A jury found former Trump campaign chairman Paul Manafort guilty Tuesday
on tax and bank fraud charges — a major if not complete victory for
special counsel Robert S. Mueller III as he continues to investigate the
president’s associates.
The jury convicted Manafort on eight of the 18 counts against him and
said it was deadlocked on the other 10. U.S. District Court Judge T.S.
Ellis declared a mistrial on those charges.
Wearing a black suit, Manafort stood impassively, his hands folded in
front of him, and showed little reaction as the clerk read the word
“guilty” eight separate times. As through most of the three-week trial,
Manafort showed no emotion as he looked at the six women and six men who
convicted him.
President Trump reacted to the verdict by denouncing Mueller’s investigation.
“Paul Manafort’s a good man,” the president told reporters in West
Virginia. The verdict, he said, “doesn’t involve me but I still feel,
you know, it’s a very sad thing that happened.”
He pointed out that the charges in Manafort’s case did not involve
Mueller’s core mission of investigating Russian interference in the 2016
election and whether any Americans conspired with those efforts.
Paul Manafort's attorneys, Kevin Downing, center, Richard Wetling, left, and Thomas Zehnle leave the Federal Courthouse after their client, Paul Manafort, was convicted on 8 counts of tax and bank fraud. (Michael Robinson Chavez/The Washington Post)
“This is a witch hunt that ends in disgrace,” Trump said.
For Trump, the outcome of Manafort’s trial was only half of a
double-barreled blast of bad news Tuesday. Shortly after the verdict was
read, the president’s former longtime attorney Michael Cohen pleaded guilty in an unrelated case
to eight crimes, saying that among other things, he helped arrange hush
money payments at the direction of then-candidate Trump.
Manafort, 69, was found guilty of filing a false tax return in each of
the years from 2010 through 2014, as well as not filing a form in 2012
to report a foreign bank account as required. He was also convicted of
two instances of bank fraud, related to a $3.4 million loan from
Citizens Bank and a $1 million loan from Banc of California.
The charges on which the jury deadlocked included three counts for not
filing a form to report a foreign bank account, and seven counts for
committing bank fraud or conspiring to commit bank fraud.
President Trump reacted on Aug.
21 to the conviction of his former campaign chairman Paul Manafort on
eight counts tax and bank fraud charges.
The judge thanked the jurors for their service and they were dismissed,
leaving the courthouse without speaking to reporters. The judge has
ordered their names not be disclosed in court records.
Once the jury left the courtroom, Ellis asked Manafort to approach the
lectern. The judge told him that he would order a pre-sentencing report
and it was important for Manafort to “pay careful attention to the
preparation of the document.”
Manafort’s wife declined to speak to reporters as she left the courthouse.
Lead defense attorney Kevin Downing said Manafort was “disappointed” in
the verdict, though he also wanted to thank the judge “for giving him a
fair trial,” and the jurors for their deliberations.
Manafort’s lawyers asked for 30 days to file a motion for a new trial or
for the judge to toss out the verdict. Manafort “is evaluating all of
this options at this point,” Downing said.
His possible prison sentence wasn’t immediately clear, but legal experts
said he likely faces roughly seven to 10 years in prison under federal
sentencing guidelines. Trump has repeatedly declined to discuss whether
he might someday pardon Manafort.
The conviction, analysts say, might increase the pressure on Manafort to
cooperate with Mueller in hopes of getting a sentencing break. “Now
that he’s seen how this goes, maybe he is now more likely to want to
consider working out a plea deal,” said Barbara McQuade, a former U.S.
Attorney who observed much of the trial.
The verdict comes as Trump has stepped up his criticism of Mueller’s
investigation, publicly criticizing it on a weekly and sometimes daily
basis. As the Manafort trial began, Trump called for the probe to be
shut down immediately.
Manafort’s guilty verdict may strengthen Mueller’s hand as he continues
to investigate possible conspiracy and seeks an interview with the
president; an acquittal could have led to a broader effort by
conservatives to shut down the special counsel’s office.
The 18 charges in the Manafort trial centered around Manafort’s personal
finances, and had little to do with the special counsel’s mandate of
probing Russian interference in the 2016 election and whether any Trump
associates conspired with those efforts.
But the trial was the first to emerge from Mueller’s probe, and as such
it marked a significant public test of his work. After four days of
deliberations, the jury largely validated Mueller’s decision to charge
Manafort.
Over two weeks of testimony, more than two dozen witnesses, including
his former right-hand man Rick Gates, as well as his former bookkeeper
and accountants, testified against Manafort. They said he hid millions
of dollars in foreign bank accounts that went unreported to the IRS, and
then later lied to banks in order to get millions of dollars in loans.
His lawyers had argued that Gates, not Manafort, was the real criminal,
pointing to Gates’ admitted lies, theft, and marital infidelity, which
he acknowledged during his testimony. Gates pleaded guilty in February
to lying to the FBI and conspiring against the United States, and has
said he hopes to get a lesser prison sentence by cooperating against
Manafort.
Prosecutors, in turn, told the jury that the case’s most compelling
evidence included the dozens of documents, many of them emails, showing
Manafort oversaw the false statements to the IRS and banks.
Manafort’s defense team called no witnesses at all, as his lawyer argued
prosecutors had failed to prove beyond a reasonable doubt that he
intended to defraud the government or banks. Manafort’s lawyers
repeatedly suggested their client might not have known the law.
The trial featured heated arguments at times — not between the
government and defense lawyers, but between the judge and prosecutors.
The judge repeatedly chided Mueller’s team in front of the jury, though
at the end of the trial he urged the panel not to consider during its
deliberations any opinions the judge may have expressed.
Manafort faces a second trial in September in Washington D.C., on
charges he failed to register as a lobbyist for the Ukraine government,
and conspired to tamper with witnesses in that case. Manafort has been
in jail since June as a result of the witness tampering charges.
During closing arguments last week, Manafort’s lawyers accused the
special counsel’s office of having gone on a fishing expedition to find
evidence of financial crimes.
“Nobody came forward to say we’re concerned about what we’re seeing
here. Not until the special counsel showed up and started asking
questions,” lawyer Richard Westling said, suggesting the special counsel
“cobbled together” information to “stack up the counts” against
Manafort and overwhelm the jury.
“It is not enough that wrong information or even false information was
given,” Westling said, telling jurors that to convict his client, they
had to be convinced that Manafort intended to deceive banks and the IRS.
Prosecutors charged that Manafort failed to pay taxes on millions of
dollars in overseas bank accounts which he kept hidden from his
accountants and the IRS. He earned that money working as a consultant
for Ukraine’s then-president, Viktor Yanukovych. Yanukovych fled Ukraine
in 2014 amid massive street protests, causing Manafort’s income to dry
up, according to witnesses.
Prosecutors called Manafort’s bookkeeper and former accountants to
testify against him. Those witnesses said Manafort misled them about
foreign bank accounts he controlled. A former accountant for Manafort
said she went along with falsifying information on Manafort’s tax return
to lower the amount he would have to pay.
Other witnesses included employees of luxury clothing stores, a
landscaper, and a home entertainment company employee, all of whom
testified to the big ticket purchases Manafort made — paid via wire
transfers from foreign bank accounts.
Witnesses said Manafort spent a small fortune at the time he was
cheating the IRS — more than $1 million on clothes, including a $15,000
ostrich jacket, more than $2 million on home entertainment systems, and
millions of dollars on homes for himself and his family. One witness
said Manafort spent hundreds of thousands of dollars on landscaping,
including a bed of red flowers in the shape of an “M” in the backyard of
his Hamptons home.
Michael Brice-Saddler contributed to this report.
