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Johnston writes: "The law is clear, and it leaves no wiggle room. The consequences for breaking it include removal from public office and up to five years in prison."

Treasury Secretary Steven Mnuchin. (photo: Bloomberg News)
Treasury Secretary Steven Mnuchin. (photo: Bloomberg News)


Here's the Law That Requires Mnuchin to Turn Over Trump's Taxes, or Lose His Office and Go to Prison

By David Cay Johnston, The Daily Beast

12 April 19


The law is clear, and it leaves no wiggle room. The consequences for breaking it include removal from public office and up to five years in prison.

onald Trump and his top White House aide declare that the administration will not give the president's tax returns to Congress, as required under a 1924 anti-corruption law. But both the Treasury secretary and the tax commissioner have been much more nuanced, saying that they will obey the law even as they delay actually doing so.

I know why Treasury Secretary Steve Mnuchin and Charles Rettig, the IRS commissioner, are so cautious. They don’t want to be removed from office and sent to prison for five years just for doing Trump’s bidding.

The reason will no doubt surprise those who think Trump can thumb his nose at the law governing congressional access to anyone’s tax returns, including his. It will for sure shock Trump, who claims that "the law is 100 percent on my side."

The exact opposite is true.

Under Section 6103 of our tax code, Treasury officials “shall” turn over the tax returns “upon written request” of the chair of either congressional tax committee or the federal employee who runs Congress's Joint Committee on Taxation. No request has ever been refused, a host of former congressional tax aides tell me.

There is, however, a law requiring every federal “employee” who touches the tax system to do their duty or be removed from office.

The crystal-clear language of this law applies to Trump, acting White House Chief of Staff Mick Mulvaney, Mnuchin and Rettig, federal employees all.

The law says all of them "shall" be removed from office if they fail to comply with the request from Representative Richard Neal, the Massachusetts Democrat who chairs the House Ways and Means Committee.

There are no qualifiers in Section 6103 that shield Trump from delivering, in confidence, his tax returns to Congress. No wiggle room at all.

Another provision in our tax code, Section 7214(a), provides that “Any officer or employee of the United States acting in connection with any revenue law of the United States… who with intent to defeat the application of any provision of this title fails to perform any of the duties of his office or employment… shall be dismissed from office or discharged from employment and, upon conviction thereof, shall be fined not more than $10,000, or imprisoned not more than 5 years or both.”

All that Neal must do is make a request in writing that falls within the committee’s tax law and IRS oversight duties. Neal’s carefully articulated reasoning and requests for specific tax returns and related tax information in his April 3 letter easily meets that standard.

Congress earlier applied this law to Richard Nixon, who resigned in disgrace after a second audit of his returns showed he was a major league tax cheat. Nixon fabricated deductions worth more than $3.4 million in today’s money. Nixon got off with a pardon, while his tax lawyer went to prison.

The IRS had audited Nixon’s 1969 tax return but failed to catch major league cheating by the sitting president. Only when Congressional tax lawyers went over it, and the IRS did a second audit, did they spot blatant tax evasion.

Even if Mnuchin or Rettig or anyone else escaped prosecution for failing to provide the requested tax returns, removal from office under 7214(a) would damage and perhaps destroy their opportunities to cash in once they leave office.

Removal from office would require disclosures to future employers and investors, limit or block service on corporate boards and require disclosures to lenders. Even someone running a privately held company, as Trump still does, would be affected by heightened disclosure requirements.

Mnuchin, a former Goldman Sachs partner and savings and loan company chief executive, is only 56. Removal from office alone could mean an end to his big paydays in finance under existing regulations.

Rettig, 61, a tax lawyer whose specialty was helping wealthy tax dodgers who got caught in audits, could lose his California law license, especially were he to be convicted.

The good-conduct provisions of the tax law are as broad as they are severe.  Significantly, it doesn’t just affect IRS auditors and collections officers. It applies to any federal employee—which means Trump as well as Mnuchin and Rettig—who “fails to perform any of the duties” they are assigned.

It also applies to any federal employee “who conspires or colludes with any other person to defraud the United States; or who makes opportunity for any person to defraud” the government. This provision could hit Mulvaney, the acting White House chief of staff and Trump’s budget director, given his reckless statements on Fox News, which some call Trump TV.

Should congressional tax lawyers, after examining Trump’s tax returns, finds that he is a tax cheat, anyone with knowledge of the cheating would also be at risk of prosecution.

Keep in mind that Trump lost two income tax fraud civil trials over his 1984 New York state and city tax returns, as recounted in my 2016 book The Making of Donald Trump.

He is also a confessed sales tax cheat, prompting Mayor Ed Koch of New York to say that Trump should have served 15 days behind bars for his crimes.

The law covers official inaction, too. Anyone who “omits” his duty “shall” be removed and may be prosecuted as a felon.

Section 7214 covers anyone with “knowledge or information of the violation of any revenue law by any person, or of fraud committed by any person, against the United States [who] under any revenue law, fails to report, in writing, such knowledge or information to the” Treasury secretary.

