Paul Manafort

AP Photo/Jacquelyn Martin

Jury Deliberations In Progress In Manafort Trial

August 16, 2018 - 2:45 pm
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ALEXANDRIA, Va. (WCBS 880) -- The jury began deliberating Thursday in the trial of former Trump campaign chairman Paul Manafort.

CBS News Correspondent Steve Dorsey said the deliberations began around 9:30 a.m., while Manafort and his defense team stays across the street at a restaurant. Deliberations wrapped for the day in the late afternoon and will resume on Friday.

Prosecutors say Manafort earned $60 million advising Russia-backed politicians in Ukraine, hid much of it from the IRS and then lied to banks to get loans when the money dried up.

Manafort's defense countered that he wasn't culpable because he left the particulars of his finances to others.

The financial fraud trial calls on the dozen jurors to follow the complexities of foreign bank accounts and shell companies, loan regulations and tax rules. It exposed details about the lavish lifestyle of the onetime political insider, including a $15,000 jacket made of ostrich leather and $900,000 spent at a boutique retailer in New York paid via international wire transfer.

It's the first courtroom test of the ongoing Russia probe led by special counsel Robert Mueller. While allegations of collusion are still being investigated, evidence of bank fraud and tax evasion unearthed during the probe has cast doubt on the integrity of Trump's closest advisers during the campaign.

Peter Carr, spokesman for the special counsel's office, declined to comment.

"When you follow the trail of Mr. Manafort's money, it is littered with lies," prosecutor Greg Andres said in his final argument, asking the jury to convict Manafort of 18 felony counts.

CBS News White House Correspondent Steven Portnoy explained the prosecution argued that Manafort lied to “support a lavish lifestyle with houses in the Hamptons and here in the D.C. area.”

“They actually used het alliterative phrase, ‘Cars, clothing, condos, and construction.’ That’s where they say Manafort put the millions he hid from the IRS and sheltered in overseas accounts that he didn’t report,” Portnoy told WCBS 880’s Wayne Cabot and Paul Murnane.

In his defense, Manafort's attorneys told jurors to question the entirety of the prosecution's case as they sought to tarnish the credibility of Manafort's longtime protege — and government witness — Rick Gates.

Defense attorney Richard Westling noted that Manafort employed a team of accountants, bookkeepers and tax preparers, a fact he said showed his client wasn't trying to hide anything. Westling also painted the prosecutions' case as consisting of cherry-picked evidence that doesn't show jurors the full picture.

"None of the banks involved reported Manafort's activities as suspicious," he said, saying Manafort's dealings only drew scrutiny when Mueller's investigators started asking questions.

Westling questioned whether prosecutors had proven Manafort willfully violated the law, pointing to documents and emails that the defense lawyer said may well show numerical errors or sloppy bookkeeping or even false information on Manafort's tax returns but no overt fraud.

During the prosecution's arguments, jurors took notes as Manafort primarily directed his gaze at a computer screen where documents were shown. The screen showed emails written by Manafort that contained some of the most damning evidence that he was aware of the fraud and not simply a victim of underlings who managed his financial affairs.

Andres highlighted one email in which he said Manafort sent an inflated statement of his income to bank officers reviewing a loan application. He highlighted another in which Manafort acknowledged his control of one of more than 30 holding companies in Cyprus that prosecutors say he used to funnel the more than $60 million he earned advising politicians in Ukraine.

Manafort chose not to testify or call any witnesses in his defense. His lawyers have tried to blame their client's financial mistakes on Gates, calling him a liar and philanderer.

Gates, who struck a plea deal with prosecutors, told jurors he helped conceal millions of dollars in foreign income and submitted fake mortgage and tax documents. He was also forced to admit embezzling hundreds of thousands of dollars from Manafort and conducting an extramarital affair.

Andres said the government isn't asking jurors to like Gates or take everything he said at "face value." He said the testimony of other witnesses and the hundreds of documents are enough to convict Manafort on tax evasion and bank fraud charges.

"Does the fact that Mr. Gates had an affair 10 years ago make Mr. Manafort any less guilty?" Andres asked, noting that Manafort didn't choose a "Boy Scout" to aid a criminal scheme.

The government says Manafort hid at least $16 million in income from the IRS between 2010 and 2014. Referring to charts compiled by an IRS accounting specialist, Andres told jurors that Manafort declared only some of his foreign income on his federal income tax returns and repeatedly failed to disclose millions of dollars that streamed into the U.S. to pay for luxury items, services and property.

Manafort attorney Kevin Downing told jurors that the government was so desperate to make a case against Manafort that it gave a sweetheart plea deal to Gates, and he would say whatever was necessary so it would not recommend he serve jail time.

"Mr. Gates, how he was able to get the deal he got, I have no idea," Downing said.

Several times during their arguments, Downing and Westling referred to the prosecution as the "office of special counsel" and suggested that Manafort was the victim of selective prosecution, an argument the judge had specifically ruled they couldn't make.

“Manafort’s defense lawyers say that he is essentially the target of a special counsel’s office that was desperate to find something to charge him with. In fact, his defense lawyer said yesterday that they stacked up charges against him,” Portnoy said.

The prosecutors trying the Manafort case did not appreciate the defense team’s repeated use of the phrase “special counsel,” Portnoy said.

“I guess they must be thinking that the defense counsel hopes to ring a bell or something in the minds of at least one of the jurors that this is something political,” Portnoy said. “So the judge said, ‘Disregard or ignore any suggestion that the Justice Department is bringing this for any particular reason or motive.”

Dorsey said the defense strategy was “strange.”

“The defense says that the prosecution has not met its burden of proof, especially beyond a reasonable doubt for this jury, and that’s what they’re hoping jurors will consider; will believe them. The defense doesn’t want to respond or justify the prosecution, saying they haven’t met enough evidence,” he said. “That’s kind of a long shot, especially since the prosecution called dozens of witnesses over a period of 10 days, and the defense strategy was just a day, day and a half with closing arguments.”

The judge’s instructions to the jury took 97 minutes on Wednesday. The jurors will have to sift through 388 documents and other exhibits as they deliberate.

“There were some arguments over the exact instructions for the jury. The defense was able to successfully allow the judge to make some small edits to their instructions, but for the most part, the jury has been instructed with considering these bank and fraud charges – 18 counts of them –that land Paul Manafort in some very serious trouble if convicted,” Dorsey said.

And when the verdict comes down, reporters will not be tweeting it or blasting it out electronically in real time.

“We are not able to bring our phones into the building, so we’re going back about a century in terms of how we’re going to broadcast this out to the world,” Portnoy said. “I’ll be bringing my pen and pad, and we’ll race out as soon as we can; we’ll get it on the air.”

Leaving the courthouse, Downing said he felt "very good" about Manafort's chances of being acquitted.

"Mr. Manafort was very happy with how things went today," Downing said.

Next month, Manafort will be on trial again in Washington, D.C., where he is charged with much more serious crimes directly related to the Mueller investigation – including obstruction of justice.

(© 2018 WCBS 880. The Associated Press contributed to this report.)