tv House Oversight Subcommittee Hearing on the Clinton Foundation Part 1 CSPAN December 13, 2018 10:26pm-1:09am EST
for being here to be qualified under section five o one c three to be organized and religious charitable scientific or other instances to be registered as a five o one c three but for those allegations of pay to play with those tax-exempt status. today's subcommittee looks at the clinton foundation allegations and with those allegations with pay to play activities the subcommittee will hear testimony from whistleblowers from the charitable organization status and just recently the clinton foundation jested a sharp decrease the donations fiscal year 16 through 17 and those donations were 53 million and
only 26.6 million in 2017 to 58 percent decrease in one fiscal year to correspond with secretary clinton's loss of the presidential election several report suggests the decrease could reflect a pay to play activity in the years prior to the years and donations the numerous report that have led congress to call for a special prosecutor to investigate the clinton foundation. and then to allege the wrongdoing by the clinton foundation and was joined this afternoon to update the committee on the progress of his investigations and has
been unwilling not only frustrating for me but for the american people that the prosecutor was not appointed have we not heard from him publicly? so we will look at his loss of testimony or an indictment on the inability to provide transparent oversight testimony before this committee. and with a five o one c three oversight with the potential claims of the whistleblowers but he could not attend due to a death in his family. this is recognized as a legitimate excuse and our
thoughts go out to him and his family. the president of judicial watch you will be testifying about the body of work he has conducted as it relates to the clinton foundation as a vehicle of pay to play transactions and finally an associate professor of law at the university of pittsburgh rounds out the first panel to discuss the allegations against the trump foundation. and the committee has received over 1300 pages of documents from the whistleblowers claims to be submitted to the irs they are part of a larger 48 page claim submission with 95 formal exhibits with 6000 pages of documents of the charitable organization status by the clinton organization.
it on a separate panel following those witnesses i would like to thank everyone for being here today and to your testimony now recognize the ranking member for his opening statement. >> i guess this is your last hearing? >> i'm glad you added the last laugh last. >> i look forward to working with you in the congress. >> i really don't look forward. here we are two weeks before christmas and my republican friends are re- gifting what needs desperate reworking they have found nothing but that doesn't stop them from trying to do it again and of course
mister cummings and i have repeatedly requested we have witnessed from the trump foundation and the whitaker foundation looking at the nonprofit foundations let's actually look at some that have outstanding allegations including the pending criminal investigation so let's look at the latest set of allegations to the clinton foundation. with two private individuals who will explain how they submitted a complaint to the irs and fbi and they have already conceded they are not whistleblowers instead would be plaintiffs in a lawsuit seeking to make money that is not a whistleblower.
and i have no firsthand knowledge of any wrongdoing the first claim is internal reports issued a decade ago that there was mismanagement challenges these were already leaked by wikileaks long ago these were made voluntarily that is not a scandal nor is it due. there was a quid pro quo with the clinton foundation but that is not what these reports said. they said some raised concerns and they may have an expectation in return but no evidence suggest of any quid pro quo but now those
employees may have had expectations even if unfulfilled and nevertheless that doesn't mean not trying to smear the clinton name yet again. yes reporting on an interview with the chief financial officer of the foundation in 2016 they claim making statements criticizing clinton in the foundation that he stated i know where all the bodies are buried but all we have to contradict is to be submitted as part of the complaint with these litigants in the lawsuit. so the irs rejected it putting the testimony of these two gentlemen as a denial letter
to say they have appeals but they refuse to give up their original complaint and they refused to come today that trump justice department but i will agree with the chairman when a request is made it should always be honored but i suspect one of the reasons they are not here and they don't have to testify and with the contents personally and to write an opinion piece and to
lead the irs based on the state regulatory filing and to summarize those allegations as "minor infractions issuing a traffic ticket and the republicans wanted a joint investigation with explosive new evidence with a confidential informant and corruptly directing millions of dollars to the foundation
but when we finally got the opportunity to interview the informant's claims fell apart not providing any evidence i showed a letter to you asking if you provided the clinton foundation operation enough matt would occur if the serious allegation against both including a judicial ruling and in fact going forward so just last month a judge ruled in new york state the attorney general could proceed with the serious allegations failure to operate the management with the statutory rules resulting in
the misuse of charitable assets. then the new york times reported the organization pay more than one.2 million and dark money from anonymous donors to target democrats in elections and said now we are having the clinton conspiracy theory but we don't want to look at those charges. the republican majority leader justify the massive investigations you will recall that to clinton after benghazi by touting to bring down her poll numbers that was the foundation they had eight committees including this one and a select committee but none of the democrats are about to gain control now mister mccarthy says we should not investigate president trump we should focus on other problems like perhaps the
clintons there are very serious issues we ought to be investigating german meadows and ranking member cummings talked about talking on - - taking documents or separating children at the border and i supported that effort we did not get a single document we were completely stymied and no subpoenas were issued and no hearings held of course it is the prerogative of the chairman of the committee calling the committee unfortunately to most people that looks like a last part of the partisanship and i think the chair. >> i think the gentleman for his opening remarks i would like to make two very quick clarifications in all sincerity. mister huber's absence today
there is no excuse if that is the benchmark we will use then all we have to do is hear from there and no one shows up and i don't think that's consistent but i would still like to highlight that if we are here a little longer which it appears we are willing to do, i am certainly willing to look at all the foundation issues i have signed 22 bipartisan letters for oversight probably the most of any republican member in that regard because i believe in oversight done properly is what we need to do. one clarification. if we look at foundations we do need to look at all of them and i believe we need to start two.5 million on the clinton foundation versus 19 billion on the trump foundation there is a big disparity of overall
revenue but yet i have been looking forward to cooperating with the new chairman. not to be presumptuous on government operations in the new congress where we do real oversight i want to make sure i clarify that. so now you are recognized for your opening statement before we do that please stand i will spare you in now and then i will read your credentials after do solemnly swear to tell the truth, the whole truth and nothing but the truth so help you god? please be seated at the record reflect both witnesses answered in the affirmative. b will go ahead as the president of judicial watch you are recognized for five minutes.
