Paul Manafort trial: Prosecutors accuse ex-Trump campaign chief of amassing fortune on foundation of 'lies'

Kevin Johnson | USA TODAY

Show Caption Hide Caption Manafort arrives in court as trial set to begin The trial of Donald Trump's former campaign chairman Paul Manafort on tax evasion and bank fraud charges got underway at a courthouse in Alexandria, Virginia on Tuesday. (July 31)

ALEXANDRIA, Va. – Federal prosecutors clashed with defense attorneys Tuesday over starkly rivaling portraits of Paul Manafort, who the government asserted had built a fortune on a foundation of “lies” while the former Trump campaign chairman’s counselors said their client had simply placed his “trust in the wrong person.”

It was only minutes into the opening argument of Manafort attorney Thomas Zehnle before he pointed the finger at the government’s star witness and former Manafort business partner, Rick Gates, who was described as the source of virtually all of Manafort’s trouble.

“This case is about taxes and trust,” Zehnle said of the bank and tax fraud case against his client. “This is about Mr. Manafort placing his trust in the wrong person.”

Gates pleaded guilty this year to conspiracy and lying to the FBI. As part of his deal with the government, he agreed to cooperate with investigators, and he headlines a list of 35 potential witnesses against Manafort.

At one point during his presentation, Zehnle asked Manafort to stand before the jury, describing him as once representing the “pinnacle” of American politics – a consultant to "presidents and senators."

Although Manafort's work for then-candidate Donald Trump has loomed large over the case, Trump's name was not mentioned in court Tuesday.

"There are two sides to every story," Zehnle said.

The defense appeal came after prosecutors presented a blistering account of Manafort’s business dealings, alleging that he used a web of deceit and secret bank accounts to acquire tens of millions in income for his consulting work in Ukraine for more than a decade, between 2005 and 2014.

Assistant U.S. Attorney Uzo Asonye also claimed that Manafort propped up a “lifestyle of extravagance” by falsifying applications for millions of dollars in loans.

Tracking the outline of the lengthy indictment against Manafort, Asonye pledged to bring the jury evidence of about 30 bank accounts opened in Cyprus and other far-flung places that Manafort used to “funnel millions of dollars to bankroll" prodigious personal spending.

The prosecutor went on to list some seven homes, jewelry and clothes, including a $15,000 ostrich-skin jacket.

When Manafort’s work for the pro-Russian leadership faction in Ukraine began to dry up in 2015, Asonye asserted that Manafort sought out bank loans using falsified loan applications.

Manafort, Asonye said, "created cash out of thin air."

“This all boils down to one fact,” Asonye said. “Paul Manafort lied ... he lied to his bookkeeper; he lied to the IRS; and he lied to financial institutions to get and keep money.

“A man in this courtroom believes the law did not apply to him,” Asonye told the jury panel that had been seated less than an hour before.

The panel of six men and six women, along with four alternates, was selected in less than four hours as prosecutors quickly culled a pool of 65 prospective jurors.

But jury selection was only one highlight on the first day of Manafort's trial that also featured the first government witness, political strategist and former Manafort contractor Tad Devine.

Devine, a senior consultant to the presidential campaign of Vermont Sen. Bernie Sanders, detailed a long association with Manafort in Ukraine – from 2005 to 2014 – in which the partnership helped elect Viktor Yanukovych, leader of a pro-Russia political faction. Yanukovych is now in exile in Moscow.

Devine said that he was paid $600,000 for his work, including a $100,000 bonus, for helping to engineer Yanukovych's 2010 victory.

The government asserts that money was paid by wire transfers from Manafort's secret foreign bank accounts.

Earlier in the day, the prospective jurors crowded into the ninth-floor courtroom where U.S. District Judge T.S. Ellis III and teams of lawyers sorted out potential conflicts that might disqualify some from serving.

Ellis has said he expects the trial to last about three weeks.

At the start of the jury selection, nine panelists reported past social or employment contacts at the Justice Department. The quick show of hands drew a ripple of laughter from the gallery and the judge.

“Remind me not to ask that question again,” Ellis quipped.

None of the panelists said that their contacts would pose a conflict in the case.

After briefly outlining the 18 counts of bank fraud, tax evasion and conspiracy charges against the 69-year-old defendant, Ellis told the panel that Manafort “must be presumed innocent.”

Ellis repeated the instruction three times as Manafort, dressed in a dark suit and white shirt, sat quietly at the defense table.

During jury selection, Manafort appeared to play an active role, often conferring with attorneys through multiple rounds.

Throughout it all, Ellis kept up the pace, repeatedly urging the attorneys to “expedite” the process.

“We’re close to the end of the process – because I’m hungry,” the judge said at one point.

Outside the courthouse, a small band of protesters greeted spectators and potential jurors who began lining up to enter around 7 a.m., two hours before court convened.

The protesters waved homemade placards, bearing the messages: “Lock him up!”; “Traitor;" and “It’s Mueller time,” referring to Russia special counsel Robert Mueller whose team was prosecuting the first case to emerge from the 14-month inquiry.

An effigy of President Donald Trump also was propped on a nearby retaining wall.

The courtroom gallery filled up early. In fact, Manafort’s wife, Kathleen, was initially unable to find a seat.

Her search ended when a spectator stood and offered his own.

Apparently unknown to Kathleen Manafort, the man – Bill Christeson – has been among the placard-carrying protesters who have appeared at Paul Manafort’s past hearings.

“I don’t think she knew,” Christeson said later.

Manafort and two others accompanying her were later moved to the front, just behind her husband.

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