Former Trump campaign manager Paul Manafort in a courtroom sketch

An accountant for Donald Trump's former campaign chairman Paul Manafort testified on Friday that she prepared his tax returns despite her concerns about the propriety of classifying money he transferred from overseas as loans.

Judge TS Ellis asked the accountant, Cynthia Laporta, whether she was testifying under an immunity agreement with the government because she was concerned that she could be prosecuted. She answered, “Correct.”

Ms Laporta testified she knew an accounting treatment for a loan was wrong when preparing Mr Manafort's tax return for 2014. “I very much regret it,” she told the courtroom.

Her testimony came on the trial's fourth day as prosecutors sought to drive home their case that Mr Manafort tried to hide millions of dollars he earned working for pro-Russian politicians in Ukraine. Manafort, 69, has pleaded not guilty to charges of bank fraud, tax fraud and failing to disclose foreign bank accounts.

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The trial in federal court in Alexandria, Virginia, is the first arising from Special Counsel Robert Mueller's investigation of Russia's interference in the 2016 US election.

Both Ms Laporta and fellow accountant Philip Ayliff, her predecessor who handled Mr Manafort's tax filings at the firm KWC, testified that they had no knowledge that Mr Manafort controlled foreign bank accounts. Such accounts must be reported to tax authorities if they contain $10,000 or more.

Ms Laporta said she asked Mr Manafort directly about any such holdings and was told there were none.

Prosecutors have tried to make their case first by presenting testimony about Mr Manafort's lavish lifestyle and then detailing his financial dealings.

Defence attorneys have signalled they will seek to blame the financial charges against Mr Manafort on his business partner Rick Gates, who was President Trump's deputy campaign chairman in the 2016 presidential election.