>> please hit the red button. >> ague chairman for conducting this hearing judicial watch is a conservative foundation dedicated to promoting transparency and accountability and integrity in government and without a doubt the most freedom of information act and it's no secret judicial watch has concerns over the years with respect for the rule of law so greeted by promises and by clinton to conduct yourself in accordingly with respect to the foundation and to be approved as secretary of state at the time even cnn reported clinton's complicated business interest could have problems for headaches for the incoming commander-in-chief to reassure
president obama and senators from both parties mrs. clinton and agreed to not participate personally in any particular matter involving specific parties with the clinton foundation and in addition they promised the president speeches and business activities would undergo a state department ethics review of the clinton foundation would disclose donors online and have restrictions for support from foreign government that is not fair that was not required by law that contingent on her being confirmed by the senate. we began moderating the ethic process and freedom of information act to see how that was implemented we were finding what was not surprising but former president clinton gave 215 speech is with $40 million
while presiding over us policy one of those was a conflict of interest that also included a consultant fee with a controversial clinton foundation advisor and the group that was caught up in the failed investment firm ms global the state department legal advisors approved his speeches in china, russia saudi arabia and egypt uae panama turkey taiwan india the cayman islands and other countries. the approvals the senior counsel and chief of staff who had been foundation officials negotiating the ethics agreement as to why she was involved in the process at all
it also shows mister clinton received a staggering sum from saudi figures specifically 18 million race from the saudi's during this time. mister clinton served as secretary of state he gave two speeches in saudi arabia earning $600,000 he spoke at the global business forum founded by the saudi investment authority and sponsored by the commercial group with ties to the saudi family with $300,000 from that speech one that was turned aside but that the ethics process is not a rubberstamp to raise money from foreign corporations mostly controlled by foreign governments specifically the document show he was approved of renaissance
capital and it turns out later was connected to uranium one so the process and the state department and then we found the clinton e-mail server a freedom of information act request the state department to have all these e-mails were not telling anyone about and also the state department who participates according to testimony at judicial watch conducting personal family business and to be sure documents that were uncovered later as a result of the e-mail server show the clinton foundation was in regular contact with others in the state department to get special favors and treatments for supporters and allies of the foundation specifically
one who was asked to be put in touch with the state department person in lebanon he says he is a key guy in lebanon and to us and also the connection of a close friend of president clinton a top earner of the foundation he appears at the top of the donor list giving between one and $5 million to the foundation to pledge a billion-dollar to the clinton global initiative. i don't know if he committed that many but he was found guilty of money laundering so they almost immediately broke promises to president obama and the senate to maintain that wall of separation we have numerous instances detailed american testimony of the favoritism of supporters within the state department. it so bad the crown prince of
bahrain cannot get a meeting directly with mrs. clinton through the state department so he went to the clinton foundation. many have noted it is hard to tell where the state department ended and the foundation began in response to these disclosures not of insider documents but hidden from the american people. now the uranium on controversy specifically it was a controversy of 2010 the uranium one deal there were monies funneled into the foundation by uranium on interest specificall specifically. and these were hidden from the american people the foundation promised to disclose these monies to an earlier agreement
31.$3 million was given to the foundation beginning januar january 2008 around the year 2008. we have the new documents of the renaissance capital $500,000 which is the tip of the iceberg and since then the new york times has reported that uranium one chairman foundation to make for donations four.$5 million to the clinton operation but none of this was disclosed and shortly after the russians announce their intentions to acquire the stake in uranium one mrs. clinton received the 500,000-dollar speaking fee from the renaissance capital organization. we are asking for documents from uranium one way or even the chump administration does not want to divulge the full
truth that there is enough evidence to launch a serious investigation to the clinton foundation and evidence in addition to this that the clinton foundation investigation it was suppressed by the justice department so is no surprise the justice department is not here today. >> and you are recognized i didn't say this please try to keep your oral testimony to five minutes we will be generous with you and you are recognized. >> thank you mister chairman and members of the subcommittee thank you for inviting me here today to talk about a subject near and dear to my heart nonprofit oversight. i am a professor of law at the university pittsburgh and i
study and teach and speak about tax law and specialize in nonprofit organizations in particular tax-exempt organizations although i'm a professor i worked five years office chief counsel of the irs overlooking the tax-exempt sector so i bring a wealth of experience revelations overseeing the policy of the irs was a pretty important time of my life and i enjoyed the time working with that office additionally before that i was a corporate attorney for three years doing investigations into accounting irregularities. i don't have much time. i will cut to the chase this is about oversight of nonprofit organizations as a practical matter the imf is seen as the nation's primary nonprofit regulator although the laws enacted by congress
and regulations implemented by the irs and treasury could be improved there is a real crisis of nonprofit oversight right now which is not sufficient to allow the irs to do the job it needs to do well. it is not there. i have some numbers you can see my written testimony. but i will use one fact from a great pro- public a piece that i know if you saw it how the irs was gutted over a period of eight years one number. the irs today has fewer than 10000 auditors the last time that had that few was 1953. 1953. so for reference those that are watching over the nonprofit so we hear about today in the range of 200
auditors and determination specialist overlooking the sector. while the irs presents has shrunk the nonprofit world has gotten bigger there is 3 trillion in that sector and 5 percent of gdp takes place over one.8 million organizations to oversee within the world the nonprofit sector is a terrific force for good and effort at solving the problems in our churches and schools. it is important there is good oversight of this group to take care of americans daily and to direct the organization of their self-interest to
carry out their own of what they want to do it when i worked at the irs they are working hard every day but the amount of money and the resources they are there mister chairman. i am not certain what this subcommittee has in mind a hearing on nonprofit oversight could do real good ic newspaper stories every day about people taking advantage of charities and it breaks my heart when i see that happen. if this is going to be a ticket for tattoo show this foundation it ain't going to
help us i would like to see the nonprofits operating better. where is the irs doesn't have the right resources it needs to conduct the oversight i don't think they have the resources they need and what they could do about the law as well. >> am almost at the end of my time. let's talk about the role the irs plays of nonprofit oversight to ideally raise up the nonprofit sector to build confidence i am worried we have a crisis on our hands not as a matter of bias but those resources to get the job done
they work hard every day we are asking too much of them right now. thinking very much am happy to take questions. >> so you were over the five o one c three whatever the numbers are section crack. >> yes i worked there 2006 through 2011 and the real regulations and the supporting organizations yes i was in the national office. >> your former colleagues would be happy. >> thank you very much mister
chairman i will assume you are familiar with the department of justice released pertaining to that conversation he had so there is some interesting information in that report specifically a telephone conversation with the principal associate attorney general axelrod pertaining to the clinton foundation can you briefly describe that conversation consisted of quick. >> according to the ig report they have this conversation with the clinton foundation
that that justice department expressed concern of the fbi agents and the presidential campaign to push back asking are you telling me i need to sit down to predicate the investigation and he told us the conversation is very dramatic and never had a similar but prior to that officials refuse those requests to issue subpoenas according to the report and since then there has been a new investigation launched. >> we agree that was a very dramatic conversation do you believe this demonstrates the
justice department was actively trying to protect the clinton foundation from an investigation crack. >> yes demonstrating it was protected by the justice department especially during the election year not that we timed them that was the result of eight or nine months to the state department so this is a very tricky time. i can imagine the pressure of the fbi. >> what is the reason they try to protect the clinton foundation crack. >> the justice department working with the clinton campaign to target president trump.
one of the key folks involved was peter's truck as an fbi official against mister trump and for mrs. clinton. the irony of the situation is mccabe is accused of leaking with pushback to say we are investigating hillary clinton which was accurate but not what he was supposed to be telling people so that is why he lied. but some in the fbi wanted to do this. >> where do you say that it causes some red flags for the justice department cracks it sounds like they were actively involved to influence the election. >> it sure does. this is an area that needs to be explored i wish it was by this congress. it was not sufficiently. there was pushback from the
doj and pushback from foreign interference in the elections but with bureaucracy putting their thumbs on the scales that's what both parties ought to be concerned about because one day that issue will be on the other foot and we don't want them to be their own branch of government. >> this could be another way to ask a similar question why would the justice department try to pressure the fbi to stop a perfectly valid investigation crack. >> for political reasons those that were ongoing at the time within candidate trump and clinton so the complaint about overt steps that is where i he reacted so strongly that is the whole reason we are here
we appreciate why how we need to do oversight that is the reason why we are doing oversight and with that i yield back the chairman recognizes the ranking member. >> listening to your testimony it's like alice in wonderland. the idea why are we here cracks apparently none of this is happening in the real world we just had a hearing here in new york where the president's personal attorney was given three years of jail time. this isn't day speculation but a crime admitted to and identified explicitly and to
coordinate and direct this illegal activity it isn't speculative or informants or whistleblowers. it is the court record you dismissed russian interference in every election that's a pretty big thing to compare the idea somebody putting their time on the scales of justice to protect the clintons even though there are no criminal parts to that effect but then they did look at it not once but twice mister comay himself we have russian interference in our election the fbi agrees with that except the president we
have criminal investigations not about the clinton foundation but the trump foundation i would like to put that into the record to say there is sufficient grounds to go forward with the criminal investigation from the trump foundation at the clinton foundation. >> without objection. >> we are not talking about it here we are making a political point yes we are here for the grand christmas miracle hope from the business at hand it is grave and serious to undermine those norms and candidly i would expect more
from judicial watch then your testimony. >> may i respond quick. >> briefly. >> that the attempts is geared at focusing to the exclusion of those russian attempts to persuade or guaranteed a positive result and those admitted efforts by the clinton campaign for the dossier for president trump with allegations generated by russian intelligence. there was a bride investigation into the full penalty what russia was trying to do with respect to both parties. >> but because of time i would be giving you more time later that this had an informant on
uranium one knowing this to be explosive testimony and then on a bipartisan basis he had no evidence of criminal activity of any kind. it is a quid pro quo you are repeating a slander with no factual basis but meanwhile we have court evidence with respect to what is going on currently my time is limited your irs background from these two republican witnesses litigants to a lawsuit not whistleblower whistleblowers, they wrote the irs with a one page summary of their interview with mister kessler and the results of the reaction of the irs to that was a denial of the letter. you know the irs why would they deny something like that
how do we read that crack. >> i won't talk specifically but in terms of the irs of any particular whistleblower claim it would be a number of considerations in particular did someone bring credible information that returns tax dollars in some way that if they have made that choice than the primary thing is to bring something to the table. i was going to note that i agree fully this committee has an important role. >> just unanimous consent request. thank you both for your testimony and the letter dated november 29th your one page
response and the response to that on december 10th entering into the record. >> without objection. >> i have not seen the letter but i'm sure i will. >> today is the 12th maybe it's in the mail. >> is probably in the mail. >> i don't play surprises. >> that's why you get the grid that i agree. >> the chair recognizes a gentleman from ohio. >> were not trying to distract anyone but try to stop that double standard there was one set of rules for the regular feet people but unless you're part of the politically connected cousin - - the class except for the whistleblowers we will hear what they have to say and get to the truth so before i come to you.
