By Nathan Layne, Sarah N. Lynch and Karen Freifeld
ALEXANDRIA, Va. (Reuters) - Prosecutors portrayed U.S. President Donald Trump's onetime campaign chairman Paul Manafort as a tax cheat who used offshore accounts to hide tens of millions of dollars from political work in Ukraine, as the first trial from a probe into Russia's meddling in the 2016 election got off to a quick start on Tuesday.
Manafort lived an extravagant lifestyle, snapping up expensive homes and cars, and spending more than half a million dollars on "fancy clothes" and $21,000 for a watch, a prosecutor said in the government's opening statement at the trial in a Virginia federal court.
"A man in this courtroom believed the law did not apply to him. Not tax, not banking law," said Uzo Asonye, a member of Special Counsel Robert Mueller's team looking at possible collusion between Russia and the Trump campaign in 2016.
In describing the 18 counts facing Manafort, Asonye said that Manafort did not pay taxes on a large portion of the $60 million he earned working for pro-Russian politicians in Ukraine, hid the income in a web of 30 overseas bank accounts, and lied to U.S. banks to borrow millions of dollars against his real estate holdings once the money from Ukraine dried up.
"All of these charges boil down to one simple issue: that Paul Manafort lied," Asonye said.
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Manafort's attorney Thomas Zehnle painted a drastically different portrait of Manafort, calling him a successful political consultant of 40 years who left the day-to-day operations of his company to his former associate Rick Gates, who betrayed him.
Zehnle made it clear that attacking the credibility of Gates, who pleaded guilty in February and agreed to cooperate with Mueller's investigation, would be a central plank of the defense.
Gates is expected to be a star witness at the trial.
"Rick Gates had his hand in the cookie jar," Zehnle said, claiming that Gates was not truthful with the accountants who prepared Manafort's tax returns and kept his name on offshore accounts to conceal an embezzlement scheme.
Thomas Green, who represents Gates, did not respond to a request for comment on the new accusations.
The government also presented its first witness, Tad Devine, a political consultant who recalled his work with Manafort in Ukraine to help pro-Russian political figure Viktor Yanukovych, who was swept from power and fled to Russia in 2014.
Devine, a strategist on Democrat Bernie Sanders 2016 presidential campaign, described how Manafort used Western-style polling and advertising to lift Yanukovych to victory in a 2010 election. Prosecutors appeared to be using his testimony to establish the nature of Manafort's work in Ukraine.
Devine was also asked about Konstantin Kilimnik, a Russian-Ukranian political consultant who he described as a translator for Manafort. Kilimnik, who prosecutors have said has ties to Russian intelligence, was indicted last month along with Manafort on charges of witness tampering.
BLOWING A KISS
Outside the courthouse, a handful of protesters displayed a life-sized puppet of Trump and held signs saying, "Trump won't do time for you," "It's Mueller time," and "I like your new suit" alongside a photo of Manafort's mug shot.
A Manafort conviction would give momentum to Mueller, who has indicted or secured guilty pleas from 32 people and three companies since his probe started 14 months ago. An acquittal would support efforts by Trump and his allies to portray the investigation as a "witch hunt."
Trump has denied that his campaign colluded with Russia, and on Tuesday tried to make the case publicly that collusion would not be a crime anyway.
Prosecutors have said they would not present evidence of collusion at this trial. The charges against Manafort largely pre-date his five months of work for the Trump campaign, some of them as campaign chairman.
Trump has vacillated between showing sympathy for Manafort and trying to distance himself.
Manafort attended a June 2016 Trump Tower meeting with Russians that is a focal point of Mueller's probe.
Earlier in the day, U.S. District Judge T.S. Ellis presided over selection of a 12-member jury, six men and six women.
Manafort, 69, was wearing a black suit, white shirt and a tie. He was actively involved in the jury selection, conferring with his attorneys and passing notes. As he was leaving the courtroom at the end of day, he blew a kiss and mouthed "I love you" to his wife, Kathleen, who was seated in the first row.
On Wednesday, prosecutors are planning to call Daniel Rabin, another political consultant who worked with Manafort in Ukraine, along with an unidentified FBI agent.
The trial is expected to last about three weeks.
Manafort faces a second trial in September in Washington, where he is charged with money laundering, failing to register as a foreign agent and witness tampering.
He has pleaded not guilty to all the charges against him.
(Reporting by Nathan Layne, Sarah N. Lynch and Karen Freifeld; Additional reporting by Lawrence Hurley, John Walcott; Writing by Warren Strobel; Editing by Will Dunham, Grant McCool, Toni Reinhold)