Caitlin MacNeal

Caitlin MacNeal is a News Writer based in Washington, D.C. Before joining TPM, Caitlin interned and wrote for the Huffington Post, the Sunlight Foundation and Slate. She is a graduate of Georgetown University.

Articles by Caitlin

Following testimony on a $3.4 million loan obtained by Paul Manafort in 2016 from employees at Citizen’s Bank, a third employee testified that Manafort’s application for a $5.5 million construction loan from that bank was denied later in the year.

Manafort was working on the Trump campaign as he worked with the bank to obtain the loan.

Emails shown during the testimony of Taryn Rodriguez, a loan officer assistant at Citizen’s Bank, indicate that Manafort applied for the construction loan on his property on Union Street in Brooklyn in early 2016 and engaged with bank employees about the loan until mid-August 2016.

Rodriguez testified that she discovered that Manafort had a mortgage on his Union Street property, a fact he and his deputy Rick Gates allegedly hid while applying for another loan at Citizen’s Bank that was approved. An email shown by prosecutors indicated that bank employees discovered this loan just a few days after Manafort closed on a loan for his Howard Street property, located in the SoHo neighborhood of Manhattan.

Documents shown by prosecutors and  Rodriguez’s testimony indicated that Manafort and Gates submitted a letter from their accountant claiming that a $1.5 million loan was forgiven in 2015 and a 2016 profit and loss statement. Testimony from earlier in the trial suggested that both of those documents were doctored in some way to inflate Manafort’s income.

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ALEXANDRIA, VA — Throughout Paul Manafort’s trial here, witnesses have indicated that Manafort started running out of cash when his Ukraine work dried up in 2014. This apparent reduction in income appears to have prompted Manafort, along with his deputy Rick Gates, to submit false or misleading documents to banks to obtain loans.

Although we’ve seen a lot of the numbers throughout the trial, Tuesday offered the best glimpse into just how worried Manafort was about paying bills, specifically his tax bill. An email submitted into evidence on Tuesday and made available to the press Tuesday night shows Manafort reacting angrily to the amount of taxes he owed on his 2014 tax returns.

“WTF?” Manafort wrote in the email to Gates dated April 17, 2015. “How could I be blindsided like this. You told me you were on top of this.”

“We need to discuss options. This is a disaster,” Manafort continued in the email. “When am I supposed to write this check?”

The email from Manafort came after Gates informed him that the tax accountants had calculated that Manafort would have an increase in taxes of about $509,000 in 2014. Gates testified on Tuesday that the email chain took place when Manafort’s accountants revealed that the actual amount owed by Manafort in taxes would be higher than they had projected earlier.

Gates told Manafort in the email that he was working with the accountants on ways to possibly reduce the amount of taxes Manafort would owe as a result of his 2014 return.

Read the entire email chain below:

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ALEXANDRIA, VA — Rick Gates testified on Tuesday afternoon that his former boss, Paul Manafort, doctored a profit-and-loss statement that went through July 21, 2016, in order to secure a loan.

While questioning Gates, lawyers for special counsel Robert Mueller admitted into evidence an email from Oct. 21st, 2016 — about two months after Paul Manafort left the Trump campaign — containing a profit-and-loss statement for 2016 that showed Manafort’s consulting firm made $3 million through July 21, 2016.

An earlier profit-and-loss statement for the same period showed that Manafort’s consulting firm had lost $638,000.

In a previous email from around the same time, Manafort asked Gates how to convert a PDF into a word document. A lawyer for the prosecution asked Gates what Gates thought Manafort meant when he asked for help converting the file.

Gates replied that he understood that Manafort was “going to make some sort of change to it.”

Gates also testified that, in the new profit-and-loss statement, some of the text alignment looked off. Gates testified that this sometimes happens when you convert a PDF into a word document to change it.

Manafort is on trial here facing bank and tax fraud charges. He has pleaded not guilty to all charges.

Gates was Manafort’s right-hand man during the pair’s lobbying work in Ukraine. Special counsel Robert Mueller originally charged Gates alongside Manafort, but Gates reached a plea deal with Mueller in exchange for cooperating in the investigation.

Gates took the stand for the first time on Monday afternoon, and returned for three hours of questioning by the prosecution this morning. This afternoon, Paul Manafort’s legal team is expected to cross-examine Gates.

Just before that testimony, lawyers for the prosecution went through some emails from March 2016 in which Gates tried to work with Cindy LaPorta, an accountant for Manafort, to create a letter that would have inflated Manafort’s income. That was around March 22, 2016. Manafort joined the Trump campaign on March 29, 2016, and Gates served as his deputy.

