As the Watergate probe was heating up in the summer of 1973, the special prosecutor’s office gained a silent partner: the Treasury Department’s Internal Revenue Service. The Watergate scandal had engulfed the activities of corporations and corporate officials. An IRS investigation found tax violations committed with campaign contributions to the 1972 presidential campaign of Richard M. Nixon.
With information gained from the IRS, the special prosecutor’s probe resulted in 18 corporate officials and 17 corporations pleading guilty to violations of campaign contribution laws.
This week, FBI Director James B. Comey told Congress that the bureau is “investigating the nature of any links between individuals associated with the Trump campaign and the Russian government, and whether there was any coordination between the campaign and Russia’s efforts.”
Based upon what has come to light thus far, expect the FBI to be joined by Treasury’s Financial Crimes Enforcement Network and the IRS. They are the agencies best equipped to conduct financial investigations into any possible crimes dealing with or motivated by money — as in money laundering.
Case in point: The Post’s March 21 article on a Ukrainian lawmaker’s release of financial documents allegedly showing that former Trump aide Paul Manafort laundered payments from the party of an ex-leader of Ukraine with ties to Russia using accounts in Belize and Kyrgyzstan.
If the financial documents are accurate and, as alleged by Ukrainian lawmaker Serhiy Leshchenko, Manafort falsified an invoice to a Belize company to legitimize a $750,000 payment to himself, then the FBI and Treasury may come calling.
Manafort, according to the New York Times, denied the allegation, stating that the ledger is forged and that Leshchenko was part of an effort to blackmail him. However, Treasury agents, the Associated Press reported , have already obtained information about offshore transactions involving Manafort in connection with a federal anti-corruption investigation into his work in Eastern Europe.
If, during the investigation of links between Russians and Trump campaign associates, the feds come across financial transactions aimed at evading taxes on illegal income by concealing the source and amount of profit, those associated with such activities should prepare to hear the words: “Ladies and gentlemen of the jury . . . ”
There’s plenty of ground for federal agencies to plow.
The Financial Times reported in October that an investigation that it conducted had turned up evidence of ties between one Trump venture and an alleged international money-laundering network. Title deeds, bank records and correspondence showed that a Kazakh family accused of laundering hundreds of millions of dollars bought apartments in a Manhattan building part-owned by Trump and pursued business ventures with one of his partners.
This week, ABC News reported that from 2011 to 2013, the FBI had a warrant to eavesdrop on a Russian money-laundering network that operated out of Trump Tower in New York. “The FBI investigation led to a federal grand jury indictment of more than 30 people, including one of the world’s most notorious Russian mafia bosses, Alimzhan Tokhtakhounov,” ABC’s Brian Ross and Matthew Mosk reported. “He was the only target to slip away, and he remains a fugitive from American justice.”
Bloomberg Businessweek reported this month: “Two months before Trump broke ground in New York in October 1998, Russia defaulted on $40 billion in domestic debt, and some of the biggest banks started to collapse. Millionaires scrambled to get their money out and into New York. Real estate provides a safe haven for overseas investors. It has few reporting requirements and is a preferred way to move cash of questionable provenance. Amid the turmoil, buyers found a dearth of available projects. Trump World Tower, opened in 2001, became a prominent depository of Russian money.”
Trump may be correct when he says he has no money in Russia and has never invested there. He can’t say, however, that Russians haven’t invested in his real estate properties.
His son Donald Jr. said no less, claiming in 2008 that Russian investments were “pouring in” to Trump’s business ventures.
So the feds must “follow the money trail” wherever it leads. Check records, bank accounts and real estate files where laundered money can ooze like water through a sponge. Who gave it, who got it, and when? Where is it now? And what was received in return?
Unfortunately, the IRS, which investigates violations of the Internal Revenue Code, is despised by Republicans in Congress who remain outraged over its handling of tea party groups’ applications for tax-exempt status. Several in the House GOP even tried, but failed, to impeach IRS Commissioner John Koskinen.
Can federal agents under Treasury Secretary Steven Mnuchin count on Mnuchin’s defense against outside interference?
Congress strongly protected the integrity of federal investigations into Watergate. What about now?
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