And IRS agent Michael Welch said Manafort used his foreign income for purchases that included a yacht, horseback riding, Italian villa rental and cosmetic dentistry.
Gates said that relationship lasted five months and that he told his wife and Manafort about it. "I am trying to change".
The questioning is part of the Manafort defense strategy of presenting Gates to the jury as someone who lies and can not be trusted.
The remaining witnesses include bankers and others familiar with Manafort's real estate portfolio and debts, and they're expected to dive into the gritty details of the prosecution's case on bank and mortgage fraud. The courtroom's overhead noise machine was turned on so that Gates, the jury and the public in the room couldn't hear what they said.
James' testimony comes after prosecutors presented days of evidence supporting the tax evasion charges against Manafort.
Gary Seferian, a senior vice president at the Banc of California, said his bank gave Manafort the $1 million loan to rehabilitate and flip properties in the Los Angeles area, in part based on a financial statement for DMP International showing a profit of more than $4 million for 2015.
Defense lawyers have painted Gates as a liar, embezzler and philanderer, getting him to acknowledge an extramarital affair and reminding jurors how he falsified hundreds of thousands of dollars in expense reports.
Manafort and Gates were the first two people indicted in Mueller's investigation into potential ties between Russian Federation and the Trump campaign.
Gates spent Monday afternoon and most of Tuesday morning corroborating prosecutors' version of events; the government's attorneys say Gates and Manafort used offshore bank accounts and wire transfers to hide money from the IRS as to avoid paying taxes.
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He said she and Prince Harry had already publicly advised they meant to meet Mr Markle when they visited the United States. It's not an easy decision for Meghan as she fears he would reveal the details of their private talks with the press.
CNN reported Thursday that the filing referred to a conversation between trial attorneys and the judge after Manafort attorney Kevin Downing asked Gates, "Were you interviewed on several occasions about your time at the Trump campaign?"
Gates pleaded guilty in February and agreed to cooperate with prosecutors under a deal that could lead to a reduced sentence.
Both Gates and Manafort worked on Trump's 2016 campaign.
Laporta said Manafort provided no documentation to back up the claim. People in the packed public gallery could only try to lipread as they saw a grim-faced Andres make a series of hand gestures.
"He always had control over the accounts", Gates said of Manafort, and the income was not reported to his bookkeepers, his accountants or the USA tax authorities.
He said if Ellis feels that negatively about the prosecution, then he should keep those feelings to himself or he shouldn't be on the case.
The result, Laporta said, was an altered tax payment that Gates told her "could be paid by Mr. Manafort".
"T$3 he judge's condescending attitude [could give] the jury the impression that the prosecution's case is dubious", said a former US Deputy Solicitor General.
Magionos testified that she reviewed 31 accounts tied to Manafort in Cyprus, St. Vincent and the Grenadines and the United Kingdom, and Manafort was listed as the beneficial owner on at least some of them. Did Gates, Andres asked, have any doubt that the special counsel would "rip up your plea agreement" if he lied on the stand?
In one exchange published in court Wednesday, Manafort instructs his Cypriot lawyer, Kypros Chrysostomides - referred to in court as "Dr. K" because, according to Gates, his name is hard to spell and pronounce - to transfer money from the Manafort-controlled Leviathan Ltd. Gates also provided the first witness testimony that overlaps with Trump's presidential campaign.