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ALEXANDRIA, VA — Rick Gates, Paul Manafort’s former deputy, testified on Tuesday that he helped Manafort provide false information to banks in order to obtain loans.

Gates told the courtroom that Manafort asked Gates to change certain things in order to obtain loans after the Ukraine income dried up in 2014.

“He had requested certain things be changed,” Gates said of his role in the alleged bank fraud.

Prosecutors first presented an email in which Manafort told Gates that he would claim his home in the SoHo neighborhood of Manhattan as a second residence (even though it was a rental property) when applying for a loan at Citizens’ Bank.

“In order to have the maximum benefit, I am claiming Howard St. as a second home. Not an investment property,” Manafort wrote in an email admitted by prosecutors.

Gates said that Manafort told him to get in touch with Philip Ayliff, one of Manafort’s tax accountants, but Gates said he could only reach Cindy LaPorta, another accountant who received immunity to testify last week. Gates said he spoke to LaPorta about listing the property as a residence.

Gates also testified that he helped Manafort provide old documents to Citizen’s Bank in order to hide the fact that Manafort had a mortgage on his Brooklyn property. Gates said that at Manafort’s request, he sent a 2015 insurance policy for the home that did not list a mortgage on the home, even though the more current 2016 insurance policy noted the mortgage.

Finally, before the court recessed for lunch, Gates said that he helped Manafort convert a $1.5 million 2012 loan from Peranova Holdings into income while applying for a loan in 2016. Gates said that he backdated a letter claiming that the loan was forgiven, even though it was not. Previous evidence has indicated that Peranova, a company Gates said Manafort controlled, never loaned Manafort money. Manafort listed the income as a loan in 2012 in order to reduce his taxable income, according to Gates. A letter backdated to 2015 was signed by a member of the law firm that ran Manafort’s Cypriot accounts, Gates said.

Gates will resume his testimony around 1:30 p.m. ET when the jury returns from lunch recess.

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On day five of Paul Manafort’s trial in Virginia, casual observers and journalists alike were eager to see Manafort deputy Rick Gates take the stand. This became clear when Kevin Downing, a lawyer representing Manafort, let it slip that Gates would testify soon, sending reporters scrambling out of the courtroom to relay the news.

Judge T.S. Ellis then told the courtroom that, while the last time Gates was mentioned and reporters ran out of the room it was “disruptive” and “mildly amusing,” the second such stampede was “not amusing” and even more disruptive.

Before Gates’ testimony was announced, court staff were relatively tolerant of some whispering among the public and press, as well as reporters’ need to leave and re-enter the courtroom to file updates.

However, once Gates’ impending arrival was broadcast, those in the courtroom struggled to contain their excitement and court staff policed the whispers more closely. The court security officer told several people to keep quiet or “take it outside” while the lawyers for both sides met with the judge at the bench before a special agent for The Financial Crimes Enforcement Network testified briefly ahead of Gates.

Before Gates took the stand, Ellis called a short recess. While members of the public last week begrudgingly tolerated reporters’ attempts to save their seats in the room while they filed, the atmosphere in the room changed once everyone knew the star witness would soon testify. Members of the public lobbied harder for seats left vacant by reporters who ran out to post updates, repeating Ellis’ constant reminder that there are no assigned seats in his courtroom. Right up until the recess ended, people milled about the room, hoping to snag a seat for the proceedings began again. People squeezed as many onlookers as they could into the courtroom’s wooden benches, and everyone else had to watch the proceedings from an overflow room with a video stream of the trial.

Wish us luck tomorrow as we cover the second day of Gates’ testimony.

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Testimony from Cindy LaPorta, an immunized witness in Paul Manafort’s trial who worked as his tax accountant, suggested that Manafort and Rick Gates requested inappropriate changes to tax documents and doctored letters in order to inflate income on loan applications.

Mueller alleges that Manafort and his deputy, Gates, began doctoring financial documents in order to obtain loans or to get better rates on loans. Emails submitted by the prosecution on Friday, along with testimony from LaPorta, started to fill in the details of those allegations.

Prosecutors first brought up discussion of a loan application Manafort submitted related to a New York City property in Soho, a property that both Gates and Manafort said in 2015 was a rental property. However, according to a January 2016 email from Manafort submitted on Friday, Manafort told an official at Citizen’s Bank that the property is a second residence, and CCed LaPorta on the email, explaining that LaPorta would back him up on that. LaPorta testified that she told Citizen’s Bank that the home was a second residence, even though she admitted in trial that it was actually used as a rental. LaPorta testified that Manafort would get a better rate if he applied for a loan using a residence, rather than a rental property.

