Special Counsel files new indictments against Paul Manafort and Rick Gates (Updated)

Special Counsel Robert Mueller has filed a new 32-count indictment Read the Special Counsel’s indictment (.pdf) against former Trump campaign manager Paul Manafort and his business associate Rick Gates. The Washington Post reports, Special counsel Mueller files new charges in Manafort, Gates case:

The indictment ratchets up pressure on Manafort and his deputy Rick Gates, who were already preparing for a trial that could come later this year on fraud and money laundering charges.

The additional charges had been expected in special counsel Robert S. Mueller III’s prosecution of Manafort and Gates. Manafort joined the Trump campaign in March 2016, and served as the campaign chairman from June to August of that year. Gates also served as a top official on Trump’s campaign [and the transition].

Mueller accused the men of lying on their income tax returns and conspiring to commit bank fraud to get loans. The indictment was filed in federal court in Virginia — a technical requirement because that was where the suspects filed their tax returns.

A court filing indicates that prosecutors initially sought to combine the new charges with the preexisting indictment in federal court in Washington, but Manafort declined to agree, leading to the possibility of two separate trials in two neighboring jurisdictions.

The new indictment offers a more detailed portrait of what prosecutors say was a multi-year scheme by Manafort and Gates to use their income from working for a Ukrainian political party to buy properties, evade taxes and support a lavish lifestyle even after their business connections in Kiev evaporated.

“Manafort and Gates generated tens of millions of dollars in income as a result of their Ukraine work. From approximately 2006 through the present, Manafort and Gates engaged in a scheme to hide income from United States authorities, while enjoying the use of the money,” the indictment charges.

From 2006 to 2015, Manafort, with help from Gates, allegedly failed to pay taxes on this money by disguising it as loans from offshore corporate entities, and by using foreign bank accounts to make payments to businesses in the United States on Manafort’s behalf.

According to the indictment, Manafort’s Ukraine income dwindled in 2015, and the scheme took on a new form — getting $20 million in loans based on Manafort’s real estate properties in the United States. But to do that, the grand jury charged, he and his deputy made false claims to banks about their company’s income and existing debts.

The indictment describes one bank employee conspiring with Manafort in the fraud. In spring 2016, that unidentified co-conspirator allegedly wrote that a document looked doctored and asked them to “do a clean excel doc” and send that instead.

Another detail in the indictment suggests that Manafort was under significant financial pressure even as he ascended to running the Trump campaign in mid-2016.

One bank lender “questioned Manafort about a $300,000 delinquency on his American Express card, which was more than 90 days past due. The delinquency significantly affected Manafort’s credit rating score.” In response, according to the indictment, Manafort got Gates to supply a letter falsely claiming that he, not Manafort, had borrowed the card to make the purchases and would pay him back.

On Tuesday, an associate of Gates pleaded guilty to lying to the FBI in the course of the Russia investigation. Alex van der Zwaan, a former lawyer at a premier law firm, admitted to lying about his contacts with Gates.Lawyer pleads guilty to lying about contacts with Rick Gates.

This follows reporting yesterday that Special Counsel Robert Mueller’s team is looking into the possibility that former Trump campaign chair Paul Manafort promised a Chicago banker a job in the White House in exchange for $16 million in home loans. Mueller asking if Manafort promised banker White House job in return for loans:

Federal investigators are probing whether former Trump campaign chair Paul Manafort promised a Chicago banker a job in the Trump White House in return for $16 million in home loans, two people with direct knowledge of the matter told NBC News.

Manafort received three separate loans in December 2016 and January 2017 from Federal Savings Bank for homes in New York City, Virginia and the Hamptons.

The banker, Stephen Calk, president of the Federal Savings Bank, was announced as a member of candidate Trump’s Council of Economic Advisers in August 2016.

Special counsel Robert Mueller’s team is now investigating whether there was a quid pro quo agreement between Manafort and Calk. Manafort left the Trump campaign in August 2016 after the millions he had earned working for a pro-Russian political party in Ukraine drew media scrutiny. Calk did not receive a job in President Donald Trump’s cabinet.

The sources say the three loans were questioned by other officials at the bank, and one source said that at least one of the bank employees who felt pressured into approving the deals is cooperating with investigators.

In court filings on Friday related to Manafort’s bail, federal prosecutors said they have “substantial evidence” that a loan made from the bank to Manafort using the Virginia and Hamptons properties as collateral was secured through false representations made by Manafort, including misstatements of income.

