The commitment is almost certainly not enforceable, for several reasons.
The commitment is almost certainly not enforceable, for several reasons.
A s usual, Dan McLaughlin said all I wanted to say, and then some, in his good-riddance post on the Trump “Anti-Weaponization” fund’s demise. As he, National Review, and the Wall Street Journal’s editors have urged, I hope Congress follows through with legislation to ban use of taxpayer money for such a fund.
It would be nice to be able to take Acting Attorney General Todd Blanche at his word, especially given that President Trump has reportedly decided to nominate him to be the full-fledged AG. But let’s face it: Blanche is being nominated because he’s shown he can be relied on to do the boss’s bidding. I don’t doubt Blanche’s sincerity in assuring a House subcommittee that the Justice Department considers the slush fund a dead letter. But the remorseless fact is: If Trump changes his mind and decides the administration is pushing ahead with the fund, then the administration will resuscitate the fund. Blanche’s testimony won’t matter because Trump, not Blanche, runs the show.
In any event, if lawmakers overcome atrophy and suddenly remember what their power-of-the-purse muscles are for, then any number of Trump lawfare gambits ought to be on the chopping block. It would be a worthy end if Congress were not only to cut funding but articulate that such abuses of power are intolerable regardless of which party indulges in them.
Putting the slush fund aside, I want to address the less-covered but equally insidious part of the Justice Department’s “settlement” of the president’s preposterous $10 billion lawsuit against the Internal Revenue Service. I’m speaking, yet again, of Blanche’s effort to give Trump, his older sons, and the Trump Organization immunity from tax audits or prosecution — in perpetuity, it appears. Senate Democrats failed this week to nullify this audit protection; on a voice vote, their proposal was defeated by Republicans, who’ve apparently decided that trashing the slush fund exhausts their enthusiasm for finally addressing presidential self-dealing.
I don’t believe Blanche’s grant of audit immunity, expressed in a three-paragraph document on AG’s office letterhead and dated May 19, is enforceable.
That document, signed only by Blanche, is an addendum to the broader settlement, which is outlined in a separate document — the one that created the Anti-Weaponization Fund and was signed by (a) Trump’s lawyer, David Epstein; (b) Associate AG Stanley Woodward on behalf of the DOJ (i.e., not Blanche); and (c) Frank Bisignano, who is the Social Security administrator but signed on behalf of the IRS as its “chief executive officer.” (There is controversy attendant to Bisignano’s curious role at IRS, but it is complicated and need not divert us for now.)
To be clear, I am not urging that the IRS audit Trump and his private businesses, or continue auditing them if that’s what the IRS was doing (such audits are supposed to be nonpublic). Government action should not be taken against anyone, the president included, unless there’s a concrete evidentiary basis for doing so. And such decisions to take action should be cordoned off from politics. I have no knowledge about whether Trump merits being audited. He has had a rollercoaster career in private industry, including audits and bankruptcies, which began long before he ran for public office. I’ve spent years, though, arguing that no one should be singled out for law enforcement treatment due to partisan politics.
That said, it works both ways. While the president shouldn’t be politically targeted for tax proceedings, neither should he be permitted to leverage the public trust he’s been given — the nation’s most powerful elective office — for his personal benefit. That’s sure what the audit immunity deal looks like.
Let’s look at the applicable statute, Section 7217 of federal tax law (Title 26, U.S. Code). As I’ve previously explained, it categorically prohibits the executive branch — explicitly including the president — from pressuring the IRS to terminate (or conduct) an audit or other investigation of a taxpayer; but, it exempts the AG from that prohibition.
That is why Blanche — an acting AG who currently has no deputy AG to whom he can delegate AG functions — is involved. Trump obviously coveted this relief, and, by law, only Blanche could give it to him. (In the prior post, I summarized the ethical lapse Blanche’s action entailed under rules of professional conduct. I won’t belabor that here.)
Here’s the salient point: Section 7217 gives the attorney general no authority over the IRS. The statute doesn’t imply that, absent the prohibition it states, high executive officials could legitimately order the IRS to conduct or refrain from conducting audits. Instead, it says: “It shall be unlawful for any applicable person to request” that the IRS audit or refrain from auditing a taxpayer. (Emphasis added.) Request. We’re talking about asking, not telling. Yes, the AG is exempted; but that just means he, alone among executive officials, may make a request. The IRS is in the Treasury Department, not the Justice Department, and the AG is not in its chain of command at all, let alone empowered to dictate to it.
Furthermore, Section 7217 says no “applicable person” may make an audit request to the IRS “directly or indirectly” (emphasis added). As noted above, the statute expressly includes the president among “applicable persons.” Hence, even though the statute allows the AG to make a request, it does not allow the president to make a request indirectly. That is, from the premise that Blanche, in his normal functions as AG, would be permitted to make an audit request, it does not follow as a conclusion that Blanche is allowed to make such a request indirectly on behalf of the president.
