Manafort defense rests with no witnesses called

ALEXANDRIA, Va. -- Paul Manafort's lawyers declined Tuesday to call any witnesses to defend him against charges of bank and tax fraud. Manafort, President Donald Trump's former campaign chairman, also told the judge that he did not want to testify, clearing the way for closing arguments from both sides and the start of jury deliberations today.

Manafort is letting the case go to the jury because he and his attorneys "do not believe that the government has met its burden of proof," said Kevin Downing, the lead defense lawyer in the case.

The decision by Manafort's legal team not to introduce its own evidence is a common tactic by defense lawyers, who often prefer to attack the government's case by grilling prosecution witnesses instead of offering their own.

Manafort spoke briefly in court Tuesday, confirming to U.S. District Judge T.S. Ellis III that he did not wish to testify.

Wearing a dark suit and white shirt, Manafort stood at the lectern in court as the judge formally asked him his intentions.

"Do you wish to testify?" Ellis asked.

"No, sir," Manafort replied.

Earlier Tuesday, Ellis also denied a motion by Manafort's lawyers to acquit him on all 18 charges without giving the case to the jury, another standard defense tactic as trials wind down. He closed the courtroom for more than two hours to discuss another defense motion that has been sealed, along with the government's response.

The judge has not given any explanation for the sealed proceeding, only noting that a transcript of it would become public after Manafort's case concludes.

Prosecutors for special counsel Robert Mueller rested their case Monday after calling roughly two dozen witnesses and introducing hundreds of exhibits. Manafort, 69, is accused of evading taxes on roughly $16.5 million in income that he earned working for pro-Russia political forces in Ukraine. When that income ran out, prosecutors claim, he fraudulently obtained more than $20 million in bank loans so he could maintain an extravagant lifestyle.

Defense lawyers made a special effort, including submitting a last-minute brief, to persuade the judge to throw out four bank-fraud charges involving $16 million in loans that Manafort obtained from a small Chicago bank in late 2016 and early 2017.

Richard Westling, one of Manafort's lawyers, argued that the bank, Federal Savings Bank, was not defrauded because its chairman, Stephen Calk, was determined to do business with Manafort, despite questions about Manafort's wherewithal. He also argued that bank officials were well aware of Manafort's true financial situation.

Emails cited by the prosecution showed that Manafort was trading heavily on his connection to the Trump campaign in seeking those loans, one of which he used to prevent another creditor from foreclosing on one of his homes.

In August 2016, before he was forced out of his position as campaign chairman, Manafort arranged to add Calk to Trump's economic advisory committee. In November, just days after the election, Calk sent Manafort a long list of top administration jobs for which he wanted to be considered.

Manafort then emailed Jared Kushner, the president's son-in-law, recommending Calk as someone who would "be totally reliable" and would "advance D.T. agenda," referring to the president-elect. Calk's "preference is secretary of the Army," he wrote. In the next two months, Calk overruled his underlings and granted Manafort more money than any other of the bank's borrowers had obtained, bank officials testified.

Westling argued that the bank was not victimized because it would have approved Manafort's loans "regardless of the information" he had submitted.

Ellis, in making his ruling, said the defense made a "significant" argument, but he ultimately ruled that the question "is an issue for the jury."

While the Trump campaign was not a focus of the 11-day trial, references to it were sprinkled throughout. Defense lawyers have acknowledged that Manafort had no income in 2016 when he was hired by the Trump campaign. Rick Gates, Trump's former deputy campaign chairman and director of his inaugural committee, testified that it was "possible" that he had embezzled some of the inaugural funds.

The government case turns in part on the credibility of Gates, Manafort's one-time trusted aide, who has pleaded guilty to two felony charges and is hoping his cooperation will keep him out of prison.

Gates' testimony portrayed Manafort as a man who repeatedly lied to maintain a lifestyle of multimillion-dollar homes and expensive suits. Manafort's former bookkeeper and accountants also testified against him, detailing instances in which they say Manafort lied to them to lower his tax bill.

Manafort's lawyers had assailed Gates as a liar, adulterer and thief who had committed all of the crimes that Manafort was accused of, and more. On the witness stand, Gates admitted to a host of offenses, including stealing hundreds of thousands of dollars from Manafort's bank accounts and concealing $3 million of his own income from tax authorities. While he appeared confident when prosecutors questioned him about Manafort's criminal activity, he grew less sure when defense lawyers confronted him with questions about his own misdeeds.

Asked about how he embezzled funds by filing false expense reports, for example, Gates replied at one point: "It wasn't a scheme. I just added numbers to the reports."

The trial, the first for Mueller's office, did not relate to the Trump campaign or Russia's campaign of interference in 2016 presidential election, but Ellis had ruled that Mueller's mandate was broad enough for him to pursue the case.

After jurors were excused for the day Tuesday, lawyers for both sides conferred with the judge in open court on the language Ellis will use to instruct the jurors in their deliberations.

The only dispute was about what jurors should be told about how to interpret questions and comments interjected by the judge during the course of the trial.

Prosecutors, who have been frustrated by Ellis' tendency to interrupt and chide prosecutors in front of the jury, sought stronger language to make clear that jurors do not need to adopt any opinions expressed by the judge.

At one point in the discussion, Ellis asked prosecutors whether they thought he had ever interjected his own opinions. Prosecutor Greg Andres, who has had the strongest confrontations with Ellis, said "yes."

Ellis eventually came up with compromise language that was agreeable to both sides.

Whatever the jury ultimately decides about Manafort's guilt, he faces a second trial next month in the District of Columbia on charges that he failed to register as a lobbyist for a foreign government and conspired to tamper with witnesses in that case.

Information for this article was contributed by Sharon LaFraniere of The New York Times; by Rachel Weiner, Matt Zapotosky, Lynh Bui, Devlin Barrett and Tom Jackman of The Washington Post; and by Chad Day, Matthew Barakat and Mary Clare Jalonick of The Associated Press.

A Section on 08/15/2018