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Abu Dhabi, UAEFriday 17 August 2018

Manafort’s financial staff reveal opaque nature of his finances

Prosecutors confirmed they planned a key aide as a witness a day after hinting he might not give evidence

Paul Manafort's former bookkeeper Heather Washkuhn testified that he kept her in the dark about the foreign bank accounts he was using to buy millions in luxury items and personal expenses. AP Photo/Manuel Balce Ceneta
Paul Manafort's former bookkeeper Heather Washkuhn testified that he kept her in the dark about the foreign bank accounts he was using to buy millions in luxury items and personal expenses. AP Photo/Manuel Balce Ceneta

Paul Manafort’s bookkeeper and accountant testified on Thursday that the former Trump campaign chairman kept them in the dark about offshore bank accounts that he used to pay for luxury cars, expensive suits and home renovations.

Philip Ayliff, an accountant with Kositzka, Wicks and Company, told the federal court in Alexandria, Virginia, that Manafort denied having overseas accounts.

“We had asked the question, and the response was ‘no’,” he said.

It is a crime to hide overseas accounts from US tax authorities.

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Mr Manafort, 69, is the first defendant to face trial stemming from special counsel Robert Mueller’s investigation of Russia’s role in the 2016 presidential election. Donald Trump’s former campaign chairman has pleaded not guilty to 18 charges, including tax fraud, bank fraud and failing to report foreign bank accounts.

None of the charges relate to his time working for Mr Trump.

On day three of the trial, Heather Washkuhn, Mr Manafort’s long-time bookkeeper, said she believed she had full knowledge of his financial affairs but admitted to being unaware of his overseas holdings.

Ms Washkuhn described Mr Manafort as “very detail-oriented” and said he “approved every penny” the firm paid from his personal account.

She told the court she sent a statement to the firm he ran with Rick Gates, DMP International, showing it had made $400,744 in 2015. But the statement that arrived at Banc of California later said it had made almost $4.5 million.

“There’s a lot of changes,” Ms Washkuhn said when the court was shown the versions side-by-side

Prosecutors allege Mr Manafort hid much of the $60 million earned as a political consultant for Ukrainian politicians by using undeclared offshore accounts. They say he used them to fund a lavish lifestyle while avoiding paying tax in the US.

They also allege that he made false loan applications to keep up his expensive lifestyle once the money from his Ukrainian employers dried up.

However, Mr Manafort’s defence team says Mr Gates – who pleaded guilty to making false statements after being indicted by Mr Mueller – was to blame.

Previous prosecution witnesses have described how Mr Manafort paid for expensive suits, cars and home renovations with international wire transfers. It was all part of a complex scheme that used offshore shell companies to avoid US taxes, according to government lawyers.

On Thursday, the jury heard from Joel Maxwell of a Florida-based company that installs lighting, audio visual equipment and automation systems for homes that did work for Mr Manafort. Mr Maxwell testified that some of the invoices shown to him by prosecutors appeared to be have been falsified.

The president of a landscaping firm in the Hamptons on New York’s Long Island, also testified that a Manafort invoice was false, listing an incorrect address and an altered version of his company’s name. Michael Regolizio said he was paid about $450,000 between 2010 and 2014 for work for Mr Manafort, and that the money arrived via a money transfer from Cyprus.

Prosecutors also confirmed they were planning to call Mr Gates as a witness a day after they hinted that he might not give evidence.

“We have every intention of calling him as a witness,” said Greg Andres, a member of Mr Mueller’s team.

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