>> i was in the tax-exempt organizations 2006 through 2011 i got an opportunity to join the faculty of the louisiana state law school. >> wonderful you were there when they started crack. >> apparently but i was not involved in that. >> you were in the exempt organization requirements with that division of the irs quick. >> yes but i did not handle. >> i did work with lois turner but you didn't know anything. >> i was not aware. >> when did you first find out the irs was targeting conservative people in that very division you were supposed to be advising and overlooking crack. >> i appreciate the question i would disagree targeting that
i was. >> you don't think people were targeted crack. >> i don't believe they were. >> there was a list the tea party and conservatives those terms come up. >> i appreciate the question. >> you don't think they were targeted crack. >> i think they were doing the best to do their jobs and did not have the resources. >> this is about targeting specific points of view. >> i understand that. >> the attorney general had a press conference when it became public and said we will get to the bottom of this not even in the very division you are the head of quick. >> i'm not saying it did not exist and they were not looking at tea party organizations but they were looking at other federal organizations that you will see from the reports that came
out later. >> that is not with the inspector general said that is not true and frankly if it was looking at everyone the same i don't think lois turner was taking that step but in my last two minutes 30 second seconds, 2 billion since 2001 cracks that is what the clinton foundation took in cracks. >> 48 million in speeches you said in your opening statement that is quarter of a million dollars for every speech that's pretty good i've never heard him speak but that's amazing and in 2008 was secretary clinton became secretary there was an agreement in your testimony you said certain things she had to do for the duration of her appointment not to be involved of the many that her husband was doing in the clinton foundation protects is that right cracks the clinton foundation where disclosed that agreement when she was
confirms back to they follow the agreement crack. >> no. not in my view. >> so they got permission got the okay then didn't follow it. >> no. they immediately began contacting people to start getting things done from their supporters as i described. >> so the secretary kept her apartment she has had her chief of staff in lawyer do everything crack. >> is that a double standard? >> oh yes mrs. clinton is and was protected and frankly still is being protected from the consequences of her behavior at the state department and subsequently. >> my colleague talked about
the things that have happened recently with mister cohen but i think it's interesting. i don't remember anyone associated with the clintons investigation it was just called a matter it was obviously an investigation but it was told to be called a matter of remember her door being kicked in a 5:00 o'clock in the morning and everything being confiscated actually she got immunity before she turned over any records. >> yes. we are doing it separately with judicial watch but to find out whether or not as report suggests the foundation investigation of the fbi was conducted in 2016 was actively suppressed by the justice department and curtailed the public reports are fbi agents could only be paper articles
but not basic tools that were available to them when you compare and contrast that investigation into president trump and his associations that is what a real investigation looks like abuses aside we have not had it comparable even during that e-mail issue. >> i did not expect to spend that much time about targeting with the irs but you are exactly right i have never seen this happen where the director is fired, the chief legal counsel is demoted fbi counsel is demoted then leaves then peter struck is demoted then fired i have never seen that happen. those of the same people who ran the investigation have
never seen that happen to any other federal agency and they are still getting attention i have never seen anything like that and also it strikes me the names they gave investigation it was the exam but the investigation between the trump campaign was crossfire hurricane just the name suggests a completely different approach in a completely different standard how they will run that investigation. il back. >> the chair recognizes the gentleman - - the gentleman from new york for a very generous five minutes. the clinton foundation is located in the district i'm privileged to represent. so i could attend many of
their functions and conferences to see that outstanding work they are doing in my district and the foundation has supported physical education 149 schools, projects are underway to restore the new york harbor or provide free training for homeless female veterans and hundreds of high school seniors prepare for graduation and college. i have a whole list of things i would like to ask unanimous consent for my district and across the country. i find it very ironic in this hearing today the republicans are targeting the clinton foundation headed by two people who are out of office and not in government that there are other foundations where people are in government in high positions like the trump foundation or the
whitaker foundation but they are not investigating we should also be investigating those foundations. so professor, i would like to ask about those allegations with the whitaker foundation and before arriving at the justice department he was president and executive director for accountability and civic trust to be focused on ethics and transparency and they have a tax-exempt status but last month the new york times reported that paid more than one.2 million in dark many from undisclosed donors. so can you describe or explain dark many cracks what is it
and are there any concerns when dark money is used to find nonprofits like this one crack. >> absolutely. dark money is a name given to money that comes into nonprofit organizations that are tax-exempt that nobody can see the money. particular dark many organizations are social welfare organizations advocacy organizations that carry out work that often can look like politics but as a result from not engaging to have to disclose under campaign finance law it comes under c4 or c-5 or c6 social welfare organizations. in the past the irs new
because there was a schedule the irs recently removed that so now not even the irs knows we don't know who is finding that advocacy work it is dark. >> we have legislation we hope to pass with the first bill in january which would disclose where the money is coming from. that's not all. last month, mister whitaker released the financial disclosure form to show he received 900,000 from his foundation in 2016 and 2017 that is over half a million dollars a year. are you aware what he did to deserve that kind of salary? >> i will not speak to any particular organization.
>> but are there stipulations that govern how much of salary crack. >> with a five o one c three of must pay a reasonable salary and in order to determine that you have to look at what other people in a like spotter paying this is assuming you are doing particular work that has to be a full fact and circumstance analysis. >> what it might have violated cracks i will not talk specifically to those facts but one interesting aspect there was a fund that came through and those are accounts that individuals can set up and community foundations they
are to take that deduction but it doesn't flow to charitable purposes right away but it is a public charity that otherwise would be a foundation would love to have an opportunity to talk about that there was an element when the organization we put them into a private foundation instead with restrictive rules that apply to them it allows organizations with those foundation rules. >> it also shows a paid at least 500,000 to the republican research firm known as america rising and according to the website to
help its clients seek democrats art 501(c)3 nonpartisan? >> there are two major rules that come in with a 501(c)3 no electoral activity to say mrs. maloney or chairman meadows you will lose your exemption also limitations on lobbying so what often happens in the space there is a concept of education if that is at school but it moves into another space it is a difficult space. >> my time is up but this website and i find this very disturbing he can go look it up today the relentless pursuit of original going
against democrats it does not sound like nonpartisan to me that it's political i personally think this should be investigated and please professor that further investigation of that tax-exempt status is warranted how they were spending their many and wh why. >> republicans have refused to investigate current people who have these non- for profits and they are obsessed with continuing to investigate the clintons many years after they have been in office we have these from.
>> i have been extremely gracious at both sides i want to recommend we stay with a five-minute timeline starting with the gentleman from iowa. >> thank you to the panel for being here today. the quid pro quo i had to look it up it is latin for something a favor granted in return for something in 2016 the clinton foundation received a 28 million-dollar donation from morocco's king mohammed shortly thereafter secretary of state relaxed us foreign aid restrictions on morocco was that the quid pro quo? >> that is the matter that needs to be investigated. the clinton foundation with a global initiative was able to
raise tons of money during mrs mrs. clinton's tenure at secretary of state some of that was truly charitable no doubt as they engaged as was highlighted but when you have foreign governments making massive donations and major corporations making massive foundations one - - donations to the foundation that is out of line with other activities that is a fair question to ask what was expected in return if that charitable enterprise was just buying insurance? maybe they just made sure they would get better hearing over certain policies. does it mean anything happened illegally? i don't know that nobody is asking the question. >> that president clinton with the secretary of state to be the honorary chancellor.
