Paul Manafort Trial, Day 3: When Your Best Hope Is Pinning It On The Help...
Twenty thousand dollars on a goddamn karaoke machine? GO TO JAIL, PAUL MANAFORT! GO DIRECTLY TO JAIL!
See, that there is why Judge Ellis is trying to tamp down testimony on Paul Manafort's wild spending habits. As he said, "It engenders some resentment." Also, too, $2.2 million for audio-visual systems in your various homes? GO TO JAIL RIGHT NOW!
Yesterday Heather Washkuhn, Paul Manafort's longtime bookkeeper, described her boss's increasing desperation after the firm's income tanked in 2015. Davis Manafort Partners (DMP) earned $60 million between 2010 and 2014, enough to keep Paul Manafort well-supplied with hideous sport jackets. But after his "golden goose" Viktor Yanukovych got chased out of Ukraine, earnings dropped to $338,542 in 2015. And by 2016, the firm was over a million dollars in the red. WOMP WOMP.
While the money was rolling in, Manafort's main concern was how to live like a king and pay taxes like a Walmart greeter -- hence the wires from offshore accounts directly to vendors. But when the money spigot stopped flowing, he went looking for a new scam. Instead of trying to hide his actual, enormous income from the IRS, Manafort needed to massively inflate his paltry income to persuade banks to fuel his extravagant lifestyle with loans. So cash that he'd wired to himself from Cyprus and labeled a "loan" in 2014 -- i.e. not taxable income -- was retroactively classified as money "earned" when he submitted his paperwork to the bank in 2016.
And Washkun, who faced losing her own health insurance as the firm slid ever further underwater, was fending off her bosses' increasingly aggressive requests to fudge the numbers. Hence the Great PDF Debacle of 2016.
Washkun testified that she sure as hell didn't dummy up that bullshit P&L statement. And when Rick Gates asked her to cook the books to count money "owed" to DMP as "earnings," she told him to take a hike. (Fun Fact: ACCRUAL METHOD is Editrix's safe word, since she cracked herself up shouting it over and over in the chatcave in February. If you ever meet her, you should mention it!)
Yesterday, while prosecutors were meticulously laying out the details of Manafort's loan fuckery and Judge Ellis was exhorting them to hurry up and stop making the defendant look like such an asshole, Manafort's attorneys had a different goal. They need someone to trip up and say IT WAS ALL RICK GATES, THAT DEVIOUS MASTERMIND! POOR PAUL NEVER KNEW THAT HE WAS FAKING THESE LOAN APPLICATIONS! Which is a steep hurdle when Manafort sent emails saying, Ricky, convert this PDF to a Word Doc so I can put fake numbers in to make it look like we earned some money last year.
So, did they clear that hurdle? Per WaPo,
Gates "handled a lot of the business affairs," Washkuhn said.
But later, the line of questioning seemed to backfire on the defense. In response to questioning, Washkuhn said Manafort kept a tight grip on financial decisions for the firm and himself.
"He approved every expenditure on the personal and business side," Washkuhn said.
AWWWWW, SO CLOSE!!!!
Astute observers will note that Manafort was hemorrhaging cash in 2016, while he was working FOR FREE on Donald Trump's campaign. Which is kind of ... weird. Could he have been a Russian plant all along? It's possible. Or maybe he was betting that a high-profile presidential campaign would make him a political superstar again, and he'd be back in $15,000 ostrich jackets by 2018. Heck, if he could work off some of his debt to Oleg Deripaska by offering private briefings and score some sweet loans by promising to set a banker up with a job in Trumpland -- well, that's a win!
And he would have gotten away with it, too, if it weren't for those meddling kids!
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Liz Dye lives in Baltimore with her wonderful husband and a houseful of teenagers. When she isn't being mad about a thing on the internet, she's hiding in plain sight in the carpool line. She's the one wearing yoga pants glaring at her phone.