The jury in Paul Manafort’s tax fraud trial indicated that it is struggling to reach a consensus on at least one of the charges against him, according to a note the jury gave to the judge on Tuesday.
It was unclear from the note whether the jury has reached a consensus on any of the other charges against Manafort. He faces a total of 18 counts related to bank and tax fraud.
The jury of six men and six women asked Judge T.S. Ellis for guidance, writing, ‘Your honor, if we cannot come to a consensus on a single count how do we fill in the verdict sheet?’
The jury, which has been deliberating for four days, also asked what impact this deadlock would have on the overall verdict, and requested a fresh verdict sheet from the judge.
Judge Ellis said he will ask the jury to retire and continue to deliberate. He said he will not ask them at this time if they have reached on a decision any of the other counts.
However, he said if the jury remains deadlocked on the charge, he ‘may then enquire if they have reached a unanimous conclusion on other counts’ so he can determine the status of the case in general.
If the jury is unable to reach a unanimous decision on any counts then the court may need to declare a mistrial. In that case the prosecution would have to decide if it wants to retry the case before another jury.
Here to watch: Kathleen Manafort arrived for the fourth day of the jury’s deliberations in a case which could send her husband to prison for the rest of his life
Confident: Defense attorney Kevin Downing arrived for the fourth day of deliberations after saying on Friday that he believed the length of time the jury was taking favored Manafort
In action: This courtroom sketch depicts U.S. District court Judge T.S. Ellis III speaking to the lawyers and defendant Paul Manafort, fourth from left, as the jury continues to deliberate in Manafort’s trial on Friday
However, it is possible based on the ambiguous wording of the note that the jury has already agreed on some or all of the 17 other counts and is stuck on the last one.
Judge Ellis also told the court that the jury question was ‘not an exceptional or unusual event in a jury trial.’ He said he wanted to make sure nothing he advised the jurors would have a coercive effect on their decisions.
Manafort’s wife Kathleen was in court close to her husband, as she has been throughout the trial.
The development is the most significant yet in the jury’s days of deliberations.
They were sent home at 6.15pm Monday after sending the judge a note an hour earlier saying it did not want to sit any later, which he accepted.
The verdict – when it comes – will be the first given by a jury on a case brought by Robert Mueller’s special counsel investigation.
Monday’s lack of any verdict came after a dramatic Friday when the stakes were raised significantly by both Donald Trump and Judge T.S. Ellis III, the outspoken federal judge who has overseen the trial.
Trump made an extraordinary intervention Friday with a jury in its second day of deliberations, calling Manafort a ‘very good person’ and his trial ‘very sad.’
But he wouldn’t talk about a potential pardon of Manafort, who refused to cooperate with prosecutors to get what could have been a reduced sentence. ‘I don’t talk about that,’ he said.
Inside the court room on Friday the judge revealed that he had received threats and was being guarded by U.S. Marshals as he ruled on a motion from CNN and other news outlets asking him to make the jurors’ names and addresses public so they could be interviewed after the trial – a routine move by the press.
Ellis rejected the motion, saying he has received threats during the course of the trial and fears for the jurors’ safety if he releases their names.
Ellis said he has also been traveling with the U.S. Marshals Service due to the threats, and added that the jury does not have this same security.
‘I don’t feel right if I release their names,’ said Ellis, adding that it would ‘create a risk of harm to them.’
‘I had no idea this case would excite these emotions,’ said Ellis.
He declined to discuss the details of the threats against him.
The judge has put no limit on how long he will allow them to deliberate over the 18 bank and tax fraud charges leveled at Donald Trump’s former campaign chairman by Robert Mueller’s special counsel probe.
The trial had heard that Manafort’s offshore bank accounts were often in the name of companies which he held only a minority stake in, although the prosecution said he was in reality in full control of them.
His turncoat deputy Rick Gates had testified that he bought ‘shelf’ companies for Manafort, which were pre-existing legal companies set up with the intention of being used by their buyers.
