FILE - In this March 8, 2018, file photo, Jason Maloni, left, former Trump campaign chairman Paul Manafort's spokesman, left, walks with Paul Manafort, center, as they leave the Alexandria Federal Courthouse after an arraignment hearing in Alexandria, Va. A federal judge in Virginia has rejected Manfort's move to throw out charges brought by the special counsel in the Russia investigation. The decision June 26 was a setback for Manafort in his defense against numerous tax and bank fraud charges. Behind Manafort protester Bill Christeson holds up a sign that says "traitor." (AP Photo/Jacquelyn Martin)

Judge in Virginia lets case against Manafort move forward

June 26, 2018 - 9:59 pm
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WASHINGTON (AP) — A federal judge in Virginia rejected a bid by President Donald Trump's former campaign chairman, Paul Manafort, to throw out charges in the special counsel's Russia investigation, clearing the way for a much-anticipated trial to start as scheduled next month.

The decision Tuesday by U.S. District Judge T.S. Ellis III was a setback for Manafort in his defense against tax and bank fraud charges brought by special counsel Robert Mueller.

It also hobbles a favored talking point of Trump and his legal team as they repeatedly attack Mueller's investigation as overly broad and seek to undermine its legitimacy. Ellis' skeptical comments and pointed questioning during a hearing last month, including his suggestion that prosecutors had pursued Manafort to get him to testify against Trump, had given the president and his supporters hope that the case might be dismissed.

Manafort, also facing separate charges in the District of Columbia, is the only one of the four Trump aides charged by Mueller who has opted to fight the allegations instead of plead guilty and cooperate. He and his lawyers have repeatedly seized on the fact that none of the charges relate to allegations of Russian election interference and possible coordination with Trump associates, the main thrust of Mueller's public appointment order.

But in a 31-page ruling, Ellis rejected Manafort's argument that Mueller had exceeded his authority by bringing charges unrelated to the presidential election. He said the May 2017 Justice Department order that appointed Mueller as special counsel specifically empowered him to pursue other crimes that arose out of the investigation, and that the case against Manafort clearly fell within that authority.

During their investigation, Mueller's team had simply "followed the money" from pro-Russian officials to Manafort to develop allegations that he was hiding the payments from the U.S. government and depositing the money in offshore accounts, Ellis wrote.

Besides, the judge said, an August 2017 memo from Deputy Attorney General Rod Rosenstein made clear that payments from the Ukrainian government of Viktor Yanukovych that form of the basis of the indictment were fair game for Mueller's investigation. The memo, filed with Ellis, also includes the specific activities Mueller is authorized to investigate involving other people beyond Manafort, at least through the middle of last year. It has not been made public.

"No interpretive gymnastics are necessary to determine that the investigation at issue here falls within this category of allegations described in the August 2 Scope Memorandum," Ellis wrote.

Even so, the judge did hint at some of the same concerns he articulated at a contentious May hearing in which he said he didn't see the relationship between the Mueller investigation and the Manafort indictment.

That skepticism gave Trump's legal team some optimism that Ellis might dismiss the case. Trump had even read some of Ellis' quotes aloud during a National Rifle Association rally, and as late as early June, Trump lawyer Rudy Giuliani had built up suspense around the ruling, saying the judge was taking weeks to craft an opinion because "there's a real problem" with Mueller's appointment.

In his order, Ellis expressed concern that special counsels could enjoy unchecked investigative authority, noting that they are not constrained by either time or budget and are not required to specify any crimes or statutes that are believed to have been violated.

The Constitution is meant to ensure that no one person has absolute power, Ellis said, but "the appointment of special prosecutors has the potential to disrupt these checks and balances, and to inject a level of toxic partisanship into investigation of matters of public importance.

"This case is a reminder that ultimately, our system of checks and balances and limitations on each branch's powers, although exquisitely designed, ultimately works only if people of virtue, sensitivity, and courage, not affected by the winds of public opinion, choose to work within the confines of the law," he added.

He ended the opinion with a word of caution to prosecutors: "Although this case will continue, those involved should be sensitive to the danger unleashed when political disagreements are transformed into partisan prosecutions."

Yet none of those concerns were enough to dismiss the indictment.

In fact, Ellis largely agreed with the ruling of U.S. District Judge Amy Berman Jackson, who presides over Manafort's criminal case in Washington. Jackson ruled earlier this year that it was "logical and appropriate" for Mueller to investigate Manafort and that prosecutors had received authorization to do so. Jackson had also previously thrown out a civil case Manafort brought challenging Mueller's authority.

The Virginia indictment charges him with bank fraud and tax evasion and accuses him of hiding tens of millions of dollars he earned advising pro-Russia politicians in Ukraine from 2006 through 2015. It also accuses him of fraudulently obtaining millions in loans from financial institutions including while he worked for the Trump campaign. Manafort also faces charges in Washington of money-laundering conspiracy, false statements and acting as an unregistered foreign agent for Ukrainian interests.

A spokesman for Manafort declined to comment.

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