>> as the founder has another organization the youth foundation that received $40 million in grants while secretary clinton was in office after she left office and went from 30 million down to 3 million. >> you have to ask the question. this is why mrs. clinton promised these disclosures that they were not followed as were supposed to have been we asked the state department give us the agreement to do the exchange of that enormous amount of money but that was blacked out by the state department. >> the ukrainian oil steel magnate done a between ten and 25 million to the clinton foundation and return to have access to the state department
would you say that is the quid pro quo? >> it certainly seems that way. >> you know you have done some work on this uranium one deal those interest contribute more than 140 million to the clinton foundation can you say what happened in return and contributions? >> the state department prove the goal of those identities to have steak and uranium one the fbi was looking into it and the allegation the investigation was curtailed or silenced from public disclosure to protect the clintons and the obama administration from
controversy which is another area for investigation. >> how does that happen how is that curtailed you under charge in the case of uranium one that some folks were charged for being left out of the documents that would have embarrassed them. whether that is true or not because the justice department is not giving us the documents. >> thank you mister chairman that the record reflect in iowa if it looks like a pig and it sounds like a pig and it smells like a pig it is probably a pig and i think based on what i have read today something smells and i yield back. >> the chair recognizes the
gentlewoman from columbia. >> i just want to establish what the standards should be as we have a president of the united states on one hand and secretary of state on the other so the absence of the standard is pretty clear but we have to look at the modus operandi for the foundation itself. because there were bound to be instances with the foundation that it was receiving some favoritism. that is what happens i suppose when you have people operating at this high of a record or.
so i thought i would look at the internal reviews by the clinton foundation. these were voluntary reviews and that is what interested me. apparently the foundation noted the issues wise and there is many board meetings as there should be cracks why isn't there more timely reporting? conflicts of interest that is what could have been found by some in the investigation but these were found by a voluntary internal reviews so looking for a standard how a foundation should act in this kind of situation so do you think those kinds of internal
reviews that were conducted by the clinton foundation are best practices cracks is that how it should be done? >> at all and to speak specifically to the clinton foundation but as someone who goes in and trains to the directors of nonprofits i certainly encourage rigorous and engaged discussion of the board they should be in gauge of what's going on in the nation - - the nature of various businesses as other members of had challenges in their organizations it's important to do oversight i deeply appreciate this committee is important it can make the difference of the functionality of the government. >> thank you very much that goes well beyond the question.
if you look at the review here they updated the conflict of interest policy they reformed the vetting and gift acceptance policy. i'm not asking you to look at those but are those the kinds of reforms or changes that you would expect a charity to make? would expect a charity to make? after commissioning reforms of the kind that i've just spoken of? >> as the clinton foundation but i recommend a good conflict of interest policy in the good gift acceptance policy.
>> one was the president while mrs. secretary and the undersecretary and you see how difficult the situation was. some employees who were interviewed had in fact this is information the committee has received raise concerns about donors who might have been expect patient of a quid pro quo benefit in return for gifts. again this is almost inherent in these two high-level officials operating in the same space. on the other hand no evidence on the quid pro quo was ever found. so i have to ask you then let me speak as a member of congress. i am sure that when some give contributions to me they have an expectation for quid pro quo. does that mean that i am in fact
guilty of something or equip pro "? to accept such contributions? >> again as to non-profits watching out for people wanting things from you in return is a big part of what you have to worry about in the basic nonprofit and becomes much more extreme as you have individuals who have additional power involved. it's a critical question they'll have to ask. >> i have to ask which of these two were operating the clinton foundation and the secretary of state. mr. chairman could i note for the record that the clinton foundation has received ratings four out of four stars from charity.
effectiveness financing and fund-raising. thank you very much. >> at the chair recognizes the gentleman from arizona mr. go start for five minutes. >> thank you mr. chairman. is it true the most recent filing for the clinton foundation has shown a significant drop off in donations now that they have no political power? there has been a 62% drop-off in donations. >> those political operatives were retained by the clinton foundation, correct? >> guess there were colleagues getting paid $10,000 a month in rent and foundation. >> he was also in libya serving as the secretary clintons unofficial advice are correct? >> courting to "the news york times" documents that have been disclosed as a result of judicial watch's efforts mrs. clinton said 25 memos in
libya. >> yes also pushing his own financial and just by trying to get contracts correct? >> yes. he worked for the clinton foundation india business concerns in libya to an 10 reported. >> is an ethical concern with the norm political operative working for supposed nonprofit that is pushing for a war that he can profit from? >> well maybe. i think the public interest here is that mr. clinton promised they had a business and they immediately started taking advice from a clinton official sidney blumenthal. >> as we turn over this to the opposition body i would like to take time to ask the panel about real foreign influence because i know they are not going to. now we continually see foreign governments and foreign entities final millions of dollars to environmental groups.
some of the largest environmental groups in the world the defense counsel and the sierra club have received millions in grants from the teaching -- the sea change foundation. the sea change foundation got millions from a bermuda company linked to russia. the environmental groups have undermined the energy or the united states fracking bans in the cash-strapped cities of new york. mr. mueller and the media were truly interested in russian interference. would it make sense to start their? >> i've seen reports about that. they have an interest in making sure that competitors aren't harmed in the energy sector and i'm surprised they haven't got more attention and their involvement in the rare mental movement here in the united states. >> russia benefits is incredible
in my the committees the natural resources committee we are trying to investigate the relationship between the natural resource defense counsel and their links to communist china governments. the nrdc has gotten close with the environmentally unfriendly chinese government while suing the u.s. government whenever it can. particularly the u.s. navy and its weapon development program. i'm sure i don't need to remind anyone here that china sees the u.s. navy has its greatest foe. mr. clinton should a nonprofit be made to register as a foreign agent if it is taking funds and orders from a foreign government that is trying to harm u.s. national and energy security? >> maybe. one of the things i noted that the clinton foundation activities is that they were advocating on behalf of foreign nationals which raised an issue of the foreign agent registration act as well. certainly my understanding of the law is there would be a
registration requirement actually if you are essentially taking orders from foreign governments and the holden to them. >> nonprofit have been given millions from wealthy benefactors produce a correct? >> yes. set so while there's nothing wrong with someone giving their money to an organist they should there is a problem in the federal government doles up nights of dollars in grants to these organizations. for instance the national immigration law center received hundreds of thousands of dollars in grants from the federal government and over 1 million from the open society foundation while working against u.s. interests. does it make sense to dole out taxpayer funds to groups that not only look to it that are against official -- mr. fitton? >> i think it's controversial and would also be controversial is the source operation is going
to spend about $1 billion this year. as you point out mostly of his own money. he subsidized u.s. tax dollars and it's a controversial year in terms of policy outlooks. >> one last comment mr. chairman i actually was part of a nonprofit and you raise how much of your dollars goes to the mission statement in detail. for example a nonprofit 97 cents of every dollar goes to the mission statement and as i look at mr. hackney i noticed the clinton foundation was content with a lot of exorbitant travel and not really dollar wise. >> thank you. >> i thank the gentleman. the chair recognizes mr. watson coleman for five minutes. >> thank you mr. chairman.