His prosecutors say Manafort earned $60 million advising Russia-backed politicians in Ukraine, hid much of it from the IRS and then lied to banks to get loans when the money dried up.
Manafort’s defense countered that he wasn’t culpable because he left the particulars of his finances to others.
The financial fraud trial calls on the dozen jurors to follow the complexities of foreign bank accounts and shell companies, loan regulations and tax rules.
It exposed details about the lavish lifestyle of the onetime political insider, including a $15,000 jacket made of ostrich leather and $900,000 spent at a boutique retailer in New York paid via international wire transfer.
Judge T.S. Ellis III told the six men and six women of the jury to take as long they needed to reach a verdict.
Key case: Paul Manafort, a one-time Trump campaign chairman, is the first person to go to trial on charges brought by the Robert Mueller special counsel probe. Judge T.S. Ellis III revealed Friday that he was under armed guard and the jurors were ‘scared’
Manafort’s defense team claimed he was a victim of a ‘desperate’ attempt by Special Counsel Robert Mueller to pin a bogus crime on the former Trump campaign chief, during closing arguments in Manafort’s tax and bank fraud trial on Wednesday.
Attorneys for Manafort argued in a 90-minute closing statement that their client was a victim of his embezzling former business partner Rick Gates, who they claim cut a deal with the government and testified against Manafort in exchange for getting his own tax fraud charges dropped.
For the first time since the trial began, defense attorneys also raised the fact that Manafort worked for Donald Trump – a possible implication to the jury that the charges were politically motivated.
‘The government – so desperate to make a case against Mr. Manafort – made a deal with Rick Gates,’ said Manafort’s attorney Kevin Downing. ‘Mr. Gates was orchestrating a multi-million dollar embezzlement scheme.’
The move may be a brave one by Manafort’s defense, who had got the judge to keep Trump’s name out of the case, saying it would prejudice a jury drawn from heavily Democratic areas of northern Virginia around the Alexandria courtroom.
Those in the court who want to be there for the verdict – including Manafort’s wife Kathleen – have been warned they need to go no further than 10 minutes away.
In its summary to the jury the prosecution honed in on Manafort’s alleged ‘lies’ and greed, while also downplaying Gates.
The trial is the first test of Robert Mueller’s special counsel probe, with the charges brought by his prosecutors in the course of their investigation into Russian involvement in the 2016 election – although they do not include any of collusion.
An acquittal would be a significant blow to Mueller and likely to be seized on by Donald Trump and his supporters as a reason to end the investigation.
‘Mr. Manafort lied to keep more money when he had it, and to get more money when he didn’t,’ prosecutor Greg Andres told the jury in an exhaustive closing statement that lasted over an hour and forty minutes.
But Richard Wesley, a lawyer on Manafort’s team, called the government’s bank fraud evidence against his client ‘selective.’
‘Clearly the goal was to…stack up the counts,’ said Wesley. ‘And to give you a sense that the evidence is so overwhelming to draw one conclusion.’
‘There is not a single bit of evidence that any of these banks came to the government and complained about these frauds,’ added Wesley.
He said none of the banks seemed concerned ‘until the special counsel showed up and starting asking questions.’
Throughout the trial, Manafort’s attorneys have suggested Gates was responsible for falsifying bank and tax records – even implying he forged Manafort’s signatures on foreign bank records. They claimed he did this to cover up for millions of dollars he embezzled from Manafort’s businesses.
In testimony last week Gates said he committed tax and bank fraud crimes under orders from Manafort – but also admitted to embezzling hundreds of thousands of dollars from his former boss while carrying at least one extramarital affair.
Downing told the jury that Gates was a ‘liar’ who ‘tried to get one over on you.’
‘How [Gates] was able to get the deal he got [with Mueller’s team] I have no idea,’ said Downing. ‘He gets to walk out of here on probation…because [prosecutors] were so desperate to try to make the case.’
