WASHINGTON, D.C. – According to reports, a U.S. Tax Court judge has ordered the Internal Revenue Service (IRS) to reveal whether it criminally investigated the Clinton Foundation, directing the agency to look into a mysterious “gap” in its records in the case.
— Financial Bounty Hunters USA (@LWDoyleUSA) May 12, 2021
Most of the proceedings in the case involving the Clinton Foundation and the whistleblowers Lawrence W. Doyle and John F. Moynihan have been sealed, but U.S. Tax Court Judge David Gustafson authorized the release of an April 22nd hearing.
In the hearing, Gustafson remanded the case back to the IRS Whistleblower Officer (WO), saying the agency’s claim that there was no criminal investigation against the Clinton Foundation was “not supported by the administrative record and thus constituted an abuse of discretion.”
The judge ruled:
“The WO must further investigate to determine whether CI [criminal investigative division] proceeded with an investigation based on petitioners’ information and collected proceeds…it seems clear that we should reman the case to the WO so that it can explore this gap.”
While ordering the IRS to reveal whether the Clinton Foundation was criminally investigated, the judge declined the whistleblowers’ request to take an Arkansas state official’s deposition or compel discovery in the case, saying such actions were “outside the scope of proper discovery.”
“Petitioners evidently look forward to a trial in which they hope to prove wrongdoing and tax evasion by the target entities and to prove dereliction of duty by the IRS. There will be no such trial in this case.”
What happened to the Clinton Foundation investigation that was open more than five years ago?
Is this the speed at which Hunter Biden's laptop investigation is set to go? #DefundTheDOJ
— Nick Fad🇺🇸 (@NicAtNigh) May 6, 2021
Regardless, Gustafson’s ruling adds a new chapter of intrigue in a case that first surfaced three years ago when Doyle and Moynihan, two respected forensic financial investigators, revealed the existence of their IRS whistleblower complaint against the Clinton Foundation during a congressional hearing.
In December 2018, Moynihan and Doyle both testified to a House committee that the Foundation wrongly operated as a foreign lobbyist by accepting overseas donations and then trying to influence U.S. policy.
At the time, Moynihan testified:
“The foundation began acting as an agent of foreign governments early in its life and throughout its existence. As such, the foundation should’ve registered under FARA (Foreign Agents Registration Act). Ultimately, the Foundation and its auditors conceded in formal submissions that it did operate as a (foreign) agent, therefore the foundation is not entitled to its 501c3 tax-exempt privileges as outlined in IRS 170 (c)2.”
The Clinton Foundation has reportedly acknowledged that past internal audits revealed compliance problems with some of its practices, but insisted that those have been fixed and that it always complied with the law, strongly disputing the whistleblowers’ allegations.
In 2018, the foundation declared that:
“It was one of the most heavily scrutinized charitable organizations in the world and had demonstrably improved the lives of millions of people across American and around the world, while earning top ratings from charity watchdog groups in the process.”
Emails: DOJ Shut Down FBI Investigation Of Clinton Foundation https://t.co/4LiGicZoH9
— KWANG N CHAN (@KWANGNCHAN1) April 16, 2021
Recent reports emerged showing that Special Counsel John Durham is investigating whether an FBI effort to investigate the Clinton charity was wrongly thwarted by politics. In his latest ruling, Gustafson suggested that the IRS whistleblower office was withholding important information for the case.
“There are facts and information, uniquely within the knowledge of the Whistleblower Office that need to be considered in connection with the resolution of the petitioner’s claim.”
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Inspector General’s investigation into senator’s wife closed due to ‘lack of prosecutorial interest from DOJ’
March 6th, 2021
WASHINGTON, DC — Former Secretary of Transportation Elaine Chao was the subject of a detailed report by the U.S. Department of Transportation’s (DOT) Office of Inspector General (OIG), which looked into allegations that she misused her public office for private gain.
The report noted that Chao allegedly and repeatedly used her staff and position as Secretary to benefit her family and their business operations. The report, which is partially redacted, also indicated that DOT staff members had raised ethics concerns about Chao’s directives.
Chao is the wife of Senator Mitch McConnell (R-KY).
IG faults Elaine Chao at Transportation over ethics concerns https://t.co/2yPq9EP3vY
A formal investigation into potential misuses of position was warranted,” deputy inspector general Mitch Behm wrote in a letter to lawmakers.
— GGP Bill☺ (@Stream25Bill) March 4, 2021
Deputy Inspector General Mitch Behm sent a six-page letter on March 2 to Chairman Peter DeFazio of the Committee on Transportation and Infrastructure. Behm had responded to DeFazio’s two previous letters from 2019, which had requested that the OIG investigate potential conflicts of interest involving Chao.
“Based on our preliminary review, we concluded that there was not a sufficient basis to initiate a formal investigation into grant awards or the Secretary’s financial interest in Vulcan Materials.
“However, we concluded that a formal investigation into potential misuses of position was warranted. We initiated our formal investigation in December 2019, and the results of that investigation have been documented in a report of investigation.”
