“You know what would be surprising? If Rick Gates and Paul Manafort had suddenly suspended their apparently deeply ingrained habits of fraudulence and thievery during the three months they ran the Donald Trump campaign.” – Franklin Foer, The Atlantic

The first of two federal trials for former Trump campaign chairman Paul Manafort shows he was a corrupt and criminal operator. He was someone deeply entangled with Kremlin-connected politicians and oligarchs and someone who sought to defraud banks, hide foreign income from the IRS, and exploit his public position for profit.

It’s clear from the fact pattern in this trial that Trump surrounded himself with people who were willing to skirt the rules, behavior not unlike how the president himself ran his businesses for decades.

Manafort’s first trial in a Virginia federal court has demonstrated a pattern of fraudulent activity, such as tax and bank fraud and work with corrupt Kremlin-allied politicians, from both Manafort and his deputy Rick Gates, senior officials on the Trump campaign.

• Manafort failed to accurately report his foreign income to the IRS, thereby evading taxes. Much of this income came from pro-Kremlin Ukrainian politicians, including former President Viktor Yanukovych, now in exile in Russia.
  • An IRS agent testified that “Manafort had $16.4 million in unreported income between 2010 to 2014,” money he used to support his lavish lifestyle while allegedly failing to pay proper taxes.
  • From 2011 to 2014, Manafort failed to report his foreign bank accounts when filing tax returns; he allegedly had fifteen foreign bank accounts and, according to Rick Gates, knew that failing to report these accounts to the IRS was illegal.
• Once his Ukrainian patron was ousted following protests against corruption, Manafort’s money dried up and his bad behavior became increasingly desperate.
  • When the payments stopped in 2014, Manafort’s bookkeeper at times begged Manafort to pay his personal bills of more than $1.1 million.
  • Manafort was deeply in debt and resorted to fraud. He began overreporting his income, doctoring profit and loss statements, to obtain favorable loans.

Details of Manafort’s alleged crimes come from, among other sources, his deputy on the Trump campaign and longtime confidant Rick Gates. Gates previously pleaded guilty to charges of conspiracy and lying to the FBI.

• Gates testified to a slew of misdeeds with Manafort, including bank fraud and failure to register as foreign agents.
  • The FARA violations will be addressed in the DC District Court in September.
• Gates aided Manafort in fraudulently underreporting his income, evading taxes when millions flowed to Manafort from the Ukrainian Party of Regions.
• When Manafort’s income dried up, Gates switched gears to help fraudulently secure loans for his boss, helping Manafort overstate the firm’s income.
  • He “[massaged] finances,” “faked mortgage documents,” and “[strategized] how to reduce Manafort’s overall tax liability.”
• Gates also asserted that although he personally carried out some of these actions, Manafort “always had control.” This is critical since Manafort’s defense has argued that Gates alone was responsible for all crimes committed.

Manafort has been accused of trying to trade a Cabinet position for a loan.

• The prosecution stressed that Manafort received numerous loans by resorting to dishonesty and fraud. In one instance, Manafort even attempted to ostensibly sell a Cabinet position in the incoming administration for $16 million in loans from Federal Savings Bank in Chicago.
• While angling for a senior post under Trump, Stephen Calk, the bank’s CEO, personally ensured Manafort received these loans, even though they posed a huge risk for his bank.
  • Calk’s involvement in the loan process was highly unusual, according to a bank official who testified. The CEO was not merely involved—he actively bent the rules, reportedly “[departing] from bank policies to approve loans for a friendly and well-connected political operative” and pushing the loan through even after the bank’s president insisted it be canceled.
  • Other ‘red flags’, as described by the senior bank official, included Manafort’s unusual leverage when dictating the loan’s terms.
  • As with other banks, Manafort misrepresented his finances throughout the process. By inflating his income and failing to accurately declare existing mortgages on loan application, he deliberately lied about details that would derail the loan process.
• Manafort’s willingness to sell off senior government posts illustrates not only his corrupt character, but also just how far he would go when facing financial distress.
  • Calk didn’t hide his true motivations for helping Manafort. A former bank official testified that Calk wanted a role in the Trump administration “and sought to make that known to Manafort” during the loan process.
  • Manafort was receptive to Calk’s desire to be Secretary of the Army or to serve in a senior position in the Treasury or Commerce departments. He requested Calk’s resume, and Calk was later “named to a panel of Trump’s economic advisers.”
  • Notably, Manafort reportedly advised the president on cabinet picks during the transition, including putting a good word in with Jared Kushner for Calk. The payback is clear.

The depth and breadth of Manafort’s pattern of criminal behavior now raises serious questions about what occurred while he was on the campaign.

• The Virginia trial illustrates the incredibly vulnerable position Manafort was in when he volunteered to run the Trump campaign at its critical juncture. Manafort inexplicably volunteered without pay to run the Trump campaign, even as money from his first pro-Kremlin presidential client ran dry and he faced mounting debt.
• During the campaign, Manafort was deeply indebted to Oleg Deripaska, a Putin-aligned oligarch. Manafort reportedly owed him $19 million after failed investments and repayment on a $10 million loan.

• These details paint a vivid portrait of a campaign manager under enormous financial pressure from Russian connections who led an operation that had nearly 90 contacts with Russian-linked operatives.

Ultimately, it defies logic to believe that Manafort would behave ethically during his time on the campaign, after years of skirting other norms and regulations.

Beyond Manafort, the trial reinforces a pattern of behavior among the people Trump surrounded himself with, both in business and on the campaign trail – for example, Michael Cohen is reportedly facing similar charges of bank fraud and tax evasion in New York. The corruption of Trump’s inner circle has implications far beyond the Virginia courtroom.