Posted by on October 30, 2017 2:52 pm
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Categories: B+ Department of Justice Department of the Treasury DOJ donald trump Donald Trump presidential campaign Economy FBI Federal Bureau of Investigation Federal Tax Florida Government of Ukraine Links between Trump associates and Russian officials Manafort Monetary Policy national security New York Times None Opposition Bloc Orders, decorations, and medals Party of Regions Paul Manafort Politics Politics of the United States Real estate Republicans Russian interference in the 2016 United States elections Special Counsel investigation Tax Fraud Treasury Department U.S. Congress U.S. Treasury Ukraine Ukrainian government United States United States presidential election Viktor Yanukovych white house

 Update: President Trump on Monday called for the focus to be shifted to Hillary Clinton after his former campaign chairman Paul Manafort turned himself into the FBI after being indicted on 12 counts, including conspiracy against the United States.”Sorry, but this is years ago, before Paul Manafort was part of the Trump campaign. But why aren’t Crooked Hillary & the Dems the focus?????” Trump tweeted. “Also, there is NO COLLUSION!”

Update: Sources close to the White House have released what appears to be an unofficial statement: “This has nothing to do with the White House.”

The statement alludes to the fact that Manafort’s alleged misdeeds took place before he joined the Trump campaign.

Update: Messages of support from Republican Congressmen for the Mueller probe are beginning to trickle in…

Update: In an apparent attempt to pre-empt criticism of the Mueller probe from President Trump, Nancy Pelosi and Chuck Schumer have both released statements defending the investigation…


Update: The Justice Department has released the Manafort/Gates indictment. The indictment contains 12 counts total, and the big one appears to be conspiracy against the US. They are also facing charges of tax fraud, money laundering and giving false statements.

The two men are expected to appear in court at 1:30 am ET.

In total more than $75,000,000 flowed through Manafort’s offshore accounts, according to the Mueller indictment. Manafort allegedly laundered more than $18 million which was used by him to buy property, goods and services in the US, income that he concealed from the US Treasury, the DOJ and others. Gates was instrumental in helping Manafort move the money form his illict foreign accounts into the US, and eventually transferred more than $3 million to accounts he controlled.

According to the indictment, between at least 2006 and 2015, Gates and Manafort acted as unregistered agents of the Government of Ukraine, the Party of Regions (a Ukrainian political party whose leader Victor Yanukovych was President from 2010 to 2014), Yanukovych, and the Opposition Bloc (a successor to the Party of Regions that formed in 2014 when Yanukovych fled to Russia). The two men generated tens of millions of dollars in income as a result of their Ukraine work. In order to hide Ukraine payments from United States authorities, from approximately 2006 through at least 2016, they laundered the money through scores of United States and foreign corporations, partnerships, and bank accounts.

Manafort and Gates used money from their Cyprus accounts to finance lavish lifestyles. Manafort spent more than half a million dollars of it on clothes from stores in Beverly Hills, and $20,000 on housekeeping. Gates spent the money on his mortgage, personal expenses, tuition payments and  an interior decorator for his Virginia home.

  Read the indictment in its entirety below, whose highlights are below, courtesy of Bloomberg:  

  •     Both men hid their work for the former Ukrainian president Victor Yanukovych, his Party of Regions and the Ukrainian government from 2006 “through at least 2016,” according to the indictment.
  • Manafort alone laundered more than $18 million to finance what the indictment called his “lavish lifestyle,” which included millions of dollars in real estate, luxury cars, antiques, clothing, landscaping services and home improvements. He also defrauded banks that loaned him money, prosecutors said, and failed to file reports to the Treasury Department declaring ownership of foreign bank accounts.
  • After news reports surfaced in August 2016 about Manafort’s work in Ukraine, he and Gates “developed a false and misleading cover story” to distance themselves from their activities, the indictment said. This included “false and misleading letters” in November 2016 and February 2017 to the Justice Department, which was trying to determine whether they had acted as “foreign principals” under the Foreign Agents Registration Act. Prosecutors charged them with false statements for those two letters.
  • They lobbied members of the U.S. Congress and worked with two other Washington lobbying firms, identified in the indictment only as Company A and Company B, according to the indictment. Manafort and Gates directed the work of those firms on Ukraine and paid them more than $2 million from the offshore accounts, it said.
  • To hide their assets, the men controlled dozens of business entities in Cyprus, Grenadines and the U.K. that masked their ownership, the indictment said. They also owned U.S. entities in Delaware, Virginia and Florida.
  • Prosecutors seek the forfeiture of four Manafort properties, including a Brooklyn brownstone, a Lower Manhattan condominium, and homes in Arlington, Virginia, and eastern Long Island.

* * *

Update: The Washington Post reports that Manafort was seen entering the FBI’s Washington field office Monday.

* * *

Update: Manafort has been hit with several charges, including tax fraud, WSJ reported. He’s expected in federal court in Washington later Monday, a person familiar with the matter said. Meanwhile, Rick Gates is also reportedly turning himself in.

* * *

Update: CBS News confirms a photojournalist has captured images of Manafort leaving his home this morning with his lawyer.

*  *  *

Surprise, surprise. The New York Times is reporting that the first indictment in Special Counsel Robert Mueller’s probe into possible collusion between the Trump campaign and Russia has been unsealed.

And the target is none other than Paul Manafort, who briefly served as chief executive of the Trump campaign last summer before reports about his work for Ukraine’s former leader Viktor Yanukovich forced him out. Manafort has reportedly been asked to surrender by the FBI, sparing him an embarassing perp walk.

Manafort’s former deputy Rick Gates has also been asked to surrender.

The charges against the pair weren’t immediately clear. But they do represent an escalation in the probe that has loomed over President Trump’s first year in office.

Gates is a longtime protege and junior partner at Manafort’s firm. His involvment in the probe was revealed in the spring. His name appeared in documents linked to a Cypriot firm Manafort set up to receive payments from Eastern European politicians like Yanukovich, who purportedly paid Manafort with money looted from the Ukraine state.

Manafort had been udner investigaiton for violations of federal tax law, money laundering and whether he failed to properly disclose his foreign lobbying.

As we’ve noted, since these charges mostly stem from Manafort’s work before he became involved with the campaign, they leave ample room for Trump to declare victory.

As far as impact to the market – so far nothing – and as KBW’s Brian Gardner explains, none is expected, despite expectations for much sound and fury and told-you-so’s from the left.

Special Counsel Robert Mueller’s indicting former Trump campaign manager Paul Manafort or former National Security Adviser Michael Flynn over activities separate from Trump campaign/administration would be “mostly political noise,” and would not significantly affect markets.

However, Gardner notes that any unsealing of indictments may dominate the week’s entire news cycle, drowning out coverage of tax legislation and monetary policy.

Now, we watch for the administration’s response.

Here’s the indictment:

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