President Trump’s former campaign chairman Paul Manafort and his associate, Richard Gates, pleaded not guilty Monday to criminal money laundering and tax evasion charges filed against them as part of special counsel Robert Mueller’s investigation into Russian interference in the 2016 presidential election.
While the charges, which stem from an alleged scheme to conceal millions of dollars made lobbying on behalf of pro-Russian government of Ukraine, do not relate to President Trump’s campaign, they come on the same day a plea agreement for former foreign policy adviser to the Trump campaign was made public.
A 31-page indictment against Mr. Manafort and Mr. Gates was unsealed early Monday and describes the two men as orchestrating a long-running operation to represent the pro-Russian government of Ukraine and former Ukrainian President Viktor Yanukovych’s Party of Regions, and laundering the payments they received through companies and foreign bank accounts. The indictment also charges the two lied to cover up the scheme.
In addition to conspiracy against the U.S., the charges include conspiracy to launder money, acting as an unregistered agent of a foreign principal, and making false and misleading Foreign Agents Registration Act statements.
Appearing in U.S. District Court in Washington, D.C. on Monday afternoon, Mr. Manafort and Mr Gates entered not guilty pleas. Both men were released from custody but were ordered to comply with certain restrictions including home confinement and will have to call in to report daily to pretrial serves by phone.
During Monday’s court hearing, special counsel prosecutor Greg Andres said the government believes both men to be flight risks because of their significant ties abroad. Mr. Andres was joined in the courtroom by special counsel prosecutor Andrew Weissman.
Mr. Manafort faces between 12 and 15 years in prison under sentencing guidelines Mr. Gates faces between 10 to 12 years in prison under sentencing guidelines if convicted, Mr. Andres said.
Both men have already relinquished their passports to federal authorities. Mr. Manafort’s attorney, Kevin Downing, acknowledged that his client had turned over his passport Sunday morning.
According to the indictment, the alleged operations on behalf of pro-Russian interests appear to have taken place up until 2014, though money laundering and misleading investigators took place in 2016 and 2017 — during and after the time Mr. Manafort worked for the Trump campaign, from March through August of last year.
The indictment states more than $75 million was transferred through the accounts, with Mr. Manafort responsible for the laundering of $18 million and Mr. Gates responsible for laundering $3 million.
After Monday’s court hearing concluded, Mr. Downing spoke to reporters and called the indictment against his client “ridiculous.”
Mr. Downing said that Mr. Manafort’s activities in Ukraine were to “further democracy” and “help Ukraine come closer to United States and the EU,” referring to the European Union.
“Those activities ended in 2014, over two years before Mr. Manafort served in the Trump campaign,” Mr. Downing said.
The attorney also questioned the grounds for the indictment explaining that it was based on the Foreign Agents Registration Act filing that requires all persons representing foreign powers to disclose that relationship and information about the relationship, including finances, to the U.S. government.
“The United States government has only used that offense six times. Since 1966, it only resulted in one conviction,” he said.
Mr. Gates, who was represented in court by a federal public defender because he had not yet secured legal representation, declined to comment following Monday’s court appearance.
Glenn Selig, a spokesman for Mr. Gates, issued a statement calling the charges politically motivated and saying he “welcomes the opportunity to confront these charges in court.”
Federal public defender David Bos said it was Mr. Gates’ intention to retain counsel before a status hearing in the case that is scheduled for Thursday afternoon.
The criminal charges against the two men mark the first wave of indictments from Mr. Mueller. Shortly after the public release of the indictments, which do not mention Mr. Trump or his campaign, authorities unsealed a plea agreement with another member of the Trump campaign, George Papadopoulos.
According to the charges and plea agreement, Mr. Papadopoulos pleaded guilty to making false statements to FBI agents as they questioned him about his attempts to arrange meetings between members of the campaign and the Russian government.
The government said Mr. Papadopoulos was in contact with a professor who had connections to Russian government officials and claimed to have “dirt” on presidential candidate Hillary Clinton in the form of “thousands of emails.” Mr. Papadopoulos told agents that he had learned this information before he became a part of Mr. Trump’s campaign, but in reality investigators said he met with the professor after he became a campaign adviser in March 2016 and the professor provided that information a month later.
Court documents said Mr. Papadopoulos was fully cooperating with the special counsel, which resulted in prosecutors dropping an obstruction of justice charge and forgoing other charges they may have brought against him.
“Since his arrest, defendant has made efforts to cooperate with Special Counsel’s investigation by participating in multiple proffer sessions and voluntarily turning over materials at the request of investigators,” his lawyers said in a document filed under seal in early October, and made public Monday.
Democrats said the indictments were proof that Mr. Mueller’s investigation is chasing real targets and, despite the limited nature of the indictment, insisted Mr. Trump was tarnished.
“The chairman of Donald Trump’s campaign and his deputy have been charged with conspiracy against the United States, money laundering, and making false statements — all related to their work to promote a pro-Putin regime,” said Tom Perez, chairman of the Democratic National Committee. “Paul Manafort and Rick Gates ran Trump’s campaign and continued to be a part of his inner circle after Election Day.”
Senate Minority Leader Charles E. Schumer, New York Democrat, warned Mr. Trump not to intervene to help his two former associates.
“The president must not, under any circumstances, interfere with the special counsel’s work in any way. If he does so, Congress must respond swiftly, unequivocally, and in a bipartisan way to ensure that the investigation continues,” he said.
Mr. Gates was a longtime partner of Mr. Manafort, according to the report, and played a role in Mr. Manafort’s dealings in Eastern Europe. The former Trump campaign aide had been under investigation for violations related to his foreign lobbying efforts.
Mr. Mueller has been heading a special investigation into possible collusion between Mr. Trump’s campaign and Russia. Monday’s charges mark the first major move in the investigation since Mr. Mueller was appointed as special counsel in May.
The development comes months after the special counsel team intensified its focus on Mr. Manafort, who served as Mr. Trump’s campaign manager. Law enforcement raided his Virginia condo over the summer in search of tax documents and foreign banking records.
Mr. Manafort previously worked for a Ukrainian political party, and had to retroactively file forms this year to comply with the Foreign Agent Registration Act based on that work. The belated filing showed Mr. Manafort’s consulting firm received $17 million between 2012 and 2014 for work on behalf of the political party.
Earlier this year, news emerged that federal investigators obtained a Foreign Intelligence Surveillance Act warrant to wiretap Mr. Manafort in 2014 and again in 2016, around the time he was involved with Mr. Trump’s campaign. To obtain a FISA order to monitor a U.S. citizen, investigators must convince a judge they have probable cause to believe the person is acting as an agent of a foreign power, such as by conducting espionage against the U.S.