Donald Trump's former campaign chairman Paul Manafort had 15 undisclosed foreign accounts and spent years hiding millions of dollars to evade tax, his former deputy has claimed.
"I regret it, clearly, and am taking responsibility for it", he said.
Gates then admitted to having "another relationship" years ago, in which he cheated on his wife with a mistress in London.
Downing repeatedly referred to Gates' extramarital affair with a woman in London - for whom he paid for a flat - as his "secret life".
"I do not recall" Gates said. "I had a period of time when I had another relationship", he added.
According to Gates, Manafort, who had by then left the campaign, asked Gates in various ways to use his position on Trump's team to do favors for Stephen Calk, a banker who had loaned Manafort millions of dollars - loans that Mueller's team alleges were consummated under false pretenses. He also acknowledged he may have submitted personal expenses to President Trump's inaugural committee for reimbursement. Mr Downing asked Gates.
Downing outlined how Gates gave false and misleading information to the special counsel after he had entered his plea agreement.
Gates struggled so badly to give a straight answer that eventually Judge T S Ellis III was forced to intervene.
"Why won't you say it's embezzlement?" he asked.
Gates said that he provided false information because he couldn't remember specific events.
"I'm trying to change", he said.
Manafort's defense attorneys have sought to paint Gates as an embezzler, a liar and the instigator of any criminal conduct.
The testimony came as prosecutors wrapped up their questioning of Gates mid-afternoon Tuesday.
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"After all the lies you've told, and the fraud you've committed, you expect the jury will believe you?"
Downing wondered aloud why Gates had shown "perfect recollection" during examination by the government but was now much less precise under cross-examination by Manafort's defence.
Mr Mueller, a former Federal Bureau of Investigation director, has indicted more than 30 people - including 26 Russians - in connection with his probe into whether members of Trump's campaign colluded with Russia to help get the real estate tycoon elected.
Four employees at Dr. K's firm established and named the entities - Leviathan Ltd. and Peranova Ltd. are two of the more high-profile examples - where Manafort and Gates held millions of dollars of payments to Manafort's Davis Manafort Partners (DMP) and DMP International from their overseas political clients.
Although the allegations of collusion between Donald Trump and Russian Federation are not at issue in this trial, any significant blows to the government's case are likely be seized on by the president's defenders, including conservative media, to support his contention that Mueller's investigation is a "rigged witch-hunt".
Gates is cooperating in hopes of a lighter prison sentence. He was aware that Manafort was acting as an unregistered foreign agent in lobbying for Ukraine, he said.
Prosecutor Greg Andres pointed out that he had created a "loan forgiveness letter between Mr. Manafort and Mr. Manafort".
The "sole objective", Gates said, was to facilitate Ukrainian payments to Manafort. "Mr Manafort worked with the local political officials and helped implement policy initiatives based on the campaign promises". His consultancy work also included "Engage Ukraine", an effort to help Ukraine join the European Union.
Rick Gates, Manafort's long-time deputy, came in for a withering cross-examination as he took the stand in a packed federal courtroom in Alexandria, Virginia.
"I stand corrected", Downing said.
Another discussion focused on Manafort's practice of classifying income as loans and then later creating whole-cloth documents in order to misrepresent those false "loans" as valid. Gates said the man schooled them on how to shield their operations from scrutiny by tax collectors.
Downing asked Gates whether he was told he was looking at 290 months for the crimes that were dismissed.
Later, Gates spoke directly to the 16 assembled jurors: "I'm here to tell the truth".