mr. hackney let me ask you something very quickly. before your position what were your various jobs? >> i worked for the conservative non-profits. >> have you ever worked for the government? >> the government, no. >> have ever worked for a republican elected official? >> know. i've always worked for non-profits. >> thank you. today we are holding this hearing again. there's another hearing in a multiyear investigation of the clinton foundation completely unsubstantial allegations but at the same time we refuse to do anything to investigate serious allegations from the top administration foundation. last month that a a state judge and eric ruled that prosecutors could push legal action against the trump foundation for
allegations focusing on and i quote the misuse of charitable assets and self dealings" mag. let me read from the judge's ruling. quote petitioners also -- the petitioner also alleges that charitable assets primarily consisting of money donated by outside sources were used to promote mr. trump's properties purchase personal items advance mr. trump's presidential election campaign and settled certain personal legal obligations. professor is the judge's ruling an indication that the allegation against the trump foundation are credible? >> so i don't want to speak directly -- . >> whether or not your perspective on the judges. >> when a judge find something that is that finding in the
public record. it becomes part of the public record. so what were your reactions to this notion of self dealings? >> i again don't want to speak specifically to the trump foundation. major issue with and private foundations when a wealthy and individuals use money for their own purposes. >> would you read that this trump foundation is worthy of congressional oversight? >> i believe the entire nonprofit sector is worthy of oversight. >> professor on june 15, you wrote an op-ed in their times about the trump foundation. in that piece you wrote and i quote as a former attorney for the chief counsel of the irs who specialize in nonprofit organizations i believe mr. trump is liable for his actions. if i were still at the irs based on velocity would take -- it would make a criminal referral
of false statements on a tax return or both. why specifically do you believe mr. trump is criminally liable regarding the trump foundation and how serious do you consider the crime of making false statements on tax returns? >> again i'm not going to speak to the trump foundation. my writing speaks for itself. senate let me ask you a question about that. you wrote an op-ed article. you are here testifying. why are you suddenly unwilling to answer specifically regarding the purpose for which we are here today? >> in the chair would weigh in on this. let me just say the gentle moment makes the point if you have written an op-ed you can't all of a sudden, as much as i load like you do not comment on if you can't not do that. she's asking a legitimate question you need to answer it.
>> let me go there. so charity matters deeply and it matters deeply that the people who file returns take care to do the things that they intend to do. and when they take that money and if they use it in ways over a series of years it's problematic and a sign that return in those instances where it is over a period of time i think that is significant and does warrant discussion. >> do you believe what you wrote? do you stand by what you wrote? >> i stand by what i wrote. >> in your op-ed you are also quoted as saying the irs faces criminal consequences for notorious criminal violations of the law and the misuse of a charity over the years is a type
of case that the irs goes after with criminal sanctions. by continuous violations of the law were you referring to that you believe are committed by the trump foundation? >> mr. hackney her time has expired but please answer the question. >> there's been a series of representatives. i did not study up for that specifically but there has been a series of representatives and there was an on recently i think out of my state of pennsylvania. i'm not positive about that but there've been a series that the irs is brought into this context. see the professor you have frustrated me. >> i apologize. >> your pardon -- person who has written. you are professor and scholar and a former irs employee and you can't even feel comfortable in supporting what you have already said in writing. with that i yield back. >> i do support it. >> the chair recognizes himself
or series of questions. mr. hackney let me follow up on ms. watson coleman. how many pages documents to the trump foundation in their filings to be revered? >> i have reviewed all of them. the tax returns that the irs has filed public record in terms of airport. >> in terms of their internal documents would he be qualified to provide an audit in terms of what they have done or not done based on the documents you have reviewed? >> i'm not certain of the question. >> based on the documents you have reviewed would he be qualified to be able to give an opinion on an audit of the trump foundation? >> so, i think you are asking have i seen every single possible document out there and i have not seen every possible document out there.
i am doing based on what the public record is and that was it that i had done. >> based on public record you are saying there is enough in the public record to say there should be a criminal quarrel? do you our law professor. >> that's different than saying -- i discussed to the fact that -- . >> my question remains are you saying there's enough in the public domain to refer it as a criminal matter? >> i believe in the instance -- >> you are under oath then you are law professor. i want to see your students be able to answer this accurately. >> absolutely. i believe where we know that there is a high likelihood that there have been false statements in return and there have been choices. >> how do you know that? >> it appears there were false statements. >> appears in no are two
different words. >> i understand. >> so you don't know. >> i believe based on the public record and that was what i was writing it based on. saint basil the public record you think there's enough for criminal referral? >> i believe in that report that there was enough to show possible problems there but again i don't want to go into that. it did not prepare to talk to the specific facts. his hearing was called at the last minute and i've not had time. >> u.s. awareness were called at the last minute by the minority side just wanted to make sure that was clear. let me go a little bit further. i want to talk about everybody's talking about how great the clinton foundation is and how above ward in a ratings and platinum ratings and gold ratings and all of those. there is a report from
november 102008 which is an internal audit. actually comes from an internal audit. since the challenges and deficiencies plaguing the foundation cannot be overstated there are real undermining of organizations at the goodness. to address these issues that present immediate threats the foundation should revamp its legal and h.r. operations, should review its government structure and document and should have an open and honest discussion with the president about the future of the foundation. would you not find that alarming if that was the conclusion of the internal audit? >> i would want to get an audit like that. the problem is there is another audit. there was another audit in 2011 that raise some of the same issues. not as directly.
>> well that is where i was going and i appreciate it. i was in 2010 and another audit in 2011 by a very different firm talked about the potential conflicts of interest and the fact that those conflicts of interest policies that were destined to be put in place. this is that quote however we did not find any evidence of the enforcement of the conflict interests. are you saying in your discovery process with foia that there is a potential conflict of interest between the charitable mission of the clinton foundation and what might have been going on? have you found that? >> yes. mrs. clinton and mr. clinton and the foundation recognized those potential conflicts of interest
and tried to reassure president obama that they would be taken care of and disclosed. as i said they were either rubberstamped or key aspects of it were not disclosed. mrs. clinton directly started violating her own agreement by allowing her staff on a regular basis to share the clinton foundation interest using public resources. >> mr. hackney this is likely based on reports you have seen is that like the special counsel is also looking into things other than russian collusion or president trump? based on reports that you have red? looking at other matters as it relates to president trump. >> oh yes i would assume campaign-finance allegations has been raised where the result is
of interest. is it likely they are looking into the trump foundation? >> it wouldn't surprise me. >> british turner testimony and what i'm trying to figure out this special counsel is looking up at why would attorney general eric holder not have looked into some of the issues related to the uranium one deal and why would they look the other way because apparently according to your testimony they did not know what the fbi or doj ever alerted criminal activities have been covered and that was a quote from your written testimony to the investigation was ultimately supervised by u.s. attorney rod rosenstein and andy mckinney. isn't it amazing how these names continue to show up? isn't it amazing? it there's no further business before this panel we will excuse
you gentlemen. we thank you for your testimony might well ask the next panel to be set up. thank you. >> thank you very much. her. [inaudible conversations] [inaudible conversations] >> the committee on oversight and government reform will come to order. please introduce our second panel. mr. lawrence w. doyle managing partner and mr. john moynahan
principal at the jail them and associates. welcome to you all are. pursuant to committee rules all witnesses will be sworn in before they testify so if you will please stand and raise your right hand. do you solemnly swear or affirm the testimony you are about to give is the whole truth and nothing but the truth so help you god? thank you. please be seated and let the record reflect that the witnesses answered in the affirmative. in order to allow time for discussion and quite frank he for q&a that you will get quite a bit of your entire written statement will be made part of the record but we would ask that you deliver your oral testimony for opening remarks in five minutes or there's a clock in front of you to remind you of that. it will turn yellow when you have 30 seconds left and you will please make sure you press the button when you are speaking
what we will do is we can have your opening testimony combined 10 minutes so i were you want to do that. mr. doyle we will come to you first and if you would yield to mr. moynahan. >> i would like to yield to mr. moynahan for opening statements. >> mr. moynahan you are recognized for up to 10 minutes. >> think you chairman turley like to thank you chairman meadows and members of the committee for having us here today. my name is john moynahan and i'm one of the partners that engaged in the investigative efforts involving a 501(c)(3) in particular the clinton foundation the subject of today's hearing. please note we do many investigations into 501(c)(3)'s and this is just one of many. when i'm finished i would like to -- mr. doyle mr. raven from
the thomas law firm previous than very active with us. as we move through this at the conclusion mr. doyle i would like to ask two questions of the committee. who are we and why did we do this? i think this gives color and background as to what we are doing how we do this for a living what our motivations are and why we are here. i would like to give at this point special thanks to three other individuals who worked on this. mr. rabbit -- the senior executive for the u.s. drug enforcement administration where i worked for many years on money laundering and financial crimes. mr. john sherer from the law firm -- and tax analysts produce shared trust adviser in the yield of taxation investment in mr. thomas gano who is a
litigator who challenged us in the entire process on her evidence in the way went about this and the integrity about what we are going to talk about today. this time i would like to yield to mr. doyle. >> a congressman medicine members of the committee thank you very much for the invitation to discuss the topic related to the oversight nonprofit organization with a specific case study the clinton foundation. my name is larry doyle and john moynahan and i are to produce graduates of the college of the holy cross. jesuit inspired pursuit of the truth competitiveness and playing by the rules have been our calling card and our commitment throughout john's career in law enforcement and mine on wall street. in the last 10 years i have spent countless hours involved
in literary and investigative pursuits related to regulatory failure. the comparisons i see between the sub-prime mortgage market, the lack of ratings and regulatory performance and the madoff's scandal two of today's topics are start. on that note i welcome the following context and perspective for today's hearing. there are currently approximately 1.75 million not-for-profit organizations in our nation today. 90% of these not-for-profit fall within the 5 o. one c3 subset and closed two-thirds are iowan c-3 public charities. recent data highlights that these not-for-profit annually generate approximately $1.74 trillion with the t8250%
increase over the last 20 years equating it to approximately 9%. on a stand-alone basis this segment of our economy will be the tenth largest economy in the world all of which begs the question who is minding the store, looking out for the donors and upholding the rule of law. >> at this point mr. chairman i would like mr. raglan to at a deuce himself. at this point i would like to answer two questions. who are we? we are apolitical. we have no party affiliation whatsoever. no one has financed us. i don't know chairman meadows. i just met him today. i don't know any of you people. i'm happy to meet you but we have no relationship to any of you. we are forensic investigators
that approach this effort in a nonpartisan professional of check given up and away. we have never been partisan. we come from law enforcement on wall street where each of us has dedicated their entire lives and careers to the law doing the right thing pursuing the facts. we follow the facts, that's all. none of this is -- i have a size not of this is our opinion. these are not our facts. they are not your facts. they are the facts of the clinton foundation. why did we do this? this is our profession. people will ask us argue doing this for money? the answer is yes. this is how we make a living. we do cases. it's that simple. we are forensic investigators former u.s. law enforcement of private practice make our living conducting these cases. we did not choose this topic because of who the individuals are or were.
