Prosecutor: Banker Seeking Cabinet Job Knew Manafort Loan Was Fraudulent

In this photo taken July 17, 2016 photo, Paul Manafort talks to reporters on the floor of the Republican National Convention at Quicken Loans Arena in Cleveland. Manafort says he’s registering with the Justice Depa... In this photo taken July 17, 2016 photo, Paul Manafort talks to reporters on the floor of the Republican National Convention at Quicken Loans Arena in Cleveland. Manafort says he’s registering with the Justice Department as a foreign agent. Michael Flynn already did. And in both cases the filings by associates of President Donald Trump will come after the fact and accompanied by the admission that they violated federal law. (AP Photo/Matt Rourke) MORE LESS
July 23, 2018 5:49 p.m.

A banker who lent Paul Manafort $16 million — after serving on Trump’s campaign and while seeking a job in the incoming Trump administration — knew that the loan was fraudulent, a prosecutor for special counsel Robert Mueller’s team told a federal judge Monday.

The bank is called “Lender D” in the court documents that led up to the Monday afternoon hearing. But based on corroborating details, it is the Chicago-based Federal Savings Bank, whose founder and CEO Steve Calk.

Calk served on the Trump campaign’s economic advisory team, and, according to the Wall Street Journal, wanted to be Trump’s Army secretary. His bank issued Manafort and his family two loans, of $9.5 million and $6.5 million, in late 2016 and early 2017 respectively, after Manafort allegedly made “several materially inconsistent representations during the process of negotiating” the loan, according to a search warrant partially unsealed last month.

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The accusation of the banker’s knowledge of the allegedly fraudulent loan came in questioning by U.S. District Judge T.S. Ellis, who is presiding over the case against Manafort in Virginia, where trial will begin next week. Ellis was hearing a request from Manafort that evidence and arguments about Manafort’s affiliation with the Trump campaign be excluded from the trial.

Mueller’s team, represented by Greg Andres at the hearing, had indicated that the only mention of the Trump campaign would be in the context of those particular loans, which Andres said would take a small part of the trial. Andres alleged that the banker’s motivations in extending the loan included his seeking and obtaining a position on the campaign, as well as seeking (though eventually not getting) a job in the administration.

Ellis asked if the banker knew if the information on Manafort loan application was inaccurate.

“He did,” Andres said.

Manafort is facing charges of bank fraud and tax fraud, mostly stemming from his consulting work  for pro-Russian then-president of Ukraine, Victor Yanukovych. Manafort has pleaded not guilty. Earlier in the day, Ellis moved the start of Manafort’s trial from Wednesday to July 31.

Ellis on Monday heard other requests by both the prosecutors and Manafort that certain evidence be excluded. The requests are routine in the run-up to a criminal trial, but in a closely watched case each pre-trial decision by the judge can take on outsize importance.

Many of the requests heard Monday were denied from the bench as moot, after the other side indicated that they did not plan to introduce the evidence in question.

Among the requests was one filed by Manafort just on Friday, after Mueller released his exhibits list, seeking that certain evidence from Manafort’s consulting work in Ukraine — which gave rise to the bulk of the charges he’s facing — be excluded. His attorney Thomas Zehnle expressed concern on Monday about certain items referenced in the exhibit, including a photo ex-President Yanukovych.

The judge asked Manafort’s attorneys to follow up with his specific list of the items on the exhibit list that they objected, while ordering Mueller’s team to respond to that list as to why they should be included.

Ellis said that if they are photos of them at a cocktail party with scantily-clad women, that such evidence would not be allowed, apparently speaking hypothetically.

“There will be no pictures of scantily-clothed woman,” Andres said.

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