The risks to his liberty and fortune help explain why Mnuchin, while not turning over tax returns by the Wednesday deadline, told Congress this week, “as I've said in the past when we received the request, it would be reviewed by our legal department, and it is our intent to follow the law.”

That artful language was likely written by a government lawyer to help shield Mnuchin from removal from office and prosecution, at least for now.

Mnuchin can’t stall forever. If he or Rettig tries endless inaction, forcing House Democrats to sue in federal court, the failure to act could result in the same painful results as outright refusal to comply.

Under what is known as a “delegation order,” the responsibility for giving Congress tax returns upon written request has long been the duty of the IRS commissioner.

In testimony before the House Ways and Means Committee on Tuesday, Rettig said the decision on turning over the tax returns was his. He said he is “working on” a letter about what he will do. He also noted that he reports to Mnuchin since the IRS is under the umbrella of the Treasury Department.

One big problem for Rettig and Mnuchin, and perhaps others, is the provision requiring removal from office for anyone who “conspires or colludes with any other person.”

Mnuchin has acknowledged that Treasury officials talked with White House officials. And Rettig indicated he has spoken with Mnuchin and others at Treasury.

How many others were in the loop? Maybe Congressional hearings will tell us.

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+41 # Elroys 2019-04-12 10:56
How long will Munchkin, Rettig and trump be allowed to stall? Why not set a firm date - May, 2019 for example. If the tax returns are not delivered in full by May 1st then the full force of the law will be invoked against all parties to the cover-up - trump, munchkin, rettig, mulvaney and anyone else complicit in the travesty of justice. How long before justice, accountability and the disinfectant of sunlight are brought to bear on those who believe they are above the law are brought down to earth, just like the rest of us American earthlings?
 
 
+6 # chapdrum 2019-04-12 12:07
Elroys-Agree, but what or whom is going to invoke the "full force of the law?" Members of Congress will be insulated when the cumulative negative effects of the Trump "administration " are made manifest in the streets, so it makes a certain perverse sense they are not overly concerned that they (and the Courts) are allowing The Don to remain in office.
 
 
+11 # lfeuille 2019-04-12 21:23
That's a month and a half. He doesn't need that much time. It is not a difficult task. He is just stalling.
 
 
+25 # HenryS1 2019-04-12 12:42
But, who would enforce the law?

"Federal Court" leads to Trump's Supreme Court. Trump wins.

A more useful question asks whether the House can safely pursue the returns with any energy, or if those efforts just enhance acceptance of the "witch hunt" prevailing narrative.

We have to face that Trump has widened long-standing cracks in the rule of law in this country. It never worked well, but it works now not at all against the powerful. The judiciary, at the top, will decide for Trump no matter what. The intelligence community and the FBI have been neutered. Criminals get pardons. And the press is the "enemy of the people".

Again, just look at how Germany became a tool for Hitler's whims of madness. We are well along the way to that result.

In the midst of the chaos, Trump and those paying Trump for influence consolidate
absolute power and control.

Trump has not even used any really risky tools yet at his disposal. War, martial law. Habeous corpus is essentially already suspended.

Emergency powers for a total fiction. We uphold Israel and Saudi Arabia's crimes against humanity. If you have the money, the US government has been for sale since Trump's ascent to the Presidency.

Remember hope existed for a while over the Mueller probe. And look how easily it lies buried.

Saying "He can't do THAT!" ignores how meaningless past precedent is for our present. If Trump does it, then it can't be illegal. That is the law.
 
 
+3 # chapdrum 2019-04-12 13:49
Absolutely right.
 
 
+7 # lfeuille 2019-04-12 21:26
But the prossess will keep the focus on Trumps obstructionism. And the outcome is really not all that certain. Roberts may object to such an obvious violation of law. They should go for it.
 
 
-4 # ojkelly 2019-04-12 15:33
What if the Chair of Ways and Means asked for the returns of his spouses par amour boyfriend and divorce lawyer?
I believe that there would be an implicit condition read into the statute that the return be necessary in connection with official business such as tax legislation. No politics.
More silly fights that will get him re-elected .
Naturally, he will pardon all involved immediately, anyway.
 
 
+2 # crispy 2019-04-14 23:27
Can he pardon himself? LOCK HIM UP!
 
 
+1 # randrjwr 2019-04-15 21:24
Quoting crispy:
Can he pardon himself? LOCK HIM UP!


He seems to think he can. Time to do away with the Presidential Pardon altogether. It has been used to spring too many who should have remained in (or gone to, as in Joe Arpaio) jail.
 
 
+6 # maindrains 2019-04-13 16:35
Pity these penalties only apply to government employees, widening their application to "anyone" who colludes to defraud the US would eliminate a whole bunch of lawyer/accounta nt/financier inspired tax evasion.
 
 
+10 # Robbee 2019-04-13 18:49
"The law is clear, and it leaves no wiggle room. The consequences for breaking it include removal from public office and up to five years in prison."

- finally? a law with teeth?

REMOVE DICKHEAD FROM OFFICE! - LOCK HIM UP!
 

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