The bank- and tax-fraud trial of former Donald Trump campaign chairman Paul Manafort resumed Friday afternoon without any public explanation for an unusual delay in the proceedings, but quickly produced revealing testimony suggesting that Manafort’s role managing the Trump campaign helped him win millions of dollars in loans at a time he was badly short on cash.
A Chicago bank CEO who thought he was being considered for positions in President Donald Trump’s Cabinet helped facilitate $16 million in loans to Manafort during and after the campaign, a bank official involved in the transactions testified Friday.
The Federal Savings Bank of Chicago agreed to issue Manafort a $9.5 million loan after an unusual dinner in New York City in May 2016, days before Manafort was elevated to the position of campaign chairman, bank senior vice president Dennis Raico said on the witness stand after receiving a grant of immunity.
The bank’s CEO, Stephen Calk, attended that dinner and spoke with Manafort repeatedly in the ensuing months, Raico said. Three days after Trump was elected, the CEO called to ask Raico to contact Manafort.
Calk “said he had not spoken to Manafort in a day or two and thought it was possible he might be up for a senior role in the administration,” Raico said. Raico said the CEO asked him to “call Paul and see if he was a possible candidate for secretary of treasury or secretary of HUD [housing and urban development].”
“Did you make that call?” asked Greg Andres, a prosecutor for special counsel Robert Mueller’s team, which brought the charges against Manafort.
“No,” Raico said.
“Why?” Andres asked.
“It made me very uncomfortable,” Raico said.
Raico also testified that the process for approving Manafort’s $9.5 million loan was unusual in several respects. For one thing, Calk had never been involved in any other loan Raico handled. In addition, when the formal application for that loan was submitted to the bank’s Chicago headquarters, approval came back quickly.
“How soon after you submitted that loan for approval was it approved?” Andres asked.
“The very next day,” Raico said. That, too, had never happened before, the witness said.
Raico said he actually reached out to his ultimate boss in the spring of 2016 after learning about Manafort’s political work. “I came to learn Mr. Manafort was involved in politics and I knew Steve was interested in politics,” Raico said.
Calk came to the dinner in New York with Manafort and then attended a July meeting about the loan via video conference, Raico said. At that session, Calk was open about his desire to work with the Trump team, Raico added.
“He indicated he would be interested in helping serve the Trump organization,” Raico said.
Jurors at Manafort’s trial, which is nearing the end of its second week, also saw an Aug. 3, 2016, email from Manafort to Raico.
“Need Steve Calk’s resume,” the email’s subject line said.
The bank issued the $9.5 million loan in 2016 and another $6.5 million loan in January 2017 despite concerns about Manafort’s income stream and a large debt on his American Express bill caused by $210,000 in charges for Yankees season tickets, Raico said.
“It’s my understanding there were discrepancies in his income,” Raico said. Asked to explain, the bank official said Manafort’s financial statements seemed jumbled. “A + B didn’t equal C all the time,” Raico said.
Manafort assuaged the bank’s concerns about his American Express bill by submitting a letter Manafort aide Rick Gates signed saying he ran up the big bill for Yankees tickets.
“Thank you for allowing me to use the AMEX Business Plum Card to purchase season tickets for the 2016 baseball season,” read the letter, dated April 3, 2016. “I expect to collect fees from various people who will be partners with me to use the tickets.”
Gates testified earlier in the trial that Manafort asked him to write the letter, or something like it, because Manafort didn’t have enough cash to pay his bills at the time.
Manafort faces four felony counts — two of bank fraud and two of bank fraud conspiracy — for allegedly presenting false information to obtain the loans from the Chicago bank.
Calk never got a Cabinet post, although an email shown earlier at the trial indicates Manafort pressed to have him considered for secretary of the army and arranged to get tickets to Trump’s inauguration for Calk, his family members and friends.
Calk was not on the prosecution’s witness list made public before the trial. The bank has issued a statements saying it is cooperating with Mueller’s probe, but has declined to comment on Calk’s actions or to identify his attorney.
Andres told Ellis on Friday afternoon that the prosecution planned to rest its case Monday after calling one or two more witnesses. Manafort’s defense will then get a chance to call witnesses or Manafort himself, although the latter prospect is considered unlikely.
