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THE LEAD WITH JAKE TAPPER

Paul Manafort Trial Begins; Facebook Discovers Meddling Ahead of 2018 Vote. Aired 4-4:30p ET

Aired July 31, 2018 - 16:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


[16:00:00]

JAKE TAPPER, CNN ANCHOR: Prosecutors say Paul Manafort had a $15,000 jacket made of ostrich skin. And the White House currently has its head in the sand.

THE LEAD starts right now.

President Trump's former campaign chairman is on trial, Paul Manafort facing, theoretically, centuries in prison if convicted. And the White House is saying, Manafort who?

And breaking news, with only 98 days until the midterm elections, Facebook this afternoon alerting the nation that they have identified an invasion of misinformation on their pages. All signs point to the Kremlin.

Plus, new signs that North Korea is going to North Korea. Kim Jong-un possibly caught red-handed making new missiles that could strike the U.S., so about that thaw.

ANNOUNCER: This is CNN breaking news.

TAPPER: Good afternoon, everyone. Welcome to THE LEAD. I'm Jake Tapper.

We begin with breaking news in our politics lead, Mueller vs. Manafort, day one. Opening statements are going on right now. Prosecutors painting President Trump's former campaign chair, Paul Manafort, as a -- quote -- "shrewd liar" who ran a worldwide scheme to avoid paying taxes.

A jury of six men and six women has been seated in the trial, the special counsel's biggest test to date. Manafort has been charged with a long list of financial crimes related to his lobbying work for a pro-Putin political party in Ukraine.

Prosecutors accuse him of hiding millions of dollars in income to avoid paying taxes and to fund his lavish lifestyle. This comes, of course, as the Trump team is ramping up its coordinated effort to try to downplay Manafort's key role on the Trump campaign in 2016.

CNN justice corresponding Jessica Schneider joins me now.

Jessica, both sides are really laying out their cases right now. JESSICA SCHNEIDER, CNN CORRESPONDENT: Yes, right now, as we speak,

Jake.

This has been a fiery start to this big case for the special counsel's team here. We heard from prosecutors laying out their opening statements and they put it to the jury really this way. They said Manafort lived in extravagant lifestyle fueled by millions of dollars in secret income, and then they went on to say that Manafort became wealthy from the cash spigot that came from working for his golden goose in Ukraine, who they called the former pro-Russian president there, Viktor Yanukovych.

And then the defense, they are making their opening statement to the jury right now. They're blaming this all on the Russian oligarchs, saying the way they were paid, that was all the instruction that they gave Paul Manafort. They're trying to shift the blame here to the Russian oligarchs.

But all of this a big start for what is a big case for the special counsel.

(BEGIN VIDEOTAPE)

SCHNEIDER (voice-over): Paul Manafort is facing the 12 jurors and four alternates who will decide whether he could spend the rest of his life in prison.

The president's former campaign chairman appeared in a Virginia courtroom wearing a dark suit with his hair neatly parted, as prosecutors open their case against Manafort for bank and tax fraud, 18 counts in all.

Manafort's lawyers, meanwhile, remained resolute.

UNIDENTIFIED MALE: Doing good.

QUESTION: Any chance that he may decide to flip and cooperate?

UNIDENTIFIED MALE: No chance.

SCHNEIDER: Paul Manafort's was the first indictment secured by the special counsel's team last October. His former co-defendant and deputy Rick Gates has already pleaded guilty and is cooperating. Gates is the government's key witness among the 35 they plan to call.

This trial is a key test for special counsel Robert Mueller. Judge T.S. Ellis has banned any mention of President Trump, Russia or collusion from the courtroom. But the case still looms over the White House, since the charges against Manafort stem from the special counsel's investigation into possible collusion between the Trump campaign and Russia.

The White House now trying to downplay the trial and Manafort's role on the Trump campaign, even though Manafort was the campaign chairman for three months. KELLYANNE CONWAY, TRUMP SENIOR ADVISER: This trial obviously centers on matters that had nothing to do with the campaign. I think that even Mr. Manafort, as I read it, had requested that there'd be no mention of his brief tenure at the Trump campaign several years ago. This has nothing to do with collusion, Russia, nothing to do with the Trump campaign.

SCHNEIDER: Manafort's Virginia case centers around his past lobbying work for the pro-Putin Ukrainian government, for which prosecutor say he received $60 million.

