Prosecutors suspect Paul Manafort might be trying to secretly claw back about a million dollars he agreed to hand over to the government for his financial crimes — and he could be using the same type of shell company at the core of his legal problems to fake a loan.
A mysterious shell company named Woodlawn LLC — which formed in the middle of special cousel Robert Mueller’s investigation into Manafort in August 2017 — claimed in court that it deserves $1 million from Manafort’s forfeiture proceeding. The company says Manafort, who was Donald Trump’s presidential campaign chairman, still owes that amount to pay back a 2017 mortgage loan.
In a court filing Saturday, the prosecutor said he could not tell if the Nevada-registered corporation’s $1 million loan to Manafort was “a real or sham transaction.”
The prosecutor says more evidence collection “is necessary because the United States lacks information to be able to discern whether Woodlawn is a person other than the defendant,” the court filing said.
Manafort’s spokesman declined to comment on the accusation Saturday.
Woodlawn claims it gave Manafort a mortgage loan of $1.025 million in two payments in 2017. But prosecutors haven’t been able to pinpoint that the money was actually paid – or that Manafort paid any of it back.
The company, prosecutors point out, hasn’t shared where the money in the loan came from or who owns the company. Woodlawn has only been affiliated with “a manager who apparently resigned shortly after verifying the initial petition and the company’s lawyer who subsequently took over that function.” The company has no address of its own.
The Justice Department says it needs to seek evidence about Woodlawn before it can determine what the company may be owed. Prosecutors have already settled with some banks for repayments they’ll get from Manafort’s property sales for loans he received under false pretenses and has not paid back.
Manafort admitted to bank fraud, money laundering and illegal lobbying for Ukrainians in the US as part of his conspiracy and obstruction plea. He said in those admissions that he used shell companies to receive millions of dollars in payments and make lavish purchases, all while hiding them from the US government.
A jury also convicted Manafort last year for tax fraud and bank fraud after a three-week trial that explained the offshore accounts and methods he used to inflate his income for banks, including by claiming he got fake loans.
In all, Manafort must forfeit $11 million to the federal government. Some of that amount may come from the sale of several properties the government has seized. He also must pay, in total, about $25 million in restitution to banks.