Closing arguments are possible as soon as Tuesday. However, things could slip somewhat depending on the length of any defense case and because Ellis doesn’t plan to convene the trial until 1 p.m. Monday.
Andres initially asked for the chance to give a two-hour opening statement and a half-hour rebuttal, but the judge said two hours would be the maximum for each side even though that was longer than he had in mind.
“I’ll tell you, I think it is no accident TV programs are half an hour,” the judge said. “If you think you can hold a juror’s attention for two straight hours, then you live on a different planet.”
Unexplained delay waylays fast-moving trial for hours
After speeding along for nearly two weeks, Manafort’s trial came to a mysterious halt Friday morning as the federal judge and lawyers for both sides huddled out of earshot of the public.
Rumors swirled through the ninth-floor courtroom in Alexandria, Virginia, about what the delay could mean — from a looming guilty plea from the former Trump campaign manager, to Judge T.S. Ellis III conceding his second mistake in two days, to an issue with the jury — but there were no clear answers.
Instead, Ellis, a 78-year-old Ronald Reagan appointee explained briefly to the court that he had a busy docket of more than 200 to 300 cases that he also has to “keep moving” and sent the overflow crowd off for an early lunch.
“I assure you this was all necessary,” Ellis said.
The scene inside Ellis’s courtroom Friday morning was starkly different from any other morning in the Manafort trial, now into its ninth day. Before the jury was summoned into the room, Ellis immediately called a bench conference with prosecutors and Manafort’s attorneys.
After that brief meeting with the judge broke up, Manafort got up from his seat and huddled with his entire team of lawyers as the entire courtroom quieted down. From the front row, a friend of Manafort’s wife, Kathleen Manafort, remarked aloud that she thought everyone was trying to listen in to the conversation. She also asked the reporters sitting in the row behind them what they thought was happening.
Paul Manafort, dressed in a blue suit, smiled and had an animated look on his face as his conference with his lawyers transitioned to individual conversations.
Ellis then called lawyers back for a second conference. This time, everyone from Manafort’s team joined the huddle, leaving the defendant by himself at his table to scribble notes as a deputy U.S. marshal sitting behind him kept watch. The judge then took the unusual step of calling the courtroom security officer over to participate — that move fueled speculation about a jury-related issue since that official is in charge of logistics issues involving the jurors.
The conference broke after a short discussion and Ellis announced he needed to recess for about 15 minutes “to consider an issue.” Oddly, he exited the courtroom through a door opposite his own chambers and in the direction of the jury room. The court’s stenographer followed.
This wait lasted longer than Ellis predicted — about 45 minutes — and when the judge returned, he summoned in the jury, took attendance and told them the court would be going back out for the early lunch break. As he has repeatedly throughout the trial, Ellis then delivered multiple warnings about not discussing the case with anyone, even among themselves and added: “Keep an open mind until all the evidence is in.”
As the courtroom emptied and prosecutors carrying all of their materials waited for the elevators, reporters asked Mueller lawyer Uzo Asonye for an update and also whether he could say what was in his cardboard box.
“I could,” Asonye said as an FBI agent loomed to his side, “but I’d have to kill you.”
When prosecutors and defense attorneys returned after lunch, most appeared to go into Ellis’ chambers for another 45 minutes while spectators, support staff and Manafort cooled their heels in the courtroom. At one point, a court reporter emerged from a door near the jury room and crossed into Ellis’ office.
When court reconvened at about 2:20 p.m., Ellis asked the jurors if their lunch was satisfactory, but offered no explanation for the delay.
At the end of the day on Friday, Ellis delivered another unusually emphatic warning to the jury not to discuss the case with others or to do internet research about the case.
“Don’t look up anything on Google. … Put it out of your mind until Monday. I certainly plan to do that,” the judge said. His comments further fueled suspicion that at least some of the hours of delay Friday were due to a jury-related issue.
Prosecutors protest another rebuke from judge
Before Friday’s mysterious courtroom action, prosecutors filed a formal, written motion with Ellis asking him to retract a comment he made Thursday in front of jurors.
