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IRS whistleblower bombshell expands Hunter Biden scandal to coverup, obstruction concerns

"It's deeply concerning that the Biden Administration may be obstructing justice by blocking efforts to charge Hunter Biden for tax violations," House Oversight Committee Chairman James Comer says.

Published: April 20, 2023 9:36am

Updated: April 20, 2023 9:33pm

In the half century since Watergate, the adage that the coverup can be worse than the crime has been emblazoned in the American psyche of political scandal. And while historians still debate whether that adage was true or not for the Nixon scandal, allegations of coverup, false testimony or obstruction have transformed many a political controversy since.

On Wednesday, an IRS whistleblower's stunning disclosure to Congress that "preferential treatment and politics" were "improperly infecting" the Hunter Biden investigation instantly transformed the scandal that has most bedeviled the Biden presidency.

Lawmakers instantly began expanding their long-running influence-peddling probe into the Biden family's pursuit of millions of dollars in foreign business deals to questions of whether there has been a coverup, whether Attorney General Merrick Garland gave false testimony and whether the case offers a fresh example of what Republicans says is a two-tier system of justice. 

"It's deeply concerning that the Biden Administration may be obstructing justice by blocking efforts to charge Hunter Biden for tax violations," House Oversight and Accountability Chairman James Comer, (R-Ky.), the lead Biden family investigator in the House, told Just the News. "The House Committee on Oversight and Accountability has been following the Bidens' tangled web of complex corporate and financial records." 

"It's clear from our investigation that Hunter and other members of the Biden family engaged in deceptive, shady business schemes to avoid scrutiny as they made millions from foreign adversaries like China," Comer added. "We've been wondering all along where the heck the DOJ and the IRS have been. Now it appears the Biden Administration may have been working overtime to prevent the Bidens from facing any consequences."

A defense attorney for Hunter Biden, accused the IRS whistleblower of violating the law.

"It is a felony for an I.R.S. agent to improperly disclose information about an ongoing tax investigation," attorney Christopher Clark said, according to the New York Times. "The I.R.S. has incredible power, and abusing that power by targeting, embarrassing or disclosing information about a private citizen’s tax matters undermines Americans’ faith in the federal government... Unfortunately, that is what has happened and is happening here in an attempt to harm my client. It appears this I.R.S. agent has committed a crime, and had denied my client protections that are his right."

Tristan Leavitt, who is representing the whistleblower, said in a Thursday tweet that his "client has an exemplary record and is making his disclosures to Congress the right way and for the right reasons."

House Ways and Means Committee Chairman Jason Smith (R-Mo.), who has the legal authority to free the whistleblower from tax privacy laws so he can share his concerns with the public, vowed a swift and vigorous investigation.

"The Committee takes seriously any allegations of misconduct by government officials or offices and will, on behalf of American taxpayers, look into concerns that are brought to our attention," Smith said. "It is our responsibility to ensure the tax code is applied fairly and appropriately to all Americans — whether through the oversight efforts this Committee initiates or the need for oversight that is brought to our attention."

Across the Capitol, Sen. Ted Cruz (R-Texas) said the allegations of political meddling in the tax case need to be viewed in concert with efforts by the Treasury Department to keep lawmakers from seeing suspicious activity reports filed for years by banks concerned by the Biden family's overseas financial transactions. Treasury recently relented and let House lawmakers view those reports.

"Why is the Department of the Treasury hiding the suspicious activity reports on the Biden family from the American people?" Cruz tweeted after spending most of his weekly podcast exploring the issue.

The IRS whistleblower, whose name has not been made public, specifically alleges two Biden DOJ political appointees have blocked career officials from bringing criminal tax charges and that the behavior behind closed doors calls into question Garland's testimony to the Senate that prosecutors have full authority to bring charges and that no political interference has been allowed.

According to a letter from the whistleblower's attorney Mark Lytle to Congress obtained by Just the News, the IRS agent revealed he is seeking to provide detailed disclosures about a high-profile, sensitive case to the tax-writing committees in Congress, which have special authority under federal tax privacy laws to receive such information. That could pave the way to share the details with other committees in coming weeks.

The letter does not state that the whistleblower disclosures are related to Hunter Biden. However, Just the News has independently confirmed the agent's allegations involve the Hunter Biden probe being led by Delaware U.S. Attorney David Weiss, a Trump holdover, according to multiple interviews with people directly familiar with the matter.

In a letter Wednesday to Republicans and Democrats overseeing multiple oversight committees in Congress, Lytle wrote: "The protected disclosures: (l) contradict sworn testimony to Congress by a senior political appointee, (2) involve failure to mitigate clear conflicts of interest in the ultimate disposition of the case, and (3) detail examples of preferential treatment and politics improperly infecting decisions and protocols that would normally be followed by career law enforcement professionals in similar circumstances if the subject were not politically connected."

You can read the full letter here:

Hunter Biden has acknowledged since December 2020 that he has been under criminal investigation for tax matters, and his representative disclosed last year he paid overdue tax bills totaling $2 million. He has expressed confidence he will be cleared of criminal wrongdoing.

