Did Mueller peek at Trump’s tax returns?

President Trump shouted replies to media questions on the White House lawn Wednesday morning, laying down his spanking-new defense for stonewalling Congress and the multiple requests and subpoenas emanating from its expanding inquiries. 

The President noted that he had completely cooperated with special counsel Robert Mueller’s many demands for documents and witness interviews and in so doing felt that there was no need now to cooperate with the multiple Congressional inquiries cropping up.{mosads}

Treasury Secretary Steven Mnuchin rejected House Ways and Means Committee Chairman Richard Neal’s second request for Trump-related tax returns, and the Trump legal team filed suit to prevent, or at least delay, production of Mazars USA’s — Trump’s accounting firm — submission of financial statements and documents to the House Oversight and Reform Committee.

Trump pointedly noted that “Mueller, I assume, for $35 million, checked my taxes, checked my financials. … They checked my financials, and they checked my taxes, I assume” — the inference being that since Mueller had looked at them, there is no need for Congress to review them also. But is that a false assumption and therefore a new false narrative foundation being created?

The Mueller report was fastidious in its adherence to the directive provided the special counsel’s team — investigate allegations of Russian election interference and evidence of any coordination by the Trump campaign with that interference. How would Mueller justify requesting Trump-related tax returns from the IRS with regard to investigating the narrow directive noted above?

It’s entirely possible Mueller did not look at Trump’s tax returns or financials.

Multiple legal pundits expressed surprise upon release of the Mueller report that there was no section that “followed the money.” There was no reference to Deutsche Bank financial transactions, despite well-publicized reports that Trump owes Deutsche Bank over $300 million, having received financing of over $2 billion since 2000, and that Deutsche Bank has been fined multiple times for money laundering and other financial transgressions. Then there was the prize-winning New York Times article explaining how Trump took part in suspect schemes to evade taxes back in the 1990s. More recently, the Southern District of New York prosecuted Trump’s personal lawyer Michael Cohen for campaign finance violations at the direction of “unindicted co-conspirator Individual-1” with regard to the hush money payments made to alleged paramours of “The Donald” prior to the 2016 presidential election. Some would question whether anyone looked at all the “money pouring in from Russia,” as Donald Trump Jr. once boasted.

While Mueller may have entertained thoughts of requesting Trump’s tax returns or those related to the Trump Organization, he may have held off given the lack of obvious connection to his directive and also the requirements of Internal Revenue Code (IRC) Section 6103, otherwise known as the IRS Disclosure law. This is the part of the IRC that became famous in passing with regard to Chairman Neal’s request for Trump tax returns. But why would this section give Mueller pause?

{mossecondads}Many old-time federal prosecutors have openly stated on various cable news shows that whenever they had a white-collar case, they would automatically request federal income tax returns from the IRS via a letter signed by a U.S. magistrate or judge, known in the parlance as an ex parte order or 6e letter. Back in the day, these letters were often no more than one or two sentences wherein the AUSA would simply say he or she needed them in regard to a financial investigation that was being conducted that may result in prosecution of some type of white-collar crimes, e.g. wire fraud, mail fraud or bank fraud. Once again, back in the day, these 6e requests were pretty much rubber-stamped and walked over to the IRS Disclosure Office and submitted with little pushback. But that was back in the day.

The IRS takes its responsibility to safeguard the privacy and confidentiality of tax returns in its possession very seriously. Any one of its 100,000 employees who might be tempted to look at or leak someone’s tax returns could be fired, fined, jailed or all of the above. That might explain why no one with the IRS has ever leaked Trump-related tax returns. This emphasis on protecting the taxpaying public’s right to privacy is also the main reason why disclosure of tax returns has been tightened up substantially in recent years at all levels and by all means, including the 6e letter.

U.S. District Court judges and magistrates have heightened their scrutiny of the ex parte tax return requests that come their way, and here is why: IRC Section 6103(i) contains a paragraph that provides direction for them on ordering release tax returns, and it reads as follows:

“Such judge or magistrate judge may grant such order if he determines on the basis of the facts submitted by the applicant that— (i) there is reasonable cause to believe, based upon information believed to be reliable, that a specific criminal act has been committed, (ii) there is reasonable cause to believe that the return or return information is or may be relevant to a matter relating to the commission of such act, and (iii) the return or return information is sought exclusively for use in a Federal criminal investigation or proceeding concerning such act, and the information sought to be disclosed cannot reasonably be obtained, under the circumstances, from another source.”

If Mueller ever pondered attempting to obtain any of Trump’s tax returns, he would have been confronted with demonstrating to a U.S. District Court judge that a specific criminal act had been committed — conspiracy? obstruction? — and that Trump’s tax returns were relevant to the commission of such criminal acts.

The real impediment to obtaining Trump tax returns, in my opinion, would be the difficulty Mueller’s team would have encountered in demonstrating the relevance of Trump’s tax returns to Russia’s election interference activities, to say nothing of the various obstruction activities delineated in Part II of the Mueller report.

So when President Trump muses out loud that he assumes Mueller looked at his tax returns, he may very well be making a false assumption.

Martin J. Sheil is a retired supervisory agent for IRS Criminal Investigation with 30 years experience, including service as coordinator of the Organized Crime Drug Enforcement Task Force (OCDETF) for the Gulf Coast Region, Branch Chief for the North Texas District (Dallas), Special Agent in Charge for the South Texas District (San Antonio) and as Director of IRS CI Asset Forfeiture in Washington, D.C.

Tags Donald Trump Donald Trump Donald Trump Jr. Internal Revenue Service Michael Cohen Mueller investigation Reactions to Mueller report Richard Neal Robert Mueller Special Counsel investigation Steven Mnuchin Tax returns of Donald Trump The Trump Organization

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