On Tuesday, a federal court convicted Paul Manafort, President Donald Trump’s former campaign manager, of eight out of 18 charges leveled against him by special counsel, Robert S. Mueller III. The successful case was the first trial brought by Mueller as part of his wide-ranging mandate to investigate crimes related to collusion and the 2016 Trump presidential campaign. It revealed, in addition to Manafort’s criminal activities, his profligacy—buying $15,000 ostrich jackets for instance—a testament to his experience maneuvering in Eastern Europe for more than a decade. It is perhaps no surprise then that in Kiev, where the corruption of the former government led the country to revolution only a few years ago, Manafort’s prosecution has been savored by many as a long delayed act of justice.
Despite the trial taking place in Virginia, the echoes of Eastern Europe’s political and business culture were clear. The presiding judge had to instruct the prosecution to elide the word “oligarch” so as to not prejudice the jury. The case exposed the offshore banking practices that Manafort had utilized to avoid paying taxes, and crucially, revealed the identities of Ukrainian oligarchs and politicians who funneled the funds to accounts in the Cayman Islands.
Manafort’s comfort in doing shady and shadowy financial dealings comes after he spent over a decade hustling for cash working in Eastern Europe. He first began consulting for Russian interests on behalf of Kremlin linked Russian oligarch Oleg Deripaska in 2005. The case revealed that over several years Manafort accepted more than $65 million in consulting fees from the pro-Kremlin Party of the Regions, whose 2010 presidential candidate, Viktor Yanukovych, he had ushered into power with his first-rate skills as a political consultant.
Manafort’s downfall as Trump’s campaign manager came after the revelations of the Party of Regions “Black Ledger” book of payments first revealed the extent of Manafort’s corrupt dealings with Yanukovych and his oligarchic clan. Serhiy Leshchenko, a reformist member of the Ukrainian parliament was instrumental in getting that new news out as part of an internal Ukrainian conflict between competing Ukrainian prosecutorial organs. Leshchenko spoke to Tablet about the ledger last year. Whether the Ledger was directly leaked by Ukrainian intelligence in the summer of 2016 remains a point of contention among journalists and analysts who work on Ukraine, but it is certainly believed to be the case in conservative circles in Washington, D.C.
Next month Manafort will have to stand in a second criminal trial on seven additional charges stemming from the investigation. These include obstruction of justice, conspiracy to launder money and failing to register as a foreign agent (a violation of the rules of the Foreign Agents Registration Act, or FARA). As much as anything else, the Manafort saga has demonstrated that FARA violations, which were almost never prosecuted, constituted a commonplace form of corruption among the Washington, D.C. lobbyist class. Already, though, the repercussions of Mueller’s case are proving to be quite radical back in Kiev.
Four and a half years after Manafort’s kleptocratic client, former Ukrainian president Yanukovych fled the Ukrainian capital for asylum in Russia, Kiev has yet to convict a single high-ranking member of his administration for their part in any of the numerous crimes of corruption in which they were implicated. It was the many crimes of the political establishment that led to the massive street protests in Maidan that cause Yanukovych to flee his presidency and the country.
Many members of Yanukovych’s government followed him into Russian exile. Of those who remained, some escaped prosecution through timely defections or resignations before the killings of protesters took place, while others stayed active in Ukrainian politics. The current Ukrainian government has chosen to take a gentle, conciliatory approach to maintaining consensus within the governing class, striking opaque deals and foregoing corruption prosecution.
The Ukrainian prosecutor’s endless deferral of that process, depending on one’s viewpoint, has either kept the wagons of an interlinked and codependent elite tightly circled or kept a fragile political system from imploding. Regardless, for many Ukrainians, the American trial of Manafort on charges related to his work in Ukraine constituted the first time that a criminal court had made any serious inquiry into Yanukovych-era corruption. Even if Manafort had not stolen all those billions from the state budget himself, his prosecution was deeply satisfying to many Ukrainians familiar with his role in the plunder of their country. The outcome in the U.S. federal courthouse has been widely seen as a belated and very satisfying victory for the rule of law.
The verdict will also push the Ukrainian state to make difficult decisions it has so far avoided out of political considerations. Last May, a widely read and controversial New York Times article by Andrew Kramer alleged a direct causal link between the finalization of the long planned Javelin missile sales to Kiev in a quid pro quo exchange for foregoing Ukrainian legal action against Manafort in Ukrainian jurisdiction. Any additional revelations from the Ukrainian side can only serve as further irritants to a famously mercurial President Trump and are thus likely to be avoided.
As I wrote at the time:
“Kramer’s Times piece boldly posited that Ukraine had brokered at the presidential level a transparent political deal with Trump, releasing the prized missiles in exchange for Ukraine dropping pursuit of Manafort in the numerous cases opened against him. The allegations were quickly seized upon in many circles as a logical continuation of the Russia collusion story. In that purview, President Trump is seen as one more pliant oligarch for President Poroshenko to strike a deal with. The allegation was received with naked partisan glee despite being, at this juncture in time, a tendentious claim that remains to be proven definitively.”
While numerous journalists have speculated about a possible deal having been made between presidents Poroshenko and Trump, none have been able to prove its existence. President Trump has done little to hide his lingering resentment toward Kiev for what he views as Ukrainian machinations in the summer of 2016 to help the Hillary Clinton presidential campaign. Though nothing was conclusively proven, the Ukrainians, much like everyone else, never believed in the possibility of a Trump victory and placed their bet on Clinton. Kiev’s political class then scampered and lobbied frantically for at least the first half year of Trump’s presidency to repair the damage that had been done.
The continued existence of an independent Ukrainian state depends on American economic, military and diplomatic backing, and Kiev officials have been understandably anxious about further jeopardizing the relationship. In Politico, my colleague and friend David Stern described the newest round of anxiety that the Manafort trial has fostered in government and intelligence circles around Kiev as renewed pressure builds to prosecute oligarchs and officials connected to Mueller’s probe. “Some politicians and anti-corruption advocates believe new information disclosed in Manafort’s trial on bank and tax fraud charges should trigger new criminal action in Ukraine against officials and oligarchs who lavished Manafort with cash,” Stern wrote. Manafort himself remains a person of interest in three open case files of the Ukrainian general prosecutor’s office, yet systematic impediments had been placed by the government in front of efforts to prosecute, with some of the cases having been effectively frozen until recently.
Kiev’s civil society has called on Ukrainian prosecutorial bodies to act on the evidence presented in Virginia by Mueller’s probe. And finally, a few days ago, Ukrainian prosecutor General Lutsenko held a press conference to announce that a case had indeed been opened against several high profile members of the Yanukovych government.
REFL has reported on the testimony of Manafort’s former partner and protégé Rick Gates, who accepted a deal and cooperated with the prosecution:
Gates has testified in court that those who transferred millions of dollars to a Manafort account in Cyprus included Yanukovych’s former chief of staff, Serhiy Lyovochkin; ex-Infrastructure Minister Borys Kolesnikov; former National Security Council Secretary Andriy Klyuyev; and lawmaker Serhiy Tihipko.
In another little-noticed revelation, yesterday an investigation by a pair of Ukrainian journalists into Manafort’s longtime Kiev fixer Konstantin Kilimnik concluded that Manafort had previously worked in Kyrgyzstan on behalf of Russian interests during the 2005 “Tulip” revolution.
As the trial continues in America, one important side story of the grand Mueller drama, and further revelations of Manafort’s dealings across the former Soviet Union are uncovered by investigators and journalists, the question remains how far the prosecutions will go, and how near to the top they will reach, in D.C. as in Kiev.