Gates says Manafort told him to be truthful to Federal Bureau of Investigation

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Gates admitted to a litany of crimes Tuesday as Downing, Manafort's lead defense attorney, hammered him for enriching himself on his boss's dime, executing tax evasion and bank fraud schemes of his own, and lying to the special counsel's investigators.

Mr Downing forced Gates to admit he had stolen hundreds of thousands of dollars from Manafort by filing bogus personal expenses claims and that he had engaged in an extramarital affair and kept an apartment in London for that objective.

Gates recounted how he and Manafort used more than a dozen offshore shell companies and bank accounts in Cyprus to funnel the money, all while concealing the accounts and the income from the IRS.

"I'm here to tell the truth and take responsibility for my actions", Gates said in response to a question from Downing about his trustworthiness. Regarding a trading company Manafort had started with a partner in 2011, he asked with deep scepticism: "You're asking the jury to believe Mr Manafort authorised another US$250,000 as a bonus?"

"He requested certain things be changed in some of those documents", Gates said, including claiming certain properties as primary residences instead of rentals and inflating his income for collateral.

He also made clear he was testifying against Mr Manafort in the hopes of receiving a lesser prison sentence, having pleaded guilty as part of a deal with special counsel Robert Mueller.

Manafort, 69, is the first defendant to go to court to fight charges stemming from Mueller's investigation into Russian interference in the 2016 presidential election. The email exchange occurred after Manafort left the Trump campaign but while Gates was active on the Trump inauguration committee.

An FBI forensic accountant, Morgan Magionos, told jurors that bank records from Cyprus, St. Vincent and the Grenadines and the United Kingdom revealed the accounts were connected to Manafort and his associates.

The prosecution flashed a December 2011 email on the TV screens in the Alexandria, Virginia, courtroom Tuesday between Gates and Manafort about a wire transfer. Gates said that these loans were actually income.

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The jury has heard how Manafort made tens of millions of dollars working for pro-Russian politicians in Ukraine.

Gates, meanwhile, wearing dark blue suit, white shirt and red tie, cut a lonely figure at the witness stand, blinking hard.

Prosecutors have a star witness in Gates, and they also have a wellspring of evidence. He admitted to committing fraud on a massive scale and extorting money from Manafort, along with assisting his former boss in filing false tax returns and bank fraud.

Cindy Laporta, a tax accountant for Manafort, testified Monday under immunity that she helped file falsified bank loan applications for him even though she knew they were inaccurate. That admission came during a line of questioning from the defense about the $2.7 million to $3 million Gates admitted he embezzled from Manafort.

The aggressive questioning was aimed at shifting blame from Manafort onto Gates, who pleaded guilty in Mueller's investigation and agreed to cooperate with investigators by testifying in the financial fraud trial.

Gates acknowledged that he did for two months and that he took first-class flights and stayed in "fancy hotels" around Europe, but said the money came from bonuses rather than illicit gains.

Gates converted the 2015 DMP P&L to a Word document for Manafort, but there were spacing, font, and other discrepancies between that copy and the original.

Michael Zeldin, a former federal prosecutor, said that in Downing's remaining hour of cross-examination on Wednesday, he needs to keep painting Gates as an unreliable person who can not be trusted. "I'm here", Gates said from the witness chair.

In detailed testimony, Gates walked prosecutors through the step-by-step process on how he and Manafort doctored and backdated documents.

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