16 Bombshells on Hunter Biden From The IRS Whistleblowers

Two IRS whistleblowers leveled serious allegations about Hunter Biden and the government’s investigation of the troubled first son, according to transcripts of testimony released this week.

The whistleblowers, IRS supervisory criminal investigator Gary Shapley and a second unnamed IRS investigator, provided evidence to the House Ways and Means Committee that top Justice Department officials stonewalled an investigation into Hunter Biden’s taxes and foreign business ventures. They also call into question President Biden’s repeated denials that he has no knowledge of his son’s business dealings.

Hunter linked dad to Chinese deal in threat to business partner Hunter Biden invoked his father’s name in a text message, threatening his Chinese business partner to come down on him with their full weight if the business partner did not fulfill his "commitment."

Biden claimed he was sitting right next to his father in an encrypted message on July 30, 2017, to an associate at CEFC China Energy. While the message does not verify that Joe Biden was sitting with his son, the Washington Free Beacon obtained photographic evidence that places Hunter Biden at his father’s Delaware home the day of the text message.

"I am sitting here waiting for the call with my father," Hunter Biden wrote to CEFC official Henry Zhao. Hunter pressed Zhao to call him to discuss a delay in payment as part of the multimillion-dollar consulting agreement.

"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. All too often people mistake kindness for weakness—and all too often I am standing over top of them saying I warned you," Hunter wrote.

The Washington Examiner
Tuesday, June 27, 2023

The stuff Hunter Biden didn’t get indicted for
by Byron York, Chief Political Correspondent

There’s no doubt Hunter Biden had some serious tax problems. In the 2010s, he took in millions from shady overseas business dealings, trading on the name of his father, then-Vice President Joe Biden, and had a history of filing his returns late with six-figure amounts of taxes due. There was also his lowlife, high-cost drug addict lifestyle in which he threw away hundreds of thousands of dollars on prostitutes and crack. He had personal financial problems most people don’t share.

Last week, Hunter Biden agreed to plead guilty to two misdemeanor counts of failing to pay his taxes on time. Republicans quickly dismissed it as a sweetheart deal, and they were right. IRS investigators, who did the key work in the investigation, wanted to charge Hunter Biden with felonies. The Justice Department disagreed, choosing instead to reduce the charges to misdemeanors. But those two misdemeanors do not describe the full extent of Biden’s tax transgressions.

For the story, it’s best to go to two transcripts released last week by the House Ways and Means Committee. The first was from IRS whistleblower Gary Shapley, who oversaw the Biden investigation. Shapley’s testimony has received a good bit of attention, in part because he revealed a remarkable WhatsApp message from July 30, 2017, in which Hunter Biden pressured a Chinese business associate for money by threatening to have his father, by then the former vice president, use his influence to retaliate against the associate if the money was not delivered. Hunter Biden said his father was “sitting next to me” as he made the threat, which, if true, would mean that Joe Biden was not telling the truth when he repeatedly denied knowledge of his son’s business affairs.

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That was big. But there is a second IRS whistleblower whose testimony was also released last week. This whistleblower, who is anonymous, was the lead case agent for the Hunter Biden investigation. As such, he had a detailed, hands-on knowledge of the evidence in the case. He is the IRS agent who would have testified against Hunter Biden had any case against him gone to trial.

This agent — call him WB2, for whistleblower No. 2 — told House investigators a remarkable story. It started with Hunter Biden before his father became vice president, before becoming a crack addict. “Hunter Biden had had a lot of tax issues, even predating all this stuff,” WB2 testified. “Back in 2002, he filed his Form 1040 late — filing and owing over $100,000 in taxes; 2003, owed more than $100,000 in taxes; 2004, late-filed and owed more than $20,000 in taxes; and then 2005, late-filed his personal return and owed over $100,000 in taxes.”

Fast-forward to 2014, when Joe Biden was vice president and a corrupt Ukrainian energy company, Burisma, put Hunter Biden on its board of directors. According to WB2, Burisma paid Hunter Biden $666,667 that year to do little or no work. Hunter Biden received the money, WB2 explained, and then moved it to a Chinese company run by one of his associates. That company then “loaned” the money to Hunter Biden.

“So imagine this,” WB2 said. “If you are an owner of a company and your friend tells you that, ‘I want to pay my wages to your company, and you’re going to loan the money back to me,’ that’s essentially what happened here. He took loans from that corporation ... and he didn’t pay taxes on those loans. ... So essentially, for 2014, we found that Hunter didn’t report any of the money he earned from Burisma.” The problem, WB2 said, was: “You can’t loan yourself your own income.”

A House Republican lawyer asked: “So none of this was taxed?” WB2 responded: “None of it was taxed.” The lawyer said: “And to date, none of it has been paid or prosecuted?” WB2 responded: “So none of this has been paid or prosecuted. And I would also like to note that the statute [of limitations] has run out on these tax years or on the 2014 tax year.” The year 2014 was not part of the misdemeanor charges against Hunter Biden. As far as the IRS and Justice Department are concerned, that’s all over.

In an extremely complex arrangement, Hunter Biden did pay some of his taxes on Burisma money in 2015. But then, in 2016, Hunter Biden did not file a personal return at all and did not pay the $581,713 he owed in taxes, according to WB2. Hunter Biden moved to California, entered his drug addict years, and did not file tax returns for 2017 or 2018, either. In 2019, he got sober and faced a child support case for a child he had had with a former stripper in Arkansas. He hired a new accountant and, in February 2020, filed his 2017 and 2018 returns, according to WB2.