back we applaud the efforts of the philanthropic nature of the clinton foundation on some of the efforts that they have done. that is not in dispute and we are not here to dispute that. rather we have backgrounds in 501(c)(3) charities both inside and outside. we know the risks and the shortfalls. 501(c)(3)'s have been found to be particularly vulnerable to abuse and the lack of oversight especially on the global front. we share a deep approach and commitment to protecting taxpayer dollars. in that context we saw the controversy surrounding this entity as well as a significant amount of money including u.s. tax dollars overflowing through this foundation. we decided to finance out of our own pockets to examine this ourselves. we also firmly believe that no one is above the rule of law regardless of party and those
who occupy senior positions in her government have a special duty. important to stress that we have not made any conclusions and to set the record straight we do not have a lawsuit against anybody. we don't have a complaint against anybody. we have a submission that probable crimes, the irs. that said we use the foia quite substantially and other tools at our disposal to gain quite a bit of public and nonpublic information. all of the information was obtained completely legally through various tools of investigation. at this time what we would like to do in an expeditious fashion is to inform the process we went through and to state our findings that are in our submission to the irs. it's a complex issue. a significant amount of information but let it be said
our claim is a tax claim. it's a claim of probable cause indicating that the foundation operated outside the bounds of its approval that came from the irs. >> you have two minutes. >> if we could read our investigative process to you in a quick fashion here is what we would do. we went to the 990s. we are finance investigators. restarter with returns of the foundation filed, not that we filed enough that you filed, that they filed. these were their revenue sources and their expenses. we attempted to reconcile all of those donations. the basis of our claim is we were unable to do that. on that note, we follow the money. we made extensive spreadsheets
of revenues and expenses. we analyze their income statement and we did a macroreview of all of their donors which is eight -- foundation paid less than one tenth of 1% of the donors paid 80% of the money. we follow the money. we further went and looked at consent decrees issued against the foundation by various states we reviewed the responses from all the states from which they operated. there were questions about violations of consent decrees that they have made to the states. do not now assistant that and the results are quite shocking. in addition to that resource contracts mou's interaction with foreign governments including e-mail exchanges between senior foundation executives and government officials.
additionally we did a review of all their foreign offices and we true a spreadsheet comparing the clinton foundation with the global fund and pepfar. the results were startling. our conclusions in the interest of time are this. the foundation began acting as an agent of foreign governments and continued doing so could assess the foundation should have registered. the ultimate and the foundation and its audit acknowledged that a conceited and all submission that it did operate as an agent. therefore the foundation did not entitle the 5 o. one c3 privileges as outlined in irs 17 dec two. the clinton foundation did not -- it far exceeded the purposes in its original corp. filed
december 3, 1997 and reconfirmed numerous other records across many jurisdictions. the foundation did pursue programs and activities for which it had neither sought nor achieved permission. such was the case even before the completion and transfer of the presidential library in 2004. as such representation by the foundation for what was a representation of the approval organizational tax that allowing to raise funds for the presidential library and related programs therein. the organizational and operational livewood c-3 internal revenue code 7.25.3. the intentional misuse of donated public funds. the foundation awfully attested it received funds and use them for charitable purposes which was in fact not the case. rather the foundation pursued in a rayovac cavities both
domestically and abroad. some may be deemed philanthropic albeit unapproved while others much larger in scope or properly characterized that profit oriented and taxable undertakings of private enterprise against the operational test for philanthropy referenced about the investigation clearly demonstrates that the foundation was not a charitable organization per se but a closely held family partnership. as such it was covered in a fashion in which it sought in large measure vans personal interests as detailed within the financial analysis of the submission and further confirmed within the supporting documentation and evidence section. alas finding donors responsibilities. a private foundation that donated to the clinton
foundation are themselves subject to tax payments on the donations that they made to the foundation under code irc 4945. unless they meet specific conditions as outlined in code 72719582. >> thank you for your time. >> thank you both for your testimony. the chair recognizes the gentleman from ohio mr. jordan. >> thank you mr. chair. as you said i don't know you guys. i just wanted to hear what you have to say. are you both accountants? >> up my undergraduate degrees in economics and the end finance magna cum laude. >> i graduated from holy cross and i'm an economics major. i worked for wall street and finance the last 10 years. i spent in excess of time
investigating and writing about regulatory failure including publishing a book. >> let's go back to some of the things you said in your opening comments. in an earlier session mr. connolly said you were in the midst of a lawsuit. that's not accurate? and that's completely inaccurate we do an investigation of the whistleblower statute that if you find probable cause we have not related any conclusions about this. we are under the law -- to the irs jurisdictional oversight. we have made that submission. whatever the irs finds and concludes we stand by. >> you submitted that claim or that concern you had to the irs that you called probable cause. when did you do that quick austin -- august 11, 2017. >> so year and a half ago almost
did someone hire you to figure out what was going on? >> we do 501(c)(3) work. to be quite frank. >> if you find out there's that commit these to get some kind of -- you get paid. >> we do this for a living. if the clinton foundation was at $2.5 million issue -- . >> how many other cases at the den where you filed a probable cause with the irs. >> the first time. >> the first time. >> we were hired by a law firms who represent 501(c) threes. spanakopita a.. these are things i highlighted in your statement. the books don't talent. give me an example. >> riverview revenues versus expenses. it's not so much that they didn't balance.
