Published: Mon, August 06, 2018
Global News | By Blake Casey

Manafort trial day 4: Accountant concedes possible wrongdoing, Manafort's double life

Manafort trial day 4: Accountant concedes possible wrongdoing, Manafort's double life

"I very much regret it", Laporta said on the trial's fourth day as prosecutors build their case that Manafort hid tens of millions of dollars he earned working for pro-Russian politicians in Ukraine to evade taxes. After a back-and-forth discussion about how much income should be reclassified as a loan to aid Manafort, they settled on $900,000, she testified.

She dealt less frequently with Gates, Manafort's former right-hand man, and only on his business accounts, she said.

Cindy Laporta - who knowingly filed a false 2014 tax return on behalf of Manafort - was granted immunity to testify against him in his criminal tax-evasion and bank fraud case.

Asked why she engaged in misconduct, Laporta said she had few good choices.

Four days into the trial, the prosecution has already called a number of witnesses who have steadily chipped away at Manafort's attempt at pinning the crimes on Gates. When Manafort and his partners, including longtime Trump adviser Roger Stone, set up their consulting firm in the 1980s, their first client was none other than Donald Trump.

Washkuhn's testimony appeared to undercut an argument by Manafort's attorneys that he can't be responsible for financial fraud because he left the details of his spending to others, including his longtime associate Rick Gates. Earlier this year, he pleaded guilty to financial charges and lying to federal investigators, and agreed to cooperate with Mueller's investigators. But Manafort was copied in on several emails discussing the matter.

Washkuhn's testimony also seemed to point toward Manafort's doctoring documents in an effort to inflate his income and to qualify for loans. On Wednesday, he defended his 2016 hiring of Manafort and suggested Manafort was being treated worse than mobster Al Capone. She said it claimed Manafort's company brought in millions of dollars more in income than documents her company created.

During this conference call, the idea was apparently established to increase a loan amount - and shift income into a loan - in order to reduce Mr. Manafort's income and thus reduce his income taxes.

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Washkuhn told jurors she had no knowledge of more than a dozen accounts in Cyprus that prosecutors say Manafort used to pay for real estate and luxury items such as cars, clothes and home improvements.

Manafort's trial, being held in USA federal court in Alexandria, Virginia, is the first arising out of Special Counsel Robert Mueller's investigation into the interactions between Trump associates and Russian officials.

After complaining about the tough questions he received from American reporters in Finland, Trump has largely steered clear of the mainstream media, instead opting for safer spaces like an interview with ally Rush Limbaugh this week. That investigation remains ongoing, and this week's financial fraud trial is not tied to collusion. She also conceded that she knew the letter was false "because of the dates".

"They never told us about any income that was deposited in foreign accounts", Ayliff said, adding that his accounting firm would want to know of such accounts "to make sure that income is being picked up and reported correctly".

Philip Ayliff, an accountant with KWC, told jurors on Thursday, the first day of his testimony, the lack of accurate information would lead to an incorrect tax return. He said he would talk to Gates about Manafort's tax returns because Manafort had authorized it.

Heather Washkuhn, managing director of Nigro Karlin Segal Feldstein & Bolno, an accounting firm, would be one of the witnesses to be called on Thursday, Andres said.

In one such instance, Laporta testified that Manafort tried to retroactively classify one of the properties he owns as a secondary residence instead of a rental, as it was originally listed.

Prosecutors tightened the noose on Manafort for the tax evasion charges Friday during questioning with Ayliff and Laporta.

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