Rick Gates' testimony continued Tuesday afternoon, followed by cross-examination by Paul Manafort's defense attorney, Kevin Downing.
Just before 3pm ET, Gates got into the meat of how he and Manafort used their roles with the Trump campaign for personal financial gain.
12:25 p.m. Gates makes one of his first references to the Trump campaign
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Rick Gates — without using Trump’s name — referenced the campaign work Tuesday.
Gates was describing how in 2015 and 2016, Manafort’s once-lucrative work in Ukraine had dried up, and his company was in dire financial straits. He said the company, DMP International, did not acquire any new clients in 2015, and to his knowledge was not earning income in 2016.
In March of that year, Gates said, he went to work for “one of the presidential campaigns.” Manafort, Gates said, hired him. We know that campaign was Trump’s, though Gates did not say the president’s name, and there was no further discussion of that work.
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Around that time, Gates testified, Manafort began applying for loans, and Gates said he altered some documents — including a profits and loss statement — for his boss. In at least one instance, he said, he did so by converting a PDF to a word document.
12:40 p.m.: Rick Gates says he faked mortgage documents at Manafort’s request
Rick Gates is now testifying that he gave a bank fraudulent home insurance documents at Paul Manafort’s request, so that his boss could get a loan from Citizens Bank.
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Gates said he also gave Citizens Bank false information about a condo Manafort owned in Lower Manhattan, saying it was a second home when it was not.
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1:05 p.m.: Gates testifies he helped Manafort massage finances to get loan
Rick Gates has now testified to helping Paul Manafort defraud banks while seeking loans in 2016 in a second way. Gates said the bank flagged that Manafort’s income was not sufficient to support the loans. To increase his income for the year, Gates testified he and Manafort agreed to have one of Manafort’s companies, Peranova Ltd., forgive a loan that had been reported as previously made to Manafort.
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Before breaking for lunch, Andres told Judge Ellis that he anticipates questioning Gates for about another hour. On questioning from the judge, he said he continues to anticipate that the prosecution will rest its case against Manafort by the end of the week.
After lunch, Gates returned to the stand.
2:10 p.m.: Gates testifies he made up $6 million in income to help get loan
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In March 2016, Gates testified, Manafort was seeking a loan from the Banc of California, but needed to show that his business was making enough income so that he would qualify. The pair had a profit-and-loss statement that showed about $400,000 in income, but that was far below what the business had made previously. Gates testified that he then set out to edit it, and made clear from whom that instruction came.
“Who directed you to alter it,” prosecutor Greg Andres asked.
“Mr. Manafort,” Gates responded.
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2:22 p.m.: Gates testifies that Manafort falsified a financial statement himself
Having testified that he altered Davis Manafort Partners’ 2015 Profit & Loss Statement at Paul Manafort’s direction, Rick Gates went on to say his boss similarly doctored his 2016 statement to obtain a different loan.
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2:40 p.m.: Gates: Manafort wanted me to use Trump campaign job to offer lender favors
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Rick Gates testified that Manafort resigned as the campaign’s chairman in August 2016, but that he remained, continuing to work for the campaign.
After Trump’s election, Gates went to work for the committee organizing Trump’s inauguration.
Prosecutor Greg Andres showed Gates emails from Manafort, which showed that Gates’s former boss requested that Gates use his position in the Trump campaign to offer a series of favors to Stephen Calk, the founder and CEO of Federal Savings Bank, one of the banks that extended Manafort a loan in 2016.
First, Calk’s name was added to a list of national economic advisers to the campaign. Then, in November 2016, Manafort wrote Gates: “We need to discuss Steve Calk for Sec of the Army. I hear the list is being considered this weekend,” indicating that wanted Gates’s help getting Calk considered by the presidential transition for the job.
Then, in December 2016, Manafort wrote Gates an email he marked “urgent,” listing people Manafort wanted to be invited to Trump’s inauguration in January. Included on the list were Calk and his son.
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That concluded the prosecution's questions for Gates.
3:36 p.m.: Defense attorney comes out swinging, calls Gates a liar
“When did you start providing false and misleading information to the special counsel’s office?” [defense attorney Kevin Downing] asked.
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“You knowingly and intentionally lied?” Downing asked.
“Uh…. yes,” Gates finally said. But he said, “I provided false information to the special counsel’s office prior to my plea agreement,” not after. In his many sessions preparing for trial, he said, he told the truth.