Gates pleaded guilty to obstruction of justice earlier this year. Although Manafort’s attorneys have repeatedly implied that Gates was offered a deal of probation for cooperating with prosecutors, he in fact faces up to 10 years in prison for these charges.
However, Mueller’s team has promised not to object if Gates requests probation during his sentencing. Prosecutors also dropped bank and tax fraud charges against Gates in exchange for his cooperation.
Downing said Gates was prepped extensively by prosecutors during at least 20 meetings with Mueller’s team. He said Gates tried to ‘look all clean shaven’ during his testimony, but ‘showed himself to be the liar he is.’ He also claimed Manafort felt ‘foolish’ for trusting Gates and giving him access to his financial accounts.
Power brokers: Rick Gates (left) and his boss Paul Manafort (second from right) ran the Trump campaign during the 2016 Republican National Convention in Cleveland, in 2016.
‘To the very end [Gates] lied to you,’ Downing told the jury. ‘He was flawless on direct [questioning] but on cross examination he fell apart.’
Downing also emphasized Gates’s ‘secret life,’ a reference to Gates’s extramarital affair. The defense claimed last week that Gates stole money from Manafort because he was living beyond his means, paying for an apartment for his mistress in London and first-class trips across Europe.
‘He finally admitted his secret,’ said Downing. ‘He was paying for his apartment in London, he was paying for fancy restaurants and hotels.’
Downing also argued that Manafort was not trying to knowingly conceal his foreign bank accounts from the government, saying he disclosed them to the FBI when he was interviewed about an unrelated matter in 2014.
‘If you’re in this major concealment scheme, why would you just disclose it?’ asked Downing.
The prosecution had said that Manafort lied to his personal book keeper, his tax preparers, the IRS, and multiple banks and financial institutions, according to prosecutors.
He also neglected to file required government reports disclosing his foreign bank accounts and did not mention them on his income tax filings, the government claims.
While hiding money in at least 31 foreign accounts, Manafort also transferred millions to vendors in the U.S. to fund his decadent lifestyle, according to prosecutors. He spent over $1.5 million on custom menswear – including a $21,000 crystal watch and a $15,000 ostrich jacket – and millions more on high-end TV and audio equipment and landscaping for his Hamptons mansion.
Judge T.S. Ellis has clashed with prosecutors in the case over their references to Manafort’s wealth, prodding them to focus instead on the tax and fraud charges. Andres stressed during his closing argument that the government is not prosecuting Manafort due to his spending habits.
‘This case is not about Mr. Manafort’s wealth,’ said Andres. ‘We are not in court today because Mr. Manafort is wealthy. We are in the court today because he filed false tax reports and he failed to file [a Foreign Bank Account Report].’
Andres also argued that Manafort’s failure to disclose his income was deliberate – a point prosecutors must prove the jurors to get a conviction.
Noting that Manafort was an attorney and an experienced international political consultant, Andres said ‘Mr. Manafort is capable and bright’ and ‘met regularly with his own tax preparer.’
Prosecutors also seemed to downplay the importance of testimony from Rick Gates, Manafort’s former business partner who pleaded guilty to lying to investigators earlier this year and has been cooperating with Mueller’s team.
Gates, who was previously billed as the prosecution’s key witness in the case, testified last week that he helped Manafort carry out his tax and bank fraud schemes.
But Gates’s credibility was also heavily damaged under cross examination, when he admitted to embezzling hundreds of thousands of dollars from Manafort and having at least one extramarital affair.
Manafort’s attorneys suggested that Gates had as many as four affairs, and claimed he used the money he embezzled to pay for a London apartment for his mistress and first-class trips through Europe.
Andres seemed to acknowledge Gates’s credibility problems during his closing arguments.
‘We’re not asking you to like him,’ said Andres.
He told jurors to take Gates’s testimony and ‘compare it to the testimony of [other] witnesses. This is how you know if it is consistent.’
Andres also pushed back against Manafort’s attorneys for concentrating on Gates’s infidelity.
