Paul Manafort, President Trump’s onetime campaign chairman, is on trial in federal court in Alexandria on bank and tax fraud charges. Prosecutors allege he failed to pay taxes on millions he made from his work for a Russia-friendly Ukrainian political party, then lied to get loans when the cash stopped coming in.
The prosecution rested on Monday, and today the defense rested, and Manafort will not take the stand. The courtroom was sealed for nearly two hours this morning, then reopened at about 11:30 a.m. with Manafort coming in 10 minutes later. The reason for the sealed court was not disclosed.
The case is being prosecuted by the special counsel investigating Russian interference in the 2016 U.S. presidential election.
What we learned on Day 11:
• Manafort’s defense team chose to present no witnesses and not put Manafort on the stand.
• Manafort sent an email to Jared Kushner recommending his banker for Secretary of the Army.
• Manafort’s defense argued that he would have received $16 million in loans from that banker regardless of any misstatements on his loan application
4:44 p.m.: Judge, prosecutors haggle over what to tell jurors about judge’s comments from bench
In a nuanced discussion of what jurors will be told before they begin deliberating, Judge T.S. Ellis III’s in-court commentary again became an issue.
Ellis had proposed giving jurors a specific instruction about his comments, effectively saying they were expressions of opinion and could be disregarded entirely. Assistant U.S. Attorney Uzo Asonye, though, argued that the judge’s proposal should be condensed – from two separate instructions into one – and not place such emphasis on the judge’s opinions.
“I just don’t think that’s where the court wants to be,” Asonye said.
Throughout the proceedings, Ellis has sparred with prosecutors, sometimes in front of the jury, and asked pointed questions himself of witnesses. Ellis said that the prosecutors’ proposal did not note a federal judge’s right to do that. “That’s still the law of the land,” he quipped. He also said that the “diction” of prosecutors’ suggested instruction was wrong, though he joked “at least it didn’t split the infinitive.” (Those who have practiced in front of Ellis say that is a pet peeve of the judge).
Later in the exchange, Ellis asked prosecutors pointedly about opinionated remarks.
“Do you think I made any such comments?” he said.
Asonye, still standing at the podium, said nothing. A momentary silence fell over the courtroom. The team’s lead prosecutor, Greg Andres, then rose in his chair and declared, “Yes.”
Ellis asked for an example. Andres pointed to the testimony of Rick Gates, Manafort’s business partner, who testified that Manafort was diligent in managing his money. When Gates said that, Ellis interrupted to point out that Manafort was not diligent enough to be able to prevent Gates from embezzling funds, Andres noted.
“That really hurt the government, didn’t it?” Ellis said flatly, adding soon after, “Never mind.”
The judge said he would consider combining prosecutors’ proposal with his own.
That was the only notable dispute during the conference over jury instructions. Ellis declared a short recess to consider the matter.
UPDATE: Ellis returned to the courtroom at about 4:45 p.m. with his new proposed jury instructions related to his comments and questions during the trial. Prosecutors and Manafort’s attorneys quietly reviewed the new language provided to them by the court officer before both agreeing with the judge’s revisions. The new language was not shown to the audience or read aloud.
Prosecutors also told the judge that they planned to request the jury be retained after the verdict in the event that they convict Manafort to deal with issues relating to forfeiture of his assets.
Westling said both sides were working together to address the forfeiture matter, then recessed for the day.
Court resumes Wednesday at 9:30 a.m.
One of the exhibits released by prosecutors late Monday was an email from Paul Manafort to President Trump’s son-in-law, Jared Kushner, in November 2016 during Trump’s transition period. It recommends Federal Savings Bank chief executive officer Stephen Calk for the job of Secretary of the Army, which Calk had listed in an email to Manafort as his sixth-most preferred job. Calk’s bank had recently approved Manafort for $16 million in loans despite internal questions about his finances. Here is Manafort’s email, and Kushner’s two-word reply:
4:19 p.m.: Judge denies Manafort request to inform jury of government forfeiture request
Judge T.S. Ellis III denied Paul Manafort’s request Tuesday to tell jurors that the special counsel is seeking forfeiture of his homes in Brooklyn and Bridgehampton, N.Y. The lawyers are currently discussing the instructions that will be given to the jury before their deliberations Wednesday.
