Clinton Foundation Whistleblowers: Doyle, Moynihan vs. IRS

In a December 2018 Congressional hearing on Not-for-Profit Charities with a Specific Case Study on the Clinton Foundation, our nation was introduced to two private individuals who had undertaken a multi-year investigative probe of the 43rd President’s foundation.

Larry Doyle and John Moynihan informed those observing that they filed a formal Whistleblower Submission replete with a hundred-plus formal exhibits in excess of 6,000 pages of evidence with the Internal Revenue Service on the Clinton Foundation in August 2017. They further testified that they had submitted the same materials to the Federal Bureau of Investigation and selected US Attorneys in the Department of Justice as well and that their documents included:  

• reviews of the foundation’s tax returns and those of the foundation’s donors

• reviews including audits of the foundation’s programs and operations, foreign and domestic

• email exchanges between foundation executives and foreign government officials

• contracts with foreign governments and engagements with other public and private entities 

• reviews of partnerships with an array of private companies, private universities, and other 501c3 public charities

• interviews with both current and former senior Clinton Foundation officials

• reviews of state registration materials

• documents covering the foundation’s own internal reviews

During the hearing, Doyle and Moynihan highlighted that they believe the evidence they presented in their submission provided probable cause that the Clinton Foundation violated IRS codes relating to the Organization and Operational Tests for a 501c3 public charity with specific details addressing Misrepresentations and Misuse of Donated Public Funds. On top of that, they also addressed their probable cause assertion that the Clinton Foundation acted as an agent in violation of IRS code and the Foreign Agent Registration Act. These whistleblowers also highlighted that private foundations, including the Gates Foundation, that have donated to the Clinton Foundation are themselves subject to taxation based on IRS codes relating to Donors’ Responsibilities. Ultimately, Doyle and Moynihan maintained that the Clinton Foundation could be subject to paying tax on anywhere from $400mm to potentially as much as $2.5 billion of revenue.  

These whistleblowers informed those watching that the IRS had issued a Preliminary Denial of their Submission shortly before they provided their riveting testimony to the House Oversight and Government Reform Committee during that December 13, 2018 hearing.

During that hearing, Moynihan specifically emphasized that their submission was “a tax claim”. Moynihan also informed those on the committee that depending on how the IRS ruled that the two whistleblowers would have other causes of action that they could and would pursue including filing an appeal to the US Tax Court if in fact they received a Final Denial from the IRS.

Well, it appears that these two ‘financial bounty hunter’ whistleblowers have done just that. How is that appeal playing out? It looks like over the course of the last few months Doyle and Moynihan have been in the midst of an extensive array of motions and responses, many filed under seal, going back and forth with IRS Counsel in the course of their having their day in the US Tax Court v the Internal Revenue Service.  Those interested in the case can track it via this US Tax Court site: 

https://www.ustaxcourt.gov/UstcDockInq/DocketDisplay.aspx?DocketNo=19004865