The government alleges Manafort hid millions and failed to pay taxes while still spending the money on real estate and luxury purchases, including homes in Manhattan, Virginia, and the Hamptons, expensive suits and baseball tickets. And prosecutors will present hundreds of e-mails, photos and financial records to prove it.

Prosecutors say Manafort also lied to banks about his income to secure more than $20 million in loans.

(END VIDEOTAPE)

SCHNEIDER: And this trial now under way. It's expected to last about three weeks. And this isn't the only trial that Paul Manafort faces. He's charged with seven counts in federal court in Washington, D.C.

That trial is set to start in September. And, Jake, until then, it looks like Paul Manafort will remain behind bars. Just today, a D.C. appeals court rejected his request to overturn the lower court decision that sent him to jail for alleged witness tampering -- Jake.

[16:05:02]

TAPPER: All right, Jessica Schneider, thanks so much.

Let's talk about this with my experts.

Kaitlan Collins, White House correspondent for CNN, the White House. I mean, even if this doesn't relate to anything having to do with the White House, which it doesn't, it's embarrassing. This is the president's former campaign chairman.

KAITLAN COLLINS, CNN WHITE HOUSE CORRESPONDENT: It is.

And they have been playing the Manafort who game for a few months now leading up to this case, because they wanted to put as much distance between themselves, the Trump campaign, and Paul Manafort as possible. One of their recent responses was we can't comment on non-White House employees, which, of course, Paul Manafort was the campaign chairman for President Trump for several months.

But also really the glaring aspect of all of this is that this trial has nothing to do with Russia. It's not going to be bringing up any kind of Russia collusion or anything like that as they go through this trial. But Russia is going to be looming over this because, of course, Paul Manafort did work for President Trump. He did play a big role in the campaign and he was there for that Trump Tower meeting with the president's son and the president's son-in-law, that meeting that has now come into question, with Michael Cohen making the allegation that President Trump did know about it.

So Paul Manafort does know a lot that could affect this White House, and in the meanwhile, as this campaign plays out -- or as this trial plays out, we're likely going to see them just continue to say that he had nothing to do with the White House or them.

TAPPER: And, Bill, Manafort has been charged with bank fraud, tax evasion, other financial crimes. That doesn't discount the possibility that there might be a different other indictment coming forward. But certainly nothing right now here has to do with conspiracy with Russia to affect the election.

BILL KRISTOL, EDITOR, "THE WEEKLY STANDARD": Right, but one assumes that assuming if there were a guilty verdict that that might then become leverage that the prosecutor -- that Mueller and others, that the Justice Department would have to get him to talk a little more about that interesting Trump Tower meeting that he was part of.

And other interesting -- and other interesting -- you were part of it, too. You're chuckling there.

DAVID URBAN, CNN POLITICAL COMMENTATOR: I think the 305 years in prison is enough leverage to get him to talk. It doesn't have to be anything else.

(CROSSTALK)

KRISTOL: If he really faces that prospect, don't you think he will some have some tendency to be a little bit forthcoming?

(CROSSTALK)

TAPPER: Why didn't he take the deal, David?

(CROSSTALK)

URBAN: I'm not sure. Because he thinks he's innocent, perhaps.

TAPPER: But beyond that, there also is -- I mean, it's -- it's very easy for prosecutors to get convictions in this type of case just in terms of the track record.

Do you think he's counting on there being a pardon coming his way?

URBAN: No, I don't think he should count on anything.

I think he needs to mount a robust defense. There is -- I saw the 35 witnesses, including his former partner Rick Gates, is going to testify against him. If you looked at the indictment, it's pretty detailed and a lot of really nitty-gritty, changing numbers on bank statements and things that are -- that are really kind of in the weeds that really have nothing to do with the campaign. Just to push back on the narrative a bit that Paul was super involved, I was there. I was one of the few folks who kind of was there from Corey through Paul through Steve Bannon. And so I got to see a bunch of it.

And I would say that what Paul did -- what Paul Manafort did very well was run the convention. Paul played a very, very large role and was really brought in, as the president states, really brought in to kind of quell this uprising amongst the delegates.

We were very concerned at the convention that there was going to be a floor fight for the actual -- the nomination.

(CROSSTALK)

KRISTOL: It cheers me up to learn that they actually were very concerned.