The existence of a federal probe of Calk and the Federal Savings Bank by the U.S. Attorney’s Office was first reported by Bloomberg News.

Read the NBC and Bloomberg reports for greater details.

If the Special Counsel is looking into Manafort’s and Gates’ real estate deal financing, money laundering schemes, bank fraud and tax evasion, how can he not be looking at Donald Trump’s real estate deal financing, money laundering schemes, alleged bank fraud and undisclosed tax returns as have been widely reported and speculated about in the media? He would be derelict in his duty if he failed to do so.

The latest indictment strikes me as a warning to the Trump White House that this is exactly what the Special Counsel is looking into.

UPDATE: And there it is … Rick Gates, Trump Campaign Aide, to Plead Guilty in Mueller Inquiry and Cooperate:

Rick Gates, who once served as Mr. Trump’s deputy campaign chairman, indicted by the special counsel was expected to plead guilty as soon as Friday afternoon, according to two people familiar with his plea agreement, a move that signals he is cooperating with the investigation into Russia’s interference in the 2016 election.

The plea deal could be a significant development in the investigation — a sign that Mr. Gates plans to offer incriminating information against his longtime associate and the former campaign chairman, Paul Manafort, or other members of the Trump campaign in exchange for a lighter punishment.

The deal comes as the special counsel, Robert S. Mueller III, has been raising pressure on Mr. Gates and Mr. Manafort with dozens of new charges of money laundering and bank fraud that were unsealed on Thursday. Mr. Mueller first indicted both men in October, and both pleaded not guilty.

Mr. Gates’s primary concern has been protecting his family, both emotionally and financially, from the prospect of a drawn-out trial, according to a person familiar with his defense strategy who was not authorized to publicly discuss the case and spoke on the condition of anonymity.

If Mr. Manafort continues to fight the charges in a trial, testimony from Mr. Gates could give Mr. Mueller’s team a first-person account of the criminal conduct that is claimed in the indictments — a potential blow to Mr. Manafort’s defense strategy.

It was unclear exactly what Mr. Gates might have to offer the special counsel’s team, whether about Mr. Manafort or about other members of the Trump campaign.

* * *

But Mr. Gates was present for the most significant periods of activity of the campaign, as Mr. Trump began developing policy positions and his digital operation engaged with millions of voters on platforms such as Facebook. Even after Mr. Manafort was fired by Mr. Trump in August 2016, Mr. Gates remained on in a different role, as a liaison between the campaign and the Republican National Committee. He traveled aboard the Trump plane through Election Day.

Pro Tip: This plea deal was in the works before the new indictments from the Special Prosecutor were filed yesterday. The information was likely supplied, in large part, by Rick Gates as part of his plea deal and cooperation agreement. His guilty plea on these set of facts will make it much more difficult for Paul Manafort to defend himself. Time to flip, Paul.

UPDATE:  Read the Superceding Criminal Information (.pdf) that Rick Gates plead guilty to and entered into a cooperation agreement with the Special Counsel.

Gates’ plea agreement requires him to cooperate with Mueller’s various lines of investigation, including his prosecution of Manafort, Gates’ former business partner and mentor, who served as Trump’s campaign chairman in the summer of 2016.

Via POLITICO:

As a cooperating witness, Gates can expect to be asked about his time working on the Trump campaign starting in March 2016 and his rise to the job of deputy campaign chairman when Manafort himself took the top slot that May. Gates’ time working for Trump overlapped with the release of hacked Democratic emails that damaged Hillary Clinton’s campaign, as well as the June 2016 Trump Tower meeting involving Donald Trump Jr.; the president’s son-in-law Jared Kushner; Manafort; and a Russian lawyer who promised dirt on Clinton.

While Manafort resigned in mid-August 2016 from his job as campaign chairman amid scrutiny over his lobbying work in Ukraine, Gates hung on and became a middleman to the Republican National Committee.

Steve Bannon and Kellyanne Conway, whom Trump tapped to replace Manafort, looked at Gates with some degree of suspicion because of his ties to the ousted former campaign chairman. But Gates remained close to both Kushner and a Trump confidant, Tom Barrack, a relationship that, combined with his political experience on a campaign filled with inexperienced people, helped to preserve his place on team Trump.Gates’ competence helped land him a top job after the election on the Presidential Inauguration Committee, where he served beneath Barrack and CEO Sara Armstrong.

After the inauguration, Gates resurfaced on one of the main Trump political organizations, America First Policies, that was being set up to boost the White House agenda. But the team — which included former campaign staffers Brad Parscale, Nick Ayres, Marty Obst, David Bossie and Katrina Pierson — was also rife with internal jockeying, and Gates was gone by March.