Defense attorneys had argued that the forfeiture notice was relevant to why the Federal Savings Bank wrote off $16 million in loans to Manafort as a loss.
“The reason behind the banks writing off the loan is clearly… the government’s action,” Richard Westling argued. “These loans were current until his indictment.”
But prosecutors pointed out that the property has not actually been seized, and in fact it was part of the bond package that kept Manafort out of jail until his recent indictment on new charges in Washington, D.C., federal court.
“This particular fact doesn’t do anything to rebut” testimony that the loans were written off, Andres said.
Ellis agreed. “It’s not relevant, and it’s confusing and prejudicial,” he concluded. “It doesn’t say anything about whether the funds are restrained.”
Andres said he planned to bring up the bank’s loss in rebuttal only if the defense raises the issue in their closing argument. In his main closing argument, he said half-jokingly, “I don’t have enough time, your honor.”
Ellis has given each side two hours but urged them to use less.
1:50 p.m.: Jury returns, hears Manafort defense rest case, is dismissed
The jurors were called back to the courtroom shortly after 1:30 p.m., when they heard Manafort’s attorneys rest their case and say they would not be calling any witnesses. The defense lawyers had announced their intentions earlier with the jury out of the courtroom.
Lawyers from both sides are expected to reconvene at 3:30 p.m. to hash out jury instructions.
Manafort looked at the jury as his lead attorney said the defense wouldn’t present any evidence. Most of the jurors looked at the judge as he instructed them to return Wednesday morning and not discuss the case, but at least one juror stared back at Manafort.
12:24 p.m.: Jury to be sent home, closing arguments set for Wednesday morning
U.S. District Judge T.S. Ellis III said that closing arguments in the case will begin at 9:30 a.m. Wednesday, and jurors will be given instructions in the case after that. The jurors will be sent home at 1:30 p.m. Tuesday, after they see the defense formally rest its case.
The lawyers will discuss Tuesday afternoon what instructions jurors will receive. Those are wonky, but important, as they will shape how jurors debate the charges of which Manafort is accused.
Closing arguments are expected to take much of the day Wednesday. Ellis had said previously he was amenable to giving both sides two hours to make their presentations. On Tuesday, though, he asked them to consider shortening that to an hour and a half.
“It seems a little excessive,” Ellis said of two-hour presentations.
Prosecutor Greg Andres suggested that might be too short, noting the judge had told him he could use his closing argument to refer to emails that had been introduced as evidence, but which jurors had not been shown in court. The remark prompted an unusual exchange.
Ellis said he recalled telling the lawyers they should not send back to the jury room evidence that had not been discussed in court. Andres countered that Ellis had previously barred the prosecution from having Manafort’s emails read to the jury, but said prosecutors could address those in their closing arguments. Ellis said he indeed recalled that, though he thought he also said, “it doesn’t make sense to send exhibits back to the jury that have not been referred to” in court.
The apparent contradiction was never resolved. Ellis remarked only that Andres should “think about” whether he could reduce his closing argument to an hour and a half.
Lawyers for Paul Manafort say they’ll rest their case without calling any witnesses in the former Trump campaign chairman’s trial
The decision in the bank- and tax-fraud case comes after Judge T.S. Ellis III denied a defense motion to acquit Manafort as his lawyers argued the special counsel had failed to prove its case at the federal trial in Virginia. Such motions are routinely filed and almost never granted.
After several hours of sealed discussions, open court began at about 11:45 a.m. with no explanation for the delay.
“Good afternoon,” defense attorney Richard Westling said, before correcting himself and saying, “Good morning.”
“I’m as surprised as you are,” Judge Ellis replied.
He then heard brief argument from both sides on the defense’s motion for acquittal, particularly on four counts related to the Federal Savings Bank.
“Federal Savings Bank was aware of the status of Paul Manafort’s finances,” Westling argued. “They came to the loans with an intent of doing business with Mr. Manafort.”
