President Trump’s former campaign chair Paul Manafort (resigned in August, 2016), and Manafort’s campaign deputy and former business partner Rick Gates, have been indicted. The charges are an outcome of the investigation into possible campaign collusion with Russialed by special counsel Robert Mueller. The indictment was unsealed on Monday.
An indictment is a formal accusation of a crime issued by a grand jury, a body of up to 23 people (the number varies by state) that determines NOT whether a defendant is guilty or not guilty, but rather, whether probable cause exists to justify an arrest. An indictment may be sealed, meaning kept secret, until it is unsealed by a judge or prosecutor . Indictments are sometimes sealed until the suspect is apprehended. Arrest of the suspect may be easier if he is unaware police are on his trail.
The charges against Manfort and Gates do not involve their work for the Trump campaign but instead relate to their financial dealings. Mueller was appointed by the Justice Department and was given authority to investigate not only potential collusion between Trump’s campaign and Russia, but also any related matters that surface from the probe.
Some of the charges against Manafort and Gates include conspiracy against the United States and money laundering. The conspiracy charge is a common charge in tax cases and consists of two or more defendants working together to defraud the country by, in the words of the statute, “impeding, impairing, obstructing and defeating the lawful governmental functions of a government agency." In this case, the relevant agencies are the Department of Justice and the Department of Treasury. Manafort and Gates are suspected to have sent tens of millions of dollars in income to offshore (foreign) accounts and not reporting that income on their tax return. Manafort allegedly used the money to enjoy a “lavish lifestyle” in the US, without paying taxes on that income. When questioned about these activities by investigators, both men allegedly responded with a series of false and misleading statements.
Money laundering is a way to disguise the origin of money obtained through criminal activity. To avoid suspicion for inexplicably having large sums of money, defendants typically open a small business and represent the illegally-obtained money as profits from that enterprise.
Other charges against Manafort and Gates include acting as an unregistered agent of a foreign principal, misleading the government about the nature of their foreign lobbying work, making false statements relating to foreign agent registration, and failing to file required documents for maintaining foreign financial accounts.
The Foreign Agents Registration Act, a federal law enacted in 1938, contains disclosure requirements that apply to people acting as agents of foreign principals in a political or quasi-political capacity. Such agents are required to make periodic public disclosure of their relationship with the foreign principal, and also report activities, money received, and disbursements in support of that relationship.
Per the indictment, Manafort and Gates acted as agents of the Government of Ukraine and of the Opposition Bloc, a Ukrainian political party created in 2012. Manafort’s and Gates’ work generated tens of millions of dollars of income for them. Failing to report these activities facilitated their ability to hide the money.
Some legal commentators suggest that Mueller’s strategy for issuing an indictment against Manafort and Gates is to “flip” them. According to this hypothesis, Mueller would use the indictment as leverage to convince one or both to become an informant about the Trump campaign. Per this theory, Mueller would offer them leniency such as dropping some of the charges, recommending lesser penalties, or maybe even providing immunity ( freedom from prosecution) if they aid in the investigation. This is a typical strategy used by prosecutors when additional evidence is needed against a more culpable suspect, or would aid a case. An offer of lenience may be quite appealing because both face significant jail time: Manafort, 80 years, and Gates, 70 years.
This same strategy was likely used to convince George Papadopolous, a former Trump foreign policy adviser, to plead guilty recently to lying to the FBI during its investigation of possible collusion between the Trump campaign and the Russians. Papadopolous has presumably provided information to Mueller.
For more information, click here.
What is the likelihood that Manafort or Gates might flip?