(Recasts first paragraph, adds Parnas as possible witness)
By Susan Cornwell and Susan Heavey
WASHINGTON, Jan 16 (Reuters) - As the Senate formally opened the impeachment trial on whether to remove Donald Trump from office, a nonpartisan congressional watchdog on Thursday dealt the Republican president a blow by concluding that the White House violated the law by withholding security aid approved for Ukraine by U.S. lawmakers.
Democrat Adam Schiff, who heads a team of seven House of Representatives members who will serve as prosecutors, appeared on the Senate floor to read the two charges passed by the House on Dec. 18 accusing Trump of abuse of power and obstruction of Congress arising from his dealings with Ukraine.
The trial's opening formalities were to continue later in the day, with U.S. Chief Justice John Roberts set to be sworn in to preside over the proceedings and then swear in all 100 senators to serve as jurors. Opening statements in the trial, only the third in U.S. history, are expected on Tuesday.
The abuse of power cited by the House included Trump's withholding of $391 million in security aid for Ukraine, a move Democrats have said was aimed at pressuring Kiev into investigating political rival Joe Biden, the president's possible opponent in the Nov. 3 U.S. election.
"Faithful execution of the law does not permit the President to substitute his own policy priorities for those that Congress has enacted into law," the Government Accountability Office (GAO) concluded, referring to the fact that Congress had already voted to appropriate the funds.
An arm of Congress, the GAO is viewed as a top auditing agency for the federal government that advises lawmakers and various government entities on how taxpayer dollars are spent.
While the agency's assessment was a setback to Trump, it was unclear how or even if it would figure in his trial in the Republican-led Senate given that key issues such as whether witnesses will appear or new evidence will be considered remain up in the air.
Democrats said the GAO report showed the importance of the Senate hearing from witnesses and considering new documents in the trial.
"This reinforces - again - the need for documents and eyewitnesses in the Senate," House Speaker Nancy Pelosi told a news conference.
Senate Majority Leader Mitch McConnell, a Republican, has said senators should consider only the evidence amassed by the House.
The House voted on Wednesday 228-193, largely along party lines, to give the Senate the task of putting Trump on trial. The Senate is expected to acquit him, keeping Trump in office, as none of its 53 Republicans has voiced support for removing him, a step that requires a two-thirds majority.
Trump has denied wrongdoing and has called the impeachment process a sham.
DEMOCRAT SOUGHT REPORT
The GAO issued its opinion after receiving a letter inquiring about the aid from Democratic Senator Chris Van Hollen. The agency's findings are not legally binding, but its reports are seen by lawmakers as objective, reliable and generally uncontested. The GAO has no prosecutorial power.
Its report noted that the U.S. Constitution grants a president no unilateral authority to withhold funds in the way that Trump did. Instead, a president has a "strictly circumscribed authority" to withhold spending only in limited circumstances expressly provided by law. Holding up money for a policy reason, which the Trump administration did in this case, is not permitted, the report said.
Asked about the GAO report, House Republican leader Kevin McCarthy defended Trump's withholding of aid, citing concerns about corruption in Ukraine's new government.
"I think it was the rightful thing to do," McCarthy told a news conference.
Congress approved the $391 million to help Ukraine combat Russia-backed separatists in the eastern part of the country. The money ultimately was provided to Kiev in September after the controversy had spilled into public view.
A pivotal event leading to Trump's impeachment was a July 25 call in which he asked Ukraine's president to investigate Biden and his son Hunter Biden over unsubstantiated allegations of corruption and to look into a discredited theory that Ukraine, not Russia, interfered in the 2016 U.S. election.
Schiff indicated that the House prosecutors were considering calling Lev Parnas, an associate of Trump's personal lawyer Rudy Giuliani, as a witness if the Senate permits testimony in the trial.
"We are continuing to review his (media) interviews and the materials he has provided to evaluate his potential testimony in the Senate trial," Schiff said in a statement.
Giuliani has said Parnas, a Ukraine-born U.S. citizen, helped him in investigating the Bidens. Documents released this week indicate Parnas was also involved in monitoring the movements of former ambassador to Ukraine Marie Yovanovitch before Trump removed her in May after being urged to do so by Giuliani.
Democrats have said Trump abused his power by asking a foreign government to interfere in a U.S. election for his own benefit at the expense of American national security.
Republicans have argued that Trump's actions did not rise to the level of impeachable offenses. They have accused Democrats of using the Ukraine affair as a way to nullify Trump's 2016 election victory.
The Senate will formally notify the White House of Trump's impending trial later on Thursday.
(Reporting by Susan Cornwell and Susan Heavey; Additional reporting by David Morgan and Richard Cowan; Writing by Sonya Hepinstall; Editing by Will Dunham)