Prosecutor Uzo Asonye countered that even if bank chairman Steve Calk was willing to overlook Manafort’s financial problems, submitting fraudulent documents to the bank would still be a crime.
“Steve Calk is not the bank,” Asonye said. Moreover he said, even though Calk “had a different motive” — a job in the Trump administration — “I’m not really sure there’s evidence he knew the documents were false.”
Ellis sided with prosecutors.
“The defense makes a significant argument about materiality, but in the end, I think materiality is an issue for the jury,” he said. “That is true for all the other counts… those are all jury issues.”
With that settled he asked Manafort’s team whether it would present a defense case.
“The defense rests,” lead attorney Kevin Downing replied.
As is standard, Ellis then began to question Manafort to ensure he was making that decision with his rights in mind.
With jurors still out of the courtroom, Manafort affirmed to the judge that he did not wish to take the witness stand.
Manafort, in a dark suit and white shirt, stood at the lectern from which his attorneys have questioned witnesses, staring up at the judge. Ellis told Manafort he had a right to testify, though if he chose not to, the judge would tell jurors to draw no inference from that.
Then, leaning into the microphone at his bench, his voice booming through the courtroom, Ellis asked Manafort four questions.
Had Manafort discussed the decision with his attorney?
“I have, your honor,” Manafort responded, his voice clear.
Was he satisfied with their advice?
“I am, your honor,” Manafort said.
Had he decided whether he would testify?
“I have decided,” Manafort said.
“Do you wish to testify?” Ellis concluded.
“No, sir,” Manafort responded.
Manafort returned to his seat.
Before Paul Manafort’s defense mounts its case and offers evidence, Judge T.S. Ellis III must decide on something called a Rule 29 motion or a “motion for a judgment of acquittal.” And in a filing late Monday, the defense argued that at least one bank would have approved Manafort for loans no matter what information he entered in his loan applications.
The motion filed by defense lawyers usually comes after prosecutors rest and is mostly a procedural matter. It asks the judge to find there is not enough evidence to warrant a conviction and to acquit the defendant without sending the case to the jury.
Judges rarely grant such motions but defense attorneys almost always make the request as a way to preserve the matter for appeal in the future if their clients are convicted. In instances in which such motions are granted, the defendant goes free and cannot be prosecuted again.
On Monday, Manafort’s attorneys asked Ellis to focus on the four bank fraud and bank fraud conspiracy charges relating to The Federal Savings Bank when considering their motion for judgment of acquittal. Manafort’s attorneys argued some of the allegations related to the loans from Federal Savings Bank are not “material,” or significant, but they were not more specific in advance of their more detailed argument expected Tuesday. They also argued that prosecutors from the special counsel failed to show “willfulness,” a legal term meaning that someone did something intentionally or voluntarily and with disregard for the law.
The Federal Savings Bank loaned Manafort $16 million, which prosecutors say Manafort received based on fraudulent financial information. Prosecutors also say the bank’s chief executive, Stephen Calk, had helped Manafort secure the loans because Calk wanted a Cabinet-level position in the Trump administration.
Defense attorneys elaborated on their arguments in a filing late Monday, saying, “any purported misstatements regarding Mr. Manafort’s income or credit card debt were immaterial” to Federal Savings Bank’s decision to loan him $16 million.
Bank chairman Calk, the defense writes, made a fully informed decision based on his interest in a business relationship with Manafort: “The record is clear that Mr. Calk and Mr. Manafort had negotiated loan terms that TFSB would approve regardless of the information in various loan application materials.”
In another filing, defense attorneys asked the court to note that the special counsel is seeking forfeiture of Manafort’s homes in Brooklyn and Bridgehampton, N.Y. The defense suggested Monday that Federal Savings Bank, which wrote the loans to Manafort off as a loss, could have seized his homes as repayment if not for this prosecution.
9:19 a.m.: New emails show Manafort deeply involved in financial dealings with banks, loan applications
Before resting Monday, prosecutors moved into evidence about three dozen emails that have not previously been shown. Most attempt to show Paul Manafort himself was deeply involved in his financial dealings even when delegating authority to deputy Rick Gates, who defense attorneys claim was sabotaging his boss. Gates testified he committed fraud at Manafort’s direction and testified under a plea deal with prosecutors.