In another 2016 discussion of a loan application at Citizen’s Bank, Manafort and Gates told LaPorta that they don’t qualify for a loan because of a 2012 $1.5 loan from Peranova Holdings. LaPorta testified that she then told Citizen’s Bank that the loan was forgiven in 2015. She said that either Manafort or Gates told her to relay that to the bank and that she relied on “their word.” Asked if she believed the loan had been forgiven, LaPorta said she did not believe that at the time. LaPorta also testified that she had seen documents that showed that there had been no payments on the loan between 2012 and 2014.

Emails submitted by the prosecution showed that Gates told LaPorta he would provide a letter on the loan forgiveness and then “chase down signatures.” LaPorta testified it was “highly unlikely” that documents had been signed yet because Gates’ email suggested that he was backdating a letter. A letter sent by Gates on Peranova letterhead declaring the loan forgiven was dated June 23, 2015, eight months before the mention of needing signatures in the 2016 email to LaPorta. LaPorta testified that it was a “false” document that she didn’t edit. Yet she passed it on to Citizen’s Bank, according to the emails and her testimony.

“I honestly believed that the bank would have to vet the document themselves,” LaPorta said when asked why she sent the document she knew was “false,” adding that she felt she was protected since she did not create the letter.

However, for yet another loan application Cindy LaPorta declined to pass along a letter to Citizen’s Bank about Manafort’s flow of income in 2014 and 2015 that was requested by Gates.

“I dismissed this letter,” she said. “I couldn’t agree to any of that.” Instead, she wrote a letter including “what I knew had happened,” she testified.

Finally, prosecutors raised August 2016 discussions of a loan application to Federal Savings Bank, which is run by Trump supported Steve Calk. In August 2016, Manafort asked LaPorta to create a profit and loss statement for his consulting firm showing that he would receive $2.4 million in November 2016 for consulting work in Ukraine. He wanted to send it to Federal Savings Bank, LaPorta said.

The statement would record Manafort’s income on an accrual basis (records income when earned), not a cash basis (records income when paid). LaPorta said that typically Manafort’s bookkeeping service prepared his profit and loss statements but that they kept the ledger on a cash basis, which would mean this request would violate that policy.

LaPorta testified that she initially agreed to prepare the profit and loss statement but declined to do so when she never received documents supporting Manafort’s claim that he would be paid in November 2016.

Manafort is on trial in Virginia for tax fraud and bank fraud charges. He has pleaded not guilty to all charges.

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On the third day of Paul Manafort’s trial in Virginia, his lead bookkeeper, Heather Washkuhn, testified that she was unaware that Manafort allegedly had control over foreign bank accounts or businesses.

While Washkuhn was aware that Manafort received payments for work he did via foreign bank accounts, she said that she was unaware that he himself controlled any foreign bank accounts.

Prosecutor Greg Andres asked Washkuhn if she was aware of Manafort bank accounts in Cyprus, St. Vincent and the Grenadines, and Ukraine, and she said she was not. Andres also listed several companies prosecutors have alleged Manafort was connected to, which Washkuhn said she was also unaware of.

As Manafort’s lead bookkeeper from 2014 onward, Washkuhn said she kept track of all of Manafort’s income and expenses for both his business and personal dealings. Her work included paying bills and managing his several properties, she said Thursday.

Washkuhn said that she interacted with Rick Gates on matters related to Manafort’s business, but that she only dealt with Manafort himself on his personal finances.

“He approved every penny of everything we paid,” she said, referring to Manafort’s personal finances.

Washkuhn said that she also recorded when Manafort received loans. She told the courtroom that while she always asked for documentation on the loans, she did not always receive it.

As part of her bookkeeping work for Manafort, Washkuhn said she kept a general ledger of Manafort’s incoming and outgoing money to send to Manafort’s tax preparers at the end of the year.

As of lunchtime, prosecutors had only begun their questioning of Washkuhn. Before she testified, Andres predicted that the prosecution would question her for about two and a half to three hours, but Andres only spent about 40 minutes with Washkuhn before the judge ordered a break for lunch.

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ALEXANDRIA, Va. – A day after giving a coy answer to the judge about whether it would call Rick Gates as a witness, the prosecution confirmed Thursday that the plan remains for Gates to testify in the ongoing Virginia trial of former Trump campaign chairman Paul Manafort.

“We have every intention to call him as witness,” prosecutor Greg Andres said in court before the jury was ushered into the room.

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