“A formal investigation into potential misuses of position was warranted,” Mitch Behm, the dpt deputy inspector general, said on Tues in a letter to House lawmakers, accompanying a 44-page report detailing the investigation and the findings of wrongdoing.https://t.co/0lENQdyOIz
— Lise Latulippe (@lise_latulippe) March 4, 2021
The main report consists of 38 pages, which detail several potential ethics concerns about Chao. For example, it noted:
“During the course of its investigation, OIG discovered evidence relating to potential ethics concerns arising from the actions of the Secretary and Office of the Secretary (OST) staff under her direction. The facts underlying potential ethics concerns include:
“a) tasking OST political appointees to contact the Department of Homeland Security (DHS) about the status of a work permit application submitted by a foreign student studying at a U.S. university who was a recipient of Chao family philanthropy,
“b) including family members and personal events in the Secretary’s planned, but subsequently cancelled, trip to China in November 2017,
“c) providing DOT Public Affairs and media support to the Secretary’s father, and
“d) using DOT resources and OST staff time for tasks for the Secretary that appear to be personal in nature.”
In 2017, staff members for Chao’s office were assigned to check with the DHS on “the status of a work permit application for a foreign student studying in the U.S. who had received a scholarship from a Chao family foundation,” the report said.
The report also noted that the student in question had requested and was granted an interview with the Secretary’s father, James Chao, at the New York City headquarters of the family’s shipping company Foremost Group.
The OIG referred this potential misconduct issue involving DHS officials to the DHS Office of Inspector General for any action they might deem necessary.
“A formal investigation into potential misuses of position was warranted,” Mitch Behm, the department’s deputy inspector general, said on Tuesday in a letter to House lawmakers, accompanying a 44-page report detailing the investigation. https://t.co/Xp3yDCmIck
— AwwSayCanUsee (@Desiree_Ahgudo) March 3, 2021
The report also noted “the Secretary directed her staff to include her relatives in both the planning of the 2017 trip to China and participation in the official events and high-level meetings during the trip.”
On Oct. 24, 2017, the Office of General Counsel (OGC) wrote an ethics memo detailing several concerns and legal parameters regarding the Secretary’s planned trip to China, according to the OIG report.
One concern mentioned in the memo included plans for Chao’s father and sister to attend official events and bilateral meetings with Chinese officials:
“The Secretary would be permitted to bring a ‘plus one’ to social events where other guests or spouses would be in attendance.
“However, the memo stated that it would be inappropriate for the Secretary to use her official position to provide her family members access not afforded to a private citizen.”
The OIG report indicated the trip was cancelled “at or near the time of the October 2017 ethics memo.”
Next, OIG’s investigation reviewed two areas of concern related to support for the Secretary’s family: DOT media support and public affairs and other support at certain events. For example, the report mentioned:
“A review of DOT emails and interviews with staff revealed that OST staffers provided various media and public affairs support to the Secretary’s father in 2017 and 2018. In addition to the planned book signing in China, there were several additional instances where OST staff were directed to help promote Dr. Chao’s biography, ‘Fearless Against the Wind.’”
The report also noted:
“OIG’s investigation also identified and examined 14 events that the Secretary attended or planned to attend with her father that took place from March 2017 to the summer of 2018.
“These include attendance at events in both her personal and official capacities and events for which DOT staff provided public affairs or other support. OIG did not determine whether the Secretary attended these events in her official or personal capacity.”
OIG’s investigation revealed situations “where OST staff members performed personal tasks for the Secretary and her relatives that did not have an obvious nexus to DOT tasks.”
Elaine Chao Used DOT Resources For Personal Errands, Family Business, IG Report Says https://t.co/1rwKSsEi8n
— TallyAnnaE (@TallyAnnaE) March 4, 2021
OIG also found several instances where the Secretary directed OST staff to perform personal errands for her, such as sending private mail to family members, and more:
“A review of Department emails also revealed several instances where the Secretary directed her staff to research and/or purchase personal items for her online, to include searching for free shipping and coupon codes. These purchases were paid for using the Secretary’s personal credit card.”
Here's the OIG report on former Sec DOT Elaine Chao and allegations that she used her office for private gain. https://t.co/WYbGmgyBld
— JessicaWehrman (@JessicaWehrman) March 3, 2021
Ultimately, the OIG report concludes by explaining why its investigation was ultimately closed.
The OIG referred the investigation to other agencies, but they declined to pursue any criminal investigations. The OIG report noted:
“On December 16, 2020, OIG referred this investigation to the U.S. Department of Justice (DOJ), United States Attorney’s Office (USAO) for the District of Columbia, for criminal prosecution.
“The USAO declined to open a criminal investigation on this matter. The USAO stated that there may be ethical and/or administrative issues to address but there is not predication to open a criminal investigation.
“On December 17, 2020, OIG referred this investigation to DOJ Public Integrity Section (PIN) for criminal prosecution. DOJ PIN declined to open an investigation on this matter.”
The OIG report then explained that Secretary Chao announced her resignation as U.S. Secretary of Transportation on Jan. 7 of this year. It further noted her resignation would take effect on Jan. 11 and that she decided to resign before her term ended due to the Jan. 6 riot at the Capitol building:
“In a resignation letter to former President Trump following the January 6, 2021, riot at the Capitol, Secretary Chao wrote, ‘I had planned on serving through the end of your term in office, but after yesterday’s events at the U.S. Capitol, I will resign as U.S. Secretary of Transportation, effective Monday, January 11, 2021, to provide a short period of transition.’”
The report concludes:
“Based on the lack of prosecutorial interest from DOJ, OIG has determined it will close this investigation. OIG is providing a copy of this report of investigation to the DOT OGC for action it deems appropriate.”
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