‘Why were there so many questions on Mr. Gates’s affair?’ he asked. ‘Was it to distract you? Does it matter?’
‘Mr. Manafort was a mentor to Mr. Gates in his criminal activity,’ added Andres. ‘[Manafort] didn’t choose a boy scout.’
The prosecutor urged the jury to focus on the documents in the case rather than on any single witness.
‘The star witness in this case is the documents,’ said Andres. ‘Virtually everything Mr. Gates testified on is in the documents.’
Andres closing argument came on the twelfth day of the trial. Nearly all of that time was spent on testimony from prosecution witnesses; Manafort’s defense team declined to call any witnesses.
Manafort’s attorneys will make their closing arguments on Wednesday afternoon. Prosecutors will then have 17 minutes to give a rebuttal – the time remaining from their two-hour closing argument allowance.
Afterward, the judge will advise jurors on legal requirements for a conviction. Judge Ellis told jurors this will likely take an hour and a half. The court will then go to recess until the jury reaches a verdict.
While the case against Manafort does not relate to any allegations of Russian election interference or possible coordination with the Trump campaign, the proceedings have drawn President Donald Trump’s attention – and prompted tweets – as the president has worked to undermine the standing of the Mueller investigation in the public square.
Star witness: Rick Gates was on the stand for three days but his credibility was attacked by Manafort’s defense and he admitted cheating on his wife with a long-term mistress in London
Trump has distanced himself from Manafort, who led the campaign from May to August 2016 with Gates at his side. Gates struck a plea deal with prosecutors and has provided much of the drama of the trial so far.
Gates testified that he helped Manafort commit crimes in an effort to lower his tax bill and fund his lavish lifestyle.
During testimony, Gates was also forced to admit embezzling hundreds of thousands of dollars from Manafort and conducting an extramarital affair.
After jurors were excused on 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.
THE ROBERT MUELLER PROBE SO FAR: FIVE GUILTY PLEAS, ONE JAILED ATTORNEY AND 25 RUSSIANS ACCUSED
GUILTY: MICHAEL FLYNN
Pleaded guilty to making false statements in December 2017. Awaiting sentence
Flynn was President Trump’s former National Security Advisor. He previously served when he was a three star general as President Obama’s director of the Defense Intelligence Agency but was fired.
He admitted to lying to special counsel investigators about his conversations with a Russian ambassador in December 2016. He has agreed to cooperate with the special counsel investigation.
GUILTY: RICK GATES
Pleaded guilty to conspiracy against the United States and making false statements in February 2018. Awaiting sentence
Gates was Manafort’s former deputy at political consulting firm DMP International. He admitted to conspiring to defraud the U.S. government on financial activity, and to lying to investigators about a meeting Manafort had with a member of congress in 2013. As a result of his guilty plea and promise of cooperation, prosecutors vacated charges against Gates on bank fraud, bank fraud conspiracy, failure to disclose foreign bank accounts, filing false tax returns, helping prepare false tax filings, and falsely amending tax returns.
GUILTY: GEORGE PAPADOPOLOUS
Pleaded guilty to making false statements in October 2017. Awaiting sentence
Papadopoulos was a member of Donald Trump’s campaign foreign policy advisory committee. He admitted to lying to special counsel investigators about his contacts with London professor Josef Mifsud and Ivan Timofeev, the director of a Russian government-funded think tank.
He has agreed to cooperate with the special counsel investigation.
GUILTY: RICHARD PINEDO
Pleaded guilty to identity fraud in February 2018. Awaiting sentence
Pinedo is a 28-year-old computer specialist from Santa Paula, California. He admitted to selling bank account numbers to Russian nationals over the internet that he had obtained using stolen identities.
He has agreed to cooperate with the special counsel investigation.
GUILTY AND JAILED: ALEX VAN DER ZWAAN
Pleaded guilty to making false statements in February 2018. He served a 30-day prison sentence earlier this year and was deported to the Netherlands upon his release.