Read the Superceding Indictment (.pdf) filed against Paul Manafort on Friday.

20 responses to “Special Counsel files new indictments against Paul Manafort and Rick Gates (Updated)

  1. Sen. John Kavanagh

    What ever happened to Trump~Russia collusion? Has Mueller given up?

    • You are such a simpleton. These new criminal charges lay out just how desperate Manafort was for the money that he owed to Russian Oligarch Oleg Vladimirovich Deripaska. He committed numerous felonies to get it both before, during and even after his time on the Trump campaign. He insinuated himself into the Trump campaign by saying he would work for free despite his desperate financial situation.

      The national security portion of the Special Counsel’s investigation (which may not result in charges in order to protect sources and methods) is examining Paul Manafort’s attempt to use his role as President Donald Trump’s campaign manager to curry favor with Oleg Deripaska, a Russian oligarch who’s an ally of Russian President Vladimir Putin. http://www.businessinsider.com/manafort-emails-during-trump-campaign-about-russian-oleg-deripaska-2017-10

      Manafort reportedly wrote to Konstantin Kilimnik, his longtime employee and a Russian-Ukrainian operative, on April 11, 2016, asking whether he had shown “our friends” the media coverage of him since his hiring as a senior campaign strategist.

      “I assume you have shown our friends my media coverage, right?” Manafort reportedly wrote.

      “Absolutely,” replied Kilimnik, who has come under FBI scrutiny over his purported ties to Russian intelligence. “Every article.”

      How do we use to get whole,” Manafort responded. “Has OVD operation seen?

      Investigators have concluded — and Manafort’s spokesman has not disputed — that “OVD” was a reference to the oligarch’s full name: Oleg Vladimirovich Deripaska.

      Bloomberg reported last week that Manafort had offered “private briefings” about the campaign to Deripaska in hopes of resolving a years-long business dispute involving a failed Ukrainian TV company called Black Sea Cable

      Jason Maloni, a representative for Manafort, declined to comment. But he told The Washington Post earlier this month that Manafort had been trying to leverage his high-level role on the campaign to collect past debts. But it was Manafort who owed Deripaska money, according to the oligarch.

      In legal complaints filed in the Cayman Islands in 2014, Deripaska’s representatives claimed he gave Manafort $19 million that year to invest in the project. Manafort all but disappeared without paying Deripaska back when the project fell through, the filings say.

      Scott Olson, a recently retired FBI agent who spent years in the bureau’s counterintelligence division, said that offer would have been “a counterintelligence flag.”

      “By doing so, he shows not only a willingness to give out campaign information he received in confidence, but also an intent to earn personal income by selling the briefings,” Olson said.

      In early 2016, Deripaska’s representatives “openly accused Manafort of fraud and pledged to recover the money from him,” The Associated Press reported. “After Trump earned the nomination, Deripaska’s representatives said they would no longer discuss the case.” (A possible quid pro quo for “collusion.”)

      Olson noted that “debt cancellation is much harder to track than payment.”

      “Payments leave a paper trail; debt forgiveness does not,” he said. It’s a very effective way to conceal transfer of value and is another CI flag.”

      Kilimnik reportedly told Manafort in a later email that he had been “sending everything to Victor, who has been forwarding the coverage directly to OVD.” Victor was a senior aide to Deripaska, The Atlantic said it confirmed.

      The emails offer a more complete picture of the emails exchanged between Manafort and Kilimnik after Manafort joined the Trump campaign — and how much Manafort still coveted Deripaska’s approval years after a falling-out over a failed business venture.

      Manafort reportedly wrote to Kilimnik on July 7, 2016, asking whether there was “any movement” on the Black Sea Cable “issue” with “our friend” — another reference to Deripaska, The Atlantic said it confirmed. Kilimnik recommended Manafort, who was the campaign’s chairman at the time, ignore a Kyiv Post reporter who had asked about the feud, adding later that he was “carefully optimistic on the issue of our biggest interest.”

      “Our friend V said there is lately significantly more attention to the campaign in his boss’s mind, and he will be most likely looking for ways to reach out to you pretty soon, understanding all the time sensitivity,” Kilimnik wrote on July 7, The Atlantic reported. “I am more than sure that it will be resolved and we will get back to the original relationship with V.’s boss.”