The president is barred under the statute from making an indirect request. Period. Even if Blanche would be allowed on his own to take an action, he should not be allowed to abet Trump in an action that Trump is not permitted to take.
Blanche, therefore, lacks authority to order the IRS to refrain from auditing; and even as to making a request, Blanche lacks authority to do that indirectly on behalf of Trump. Yet, in the audit immunity agreement, Blanche purported to make the following commitment: “The United States RELEASES, WAIVES, ACQUITS, and FOREVER DISCHARGES each of the Plaintiffs [i.e., Trump, his elder sons, and the Trump Organization] from, and is hereby FOREVER BARRED and PRECLUDED from prosecuting or pursuing” any claims, money damages, “examinations” (e.g., audits), or other relief — regardless of whether the underlying information is presently known or unknown — that could have been asserted against them by the Internal Revenue Service. (I’ve capitalized terms above because that’s how they appear in the immunity agreement.)
Now understand: I am not saying that the Justice Department never gives immunity for tax crimes on the government’s behalf. It does so all the time. Nevertheless, this is done in connection with judicial proceedings and ultimately approved by the court. When someone pleads guilty pursuant to an agreement with the government, the plea and the agreement terms are not valid unless accepted by the court. The judge in the case reviews the agreement and questions the defendant about it, as required by federal law. (See Rule 11, Fed. R. Crim. P.)
In addition, when the Justice Department wants to grant a person immunity from prosecution to compel that person’s testimony in a hearing, grand jury, or trial proceeding, federal law requires a court order. (See Section 6003 of the penal law, Title 18, U.S. Code.) On that score, it is worth noting that, even though Congress required approval by the AG (or another high DOJ official) for an immunity application, there still can be no immunity unless the court approves.
Does the Justice Department ever grant immunity without court approval? Yes. Best known in this category is the so-called Queen for a Day agreement: By letter, a person may agree to be interviewed by prosecutors and investigators, on the condition that the government not use the person’s statements (or any leads derived from the statements) against him. But that is a very limited form of immunity — it is not a protection against being investigated or prosecuted. And the way it works is, if the government tries to use the evidence in violation of the agreement, the judge handling the case makes a ruling on immunity. That is to say, it’s the court, not the DOJ, that has the final say on the scope of immunity.
In the future, if the IRS were to audit Trump or try to bring legal proceedings (civil or criminal) against him, Trump would undoubtedly attempt to derail that effort by claiming the immunity agreement is binding as a contract.
Every first-year law student learns that a written contract reflects a meeting of the minds, as to which the party that must perform has signed and the party that benefits has provided consideration. The consideration can be nominal, often just $1; this keeps the courts out of refereeing whether contracts between private parties are fair exchanges, but government contracts are scrutinized more exactingly because they involve the public interest and taxpayer funds.
Clearly, the president would argue that (a) the government is the party required to perform in an immunity agreement, with Blanche, as acting AG, authorized to bind the government by his signature; and (b) Trump (in his private capacity, even though the agreement addresses him as “President”) provided adequate consideration by agreeing to drop his $10 billion lawsuit against the IRS.
I don’t think that would fly. Blanche had no authority to bind the IRS. He undoubtedly has authority to bind the government in the resolution of a court proceeding, but Trump discontinued his lawsuit precisely to thwart Judge Kathleen M. Williams (an Obama appointee in the Southern District of Florida) from acting on the settlement. He did that because Judge Williams appeared poised to conclude that Trump’s suit was collusive (i.e., he controlled both the plaintiff and defendant in the case).
I wouldn’t bet that Williams would have agreed with Trump detractors, who claim the suit was a “fraud on the court.” Yet, she wouldn’t need to go that far to find that the suit was not adverse enough to qualify as a “case or controversy” — the minimum constitutional threshold for a court to exercise jurisdiction. And even if she assumed for argument’s sake that she had jurisdiction, she might well have decided the theory behind Trump’s claim that the IRS (i.e., American taxpayers) should pay him an outlandish $10 million was so weak that it did not, in any event, amount to valuable consideration.
As it happens, Williams is considering taking action even though the suit has been dropped. I doubt she has authority to do that. But again, that’s because there is no case now, and there may not ever have been a cognizable case. If there’s no real case, then there was nothing for Blanche to settle as counsel for the United States. With that put aside, the acting AG lacked authority to request that the IRS not conduct future auditing if the request was made indirectly on behalf of the president (which seems patent); and Blanche, in any event, had no power to prevent the IRS from auditing.
It’s understandable that President Trump would want audit immunity. As a rule, IRS audits are financially and emotionally draining. In the president’s specific case, it’s been reported that there could be $100 million at stake. Nevertheless, I don’t believe the audit agreement Acting AG Todd Blanche executed is effective to provide his boss with the desired shield.