Van der Zwaan is a Dutch attorney for Skadden Arps who worked on a Ukrainian political analysis report for Paul Manafort in 2012.
He admitted to lying to special counsel investigators about when he last spoke with Rick Gates and Konstantin Kilimnik.
CHARGED: KONSTANTIN KILIMNIK
Indicted for obstruction of justice and conspiracy to obstruct justice.
Kilimnik is a former employee of Manafort’s political consulting firm and helped him with lobbying work in Ukraine. He is accused of witness tampering, after he allegedly contacted individuals who had worked with Manafort to remind them that Manafort only performed lobbying work for them outside of the U.S.
He has been linked to Russian intelligence and is currently thought to be in Russia – effectively beyond the reach of extradition by Mueller’s team.
INDICTED: THE RUSSIANS
Twenty-five Russian nationals and three Russian entities have been indicted for conspiracy to defraud the United States.
Two of these Russian nationals were also indicted for conspiracy to commit wire fraud and 11 were indicted for conspiracy to launder money. Fifteen of them were also indicted for identity fraud.
Vladimir Putin has ridiculed the charges. Russia effectively bars extradition of its nationals. The only prospect Mueller has of bringing any in front of a U.S. jury is if Interpol has their names on an international stop list – which is not made public – and they set foot in a territory which extradites to the U.S.
POLITICS, SEX, AND LIES: THE RISE AND FALL OF PAUL MANAFORT
In the span of just two years, Paul Manafort has gone from one of Washington’s most sought-after Republican lobbyists to a political pariah – something the outcome of his trial will barely change.
It has been a long fall from grace for the 69-year-old former Trump campaign manager, the son of a small-town mayor who went on to work for four U.S. presidents and made his fortune as the Washington mouthpiece for some of the world’s most notorious dictators.
Today Manafort has few defenders in the nation’s capital, after being charged with tax fraud and failing to register as a foreign agent by special counsel Robert Mueller.
Even Manafort’s former boss, President Trump, claimed he never would have hired the former lobbyist if he had known about the allegations.
‘Paul Manafort came into the campaign very late and was with us for a short period of time (he represented Ronald Reagan, Bob Dole & many others over the years), but we should have been told that Comey and the boys were doing a number on him, and he wouldn’t have been hired!’ wrote Trump in a Twitter post in June.
The power brokers: Paul Manafort, his future business partners Roger Stone and Lee Atwater, were photographed as young Republican operatives. Stone, a Trump confidante and notorious political dirty trickster is now fighting off the Mueller probe himself; Atwater died in 1991, a former RNC chairman with a reputation for dirty campaigns. All three cashed in on their political work by lobbying those they got elected
Manafort, the grandson of an Italian immigrant, was raised in a staunch Republican home in New Britain, Connecticut.
When he was 16, his father Paul John Manafort Sr. was elected mayor of New Britain and served for three terms.
In 1981, Manafort Sr. was indicted – but later acquitted – on perjury charges in a sweeping city corruption and bribery scandal that also ensnared the police and fire chiefs.
After Catholic parochial schools and graduating from Georgetown University Law School, Manafort went on to work as an advisor for Republican Presidents Gerald Ford.
He served as an advisor to Ronald Reagan, George H.W. Bush and Bob Dole’s presidential campaign.
But he – and his business partners – worked out how to turn political advising into a gusher of cash: by lobbying the very politicians they had helped elect.
He co-founded a prominent lobbying firm with ex-Nixon aide Roger Stone, and other partners, which shopped their access to top Republicans to U.S. businesses, state and city governments, and anyone who would pay.
That came to embrace the wider world too; the Manafort lobbying roster included brutal regimes willing to pay high fees for his services – including Filipino dictator Ferdinand Marcos and Zaire military leader Mobutu Sese Seko.
Betrayed: Kathleen Manafort stood by her husband despite his family finding proof of his mistress on Instagram; she attended every minute of his trial
Manafort went on to found his own political consulting firm in 2005, bringing on his former intern Rick Gates as his trusted deputy.
