I have some technical questions about law that I’ll put together here and see if anybody can answer. They’re in connection with questionable behavior of federal prosecutors. I’m rewriting this now that the House has released the transcripts of interviews with whistleblowers.
(1) Today it was announced that Hunter Biden is pleading guilty. Our best source of news about American politics, the London tabloid, The Daily Mail, says
Hunter Biden lawyer Chris Clark said Tuesday that it was the end of the road for a five-year probe of the president's son, now that he is pleading guilty to two tax misdemeanors.
'My understanding is we’re done,' Clark told MSNBC bluntly when asked about the status of any other Hunter investigation related to his business practices, lobby registrations, or other matters.
He repeatedly attested to the fairness of prosecutors in their handling of the probe, which also has him dispensing with a gun charge without a guilty plea being required. He said he wouldn't agree to make a deal if there were more charges pending.
That came despite U.S. Attorney David Weiss saying the government's investigation of Hunter Biden is 'ongoing.'
He did so while confirming that Biden would plead guilty to two tax crimes related to $1.5 million in unreported income, while also resolving a gun charge dating to a period in October 2018 when he was addicted to drugs including crack cocaine.
Prosecutors say the unpaid amount over the two years totaled $200,000.
. . .
In 2021, Hunter reportedly paid back the feds for outstanding taxes, more than two years after disclosing the probe into his finances. The New York Times reported he told an associate the amount was more than $1 million, and that he needed a loan to pay what he owed the government.
https://twitter.com/mrddmia/status/1671198896243216384
(Question 1a) As Jenna Ellis discovered, Biden should not be offered pre-trial diversion if he “brandished” his gun. There are pictures of him waving his gun, apparently. Is that what “brandishing” means legally, or did he need to be threatening some individual?
(Question 1b) Is pretrial diversion routinely offered for illegal gun ownership? (see, e.g. , https://twitter.com/Bugs_Meany/status/1671246229500579842)
I’ve reviewed data on 189,000 firearm possession cases by DOJ. Not a single diversion. In fact, among all cases prosecuted by DOJ less than 1% were resolved by a diversion.
(Question 1c) Will we get to see the actual plea bargain between Hunter Biden and the U.S. government, and will it tell us if the government is agreeing to not pursue specific other charges?
July 27: See the [https://www.rasmusen.org/rasmapedia/index.php?title=Hunter_Biden_Plea_Bargain#Court_Documents Hunter Biden Plea Bargain] and links there.
(Question 1d) If the plea agreement does say the government agrees not to prosecute, say, bribery charges against Hunter Biden in exchange for his cooperation, is that binding on future Administrations? (I have heard that plea bargains are *not* contracts, but i don’t know their exact status.)
(Question 1e) Would it be double jeopardy to later charge Hunter Biden with *brandishing* an illegal weapon? Answer: Not really relevant. Him showing the gun in a photo is not “brandishing”. He needs to be threatening someone with it.
(Question 1f) The evidence for these charges apparently goes back to 2018. Prosecutor Weiss was a Trump appointee kept on by Biden. Were Weiss and the Justice Dept. legally obliged to tell President Trump of these allegations? Note that it is relevant that the Justice Dept. considers them worthy of prosecution in 2023 and obtained guilty pleas, so we know they were not implausible allegations in 2018.
(Question 1g) The evidence for these charges apparently goes back to 2018. Was the Justice Dept. legally obliged to set up a special counsel to handle them, since a Republican was then President? In such cases, is it required to let the President decide whether to appoint a special counsel, or are low-ranking Justice employees allowed to use their discretion?
(Question 1h) If concealing these allegations seems to had no basis except to influence the 2020 election, can Justice Dept. officials be charged with any offense against election laws? Perhaps the absolute immunity of prosecutors protects the U.S. Attorney from going to court for his prosecution decisions if he knew (who was he?), but would it protect him from being taken to court for withholding information from his superiors?
(Question 1i) Was Weiss recommended to be U.S. Attorney by Biden? He was nominated by Trump, but the Senate takes an interest in these things, and Delaware had two Democratic senators. It would be just like Trump not to realize that U.S. Attorney for Delaware was a politically crucial job.
ANSWER: Mike Davis answered this for me on Twitter. Indeed, the senators from a state customarily have great influence on these appointments, and they did in selecting Weiss.