The new filing objects to a remark that seemed to dismiss the significance of a bank fraud conspiracy charge against Manafort that stems from a loan he sought but never received.
After the prosecution spent about 40 minutes Thursday afternoon questioning a bank employee about Manafort’s unsuccessful effort to get a $5.5 million construction loan on a Brooklyn brownstone, Ellis implied that the testimony had been a waste of time, or at least overkill.
“You might want to spend time on a loan that was granted,” the judge scoffed at Asonye, prompting him to jump up from his seat.
“Your honor, this is a charged count in the indictment,” the prosecutor said.
“I know that,” Ellis shot back.
In the new motion, prosecutors protested the judge’s comment and asked him to tell the jury to ignore it.
The statement, prosecutors wrote, “misrepresents the law regarding bank fraud conspiracy, improperly conveys the Court’s opinion of the facts, and is likely to confuse and mislead the jury. The Court should provide a curative instruction in order to avoid any potential prejudice to the government.”
Prosecutors filed a similar motion Thursday, objecting to the judge’s actions a day earlier rebuking the prosecution for allowing an expert witness to sit through the trial prior to his testimony. Ellis said that defied his usual policy barring witnesses from listening to other testimony. However, court transcripts showed that on the trial’s first day, the judge specifically gave permission for the expert to sit in on other witnesses.
In response to the prosecution’s motion, Ellis issued what seemed like a grudging apology in front of the jury, saying he “may have” made a mistake and instructed jurors to disregard what he said.
Yankees official details Manafort’s season ticket bill
One of the most anticipated figures on the prosecution’s witness list for the Manafort trial, Irfan Kirimca, took the stand Friday.
Kirimca is no household name, but the interest in his appearance was driven by the sought-after job he holds: senior director of ticket operations for the New York Yankees.
Manafort was a longtime season ticket holder at the Yankees. His tickets have figured in the trial in a couple ways. The big charges for tickets contributed to a delinquent American Express bill that jeopardized millions of dollars in loans Manafort was seeking. And his payment for the tickets on at least one occasion using money wired directly from an offshore bank may support prosecutors’ claims that he was paying his personal expenses by using funds never reported on his income taxes.
Manafort wasn’t just a holder of ordinary box seats, Krimica said. Instead, the once-high-flying lobbyist had tickets to the Legends Suite. One contract showed Manafort’s tickets costing about $700 apiece a few years back.
Kirimca testified that Manafort had a long-term contract including four tickets to 81 games a year. Despite Gates’ letter saying he and his friends were sharing the tickets in 2016, prosecutors displayed an email in which Manafort seemed to be calling the shots on the seats.
“Will you and Kathy be attending opening day or any other games that week,” the Yankees’ Drew Fox asked.
“Yes. Kathy and I will be attending opening day!” Manafort replied, also asking that the tickets be shipped to his Trump Tower apartment.
More hints that Gates may be cooperating in Trump-Russia probe
There was another signal Friday that the trial’s star witness, former Manafort protégé Gates, may be cooperating with Mueller’s ongoing probe of alleged coordination between the Trump campaign and Russia during the 2016 election.
In a status report filed Friday with the federal judge who took Gates’ guilty plea earlier this year, prosecutors and Gates’ lawyers asked to put off initiating sentencing proceedings in his case for another 90 days.
In support of that request, attorneys cited the “possible need” for Gates’ assistance in the continuing Mueller probe. They also noted that Gates just testified at the Manafort trial in Virginia. (A separate trial of Manafort on other charges is set for next month.)
“The defendant continues to meet with the Special Counsel’s Office as required by his Plea Agreement,” the lawyers wrote. “The investigation, which includes the possible continued need for assistance from the defendant as required by his Plea Agreement, is ongoing.”
On Thursday, prosecutors handling Manafort’s Virginia trial persuaded Ellis to seal a court transcript of a sidebar conference earlier in the week where Gates’ cooperation with the Mueller team was discussed. Ellis agreed to keep the information under wraps because it could expose confidential aspects of the ongoing inquiry.
It is not entirely clear that Gates’ cooperation relates to the issue of Russian influence on the 2016 election, but the question that prompted the bench conference involved prosecutors’ interest in issues related to Gates’ work on the Trump campaign.
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