Rick Gates says he and Manafort disguised foreign income as loans

Paul Manafort's associate says 'hundreds' of emails prove former Trump campaign chief directed fraud

Former Trump campaign staffer admits financial crimes

Sometimes, however, Gates said he would perform the same task without Manafort's direction or knowledge in order to embezzle funds from his employer. "How could I be blindsided like this" on his high tax bill. This time, however, Manafort himself provided Gates the template to be used for vendor payments, according to the witness.

On Tuesday, the court was shown a series of emails, contracts and what prosecutor Greg Andres referred to as "fake invoices", in which Gates altered the template to show the name of a shell company instead of Manafort's.

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But during cross-examination on Tuesday, the defense painted Gates as living a "secret life" in London and accused him of embezzling money from Manafort's foreign accounts at center of the trial to indulge in an extramarital affair in the United Kingdom.

Manafort's team hopes so.

In other testimony, Gates recounted how he falsified documents for Manafort, including converting a PDF of a profit-and-loss statement to a Microsoft Word document so he could doctor it to inflate the business' income. Downing mentioned that Gates was maintaining an apartment in London.

"I haven't", Gates replied, explaining that the money went into his personal accounts and was spent over the years. The pair avoided all eye contact.

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Gates, who is 46 and married, admitted: "There was a period in my life, about 10 years ago, when I had a relationship, yes". I'm taking responsibility for it.

Downing told Judge T.S. Ellis III that he plans to cross-examine Gates for another hour Wednesday morning. Mr. Manafort had the same path.

Gates struggled to answer Downing's questions about which of his transactions were legitimate and which were not, prompting Downing to complain that Gates "seemed to have flawless recollection" when being questioned by Greg Andres, a lawyer for the prosecution.

Manafort, a former Trump campaign chairman, has pleaded not guilty to 18 counts of bank and tax fraud and failing to disclose foreign bank accounts. In short, they said they wanted to pin it all on the underling.

The questioning is part of the Manafort defense strategy of presenting Gates to the jury as someone who lies and can not be trusted.

The defense is largely staking Manafort's innocence on discrediting Gates. Gates did not recall.

The defense highlighted the terms of the deal Gates received for testifying in the bank and tax fraud case against Manafort on charges that stem from special counsel Robert MuellerRobert Swan MuellerSasse: US should applaud choice of Mueller to lead Russian Federation probe MORE's Russian Federation investigation.

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In general, references to Trump at the trial have been few and far between.

It's a day that featured testimony from just one witness, Rick Gates, Manafort's longtime deputy, who finished his direct questioning from prosecutors and underwent a grueling cross-examination from lead defense attorney Kevin Downing. This kept the scheme mostly hidden from accountants and bookkeepers-though immunized witness Cynthia Laporta earlier testified that she had her doubts about the veracity of Manafort's and Gates's representations surrounding the loans. And prosecutors flashed a note from a meeting Manafort and Gates had in 2013, showing that an unnamed Trump may have received Manafort's Yankees tickets. "Have they confronted you with so many lies you can't remember any of it?"

There are still several more documents on the prosecutors' list called "intentionally left blank".

Employees from Federal Savings Bank are expected to testify later this week.

How much more might we hear about Trump? But Trump has shown interest in the proceedings, tweeting support for Manafort and suggesting he has been treated worse than gangster Al Capone.

Downing asked Gates whether he was told he was looking at 290 months for the crimes that were dismissed.

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