In one February 2016 email, as Manafort is juggling bills, he asks Gates to sign a document for him and send it back “so I can send… as if it is my signature.” Later, he says, “I need you to sign the … docs with my signature and kathy’s. [An apparent reference to his wife] Pls look at previous signatures. The last time you did mine it was rejected.”
In another February 2016 email, Manafort says issues holding up a Citizens Bank loan were resolved, specifically insurance policies showing he already had a mortgage on one property. Gates testified that Manafort directed him to send the bank outdated insurance documents showing there was no mortgage. In May 2016, Manafort asks Gates to draft a letter from their business accountant claiming a $1.5 million loan was forgiven in 2015. The accountant testified it was clear the loan forgiveness documentation was backdated, and an FBI forensic accountant testified that Manafort actually controlled the entity that gave him the “loan.”
Defense attorneys have suggested Manafort’s signature was forged on documents opening bank accounts in Cyprus.
Several emails appear to show Manafort directing an employee of a Cypriot law firm to send wire transfers to various vendors. In one email from 2012 to a bank employee asking about wires from several of the Cypriot entities, Manafort explains that he has “various contracts with Ukraine” and the “international transfers” are “payment for those services.”
Other emails detail what prosecutors said were Federal Savings Bank Chairman Steve Calk’s attempts to get jobs in the Trump campaign and administration. In an Aug. 4, 2016 email to Manafort, Calk says, “I am happy and willing to serve.” In November, just after the election, Calk sends a petition to be nominated Secretary of the Army to Manafort, asking “what changes and improvements I should make.” Among the qualifications Calk lists — “Mr. Calk willingly risked his national professional and personal reputation as an active, vocal, and early supporter of President-Elect Trump.” He listed the “Perspective Rolls” [sic] he would like in the administration, listing possible prospective jobs he sought, in order. Secretary of the Army was number one, followed by the chiefs of Treasury, Commerce, HUD, and Defense. He said he would also be most interested an ambassadorship in the United Kingdom but would settle for France, Germany, Italy, Spain, Japan, Ireland, Australia, China, United Nations, the European Union, Portugal, the Vatican, Luxembourg, Austria, Switzerland, the Netherlands and Singapore. in that order.
In October, when testimony showed Manafort told Calk and then-Federal Savings Bank vice president Dennis Raico he had a “blackout” and needed a loan to cover an extra million dollars, Calk replies, “Consider it done. Dennis has been directed. We will close on time. Can you call my cell this afternoon? I need your advice.”
When Calk sends his resume to Manafort a few weeks later, he thanks him for his “guidance and assistance.”
Another email shows Manafort reached out to President Trump’s son-in-law Jared Kushner on Nov. 30, 2016, to recommend Calk for Secretary of the Army, saying, “His background is strong in defense issues, management and finance.”
The special counsel had tried to introduce these emails through an FBI agent earlier in the case but were blocked by Judge Ellis. They now plan to show them to jurors only in closing arguments.
9:00 a.m.: Jury may get Manafort case today
Jurors may well be deliberating on the fate of Paul Manafort by the end of the day, depending on whether the former Trump campaign chairman puts on any evidence.
First, Judge T.S. Ellis III is expected to rule on a motion from Manafort’s defense that he should be acquitted now because the special counsel failed to prove its case. Such motions are routinely filed and almost never granted.
Assuming Ellis denies the motion, he will then ask defense attorneys whether Manafort intends to put on a case. If they say no, he will ask Manafort himself under oath whether he is knowingly and voluntarily making that decision and giving up his right to testify in his own defense.
Ellis has previously made clear that if there is a defense case, he expects it only to last a day or two, telling jurors they will have the case by mid-week. Were Manafort to testify or offer witnesses to defend his character, it would give prosecutors a chance to directly challenge his credibility in ways they currently cannot.
Once the defense rests, Ellis will hear argument from both sides on the law that should guide the jury in their deliberations. He will then read the instructions to the jurors, both sides will offer closing arguments for about two hours, and then for the first time since the case began two weeks ago, they will be free to discuss the evidence with each other.