(CROSSTALK)

KRISTOL: But, actually, you guys were worried.

TAPPER: So, Nina, I want to play some sound for you.

This is Kellyanne Conway and Rudy Giuliani, both of them kind of downplaying this case. I want to get your reaction.

(BEGIN VIDEO CLIP)

CONWAY: This has nothing to do with collusion, Russia, nothing to do with the Trump campaign.

RUDY GIULIANI (R), FORMER MAYOR OF NEW YORK: Paul Manafort does not know anything, nor could it be possibly he did. He was with him for four months. I was there when Paul Manafort was there. Paul Manafort was a brilliant gatherer of delegates.

(END VIDEO CLIP)

TAPPER: That's a pretty important role when you're still not -- you don't have the presidency secured.

(CROSSTALK)

NINA TURNER, CNN POLITICAL COMMENTATOR: And Mayor Giuliani said the same thing about Cohen, so we should be very suspicious when he says he didn't know anything, and up comes the tapes with Cohen.

I mean, the president has known or has some type of relationship with Manafort for about 30 years. And even though what he's being tried for right now has nothing to do directly with the president and Russia, Russia is still in there.

It's about business for Russian oligarchs, which we know that the president is infatuated with Russia. So I definitely find it hard to believe that the president didn't somehow try to utilize Manafort's relationship.

(CROSSTALK)

KRISTOL: The ridiculous line that, well, he only dealt with delegates.

The Trump Tower meeting -- the Trump Tower meeting with the five Russians, was that about delegates?

(CROSSTALK)

KRISTOL: He seems like he was kind of important maybe.

TURNER: Very important.

URBAN: In June -- just contextually, in June of 2016, the campaign was far, far more concerned with Ted Cruz and Governor Kasich.

(CROSSTALK)

TAPPER: He was there from March to August, just for the record.

(CROSSTALK)

KRISTOL: It's amazing he was able to take a half-hour to meet with those Russians.

[16:10:00]

TAPPER: Kaitlan, you were talking about the important role, all the events that happened while Manafort was on the campaign from March until August.

Take a listen to President Trump talking about this last month.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: Manafort has nothing to do with our campaign. Paul Manafort worked for me for a very short period of time. He worked for Ronald Reagan, he worked for Bob Dole, he worked for John McCain or his firm did. He worked for many other Republicans.

He worked for me, what, for 49 days or something, a very short period of time.

(END VIDEO CLIP)

TAPPER: But, as you know, it was more than 49 days. But, as you note, it was a significant period of time.

Look at the timeline, OK, from March to August 2016. During this timeline, if those people are people who are looking at the Russia investigation, this is when George Papadopoulos ran his mouth to an Australian diplomat about the Russians having dirt on Hillary Clinton and telling him. Manafort attended that Trump Tower meeting with the Russian lawyer, Jared Kushner and Donald Trump Jr.

In July, President Trump asked Russia to find Hillary Clinton's missing e-mails. It's not like nothing Russia-related was going on during that period.

COLLINS: It wasn't. That was a crucial period for the campaign.

And, of course, he's not just a delegate counter, as Rudy Giuliani said. He was there. And if he was just that and he wasn't the campaign chairman, which is another argument that we hear, that it was really Jared Kushner running the campaign, then why was he included in that meeting in Trump Tower?

They obviously felt that he had a high enough role that they should include him in that meeting. We have seen the president try to downplay his relationships with people before when it's no longer convenient for him to be close to them.

We saw it with Paul Manafort -- or Michael Cohen, who he said only did a small amount of business for him. Well, that amount of business seemed to deal with Karen McDougal and Stormy Daniels, two very critical stories right now that could really damage his presidency, if they haven't already.

So Paul Manafort did play a role. The White House can't downplay it, but we will see them continue to do that.

(CROSSTALK)

URBAN: I will say, to say that this campaign was entrepreneurial and run in a very entrepreneurial fashion, with a lot -- not a lot of direction from the top...

(CROSSTALK)

TAPPER: Interesting word for it, entrepreneurial.

URBAN: ... would be an overstatement.

TAPPER: Yes.

Nina, the fact is, though, what if this it? What if this is the only case that really gets anybody? The Russian military intelligence officers aren't going to come to the United States and be tried. What if it's just Manafort on financial crimes and ultimately that's it for the Mueller investigation when it comes to anything having to do with the Trump campaign?