The 2018 return, WB2 said, contained false claims for deductions. “Some of the items that he deducted were personal no-show employees,” WB2 said. “He deducted payments that were made to who he called his West Coast assistant, but she was essentially a prostitute. He made payments — there’s an $18,000 wire that is made to one of these individuals, and on the wires, they say $8,000 in wage and $10,000 in golf — $10,000 golf club member deposit. And we know that that $10,000 went to pay for a sex club. He went to a sex club — and we’ve talked to the person that owned that sex club, and they confirmed that he was there. And the [sex club member] has to pay $10,000 ... so that was deducted on the tax return.”

Hunter Biden also “deducted expenses for hotel rooms for one of his drug dealers or what we believed to be one of his drug dealers,” WB2 added. “There was a significant amount of expenses deducted related to his girlfriend at the time, Airbnbs related to her, hotel rooms. So he deducted a lot for the Chateau Marmont, and he actually was blacklisted and thrown out of the Chateau Marmont. We actually have ... photos of the rooms and the destruction that was done to the rooms.”

In those years, Hunter Biden was in full flight when it came to profiting from his father’s name and influence. The money wasn’t just coming from Ukraine. It was coming from all over the world. “Global income streams for everyone altogether, so it’s for the period 2014 through 2019, our investigative years, so the total global transfers that Hunter and his associates would have received from Ukraine, Romania, and China was $17.3 million, approximately,” WB2 said. But that was for everyone involved in the Hunter Biden enterprise. As for Hunter Biden himself, WB2 said: “Of this amount, for the period 2014 through ... the end of 2019 — that’s when income stops coming in — it’s $8.3 million. This is what Hunter would have received of that.” That’s the bottom line for Hunter Biden’s foreign income during that period: $8.3 million.

The IRS investigation began in 2018. “The investigation into Hunter Biden, code name Sportsman, was first opened in November 2018 as an offshoot of an investigation the IRS was conducting into a foreign-based amateur online pornography platform,” Shapley told House investigators.

By the time his father was the Democratic candidate for president, Hunter Biden owed a lot of unpaid taxes. By Shapley’s estimation, the total owed was $2.2 million. Since 2014, Hunter Biden has sometimes failed to file his returns, has failed to pay tons of tax, and has fraudulently claimed deductions for payments to prostitutes. How could he get out of such a situation?

One big step would be to pay off all his taxes and penalties. Many news accounts of the Hunter Biden story have noted that prosecutors are less likely to charge a person who has committed tax crimes if that person ultimately paid off his or her bill. The idea is that a jury would ask: Hey, this guy has paid what he owes, so why are you putting him on trial? Hunter Biden could put himself in an infinitely better position if he paid the IRS what he owed. But that was $2.2 million. Where could Hunter Biden get $2.2 million?

Enter Kevin Morris. A wealthy Hollywood celebrity lawyer, Morris apparently met Hunter Biden at a political fundraiser in the 2019-20 period. And then, when Joe Biden was in the White House, Morris paid the younger Biden’s tax bill.

According to WB2, on his 2020 tax returns, Hunter Biden included a note: “The taxpayer received financial support from a personal friend totaling approximately $1.4 million. The parties agreed in 2020 to treat the support as a loan and later documented their agreement in a promissory note in the amount of $1.4 million, 5% interest. The promissory note requires periodic payments between 2025 and 2027. The promissory note was executed by both parties on October 13th, 2021. The taxpayer is treating this amount as a loan for tax purposes. The balance of the financial support is treated as a gift. No amount of the support is treated as a reported taxable event on this return.”

In later months, Morris gave his friend even more money — approximately $800,00 more, bringing Morris’s total payoff of Hunter Biden’s tax liabilities to the full $2.2 million owed. The Morris money would serve as a roadblock to those IRS agents who wanted to prosecute Hunter Biden. “The payment could make it harder for prosecutors to win a conviction or a long sentence for tax-related offenses, according to tax law experts, since juries and judges tend to be more sympathetic to defendants who have paid their bills,” the New York Times reported in 2022. Of course, Hunter Biden did not actually pay his bills. Morris did.

In WB2’s testimony, a Republican lawyer asked about the Morris loans: “Has that transaction been investigated?” WB2 responded, “I’m no longer a part of an investigation related to that.” As part of what the whistleblowers say is retaliation against them, top IRS officials removed both WB2 and Shapley from the Hunter Biden case.

And now the matter has been resolved with two misdemeanor charges. The conclusion is deeply frustrating to IRS agents like WB2. Hunter Biden failed to file returns, failed to pay his taxes for several years, and falsely claimed deductions. WB2 also pointed out, more than once, that Hunter Biden’s tax offenses occurred over a period of years, some of which he was on drugs and some of which he was not, meaning that not all of the violations can be attributed to Hunter Biden’s being in a drug-induced haze, as some defenders suggest. The agents’ conclusion is that just because Hunter Biden’s new friend bailed him out — no repayments required until 2025 — does not mean Hunter Biden did not violate the tax laws repeatedly in the 2010s.

At the end of WB2’s deposition, a Republican lawyer asked this question: “If someone meets all the elements for a crime of willful evasion and are found to, in conjunction with that, owe a liability, and they pay off that liability years later when they’ve been caught, has a crime been committed?” WB2 answered simply: “Yes.”

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