He also continued to take on controversial clients. In 2010, Manafort helped elect Ukrainian President Viktor Yanukovych, head of Ukraine’s Putin-allied Party of Regions.
The victory paid off – between 2010 and 2014, federal investigators said Manafort’s firm earned ‘a cash spigot’: $60 million in fees from the Party of Regions’ political patrons.
According to prosecutors, Manafort stashed the funds away in a series of offshore bank accounts and shell companies, and failed to disclose the income in his tax returns. In total, they claim he dodged taxes on $15 million.
But after Yanukovych was voted out of power by Ukraine’s parliament in 2014, Manafort’s fortunes suddenly changed. He stopped getting payments from Yanukovych’s wealthy oligarch supporters, and started to have trouble paying his bills.
This is when prosecutors claim Manafort started applying for loans using phony financial information. In total, they said he scammed banks out of $20 million.
Manafort’s alleged crimes were uncovered during the course of a special counsel investigation led by Robert Mueller, who has been investigating potential Russian interference in the 2016 election and collusion with the Trump campaign.
In addition to the tax and bank fraud trial in Alexandria, Virginia, Manafort also faces additional counts of failing to register as a foreign agent for his Ukraine work. That trial is set to take place in Washington, D.C.
Even before the charges were filed against him, Manafort’s personal life had been unravelling, according to years of hacked text messages between his daughters Andrea, 32, and Jessica, 36, that were posted online.
According to the messages, Manafort’s family had caught him having an affair with a woman who was around the same age as his daughters, renting a pricy house for her in the Hamptons and paying her credit card bill.
They discovered the affair after seeing the woman’s posts boasting about her expensive travel and dinners on Instagram.
Manafort, who was undergoing an emotional breakdown according to the messages, committed himself to a psychiatric clinic in Arizona in 2015.
Texts: Manafort’s daughters Jessica (left, with now ex-husband Jeff Yohai) and Andrea (right with husband Christopher Shand) exchanged text messages which were hacked revealing his affairs and calling him a psychopath.
Fruits of lobbying: This is the condo overlooking the Potomac where the FBI raided Manafort on orders from Mueller. He bought it for $2.75 million, part of a property empire worth conservatively $15 million
After he was released in 2016 – claiming he had ‘new insight’ into himself – he linked up with the Trump campaign and became the candidate’s campaign manager during the crucial months surrounding the Republican National Convention.
His daughter Andrea took a different view of that.She wrote in a leaked text to a friend, who was not named in the leak: ‘Trump probably has more morals than my dad. Which is really just saying something about my dad. My dad is a psycho!!! At least trump let his wives leave him. Plus, Trump has been a good father.’
And she also texted: ‘Trump waited a little too long in my opinion, but I can attest to the fact that he has now hired one of the world’s greatest manipulators. I hope my dad pulls it off. Then I can sell my memoir with all his dirty secrets for a pretty penny.’
Despite the clearly unhappy family, Manafort’s wife Kathleen stood by him in the face of his infidelity.
She also loyally attended each day of his tax fraud trial, always sitting in the row directly behind his defense table.
Since June, Manafort has been incarcerated for alleged witness tampering related to his foreign agent case. He has been serving that time in a county jail in Alexandria which is close to the federal court where his tax and bank fraud trial was held.
In a recent mug shot, the fashion-conscious Manafort sported a jailhouse jumpsuit and shadowy stubble. His brown hair, which he previously dyed, is now tinged with grey.
The former lobbyist, who once spent $18,000 on a python skin jacket, has also been forced to attend his trial without socks – because he reportedly balked at the white ones he is required to wear as an inmate.
The charges against Manafort have even impacted the legacy of his father, a popular three-term mayor in New Britain, Connecticut, from 1965 to 1971.
This month the city changed a street named after the former mayor from ‘Paul Manafort Drive’ to ‘Paul Manafort Sr. Drive’ in order to distance it from the controversy surrounding Manafort’s trial.