TURNER: I mean, certainly if that's from a political end, in terms of what would the Democrats do, the Democrats definitely have to run on something bigger than just Russia, Russia, Russia.

And you will find lots of Democrats across the spectrum, especially on the progressive side, who are really pushing for the Democrats to have a stronger message than Russia.

But where there's smoke, there's fire. It might not be with Manafort, but it might absolutely be with somebody else.

TAPPER: All right.

(CROSSTALK)

URBAN: Take down Papadopoulos. He's a kingpin.

TAPPER: Everyone, stick around.

Opening statements just wrapped in the Manafort trial. The first witness is about to take the stand. We're going to take you inside the courtroom next.

Stay with us.

(COMMERCIAL BREAK)

[16:16:50] TAPPER: The case of the United States of America versus Paul Manafort seems to be on a fast track. Opening statements just wrapped and first witnesses are expected soon.

CNN's Evan Perez was inside the Alexandria, Virginia courtroom all day.

Evan, what did Manafort look like?

EVAN PEREZ, CNN JUSTICE CORRESPONDENT: Well, Jake, Manafort looked a lot more relaxed than we've seen him in court lately. He was wearing a suit with some pants that were entirely too long, not really the tailored suit that we used to see him in during the early months of this case. He smiled at his wife. He actively participated as his team tried to pick jurors who are going to be hearing his case.

And then while the prosecution laid out the case against him, really took him down, describing his extravagant lifestyle, described him as a liar, he stared down at his papers. His wife was right behind him. She had the stoic look on her face. She didn't look up as the prosecutors were describing the $21,000 watch that he was buying with this money that he got from a Ukrainian client.

So, you know, it's quite a different Paul Manafort than we used to see a few months ago when he would show up with protesters around outside the D.C. court and wearing those fine suits, Jake.

TAPPER: All right. Evan Perez at the courthouse, thanks so much.

I want to bring in CNN senior legal analyst, Preet Bharara. He was the U.S. attorney for the Southern District of New York before President Trump fired three months after taking office.

Preet, so the opening statements, the prosecutors calling Manafort a shrewd liar, outlining some over the top rich guy stuff. The defense saying, hey, the oligarchs insisted on paying him through these secret accounts. That's how they do it there.

Is this what you expected? PREET BHARARA, CNN SENIOR LEGAL ANALYST: Well, what you expect in a

case like this where the evidence seems very strong, there's a lot of documentary evidence that I think is pretty specific, hard to get past the idea that he didn't, you know, claim income that he clearly got, that he didn't recite in tax return information that you are supposed to, that he had an interest in foreign bank accounts. And so, the defense can be expected in cases like this to blame other people. So, they're going to blame Rick Gates, who lied and had to play guilty and say he's lying now at trial. He blamed the oligarchs. He's also going to probably blame the lack of awareness or understanding that he was supposed for fill out these documents in a particular way and make certain kinds of filings with the IRS.

So, I haven't seen anything so far and just gotten it sort of on social media in the few minutes before appearing here. It's sort of par for the course.

TAPPER: Preet, you've heard Trump supporters say, look, Manafort, this is the big fish, none of the charges are related to conspiracy with Russia, so Mueller must have nothing on that issue.

What would your response be?

BHARARA: Yes, we don't know what Mueller has. You know, these cases have proceeded in stages. So, you will have a charge against somebody one day, you'll have a superseding indictment that has additional charges in it the next month or a couple months later. It may be the case that there is nothing else that the Mueller team has against Paul Manafort, so certainly we haven't seen it so far.

And I understand that the judge in this case has made it clear that there should be no references to the Trump campaign and really no references to Russia at also as not to taint the jury and the jury's thinking in this case. So, we don't know.

[16:20:01] I think there are other shoes to drop that could potentially happen in the future. This is not, you know, the only trial that Paul Manafort has to face. He's got another one in the District of Columbia coming up in just a few weeks.

It's possible that, as satisfactory answer as possible, that the Mueller team has more and it's also equally possible that they don't.

TAPPER: Would you expect Manafort to blame this on his former number two Rick Gates? We're getting word that that might be part of the defense strategy, blaming this on Gates.

BHARARA: Yes, I mean typically when you have a cooperating witness who like Rick Gates in this case was part of the scheme, was charged in the original criminal document, criminal charge, that is the obvious person who you blame because you want to divert blame from yourself. So, it's sort of defense argument 101.