(2) The lead prosecutor against Donald Trump is Karen Gilbert. In 2009, she was formally reprimanded by a judge for having two witnesses in a case tape the defense lawyer without getting permission and without good reason. The case was dismissed and Justice had to pay $600,000 in legal fees. There is a shorter 2009 discussion at the Legal Profession Blog.
(Question 2a) Did prosecutor Karen Gilbert commit a criminal act in telling two people to tape the defense lawyer? Florida is currently a two-party-consent state, meaning both people in a conversation have to authorize taping.
(Question 2b) If a private attorney had done this kind of taping of a privileged conversation, would he be disbarred? Why wasn’t Karen Gilbert disbarred? Is it too late to disbar her for this offense?
(3) It seems the former FBI director had large-scale business dealings with President Biden:
…former FBI director Louis Freeh at Freeh's private consulting firm from August 2013 to February 2015, according to Hines's LinkedIn profile. Freeh has extensive ties to the Biden family. He was recruited by Hunter Biden in 2016 to help a Romanian businessman fight bribery charges in Europe. Freeh gave $100,000 to a college trust for two of Joe Biden's grandchildren, according to emails from Hunter Biden's abandoned laptop. Freeh said that he looked forward to "future work" with Hunter Biden and that he had discussed "future work options" with then-vice president Biden. Freeh later joined the board of the Beau Biden Foundation, named for the president's late son.
(Question 3a) Is this grounds for investigating the Freeh-Biden relationship?
(4) An IRS-agent whistleblower says the Justice Dept. obstructed the IRS investigation of Hunter Biden. The three-hour transcript has been posted.
(Question 4a) The IRS agent said (referring to the DC US Attorney Graves’s refusal to prosecute),
That process meant no charges would ever be brought in the District of Columbia, where the statute of limitations on the 2014 and '15 charges would eventually expire.
. . .
To make matters worse, defense counsel was willing to sign statute of limitations extensions for 2014 and 2015 and had done so several times. Because United States Attorney Weiss had no ability to charge 2014 and 2015, DOJ allowed the statute of limitations to expire. There is no mechanism available to collect the tax owed by Hunter Biden for 2014 other than in a voluntary fashion.
But is any statute of limitations on tax fraud? Tax code 6501(c)(2) :
"In case of a willful attempt in any manner to defeat or evade tax imposed by this title (other than tax imposed by subtitle A or B), . . .collection of such tax may be begun without assessment, at any time." . . .
Is it that Hunter Biden's 2014 tax could still be collected today, but he cannot be criminally prosecuted? The 2015 Justice manual and other sources say there is a 6-year statute of limitations, contrary to the statute I quote above.
That, I think, is the situation. GoldingLawyers has a pretty good page. The IRS can go after you to collect the tax and impose civil penalties forever for tax fraud, deliberate underpayment. The Justice Dept, however, can only pursue criminal penalties— jail— for six years.
IRS whistleblower Shapley said in his testimony that the 2014 tax owed by Hunter Biden could now not be collected even in civil proceedings because of the statute of limitations. That seems wrong. Remember tax code 6501(c)(2). Shapley is “A”, “Answer”, in the quote below:
Q And now that the statute was allowed to run for 2014, there is no mechanism by which the IRS can force the taxpayer to pay the amounts you believe are due?
A That is correct.
Aha! I’ve come to the point in the transcript where all this is explained. It seems custom and maybe caselaw is not to use the infinite civil statute of limitations unless a criminal conviction has already been obtained (which has the six-year limit). The Minority Counsel (Q) was wondering about that too. IRS agent Shapley is A:
Q Civil referral. And did that occur in this case at all after -- after prosecution was declined, or the statute ran, the criminal statute ran?
A No, it didn't, because the civil statutes had run. The statute of limitations had run. I'm sorry.
Q The civil statute of limitations on fraud are infinite under IRS 6501(c). And, similarly, the statute for failure to file also does not run if you don't file a return. Was that thought of and acknowledged by Criminal Investigation when deciding whether to refer the case?
A Are you asking about the civil fraud penalty?
Q No, not the civil -- if there's fraud under 6501(c) -- if the IRS can demonstrate fraud, then the statute of 6 years does not apply, correct?
