The dramatic development in the Trump-Russia saga was announced at a court hearing in Washington DC on Friday morning, where Manafort confessed to two criminal charges as part of a plea deal. “I’m guilty,” he said.

Manafort signed a 17-page plea agreement that said he would assist government prosecutors with “any and all” matters, and brief officials about “his participation in and knowledge of all criminal activities”. He also agreed to turn over documents and testify in other cases.

Trump’s team tried to dismiss speculation that Manafort could incriminate the president. Sarah Sanders, the White House press secretary, told reporters the case was “totally unrelated” to Trump. In a statement, Trump’s lawyer Rudy Giuliani said: “The president did nothing wrong.”

Still, the agreement amounted to a major coup for Mueller, who has for 16 months been investigating Russia’s covert intervention in the 2016 campaign and any links to members of Trump’s team. US intelligence agencies have concluded that the Kremlin worked to boost Trump’s bid for the White House.

Along with his agreement to cooperate, Manafort pleaded guilty to conspiring to defraud the US and conspiring to obstruct justice in return for other charges being dropped. Mueller’s team indicated that Manafort would receive a maximum sentence of 10 years in prison.

Last month Manafort, 69, was convicted of eight counts in a fraud case brought in Virginia by Mueller, the special counsel. A further 10 charges, on which the Virginia jury was deadlocked, will also be dropped as part of the deal unveiled on Friday.

The agreement brings an end to weeks of negotiations between Manafort’s lawyers and Mueller’s team. Speaking outside the courthouse, Kevin Downing, one of Manafort’s attorneys, said: “Mr Manafort has accepted responsibility and he wanted to make sure that his family was able to remain safe and live a good life.”

Manafort’s conspiracy to defraud the US involved money laundering, tax fraud, failing to register as a foreign agent and lying to the justice department, a court filing said. It said he conspired to obstruct justice by tampering with a witness.

In addition to any prison sentence he might receive, Manafort also agreed to forfeit homes in Virginia and New York – including an apartment in Trump Tower – and the funds from several bank accounts.

Dressed in a dark suit with a white shirt and a dull purple tie, Manafort on Friday seemed a faded caricature of the hard-charging DC power broker who worked for corrupt dictators including the Philippine president Ferdinand Marcos and Mobutu Sese Seko of Zaire.

Before joining Trump’s campaign, Manafort worked extensively for pro-Kremlin politicians and oligarchs in Ukraine. Prosecutors said the work generated more than $60m in income and that Manafort laundered this through shell companies and offshore accounts to avoid paying US taxes. He also lied about the nature of the work when confronted by the justice department in 2016, Mueller said.

Mueller’s team has been investigating whether his connections in the region are linked to Russia’s attack on the 2016 US election. Mueller alleges that Konstantin Kilimnik, a Russian consultant who worked for Manafort, has ties to Russia’s intelligence services.

On Friday Mueller’s team disclosed new details about Manafort’s work as an unregistered lobbyist in the US for Viktor Yanukovych, the Ukrainian president deposed in a popular uprising in February 2014.

Judge Amy Berman Jackson described the charging paperwork, read aloud by prosecutor Andrew Weissmann in a methodical monotone, as “the longest and most detailed summary of charges” she had heard in her courtroom.

Manafort allegedly orchestrated a plan to smear a Yanukovych domestic rival, Yulia Tymoshenko, by disseminating “with no fingerprints” allegations that Tymoshenko had paid for the murder of a Ukrainian official. “My goal is to plant some stink on Tymo,” Manafort wrote in a message.

He also allegedly schemed to have “Obama Jews” exert pressure on Barack Obama’s administration to support Yanukovych and disavow Tymoshenko, and conspired with an Israeli government official to spread allegations linking Tymoshenko to antisemitism. Manafort allegedly wrote in one message to an unidentified associate: “I have someone pushing it on the NY Post. Bada bing bada boom.”

Following Manafort’s conviction in Virginia, Trump said he felt “very badly” for Manafort and praised him for refusing to become a cooperating witness for the government like the president’s former legal fixer, Michael Cohen, who separately pleaded guilty in New York to tax fraud, bank fraud and a campaign finance violation.

Giuliani was quoted on Thursday saying that the president’s team remained in “open communication” with Manafort’s as part of an agreement to share information, renewing speculation that Trump may pardon the former aide for his crimes.

“There’s no fear that Paul Manafort would cooperate against the president because there’s nothing to cooperate about and we long ago evaluated him as an honorable man,” Giuliani told Politico.

Manafort has been in jail for almost three months after his bail was revoked. Mueller’s team alleged that Manafort tried to tamper with witnesses in his case by contacting them and attempting to coordinate testimony. He was also charged with failing to register as a foreign agent.

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