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Prosecutors highlight Manafort's lavish tastes

Adding to their portrait of Paul Manafort's wealth, prosecutors walked jurors through the hundreds of thousands of dollars the former Trump campaign chairman spent on a karaoke machine, landscaping, home improvement and what one landscaper described as one of the biggest ponds in the Hamptons. CNN's Jessica Schneider reports.

Posted: Aug 3, 2018 10:00 AM
Updated: Aug 3, 2018 10:34 AM

Financial professionals who dealt with former Trump campaign chairman Paul Manafort finally began to flush out the prosecutors' vast accusations of financial crimes on day three of the former Trump campaign chairman's criminal trial.

Here are five takeaways from the day in court:

1. Bank Fraud Evidence Emerges

If anything, day three of Manafort's criminal trial will be remembered by those in the courtroom for the moments when prosecutor Greg Andres showed that Manafort and Rick Gates had allegedly sent fake business records to three different banks, concealing a steep drop in profits at their political consulting firm.

Andres showed allegedly doctored financial statements labeled with Manafort's business' name, DMP International, on video screens to the jury. He then imposed the real financial statements -- showing millions of dollars less in income -- prepared by a bookkeeper next to them.

Andres did this at least three times Thursday. Manafort's longtime bookkeeper Heather Washkuhn explained why the invoices that Manafort and Gates sent to banks that were lending them money were phony: a missing letter here, some too-light text there, the wrong numbers entirely.

This was the first evidence prosecutors have revealed that puts real oomph behind their bank fraud accusations. If the jury finds Manafort guilty of the nine bank fraud charges he faces, the government can seize his millions of dollars in assets and each count carries a maximum sentence of 30 years in prison.

"There's about a $4 million difference," she said about one financial statement her company prepared versus one Gates provided to a bank.

2. Into the heart of the trial

Washkuhn's testimony also ushered in a new and important phase of the Manafort trial.

Thursday kicked off prosecutors' exhaustive presentation of dry financial evidence and the testimony of several financial professionals. After Washkuhn finished testifying, an accountant whose firm prepared Manafort's taxes, Philip Ayliff, took the stand. Ayliff's colleagues are expected to follow him into the witness box when he's finished. Bankers will certainly testify as well.

Though the documents and testimony presented to the jury so far could read like a lesson in business accounting and partnership taxation, prosecutors have dropped in allegedly forged documents -- from still-mysterious fake invoices to the financial statements Manafort's company sent to banks -- to keep the jury's interest.

Ayliff and his colleagues may give testimony for several hours Friday, but it means the trial has truly settled into its pace.

Notably, Judge T.S. Ellis, who's proven to be a lively and exacting master of ceremonies, interrupted prosecutors far less than during the previous day of witness questioning. Instead of rushing the prosecutors along, he allowed the court action to proceed Thursday at a more relaxed pace.

3. Connecting the dots

Thursday was also the first day the layers of the prosecution's case have started to come together.

So far, prosecutors have prompted testimony about Manafort's success as a political consultant in Ukraine. They've demonstrated his wealth -- and the mind-boggling amounts he spent on premium creature comforts -- paid for through suspicious wire transfers from unknown companies with bank accounts in Cyprus. Then, they've shown the jury how Manafort and his company went broke and are beginning to lay out evidence about how he allegedly lied on official forms and to banks.

4. Elaborate Purchase Rundown

Who can forget the $18,500 python-skin jacket or the $15,000 ostrich jacket detailed in invoices from high-end men's clothier Alan Couture that emerged in the trial's second day? The jury hasn't seen photos in the courtroom of these items of clothes. (They'll get to review the photos before deciding the case.)

But they got another earful Thursday morning about other lavish purchases worth millions of dollars, from the landscaper who sculpted the M-shaped flower bed and the audio-visual company that installed the karaoke system at Manafort's Hamptons estate.

All together, prosecutors have shown through these vendors how the allegedly unreported money in foreign bank accounts built out Manafort's collection of finer things.

5. Gearing up for Gates

Once the accountants provide their testimony, a well-known witness will walk through the courtroom's door. Gates, Manafort's longtime deputy who pleaded guilty and is helping the special counsel's team, is primed to testify. He's been the focus of parts of the trial in previous days — and especially central to Manafort's assertion of innocence.

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