A The civil fraud penalty which you are referring to -- it can only be assessed with a criminal conviction. That's the standard for civil to be able to make that fraud assessment. And there are some jurisdictions where it has to even be 7201, an evasion case, in order for the civil fraud penalty to be able to be assessed.
Q 6501 is the civil fraud penalty or -- maybe I'm mixed up, because I was under the impression that that was the limitation on assessment. So put it aside. I don't have my Code with me. But I was pretty sure that the limitation on assessment -- in the case of fraud, simply did not run. But --
A I think you are partly correct, but the way that the precedence for proving fraud, for the civil fraud penalty, is a criminal conviction or guilty plea.
Q That could -- we'll have to look.
A That's my understanding, and that's the way that I've seen it done in the past.
Q Okay
(Question 4c) The Information says Hunter is being charged with two charges of misdemeanor 7203, for 2017 and 2018 taxes, and has pleaded guilty to it. Why not the felony § 7201. Attempt to evade or defeat tax? And felony § 7206. Fraud and false statements? Or § 7207. Fraudulent returns, statements, or other documents? There are lots of very similar crimes, many perhaps for each individual action. Here, we have very serious tax crimes From what IRS whistleblower Shapley says, they include shady pretend-loan schemes to deliberately evade tax, crazy deductions of prostitutes’ first-class air travel as business expenses, and simple non-reporting of income.
There was -- even DOJ tax and U.S. Attorney's Office in Delaware was, like, this is a slam dunk case. So what occurred in 2018 was -- it wasn't a tax return that was prepared until 2020 mind you so it was, like, late and stuff. But he was expensing personal expenses, his business expenses. So, I mean, everything, there was a payment that -- there was a $25,000 to one of his girlfriends and it said, "golf membership."
And then we went out and followed that mother of one of his children in Arkansas. And she was an off-the-book employee that he was giving her healthcare benefits, she wasn't working, you know.
All that was expensed. There were multiple examples of prostitutes that were ordered basically, and we have all the communications between that where he would pay for these prostitutes, would book them a flight where even the flight ticket showed their name. And then he expensed those.
Mr. Lytle. First class?
Mr. Shapley. I don't recall if it was first -- I think it was first class on some of them, but some of them was, like, Frontier, I don't think they were a first class.
So the worst part about 2018 is that Hunter Biden's accountants are sitting there with him at a table, and they have all the numbers in front of them, right? The bank accounts in front of them and they are saying that, you know, you need to circle what are business expenses so that we know what to deduct.
So it becomes apparent to the accountants during this interaction that he's putting things on here that aren't expenses, that aren't true business expenses.
So the accountants create a representation letter that basically they said they have never done before. And they had him sign this document, and it was basically because they didn't believe what he was saying, but they didn't -- if they were going to prepare his return, they had to listen to what he was saying. I mean, I guess they could have just chosen not to prepare his tax return would have been their only out. But that was the type of conduct in 2018.
So why was he just charged with a misdemeanor and the cheating is deliberate, immoral in se, and obviously illegal even to someone with no knowledge of law?1
If anybody can answer any of these in the comments, I’d appreciate it.
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It’s interesting to see what Forbes wrote about the charges. This was before the whistleblower, and the Justice Dept. was making it sound like Hunter was just late paying his taxes. Not so, it turned out in a few days.
Typically, failure to pay does not result in jail time. It's considered a misdemeanor and usually results in fines of up to $25,000, though prison time of up to a year can be tacked on if the situation warrants.
According to the court documents, the tax liability was related to combined income of $3 million for those two years—$1.5 million per year. In 2021, Biden claimed to have paid the IRS what he owed. However, paying the liability after the due date (in this case, April 17, 2018, for the 2017 tax year and April 15, 2019, for the 2018 tax year) doesn't mean a crime was not committed.
A misdemeanor failure to pay can be escalated to a felony in some cases. According to the Department of Justice manual, those involve individuals who fail to file tax returns or pay a tax “but who also commit acts of evasion or obstruction.” In that case, the charges would be brought as felonies under sections 7201 or 7212(a). That’s not the case here—likely because Biden paid the tax due and was cooperating with authorities.
I think the Freeh connection is one of the most interesting aspects of the story. Is it possible that the plea deal is to protect the FBI as much as it is to protect Biden? What are the other revolving door careers in the FBI that the Biden family may touch?