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Banker Pushed $16M Manafort Loans Despite Risk, Jury Told

17 August 2018

Attorneys for Paul Manafort rested their case on Tuesday without calling any witnesses, including the former Trump campaign chairman himself, who told the judge he did not want to testify in his own defense against bank and tax fraud charges.

Earlier Tuesday, Ellis said he would instruct the jury to think about the "materiality" of the question of whether Federal Savings Bank founder Stephen Calk could contribute to Manafort allegedly defrauding the bank for $16 million in loans. During testimony, Gates was also forced to admit embezzling hundreds of thousands of dollars from Manafort and conducting an extramarital affair.

Trump has distanced himself from Manafort, who was chairman of the campaign from May to August 2016 - with Gates at his side.

"Mr. Calk is a co-conspirator, and he participated in the conspiracy to defraud the bank", prosecutor Greg Andres said at the sidebar, in a transcript unsealed over the weekend. The indictment says he and business associate Rick Gates moved money from Ukraine through foreign bank accounts to hide it from the Internal Revenue Service.

While the prosecution has built a solid case, Manafort's lawyers appeared to have raised some doubts about the testimony of Gates and other witnesses, Wu said.

James Brennan, a vice president at Federal Savings Bank, says Manafort failed to disclose mortgages on his loan application.

U.S. District Judge T.S. Ellis III says the proceedings and the motion will be kept secret until after Manafort's case concludes.

Instead, Mueller's prosecutors have called accountants, bookkeepers, luxury vendors and Manafort's longtime business associate, with a final group of witnesses appearing on Friday to lay out his alleged financial transgressions.

The hearing comes after the judge delayed Manafort's trial for hours last Friday without explanation.

That information led senior executives to reject one of the loans.

The trappings of Manafort's lifestyle dominated media headlines throughout the trial: there was half a million dollars worth of antique rugs, $750,000 spent on landscaping for his $13 million Bridgehampton mansion, and more than $1 million for clothing, including a $15,000 jacket made of ostrich skin. Prosecutors said Calk unsuccessfully sought a larger role in the Trump administration. Under tough cross-examination from defense attorneys, Gates maintained that every action he took came at Manafort's direction.

"We've rested because Mr. Manafort and his legal team do not think the government has met its proof", Downing told Reuters.

"You have an absolute right to testify before this jury", Ellis said. On Monday, defense lawyers filed a sealed motion, and prosecutors filed a response also under seal.

The prosecution pressed Ellis to alter instructions about comments the judge had made to emphasize that they should not be considered by the jury.

Manafort, through his political consulting firms (first, Davis Manafort Partners, then DMP International), controlled 32 foreign bank accounts in Cyprus, St. Vincent and the Grenadines, and the United Kingdom, set up by Cypriot lawyer Kypros Chrysostomides, referred to in court as "Dr. K" due to his name's hard pronunciation and spelling for non-Greek speakers.

Brennan, asked about whether the bank made money from lending to Manafort, said the bank has written off the loans and "took a hit" of $11.8 million.

Banker Pushed $16M Manafort Loans Despite Risk, Jury Told