we wanted to do our own work. all her own work and we created spreadsheets and looked on a line item by line item uses how much was salary and how much on travel and office expenses and just created that's red sheet to follow the money. >> it's not about balancing its about what they spend it on. >> exactly. >> you said government officials were talking all the time on e-mails and it was dark what they had to say. walk me through one of those enough to give me an example of that. >> the discussions between the senior foundation official prior to the library being turned over to the national archives while they were in the process of looking to launch their health-related that to these and the nature pushing those programs. when we looked at that that
caused concern in terms of looking to be far outside. they are out there talking about these health-related activities and they were approved for library. >> can any give the committee an example of one of those e-mails that were outside of the limits of the parameters of where they are supposed to be? >> we are talking about a european country that is in dialogue with senior members of the foundation that eventually signed an mou for cash flow programs. that was happening in 2002. the library which is the only approval that the irs gave to them is a foundation was turned over in 2004. two years before the library was turned over senior officials
negotiating and an mou between a urine p.m.-based country and an african country. we have those exchanges. to us that is a red flag because your approval was for libraries. why are you negotiating health-related contracts? if you wanted to do that you can you change your corporations seek approval from the irs that was specific way stayed in your determination letter. the irs gave them -- the determination letter it said should you change the purpose to intentions of what you are doing you need to contact us for approval. you cannot do that. >> one message over and above that in one of those e-mails a statement was made, this is not it went in foundation program
per se which an hour reading and understanding of the law, it isn't. >> mr. chairman nye amount of time. >> the chair recognizes mr. mr. martin for five minutes. >> thank you sir. you submitted a complaint to the irs and the fbi with allegations against the clinton foundation. think you testified to that an office. staff that is not correct, maam. what it is is we put together investigative findings and make you a submission. not a complaint. the complaint is the final document that is submitted to the court saying we are going to indict somebody. we actually have reached
conclusions. we are siding in our submission indicia or probable cause as to what has gone on. >> why won't you give us a copy? we anticipated that question. we have this as an ongoing matter and we don't know how the irs will rule on that. >> then what's the point of withholding it from this committee? >> i want to answer your question specifically. there may be further causes of action we can't or sue under the law and we are not going to sacrifice or pretend you to do that. this is how we make a living. not everything that we have done in our best occasion during the submission -- we only put in our submission that was applicable to a tax claim. we have not put in our submission anything that is not a former tax issue.
>> to reiterate you are not with -- . >> we are people who are not from inside the clinton foundation. where financial investigators on the outside of the clinton foundation filing a claim under the whistleblower act. you cannot be a plaintiff in the tax case. that is not allowed within the law. >> so what are you? >> in this case we filed under whistleblower act. >> you told us last friday that you are plaintiffs in a lawsuit rates absolutely not. i was completely incorrect. >> committee staff asked you for copies of documents and you submitted to the irs. he declined and you also said
you had provided no documents to republicans. >> we have not. somehow however on monday republicans did obtain 1300 pages of documents are mere submission. when i sent them over to us they claimed you gave chairman meadow's office these documents on a gift. they said you provided them -- did you or your attorney provide these documents to chairman meadow's or any other republican? >> we did not. >> i am very confused. last monday our staff e-mailed you are rather your attorney and asked if these documents, and
again i apologize, were provided by you. he responded moynahan and doyle did not provide any type immense tim meadows staff. it is my understanding that they gave the documents -- it is my understanding they were given those documents by a reporter named don salmon on his own initiative. do you stand by your statement that you had nothing to do whatsoever with providing these documents like. >> that is not what you asked me. you asked me if i deliver the documents the republicans and we did not. >> we did have something to do with it. tonight yes do you did and asked
me that. you're asking me now the answer is those documents following a preliminary denial letter by the irs when they asked for us for an appeal. we sent pictures of their own irs agents worked on cases. >> you're being contradictory. they sent us an e-mail on tuesday and i'm quoting from it. we have received the same 1300 pages by their office and they received this material from doyle and moynahan. doyle and moynahan were reticent to come forward and share documents. we have been treating them as the whistleblowers. after we received these documents we asked them for permission and understand i'm quoting to share with you.
last friday their lawyer confirmed. >> congressman we'll explain it. we were in data tier staff member that both sides have the same materials. whatever the republicans have the democratic side should have as well. we are here not right versus left. john and i are all about right are so wrong. with regards to your question i want to be very specific. those materials we later learned were supplied to the republican side that john solomon. he gave it to john solomon in our exercise of trying to understand the playing field with the irs with a slow number personal doing this. >> why did you give it to
reporter? did you know he would give them to the committee? >> we did not know that. >> i suggest we take this matter up. >> i will be glad to do that. i can assure you anything i have the minority has and you know that i will not keep documents from you. >> i do want that to be clear. >> we want that. >> i think you all are in possession of everything i have and we want to make sure everyone is on a level playing field here. the gentleman from iowa is recognized. >> thank you mr. chairman. both of you have done extensive work with 501(c) threes, is that correct? >> yes. >> tell me what is the average percentage of donations or revenues that goes to intended
beneficiaries in the average 501(c)(3) lexus of 20% or is that 80%? >> out of the ones we worked on to be quite frank are the ones that have problems. if you are asking me the question relative the fee we have worked on it is significantly lower than that. >> now we worked on it just for the industry. >> you would hope no more than 15% is administrative. >> 80% would go to the intended in the fishery. >> people have to make a living and you can expect the administration within those but this is about philanthropy and public support for this. you to give it to the people who need it. >> voice a donation to the clinton foundation. >> based on information we have from the 990 and we do not believe that is complete because
we do not have subpoena power that range is somewhere around 60%. >> actually congressman if i could it would be beneficial but could quickly run through the breakdown of expenses if that's okay. >> that would take too much time. >> they were 12% compensation salary and benefits travel 8% and other expenses 12%. overall it might have been 40% by our calculation and ended up to going to programs that 60%. >> what happened to the contribution level of the clinton foundation when the clintons were no longer in political power? did they go up or down? >> they went down. >> significantly? >> quite frank their analysis
does not include that. this particular foundation of 2005 to 2015 week break it down dollar by dollar. we start with the first identification number issued by the irs and the tally that up year by year. we take the second employer identification numbers that was used over to your period which from our freedom of information act requirement was approximately $22 million. it was not approved to do that what appeared to be paid to play? spin it to be very clear our focus is on financial analysis and whether they live within the boundaries. as counsel of that investigation with it come across instances of
that but we put that into a catchall category outside of the boundaries. >> mr. chairman i will you up my -- the balance of my time to the gentleman from ohio. >> in your opening statement use the term agent of a foreign government to give me an example of that. >> sure. there are so many examples. mozambique in 2002 there was a memorandum of agreement with the foundation and mozambique did work on their behalf through their ministry of health. this was a program and again through that engagement it was plainly obvious based on e-mails that we have reviewed that this was not a clinton foundation program per se. they were there to support the
mozambique ministry of health. if you want to reduce this to layman's terms they were brokering money and they were brokering pharmaceuticals but that's a term on wall street reuse. they were an agent of money through these donors. for lack of a better term they were vague in terms of their fees. roquefort the money and then they negotiated these relationships with the pharmaceutical companies. by the same toking they were brokering the pharmaceuticals. >> i think one of your concluding remarks was the clinton foundation function as the ghostly held family partnership and not a charity. >> the reality is public charities and private foundations -- public charities or organizations allowed to solicit funds from the general
public which is what they were for for a library. they followed that with funds from public trust. going along with that public charities really don't make grants. they don't. they do the programs. i have my own 501(c)(3) involving baseball. i fixed up a lot of baseball fields in massachusetts so when people donate to that $20,000 to go and pull the weeds out. we do the work. private foundations are different. on those boards there may be one or two individuals. those foundations are governed in a way that there is a specific function that's going to go on and they issue grants. a lot of times those grants go to a public charity. there are striking differences between public charities and private foundations. what happened here or whatever
reason we don't know we don't have an opinion on it it became a hybrid. our analysis shows that this hybrid models the global fund in geneva switzerland but that's a hugely important point. .. >> in the same recipient countries of the global fund to create a separate entity that was formed in 2006 mister
clinton and mister gates was on the board. together they formed that the difference was the single largest owner to the clinton foundation those revenues did not stay outside of the united states they created jurisdiction by flowing back into the united states and bank of america boston massachusetts that becomes under the jurisdiction to be governed by the internal revenue service so they are facilitator you cannot do that. when you pay your taxes. >> i will cut you off there.
the time is expired. >> i will ask you to try to be succinct and direct and bluntly dumb it down you are talking about stuff quite frankly i have no clue when you start quoting different statutes and things like that the average american we just want to know if there is wrongdoing or not. i know you say you don't have an opinion then why did you file a probable cause filing with the irs new. >> but based on the facts do believe there is probable cause of wrongdoing crack. >> yes. >> yes. >> so let me get to this. you have been well advised so i will be blunt i checked with the irs commissioner nothing that you say according to him
will actually affect any potential claim that you already submitted that's what he told me so if that is the case you have a problem giving the 6000 pages that you submitted to the minority and the majority crack. >> we will take that under advisement. >> then you need to go ahead with your counsel right now. listen. our patience is running thin for you to provide expert testimony i am saying if you have a legitimate claim you would protect that but if you will not share the information with this committee and cut to the chase my patience is running out. i will give you a few seconds to talk to your attorney and come back to decide how you want to proceed.
