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Zoe Tillman @ZoeTillman
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Week 3 of Paul Manafort's trial kicks off at 1pm. Want to catch up on Week 2?
Rick Gates:…
Rick Gates II:…
Following the $:…
Judge v. prosecutors:…
Quid pro quo?:…
This a.m., prosecutors filed a brief arguing that even if the CEO of Federal Savings Bank had personal reasons for approving $16M in loans to Paul Manafort (as the govt has argued) that's not a defense to the charge that Manafort defrauded the bank…
And we're back at the US District Court for the Eastern District of Virginia, where Paul Manafort's trial is set to resume at 1pm. Known as the "rocket docket," the courthouse has a statue out front that reads, "Justice Delayed Justice Denied" (note the animals...)
Up next: The government is expected to finish its case in chief. We'll hear from another Federal Savings Bank witness, James Brennan (who received immunity to testify), and possibly another witness to talk about foreign bank account reporting to the feds
Once the government finishes, the judge will ask Manafort's lawyers if they plan to put on evidence, and if so, an estimate for how long that'll take. Then we'll go to closing arguments and jury instructions, and then the jury will deliberate. Stay tuned.
Quick p.m. break. We've heard from James Brennan, a VP at Federal Savings Bank, re: $16M in loans the bank approved. Brennan received immunity to testify. He was involved in underwriting the loans
Brennan talked about issues and "red flags" that came up while the bank was reviewing Manafort's applications for these loans, including inconsistencies in the income Manafort was reporting. Jury also saw again that certain existing mortgages weren't incl. in the applications
Re: the $9.5M loan Manafort got on a property in Bridgehampton, NY, Brennan testified that one bank exec had rejected it, but it ended up being approved. "It closed becuase Mr. Calk wanted it to close," he said — jury heard last week about Steve Calk seeking Trump admin posts
We saw a Sept. 2016 memo that a bank employee prepared outlining the concerns with Manafort's loan app, incl. $2.4M in income Manafort said he'd *earned* but there was no documentation that money was *received*; delinquent NY Yankees season tickets debt; other mortgages
We're in cross right now by Manafort's lawyer. He asked if it's against any rules for a borrower to prep a sheet listing profits and losses — Brennan said no. Prosecutors say Manafort submitted false info (different #s than his bookkeeper had) about his income to defraud the bank
Re: mortgages that weren't listed, Manafort lawyer Richard Westling asked how a borrower would know to include a mortgage taken out by an LLC. Brennan said an individual would need to list it if they were a guarantor. Westling asked him to show where that was in the application
Brennan said that in that section of the loan app, there was a reference to including loan guarantees. Westling then asked if Brennan knew who exactly checked the boxes that were filled out in Manafort's loan app. Brennan said he didn't know.
Last week, we heard Qs from Manafort's lawyer about whether loans were "overcollateralized" — backed up by assets worth more than the loan. There were ~15.3M in assets for a $9.5M loan. Was that a "healthy" ratio, Westling asked? Brennan said it would be considered standard
When we return: Finishing up cross examination and any redirect by the government. Then we'll hear from the judge about whether he'll allow in add'l govt testimony about whether Manafort's business reported foreign bank accounts (versus Manafort individually)
We are done for the day. The judge allowed the govt to introduce evidence that Manafort's businesses didn't file foreign bank account reports, over defense objection (they argued it wasn't relevant to whether Manafort individually willfully failed to file required FBARs)
The govt then rested its case. Manafort's lawyers moved for a full judgment of acquittal on the indictment — we'll hear full arguments tomorrow, but one arg is the govt failed to show Federal Savings Bank relied on any allegedly false info Manafort submitted. More on that soon
The judge is finishing the day with arguments on a sealed motion that Manafort's lawers filed — they closed the courtroom for that, so I don't have any details on what that's about as of now
Day 10: The prosecution rests, and Paul Manafort's lawyers ask for a full acquittal…
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