a packed courtroom, a day after he calmly acknowledged having embezzled hundreds of thousands of dollars from Mr Manafort, to detail exactly how the two stashed money in foreign bank accounts and falsified bank loan documents.

During his two-day testimony Mr Gates never looked in his former mentor’s direction, while Mr Manafort frequently glared at him as he admitted to their joint criminal activity.

The face-off between longtime business associates and former senior members of the Trump campaign drew scores of people who arrived at the courthouse as early as 6.00am to get a seat in the crowded courtroom.

In his testimony on Tuesday, Mr Gates claimed there were "hundreds" of emails proving his former boss directed the complex fraud scheme.

This was bolstered by email exchanges produced by the prosecution appearing to confirm that Mr Manafort directed moving the money his consulting company earned from Ukraine through Cypriot accounts. 

"There were hundreds of these," Mr Gates told the court.

Mr Gates also told jurors that after the money dried up in 2014 with the fall of Ukrainian President Viktor Yanukovych, the two men tried to earn money from a new opposition party that was formed, but payments were slow to come.

Mr Gates, who is awaiting sentencing, told jurors of his own criminal conduct, and admitted to three other crimes that had not been previously known – lying on a mortgage application, credit card applications and filing false expense reports to an employer.

The case against Mr Manafort has nothing to do with either man’s work for the Trump campaign, but the president has shown interest in the proceedings, tweeting support for Mr Manafort and suggesting he has been treated worse than the notorious gangster Al Capone.