IRS Agents Say the Justice Department Hindered Their Probe of Hunter Biden

From a Wall Street Journal column by Kimberley A. Strassel headlined “The Whistle Blows on Hunter Biden’s Plea Deal”:

The Beltway press corps spent the week quoting “experts” assuring the public that Hunter Biden’s plea deal didn’t amount to special treatment. You can believe that, or you can read the sworn testimony of Internal Revenue Service investigators who say the opposite.

House Ways and Means Chairman Jason Smith on Thursday released the testimony of Gary Shapley and another, anonymous IRS whistleblower. They tell a story of blocked search warrants, tip-offs to Mr. Biden’s team, squelched avenues of investigation, downgraded charges, and interference by Joe Biden’s appointees. Mr. Shapley, a 14-year IRS veteran, said the Justice Department, its Tax Division and the Delaware U.S. Attorney’s Office “provided preferential treatment and unchecked conflicts of interest.”

The president’s son on Tuesday scored a sweet deal, pleading guilty to two misdemeanors for “failure” to pay taxes, and a pretrial “diversion” agreement to avoid a felony firearms charge. He’ll likely avoid jail time. We now have a better idea of how this wrist-slap came about.

Mr. Shapley, leader of an elite team of agents specializing in international tax investigations, was brought in as supervisor of the Hunter case in January 2020. He says he quickly was stopped from taking normal investigatory steps. One example: He says his team was told in September 2020 by Assistant U.S. Attorney Lesley Wolf that they couldn’t pursue a search warrant of Joe Biden’s guest house (Hunter’s onetime residence) because of the “optics” and because “there is no way we will get that approved.”

In December 2020 the team wanted to search a storage unit in Virginia where Hunter had moved business documents. Ms. Wolf again objected, then tipped off Hunter’s defense counsel, “ruining our chance to get to evidence before being destroyed, manipulated, or concealed,” Mr. Shapley said. Federal Bureau of Investigation headquarters also tipped Hunter’s Secret Service team to a proposed “day of action” in which members of U.S. Attorney David Weiss’s team intended to conduct surprise interviews of witnesses—including Hunter. This gave a group “close to Hunter” the opportunity to “obstruct the approach,” and of the “12 interviews we hoped to conduct on our day of action, we only got one substantive interview.” Hunter lawyered up.

Along the way, according to Mr. Shapley’s testimony, Ms. Wolf told investigators not to ask any questions about “dad” or “the big guy.” They were blocked from pursuing leads about the financial transactions of Hunter’s children, since she said they’d get “into hot water if we interview the president’s grandchildren.” They were ordered not to look into evidence of campaign-finance violations. They were told to take Hunter’s name off official document requests, which Mr. Shapley said was “absolutely absurd.” The second whistleblower told the committee that he became “sick of fighting to do what’s right.”

The IRS team nonetheless prepared a document in late 2021 covering tax years 2014-19, in which it recommended charging Hunter with felony tax evasion, felony false tax returns, and failures to pay tax. Mr. Shapley says this was partially based on Hunter’s “textbook” tax evasion of declaring his income from the Ukrainian firm Burisma as a “loan.” Mr. Shapley says the team was also looking into a Foreign Agents Registration Act case.

According to Mr. Shapley, the Weiss team was prepared to pursue these charges but was blocked by Biden appointees—despite Attorney General Merrick Garland’s public claim of Mr. Weiss’s independence. Mr. Shapley notes that the proper venue for a tax case is where a subject resides or a return is filed; in Hunter’s case, the District of Columbia or California. But he says the U.S. attorney in the capital, Matthew Graves, refused to bring charges, and when Mr. Weiss asked for authority to bring charges there, he “was denied.” Mr. Shapley said U.S. Attorney Martin Estrada of California’s Central District, similarly declined to bring charges. Messrs. Graves and Weiss were both appointed by Joe Biden.

The Justice Department told the Journal on Thursday: “As both the Attorney General and U.S. Attorney David Weiss have said, U.S. Attorney Weiss has full authority over this matter, including responsibility for deciding where, when, and whether to file charges as he deems appropriate.”

These actions, and the lapsing of the statute of limitations, spared Hunter the gravest charges—those relating to his 2014 and 2015 tax returns, which Mr. Shapley says showed his “scheme to evade” taxes and possible FARA violation: “The purposeful exclusion of the 2014 and 2015 years sanitized the most substantive criminal conduct and concealed material facts.” Mr. Shapley says that Hunter still hasn’t reported or paid tax on some $400,000 of Burisma income.

Mr. Shapley provided further evidence of influence peddling. He gave the committee a 2017 WhatsApp message in which Hunter tells a Chinese businessman “I am sitting here with my father” and pushes the businessman to fulfill a “commitment.” He warns the businessman to personally resolve the issue that night, or “I will make certain that between the man sitting next to me and every person he knows and my ability to forever hold a grudge that you will regret not following my direction.” Mr. Shapley also says that Hunter’s partner, Rob Walker, admitted to investigators that a Joe Biden appearance (while out of office) at a Hunter business meeting with the Chinese was “orchestrated” to “bolster” the “chances at making a deal work out.” Mr. Shapley says Hunter’s attorney warned prosecutors that any charges would be “career suicide.”

There’s plenty more—including Mr. Shapley’s evidence of intimidation and retaliation against his team. But even this glimpse turns this week’s Hunter plea into a joke. The Justice Department needs to provide answers.

Kimberley Strassel is a member of the editorial board for The Wall Street Journal. She writes editorials, as well as the weekly Potomac Watch political column.

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