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Treasury’s Mnuchin ‘properly’ followed guidance in refusing to give Trump’s tax returns to Congress, inspector general finds

The Washington Post logo The Washington Post 4/10/2020 Jeff Stein, Erica Werner, Tom Hamburger
Donald Trump, Steven Mnuchin are posing for a picture: Steven Mnuchin, U.S. Treasury secretary, speaks during a Coronavirus Task Force news conference in the briefing room of the White House last Tuesday. (Kevin Dietsch/UPI/Bloomberg) © Kevin Dietsch/Bloomberg Steven Mnuchin, U.S. Treasury secretary, speaks during a Coronavirus Task Force news conference in the briefing room of the White House last Tuesday. (Kevin Dietsch/UPI/Bloomberg)

Treasury Secretary Steven Mnuchin followed internal protocols when he refused to give President Trump’s tax returns to Congress, Treasury’s office of inspector general found in a report obtained by The Washington Post on Friday ahead of its public release.

Richard K. Delmar, deputy inspector general of the Department of Treasury, wrote in a letter to House Democrats that Mnuchin “properly” processed the demands for Trump’s returns and followed the guidance of the Department of Justice’s Office of Legal Counsel. Lawyers for the legal counsel’s office wrote in a June 2019 opinion that House Democrats’ demands for Trump’s return should be denied because they did not serve a legitimate “legislative purpose.”

“The core of our inquiry is that the [Treasury] Department processed the request properly, that it sought legal guidance from the Department of Justice’s Office of Legal Counsel, determined that it was bound by that office’s advice, and based on that advice determined not to provide the returns and tax information sought,” Delmar’s one-page letter states.

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The letter continues: “We do not presume to opine on the analysis and conclusions of the OLC opinion and advice. We report the Treasury decision to conform to that advice, and do not have a basis to question that decision.”

Delmar’s opinion is a setback for congressional Democrats who have for years said the administration broke a 1924 law that appears to explicitly give Congressional tax writing committees the authority to obtain the president’s tax returns. A spokeswoman for House Ways and Means Committee Chair Rep. Richard Neal (D-Mass.), who requested the returns and is battling the administration in court to get them, said Friday the congressman is focused on the response to the coronavirus.

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Senate Finance Committee Chair Charles E. Grassley (R-Iowa) said the inspector general’s opinion “should put to bed any question about the Treasury Department’s handling of this matter.”

Delmar, the deputy inspector general who issued the ruling, functioned as the department’s acting inspector general since June 2019 because nobody was appointed as Treasury’s inspector general. Delmar has worked as an attorney in the Treasury inspector general’s office since July 1999. He was previously a trial attorney in the Department of Justice’s tax division, as well as a tax litigator and criminal tax program manager with the IRS Office of Chief Counsel. He said in an interview Friday that the has no partisan affiliations.

Delmar’s letter to House Democrats cites a five-page report by Sally Luttrell, assistant inspector general for investigations at the Treasury Department, which was also obtained by The Post. Luttrell’s memo found there was no indication of “unsolicited opinions or attempts to influence the process” beyond a public letter from Trump’s personal attorney, William S. Consovoy, and letters from congressional lawmakers. Critics had questioned whether White House attorneys unduly interfered in Treasury’s handling of the request for Trump’s tax returns.

Attorneys in the Treasury inspector general’s office interviewed eight Treasury officials, while also reviewing Treasury officials’ email records. Much of the investigation centered on officials in the Treasury Office of General Counsel, the memo states

“Based on the interviews conducted and review of relevant emails, [the inspector general’s office] found Treasury’s receipt, processing, and responses to Chairman Neal’s requests for records and subpoenas to be consistent with Treasury’s general process for handling Congressional correspondence and requests to include Secretary Mnuchin supervising the matter,” Luttrell’s letter states. It also adds that its inquiry “did not examine the legal bases for decisions made by Treasury or OGC, however.”

Trump refused to release his tax returns during the 2016 presidential campaign, breaking with decades of precedent, and experts say his sprawling business interests pose substantial undisclosed potential conflicts of interest. In April 2019, Neal requested six years of the president’s personal and business tax returns, citing the potential for massive undisclosed financial conflicts-of-interest. But Democrats’ legal battle for Trump’s returns is entangled in the courts and it is unclear if the matter will be resolved before the 2020 presidential election. Trump has told advisers he will battle the issue to the Supreme Court.

Numerous legal experts and congressional Democrats have argued Mnuchin is required to turn over the returns, regardless of the reason Congress gave for requesting them. A confidential 10-page memo prepared in the fall by IRS officials also found that the tax returns must be given to Congress unless the president asserts executive privilege, which Trump did not do in this case.

“Without a doubt, there are legitimate purposes for the Ways and Means Committee to have Trump’s returns,” said Steve Rosenthal, a legal expert at the non-partisan Tax Policy Center. “Congress can legitimately investigate whether Trump is running the government for his benefit or the public’s.”

A whistleblower at the IRS has separately alleged political interference with either the tax returns of Trump or Vice President Mike Pence involving at least one political appointee at the Treasury Department. On Friday, Delmar said his investigation did not look into the IRS whistleblower’s claims. He also said he did not know if there was a separate inspector general investigation currently ongoing into this allegation.

“What we did was we looked at the process by which Treasury took in the chairman’s request, rooted it, evaluated it and responded to it,” Delmar said.

Read more:

Senate investigators interview IRS whistleblower about alleged interference with Trump or Pence audit

Confidential draft IRS memo says tax returns must be given to Congress unless president invokes executive privilege

IRS whistleblower said to report Treasury political appointee might have tried to interfere in audit of Trump or Pence

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