And in this particular case, the uphill battle, I don't know how uphill it is, for the government is that one of the particular crimes to which gates has pled guilty is lying to the FBI. And not just lying to the FBI, but lying to the FBI in the course of an interview -- in the course of a proffer meeting in which he was trying to convince the FBI specifically that he was being truthful and to try to get a deal.

And so, the argument that you see time and time again in court, sometimes it works, most of the time it doesn't, if you have good corroborating evidence of the testimony of this previously lying witness, sometimes it works. But this is a guy who lied before, he lied to the faces of the FBI, why should you believe him now. And so, why not use him as a scapegoat to escape criminal liability for yourself.

TAPPER: What do you make of Mueller bringing this trial now? Do you think it's part of a larger strategy? Obviously, just a few weeks ago, the grand jury returned indictments against 12 members of Russian military intelligence which obviously at least as far as I know has nothing to do with this case which is the first major case.

BHARARA: Well, Mueller brought the case I think when you have enough evidence to prove it and to get a grand jury to go along with the charges and accept the indictment. And then the trial schedule was set by the particular judge in both the D.C. case and the Virginia case. I don't think contrary to what some say that there is a micro managing strategy about timing of particular charges. Obviously you take that into account.

I'm sure that the special counsel will take into account as others have suggested the election calendar and not do anything dramatic in the days and weeks leading up to the election. But I don't see any overarching tactical, you know, issue here in the timing of this case.

TAPPER: Manafort has had multiple chances to make a deal with the prosecutors. A lot of people I know are surprised that he didn't make a deal. How do you interpret the fact that he -- that he has not?

BHARARA: Right. This is the age old question in all criminal cases. Why some people flip, why some don't.

There have been -- I've seen people flip when they didn't have a lot to lose by going to trial and I've seen people refuse to flip even though they had substantial assistance they could have given the government and instead take their lumps and take mandatory minimum sentences in drug cases and very long sentences in white collar cases. It's hard to know what's in a person's mind and heart. Some people are just in denial and they think they can beat the charges.

There is some speculation I know that, you know, he is holding out for a pardon at the end of the day. Some people don't want to admit that they have committed crimes because their lies are believed by family members. So, it's hard -- it's hard to say.

Now, some people have speculated that if and when he's convicted at this trial or the next trial, he could change his mind. But it's really unusual. It happens, but it's really unusual for prosecutors to want to take the testimony of somebody who was obstinate enough to go to trial, put the government to its proof, it depends on how much information they have, and if he hasn't cooperated by now, the likelihood that he will in the future and that his cooperation will be accepted and used is low.

TAPPER: All right. Preet Bharara, thank you so much.

Messing with Americans' minds, the disinformation campaign that Facebook just announced that could be meant to influence your vote in the upcoming midterm elections.

Stay with us.

(COMMERCIAL BREAK)

[16:28:34] TAPPER: Welcome back.

Our tech lead now: Facebook announcing that they have discovered and dismantled what they suspect is another Russian disinformation campaign aimed at American voters, fewer than 100 days before you head to the polls. Facebook saying it can't be certain that Russia is the perpetrators, but all signs do point to the Kremlin and more than 30 fraudulent pages and profiles have already been removed, Facebook says.

CNN senior investigative correspondent Drew Griffin joins me now.

And, Drew, is this identical to what we saw in the 2016 campaign?

DREW GRIFFIN, CNN SENIOR INVESTIGATIVE CORRESPONDENT: It's certainly typical, Jake, of the behavior we saw around that 2016 election, setting up fake sites, getting real Americans to like, follow these pages, and then sending out disinformation to encourage division in America. And, Jake, it worked again.

(BEGIN VIDEOTAPE)

GRIFFIN (voice-over): Facebook calls it inauthentic behavior and though Facebook can't be sure, it sure looks like Russia again. Thirty-two pages with names including "Black Elevation", "Resisters", "Aztlan Warriors" being followed by 290,000 accounts. The fake accounts also setting up and promoting real events and protests aimed at further polarizing U.S. political discourse.

Many of the events did occur, including this one last year in New York City attended by actual Americans who likely had no idea that the Resisters Facebook page was probably run by Russians. Another event by the same group was supposed to take place in a couple of weeks. Resisters set up a counterprotest against white supremacist at --