3:47 p.m.: Gates admits affair and using money embezzled from Manafort for trysts
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[H]e said about 10 years ago, he had “another relationship.” In other words, he had had an extramarital affair.
Downing asked Gates if his secret life had taken place in London. Gates acknowledged the relationship had taken him to London and other places.
“As part of your secret life, did you have a flat? Is that what they call an apartment in London,” Downing asked.
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Gates testified that he had used money embezzled from Manafort to help fund his relationship. Downing asked him to agree that he had spent as much as $3 million on this purpose. Gates said he believed the figure was lower, but, again, agreed that he had indeed taken money from Manafort without his permission.
3:55 p.m.: Gates admits he may have improperly submitted personal expenses to Trump committee
As defense attorney Kevin Downing vigorously questioned Rick Gates about all the ways in which he had stolen money from Manafort and others, Gates made a notable confession, acknowledging it was possible he had submitted personal expenses to President Trump’s inaugural committee for reimbursement.
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4:07 p.m.: Manafort’s attorney tries to paint Rick Gates as taking advantage of his client
Defense Attorney Kevin Downing seemed intent early in his cross examination of Rick Gates to drive home a theme.
Rick Gates repeatedly took advantage of Manafort when it came to money, and he lied about it so frequently that it was now difficult to sort fact from fiction.
A little courtroom color:
4:13 p.m.: Rick Gates won’t look at Manafort during testimony
As he did yesterday, Rick Gates has assiduously avoided looking at Manafort during today’s testimony. Manafort has occasionally stared up at Gates, but he has also frequently looked at monitors showing documents, or occasionally just off in the courtroom.
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As cross examination of Gates began, though, Manafort resumed his staring at Gates.
4:30 p.m.: A question about Trump, an objection and a delay
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Downing jumped around with his accusations, and it was not always clear if Gates was reluctant to admit wrongdoing or genuinely confused. But the broader point being made was clear: Gates has been involved in a lot of questionable business activity.
4:57 p.m.: Gates testifies he wired offshore money into his company
Earlier in the day, Rick Gates testified about how he used to create fake invoices at times to submit to offshore banks to get them to wire funds to Paul Manafort to support Manafort’s lifestyle. Now he has testified that he would at times use the same process to cause banks to wire money from an account belonging to Manafort to a company controlled by Gates himself.
Manafort’s defense attorney, Kevin Downing, walked Gates through a series of such wire transfers.
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Gates tripped up as he explained the reason for these transfers, repeatedly agreeing that some of the money was unauthorized but also that some was to reimburse him for business expenses, and some were bonuses from Manafort.
Downing asked pointedly why would Gates have called these transfers reimbursements for expenses. With that opening, Gates offered remorse to the jury. “I was, in essence, living beyond my means,” he said.
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Downing responded, “Was it for your secret life?”
Gates responded: “It’s not a secret life. It went to an account my wife knew about.”
5:17 p.m.: In tense cross-examination, Gates says Manafort has yet to face his crimes
In one of the most tense exchanges yet during his cross examination, Rick Gates compared his situation directly with that of his former business partner, suggesting that he had taken responsibility for his actions, while Manafort chose to fight at trial.
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“After all the lies you’ve told and fraud you’ve committed, you expect this jury to believe you?” Downing asked.
“Yes,” Gates responded flatly.
The two men continued to talk over one another, and Gates remarked, “I’m here to tell the truth.”
That’s when his commentary turned to Manafort.
“Mr. Manafort had the same path,” Gates said. “I’m here.”
Gates added later that he had “accepted responsibility.”
“I’m trying to change,” he said.
5:27 p.m.: Judge questions how closely Manafort watches money
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“Mr. Manafort in my opinion kept fairly frequent updates,” Gates said, after a discussion of movement between their consulting firm’s offshore accounts. “Mr. Manafort was very good at knowing where the money was and where it was going.”
Judge Ellis, as he has repeatedly, interjected.
“He didn’t know about the money you were stealing,” Ellis said, “so he didn’t do it that closely.”
The comment by the judge goes to a question at the heart of the trial — how much fraud could possibly have gone on under Manafort’s nose without his knowledge.
Downing also challenged Gates on his acceptance of responsibility, pointing out that he has not repaid the money he stole from Manafort.
Related: Manafort Trial: Day Six
Paul Manafort trial Day 6: Gates admits affair, says he used Manafort’s money for trysts (WaPo)