The IRS agent has a sterling record investigating tax crimes across the globe, including work on high-profile Swiss Bank prosecutions, and has won several merit awards. His emergence now in such a politically charged case is certain to inflame a debate over unequal justice in Washington. The whistleblower originally approached the IRS' internal watchdog and Congress late last year with the help of prominent Democrat lawyer Mark Zaid, who previously represented clients whose allegations about a call with the Ukrainian president led to Donald Trump's first impeachment in 2019.

The agent subsequently hired Lytle, a former federal prosecutor with significant experience in prosecuting complex tax matters with the Justice Department's Tax Division. Lytle also represented former Twitter head of Trust and Safety Yoel Roth in his recent congressional testimony and is currently defending a former FBI supervisor named Timothy Thibault who has been accused of pro-Biden political bias in anonymous whistleblower disclosures to the offices of Sens. Chuck Grassley and Ron Johnson, and House Judiciary Committee Chairman Jim Jordan.

Lytle told lawmakers in his letter that the IRS agent has also disclosed his concerns to both the Treasury Department Inspector General for Tax Administration and Justice Department Inspector General Michael Horowitz, the same watchdog who unmasked FBI abuses during the Russia collusion case.

People directly familiar with the case have described the disclosures to Just the News as focused primarily on improper politicization of the case at the Justice Department and FBI headquarters rather than at the IRS or Treasury Department.

Specifically, the agent has provided evidence that at least two Biden DOJ political appointees in U.S. attorneys' offices have declined to seek a tax indictment against Hunter Biden despite career investigators' recommendations to do so and the blessing of career prosecutors in the DOJ tax division.

He also alleges that Weiss told agents on the case that the Delaware U.S. Attorney asked to be named a special counsel to have more independent authority in the probe but was turned down, according to interviews.

The agent also alleged that specific DOJ employees placed strictures on questions, witnesses and tactics investigators may be allowed to pursue that could impact President Biden, according to the interviews.

The sources said the agent's decision to blow the whistle was prompted by sworn testimony from Garland that Delaware U.S. Attorney Weiss had full authority, free from political pressure, to pursue a case against Hunter Biden in any part of the country, according to interviews.

In an interview with Just the News, Lytle said he could not yet identify the specific case his client had raised concerns about or the specific political appointees whose actions or testimony raised concerns because of tax confidentiality laws. But he confirmed that one senior DOJ official's recent testimony played a role in the agent coming forward to blow the whistle.

"I can say that he's been working diligently on a high-profile case," the lawyer said during an interview on the John Solomon Reports podcast, explaining that his client "was concerned about some statements by a senior political appointee from the Department of Justice that contradicted what he knew to be the facts of the case."

Lytle said his client is a career law enforcement official who hasn't made any political donations and doesn't even use social media. "He is just a guy who likes his job as a law enforcement officer, as an investigator, and he takes it seriously, and he's dedicated," he said. "And when he sees something that is not routine and doesn't follow the rules, or ... something maybe is affected by politics — that's what made him come forward."

The agent wants both Democrats and Republicans to hear his account and be able to question him, Lytle said.

"He's insisted that when he comes forward, this is not to talk to just one party or the other party," the lawyer said. "He wants to make sure that when he tells his story, both sides are there, so that he can present it, and they can sort it out. He doesn't want to be accused of picking a side, even if that might happen anyway. But he has information, it's credible, and it's supported by emails and documents."

Lytle added that if his client is cleared to talk to Congress he also will be able to identify contemporaneous witnesses to corroborate his claims of political interference. 

"I believe he'll be able to talk about these meetings that he attended, that were with both agents and prosecutors," he explained, "and how he summarized those meetings and put it in writing and distributed those to folks within the IRS and sometimes to other agents as well. And so those are all in writing, contemporaneous. And then there's emails too, so those are important documents that will ... I think, end up corroborating his credibility."

One of the issues key to the whistleblower's concerns involves which U.S. attorney's office has the authority to bring criminal tax charges and where. The whistleblower alleged that Trump-appointed U.S. Attorney David Weiss could not legally bring charges in Delaware.  Because of where Hunter Biden lived at the time his tax returns were filed, Weiss needed the permission of Biden-appointed U.S. attorneys in other districts to bring charges outside of Delaware. The agent alleges two such U.S. attorneys appointed by Biden declined his requests, according to interviews.

In testimony as recently as last month, Garland told Iowa GOP Sen. Chuck Grassley that Weiss had full authority to bring charges in any district he needed. "If it's in another district, he would have to bring the case in another district," Garland said. "But as I said, I promise to ensure that he's able to carry out his investigation and that he'd be able to run it. And if he needs to bring it in another jurisdiction, he will have full authority to do that."

The IG has obtained contemporaneous government emails and memos in DOJ files documenting to IRS leadership what the agent believed was evidence of political interference and biased behavior by DOJ employees. The agent is willing to make the same evidence available to Congress, according to Lytle's letter.

David Weiss, the Justice Department and Hunter Biden's attorney Chris Clark have not responded for comment. 

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