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Manafort Leaned on Ties to Trump to Win Loans, a Bank Official Testifies


Manafort Leaned on Ties to Trump to Win Loans, a Bank Official Testifies

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Paul Manafort in June in Washington. Prosecutors working for the special counsel have called more than 20 witnesses and have introduced hundreds of exhibits they say prove that Mr. Manafort evaded taxes and fraudulently obtained bank loans.CreditBrendan Smialowski/Agence France-Presse — Getty Images

ALEXANDRIA, Va. — In late 2016, with mounting debts and his political consulting firm on the financial ropes, Paul Manafort sought millions of dollars of loans from Federal Savings Bank, a small Chicago bank whose chairman had political ambitions.

The chairman, Stephen M. Calk, pushed the bank to loan Mr. Manafort $16 million, even though Mr. Calk’s top deputies had qualms about whether Mr. Manafort could pay them back, a former top bank official testified Friday as the prosecution wound up nine days of presenting evidence in Mr. Manafort’s trial on bank and fraud charges.

The deputy, Dennis Raico, a former senior vice president at the bank and one of the prosecution’s final witnesses, said Mr. Calk wanted something from Mr. Manafort, too. He was interested in landing a job in the Trump administration, Mr. Raico said.

On Nov. 11, 2016, days after the presidential election, Mr. Raico said he received a call from Mr. Calk asking him to contact Mr. Manafort, who had led the Trump campaign the previous summer. Mr. Calk wanted him to ask Mr. Manafort “if he was a candidate for secretary of Treasury or secretary of HUD,” Mr. Raico said, using another name for the Department of Housing and Urban Development.

With only one day left before they rest their case, prosecutors working for the special counsel, Robert S. Mueller III, have called more than 20 witnesses and have introduced hundreds of exhibits they say prove that Mr. Manafort, 69, evaded taxes on $16.5 million in income and fraudulently obtained more than $20 million in bank loans. Friday’s proceeding was delayed for five hours over an undisclosed issue.

Mr. Manafort’s criminal activity, prosecutors have claimed, began more than eight years ago and continued throughout the five months that he worked for the Trump campaign. Even after he was forced to resign in August 2016 as the campaign’s chairman, Mr. Manafort still sought to use his connection to Mr. Trump to bail himself out of financial trouble, prosecutors say. Mr. Manafort succeeded in winning loans from Federal Savings Bank only because he falsified documents to inflate his income by millions of dollars, the government contends.

Mr. Raico, who testified under a grant of immunity, never made the call to Mr. Manafort about whether Mr. Calk was in line for a position as a cabinet secretary because, he said, “it made me very uncomfortable.” Mr. Calk, who never landed a job in the Trump administration but did serve on the campaign’s economic advisory council, did not respond to repeated requests for comment.

Mr. Raico was troubled by the bank’s decisions to loan Mr. Manafort so much money, he said Friday, because “A plus B didn’t equal C all the time” in Mr. Manafort’s financial records.

“Take a deep breath,” Mr. Raico wrote to Javier Ubarri, the bank’s president, after Mr. Manafort forwarded him a new loan proposal in October 2016 after at least one application had died. The government claims that Mr. Manafort gave the bank a document showing that DMP International, his political consulting firm, turned a profit of $4 million dollars in 2015 when it actually suffered a loss of more than $600,000.

None of that seemed to concern Mr. Calk, according to Mr. Raico.

“He had a personal interest. He met with the borrower on his own accord without any staff present,” he testified. “It wasn’t the norm.”

One email from Mr. Manafort that Mr. Calk shared gave Mr. Raico particular pause. Mr. Manafort wrote that his existing mortgage on his home in the Hamptons, in New York, which he was using as collateral, was actually $3.5 million, not $2.5 million.

“When we had lunch, I must have had a blackout,” Mr. Manafort wrote to Mr. Calk in October 2016. He was not able to show more assets to cover the difference, as Mr. Raico had insisted, he wrote, adding, “I look to your cleverness on how to manage the underwriting.”

Follow Sharon LaFraniere and Emily Baumgaertner on Twitter: @SharonLNYT and @Emily_Baum.

A version of this article appears in print on , on Page A11 of the New York edition with the headline: Manafort Leaned on Ties To Trump to Win Loans, A Bank Official Testifies. Order Reprints | Today’s Paper | Subscribe

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