Manafort trial - live updates: Rick Gates claims political consultant Konstantin Kilmnik controlled hidden overseas accounts

Trial enters second week and Rick Gates takes the stand

Ex-Trump Campaign Chair Manafort's Court Arrival

Rick Gates, a longtime business associate of Donald Trump's former campaign chairman Paul Manafort, on Monday testified at trial that he helped Manafort file false tax returns and hide his foreign bank accounts.

Mr Gates is expected to be the government's star witness in its case against Mr Manafort. Mr Gates, who also served on Mr Trump's campaign, pleaded guilty in February and agreed to cooperate with prosecutors under a deal that could lead to a reduced sentence.

Taking the stand on the trial's fifth day, Mr Gates admitted to helping Mr Manafort doctor financial statements, hide sources of foreign income, mislead banks to get loans and cheat on his U.S. taxes. He said he did so at Mr Manafort's direction.

“At Mr. Manafort's request we did not disclose foreign bank accounts,” Mr Gates told the jury in federal court in Alexandria, Virginia, describing their relationship of two decades as limited to business. “Outside of business we did not socialise.”

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Mr Manafort's attorneys have signalled they will seek to blame Gates and have accused him of embezzling millions of dollars from Mr Manafort. Mr Gates has been described by witnesses as Mr Manafort's right-hand man who helped run the operations of a multimillion-dollar political consulting business.

In addition to assisting in Mr Manafort's alleged crimes, Mr Gates told the jury he had failed to report his own income routed through bank accounts in the United Kingdom and stole several hundreds of thousands of dollars from Mr Manafort by filing false and inflated expense reports related to their work in Ukraine.

Mr Manafort has pleaded not guilty to 18 counts of bank and tax fraud and failing to disclose foreign bank accounts. The charges largely predate his five months on the Trump campaign but were the first to go to trial arising from Special Counsel Robert Mueller's investigation into Russian interference in the 2016 US election.

The jury has heard how Mr Manafort made tens of millions of dollars for work with pro-Russian politicians in Ukraine. Mr Mueller is also investigating possible coordination between Trump campaign members and Russian officials in the election campaign, but the charges against Mr Manafort do not address that.

Prosecutors went through a list of overseas corporations and Gates testified that all of them were controlled by Mr Manafort and contained income earned by his political consulting work.

Mr Gates said an associate, Konstantin Kilimnik, had control over the overseas accounts. Mr Kilimnik is a Russian-Ukrainian political consultant who was indicted in June on charges stemming from the Mueller probe. In court filings Mueller has accused Mr Kilimnik of having current ties to Russian intelligence services - an allegation he has denied.

Mr Gates testified that Mr Manafort directed him to report overseas income as loans in order to lower taxable income - an allegation prosecutors have been eliciting testimony about from witnesses since last week.

Reuters

[6 August 2018 23:08 · Lucy Anna Gray]

[6 August 2018 23:13 · Steve Anderson]

Mr Andres has been questioning Mr Gates about his work with Mr Manafort on parliamentary elections in Ukraine beginning in 2007.

Mr Gates was asked to review several emails between Mr Manafort and Ukranian political officials and businessmen, which were displayed for jurors.

Mr Gates testified the operatives in Ukraine paid Mr Manafort millions of dollars for political and policy work by wiring money from their companies in Cyprus to Mr Manafort’s unreported foreign bank account in Cyprus.

At times, Mr Gates testified Mr Manafort would move money from Cyprus to his US accounts.

[6 August 2018 23:13 · Steve Anderson]

​Mr Gates acknowledged under questioning by prosecutor Mr Andres that he has a powerful incentive to cooperate with prosecutors. If the government determines that Gates’s assistance in their case against Manafort is “substantial,” he could avoid jail time.

Judge Ellis emphasised several times that it would be up to the judge overseeing Gates’s plea agreement in Washington — US District Judge Amy Berman Jackson — to assess Gates’s cooperation and decide whether to sentence him to a term of probation.