      Kilimnik reportedly wrote to Manafort again on July 29, after Trump had accepted the GOP presidential nomination:

      “I met today with the guy who gave you your biggest black caviar jar several years ago. We spent about 5 hours talking about his story, and I have several important messages from him to you. He asked me to go and brief you on our conversation. I said I have to run it by you first, but in principle I am prepared to do it, provided that he buys me a ticket. It has to do about the future of his country, and is quite interesting.”

      Manafort agreed, and they met in New York on August 2.

      Manafort was forced to resign just over two weeks later, after The New York Times reported that the pro-Russia political party he had worked for had earmarked him $12.7 million for his work between 2007 and 2012.

      Deripaska in March took out quarter-page ads in The Wall Street Journal and The Post announcing that he was “ready to take part in any hearings conducted in the US Congress on this subject in order to defend my reputation and name.”

      – No idea whether this Russian Oligarch has cooperated with the Specal Counsel. Probably not because the charges against Mananfort include a claim for forfeiture to the U.S. government as a remedy for his criminal acts, which means Deripaska will not get paid – unless he already has.

      This portion of Mueller’s investigation in ongoing and yet to be made public. Patience, troll boy. It’s coming.

      • Sen. John Kavanagh

        You are grasping at straws. Time will tell but it is running out.

        • John, if it turns out AZBM is not grasping at straws and, instead, that you were drinking the Fox News Kool-Aid, will you publicly acknowledge how foolish you were?

          • Sen. John Kavanagh

            If Trump is convicted, then I would have to. Will you apologize to Trump, if you are wrong?

          • Yes, if it’s proven with the same level of certainty that a conviction would require, since you’re using that as the standard.

        • And what do you mean “time is running out”? There is no time limit on Mueller’s investigation. If Trump uses pardons to try to protect himself, or tries to fire Mueller, that is obstruction of justice and impeachment is on the table for that act alone.

          • Sen. John Kavanagh

            So after what amount of time without charges of collusion will you admit it is a nothingburger?

          • Well, let’s use the GOP’s Whitewater investigation of Clinton as a benchmark, something I’m sure you considered both reasonable and fair at the time.

            The Justice Department opened an investigation in 1993. Ken Starr was appointed Independent Counsel in August 1994. The Senate Special Whitewater Committee issued an 800-page majority report on June 18, 1996, which only hinted at one possible improper action by President Clinton.

            In September 1998, Independent Counsel Starr released the Starr Report, concerning offenses alleged to have been committed by President Clinton, as part of the Lewinsky scandal. On November 19, 1998, Independent Counsel Starr testified before the House Judiciary Committee in connection with the Impeachment of Bill Clinton over charges related to the Lewinsky scandal. Starr said that in late 1997, he had considered preparing an impeachment report regarding the fraudulent $300,000 loan to Susan Mcdougall and the question of whether the President had testified truthfully regarding the loan. Starr said that he held back the charges because he was not sure that the two major witnesses had told the truth, but that the investigation was still ongoing. Starr also chose this occasion to completely exonerate President Clinton of any wrongdoing in the Travelgate and Filegate matters.

            As for the Lewinsky scandal, the impeachment process of Bill Clinton was initiated by the House of Representatives on December 19, 1998. Clinton was subsequently acquitted of these charges by the Senate on February 12, 1999.

            Kenneth Starr’s successor as Independent Counsel, Robert Ray, released a report in September 2000, that stated “This office determined that the evidence was insufficient to prove to a jury beyond a reasonable doubt that either President or Mrs. Clinton knowingly participated in any criminal conduct.” The Clintons were never charged with any crime.

            So let’s see, that’s 1993-2000, some seven years – I’m good with that considering we were attacked by the Russians in order to elect this fool president.

        • For Sure Not Tom

          But there’s so many straws to grasp at, Little Cryin’ Johnny.

          In the nine months since Robert S. Mueller III was appointed to oversee the investigation into possible links between the Trump campaign and Russian officials, he has issued more than 100 criminal counts against 19 people and three companies. Of the 19 people, five — including three Trump associates — have pleaded guilty. Thirteen are Russians accused of meddling in the 2016 presidential election.

          Time is running out for the Trump/Kushner crime families.

    • Someone hasn’t been paying attention. But I guess they don’t cover this on FOX

    • For Sure Not Tom

      What a stupid question. Learn to troll better.

  2. Hopefully these guys are screwed. Even if Trump pardons them they’re still liable for the same charges at the state level, if the states decide to file them. I believe accepting a pardon is an admission of guilt. So, either way they could be doing hard time, as they should.