Banker Takes Witness Stand As Manafort Trial Resumes

ALEXANDRIA, Va. (CN) – A Chicago bank approved former Trump campaign chair Paul Manafort for a loan just one day after the bank’s chief told Manafort he was interested in serving for then-presidential candidate Donald Trump, a bank executive testified Friday after the trial was put on hold for several hours.

Paul Manafort, President Donald Trump’s former campaign chairman, leaves the federal courthouse in Washington on April 4, 2018. (AP Photo/Andrew Harnik, File)

Dennis Raico, a former senior vice president at Federal Savings Bank, delivered the testimony Friday afternoon during Manafort’s tax and bank-fraud trial in Virginia federal court. U.S. District Judge T.S. Ellis III delayed the trial Friday morning for three hours.

Raico told jurors that Federal Savings Bank founder and CEO Steve Calk said he wanted to meet Manafort after Raico told him the then-Trump campaign chairman was a potential client of the bank.

Raico said he told Calk about Manafort because he knew Calk was interested in politics and that Manafort worked in the field.

Manafort joined the Trump campaign in March 2016 and started meeting with the bank in April, Raico testified.

Manafort eventually received two loans worth a total of $16 million from the bank. Raico testified Calk was personally involved with the Manafort loans and sought to expedite their processing.

Manafort and the bank closed the first loan on Nov. 16, 2016, just days after the presidential election, and the second on Jan. 4, 2017, shortly before Trump’s inauguration.

Raico said Calk and Manafort met at a dinner at The Capital Grille in Manhattan in May 2016 during which “politics, loans” and other topics were discussed. He said Manafort and Calk sat near each other during the dinner and were able to talk privately.

Prosecutor Greg Andres asked Raico to summarize an email displayed in court from August 3, 2016.

In the email, Manafort requested Raico provide him with a copy of Calk’s resume.

“Why did he make this request?” Andres asked.

“He wanted to serve in the Trump administration,” Racio replied.

“Were you often asked to pass messages between Mr. Manafort and Mr. Calk?”

Racio said he was and that it frequently made him “uncomfortable.”

Later, on Nov. 11, 2016, Calk called Raico and mentioned that he hadn’t heard from Manafort in awhile and wanted Raico to call Manafort to see if he “might be a potential candidate for head of the Department of the Treasury,” Racio testified.

A witness earlier in the trial testified that Manafort suggested to his business partner Rick Gates that Calk should be considered for a position in the Trump administration. Gates was working on Trump’s inauguration at the time and Manafort had left the campaign before the election.

In another email displayed in court Friday from Raico’s assistant to Tom Horn, an underwriter who sits on the credit committee at Federal Savings Banks, the assistant wrote that she “spoke to Paul”  and had receive income documents for the Davis Manafort Parnters International LLC loan application.

According to Raico, there were “discrepancies” in Manafort’s income and tax returns.

“What do you mean by discrepancies?” Andres asked.

“A plus B didn’t equal C all the time,” Raico said.

A $300,000 outstanding balance on Manafort’s American Express card for season tickets to the New York Yankees was one of the discrepancies, Raico said.

Raico testified that Manafort told him in February 2016 he had lent the card to Gates and said he anticipated repayment by the end of May, but the balance was still outstanding by September of that year. Gates disputed ever using the card during his testimony earlier this week.

Raico told prosecutors Calk and Manafort had met on several occasions by that point,  often for lunch.

On Oct. 5, 2016, Raico said he and Federal Savings Bank president Javier Ubarri had met with Calk to submit Manafort’s loan application but the application hit a snag two days later.

In an email from Calk to Manafort in which Raico was blind-copied, Calk reportedly wrote in the subject line: “Major issue.”

The problem, Calk said, was that the outstanding mortgage for Manafort’s Bridgehampton, New York property was $3.5 million instead of $2.5 million.

Manafort hadn’t told Federal Savings Bank about the discrepancy before, Raico testified. When Calk inquired, Manafort allegedly chalked it up to forgetting, calling it a “blackout.”

Raico also told prosecutors Calk emailed him after the exchange, looking for a way to make the income fit the application.

“I look to your cleverness to understand the underwriting,” Calk wrote.

Raico said Calk’s interest in the Manafort loan was unusual.

“Mr. Calk’s involvement was much more than any other loans I had at the bank,” he said.

He also testified about an email from October 2016 in which the bank’s president, Ubarri, indicated it would not be going forward with Manafort’s loan.

Raico replied that he had spoken with Calk, who allegedly said the loan should be approved.

On cross-examination, Raico clarified that he believed Ubarri and Calk were talking about two different loans: While Ubarri was saying the bank would not go forward with a loan Manafort wanted to flip a property in California, Calk was talking about the loan involving Manafort’s house in Bridgehampton.

Manafort walked away from the California loan during closing and suggested they change the terms to instead cover the Bridgehampton property, Raico said.

But on the prosecution’s redirect, Raico said Calk’s decision to approve the restructured loan was still oddly quick, especially considering how much the loan had changed.

Calk was a member of a three-voter panel that approved loans at the bank, Raico testified.

Raico spoke quietly during testimony, with Judge Ellis on multiple occasions imploring him to talk louder and move closer to the microphone on the witness stand.

During the redirect of Raico, prosecutor Andres elicited big laughs from Judge Ellis and the gallery when he was interrupted by the judge while asking if Manafort signed a declaration acknowledging it was a federal crime to falsify statements on his loan application.

“Shouldn’t this question be on direct?” Ellis asked.

“Your honor, it was, I forgot,” Andres said.

Ellis joked, “Confession is good for the soul.”

Andres didn’t miss a beat.

“My soul is in pretty good shape,” he said, smiling. “At least it should be after this.”

The court erupted in laughter.

Irfan Kirimca, senior director of ticket operations for the New York Yankees, also testified Friday afternoon.

Kirimca corroborated earlier testimony from Gates, saying that when he searched the Yankees season ticketholders database at the government’s request ahead of trial, he never found any records indicating Gates bought the tickets.

Gates wasn’t even in the database, Kirimica told prosecutor Brandon Van Grack.

Jurors also heard testimony from Andrew Chojnowski, chief operating officer at Federal Savings Bank.

While Chojnowski was not personally involved in the approval of Manafort’s loan applications, he told jurors that he did review Manafort’s documents for the bank’s loan application packet.

Van Grack displayed a copy of the application for jurors and asked Chojnowski to read a portion of the warning on the form.

“The penalty for mortgage fraud is 30 years imprisonment or a $1 million fine,” Chojnowski read aloud.

Prosecutors told Judge Ellis they expect to rest their case on Monday following testimony from James Brennan, Federal Savings Bank’s vice president of commercial and construction loans.

Brennan is one of five witnesses who was granted immunity ahead of trial.

The banker’s name came up frequently during Raico’s testimony Friday. Raico told jurors Brennan was often a part of discussions between Calk and Manafort.

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