answer any questions you may have spin i just you are aware and your counsel is aware , have you submitted all those documents to the irs. >> have you submitted them to the fbi crack. >> yes. >> we will compel you to bring all of those documents to this committee and i will tell you you are being poorly advised by your counsel i am saying that directly to you. this is a hearing to get to the truth. so if you are about the truth then why aren't you willing to give us the documents i don't think we should sacrifice our potential. >> if i could protect your financial claim and as a commitment from the irs would you be willing to give the documents quick. >> that only claim is that with the irs we have other claims we could bring. >> you said you will also
bring civil quick. >> we have opportunities. this is what we do for a living. >> use a potentially you will have a civil lawsuit and this public hearing could affect that quick. >> no. what we are saying is the irs stands on its own merits if the irs finds one way we have one reaction if they find one way we have another reaction. >> do you believe based on an interview you have done with the clinton foundation there was criminal activity that might have happened quick. >> we do believe that yes. >> you have that based on what quick. >> interviews and larry can
speak to that directly. >> we met with mister kessler nh i reached out to him early to mid october as a former acquaintance he call me back noh at 945 in the morning three and a half weeks after i had reached out to him and we exchanged pleasantries and i confirmed him so he was fully aware of who he was and we got together and he was very forthcoming and we stand by every word. >> what does forthcoming mean? what alleged activity do you believe the clinton foundation may have been a part of quick. >>'s statements to us were very clear and genuine that mister clinton on a regular basis mixed and matched his personal basis with that of the foundation.
>> so your conversation indicated there was co- mingling of funds between the president and the foundation. >> donated funds to the foundation? >> that was stated to us. >> and stated very specifically i have been doing this for a long time when someone says they know where the bodies are buried. >> but that is hyperbole. tell me the other potential criminal that may have happened. >>'s statements to us we have submitted with the irs. is that for them to make that determination. >> what are the other alleged criminal activity communicated to you quick.
>> he communicated coming billing of funds that the most specific activity on a regular and ongoing basis. >> did you have another interview? with barbara official? >>. >> with your sporran testimony if you interviewed someone else as a witness you are required to answer that or plead the fifth. >> we made a confidentiality agreement with her at the time. >> see you have a confidentiality agreement with someone you interviewed what was that person's position quick. >> a very senior position within the access program.
>> that is referred to as chai is that the largest part of the clinton foundation? how many dollars of assets is in the chai part of the foundation? >> give us a minute. >> approximately 900 million by that analysis. >> what were the allegations she alerted you to crack. >> she stated very specifically that the funds were used essentially as a piggy bank you could travel when you wanted to the senior administrators would operate the fund treated this as personal business, foundation business, travel and personal expense.
>> so you are saying that they could use the charitable donations for private travel and go on personal trips? >> yes. that is the conclusion. >> what else? >> she also reference the relationship with his largest donor of bill gates at which point in time they were not on speaking terms and referenced the fact that this point in time in 2009 the health initiative had not received prior approval for their activities by the irs. >> so the clinton foundation had not received proper approval? who did not quick. >> the clinton health prior to
2010 chai which is the acronym for clinton hiv-aids which we are led to believe from this interview that mister gates telling mister clinton you need to get formal approval for this activity that goes back through 2002 that is the premise of the submission and at that point i actually went and got formal approval from - - from the irs that then became known as the clinton health access initiative. >> who approved the 501(c)3 status. >> it would have been the irs. >> we have the document i don't have the name offhand but we have the determination letters the initial approval was simply for a library.
>> who modified it quick. >> we saw no modification you have to notify the irs to change your articles of incorporation. >> were there any modifications? >> no. >> we have a second round we will go to you as soon as you are ready. >> very specific strategy that went on i think that's what you want to know. in order to go forward the application has a schedule g that asks if a successor organization to a previous one? then you have this running an approved and then advised with mister gates to get approved so then they go make an application and on all the
forms when asked is this a successor operation they specifically and affirmatively answer no. that is a misrepresentation it is the same people doing the same thing the same people doing the same thing. >> so did you ask this individual she said i work for charitable organizations this is the furthest thing from a four star rating. >> she went on to further state to us that she advised her own friends in multiple businesses to stop donating to the clinton foundation it was so bad. >> i will yield to the gentleman from georgia but let me say thi this.
it is critically important we have the documents we could hear your testimony all day long it's not fair to ms. norton - - norton or to me to hear your testimony that we cannot verify without documents just like you submitting something that with the irs have you submitted these to the fbi crack. >> yes. >> you believe they have opened an investigation based on your conversations quick. >> yes. >> you believe there is an open criminal investigation by the fbi on the clinton foundation? >> out of little rock there is an open criminal investigation into the clinton foundation with the information you have submitted quick. >> they informed me they were
very very very grateful and the case fashion. >> that is incredibly important if you are telling me there is an open criminal investigation maybe that makes sense why mister huber is not here because if he cannot comment on the ongoing investigation maybe that's why he didn't show up. >> that's why we want the committee to come to their own logical conclusions and not have us come to your conclusions for you thank you mister chairman i had to step out i know my concerns and questions have already been covered but i do want to bring up a couple of things from the satisfaction and understanding i understand the necessity of the documents i was a little hesitant coming into this i
feel like you are using us for your own benefit but we need the information to do the proper oversight we are responsible for. >> excuse me you invited us. >> you have not turned over the documents and we need those documents. >> you invited us we told the staff members if not to then take it away. >> also know there is a point that from a financial perspective that we are here to do oversight and we need cooperation. have you been in contact with the attorney or anyone on the investigation team. >> we sent all information and documents to salt lake city early april and provided information in mid april and
late may then again late octobe october. the first communication with us attorney's office is late november 2 weeks ago. >> see you have been in communication. >> we received two incoming phone calls that friday. >> can you say with whom quick. >> what are the assistant attorneys and one was that? >> that was two weeks ago. >> no communication prior to two weeks ago crack. >> know there was not. >> what was the basic nature of communication quick. >> reviewing materials. >> so you did not have a conversation? >> no sir just with the fbi it is a one-way communication they ask. they don't tell.
>> so how do you know they are following up on the information that you gave them crack. >> based on their question. >> they did not say they were following up crack. >> you are giving an educated guess. michael horwitz have you been in communication with him or his team? >> we informed the inspector general of our submission by a letter midyear. >> have you heard back? any communication quick. >> know. >> you don't know if anything is going on that and that all. 2011 the clinton foundation hired outside law firms that came up in the first panel talking about performing a governance review are you
familiar with that? >> yes. >> this memo has been widely spread in the media and you are familiar based on your investigation, do you find any indication there was ever a quid pro quo or donations and return for action by hillary clinton as secretary of state quick. >> yes but not from the memo but from her own investigation. >> are you convinced that took place? >> yes. >> i yelled back. >> the chair recognizes the gentleman from the district of columbia. >> i want to further clarify because you indicated how very grateful the fbi was for the information but they never
confirmed that they were going to do with the information or if there would be an ongoing open criminal investigation did they. >> you do not hear my question crack. >> you said how grateful the fbi was to receive your information so i am asking you did they confirm this information would be used as part of an ongoing criminal investigation. >> i want to clarify that. >> also because of your own status you don't classify yourself as whistleblower. >> via the outside. >> with a lawsuit.
>> not involving us. >> believe our potential plaintiffs. >> we will never have that tax lawsuit it is not allowed we have a submission to the irs we are not adverse to the clinton foundation if any action is taken it is taken by the irs not us. we submit probable cause they determine if there is an action to be taken we are not adverse in the submission to the clinton foundation. we gave them probable cause they will determine. >> are you seeking any monetary awards if the irs is successful there is an award. >> how much quick. >> whatever the irs determines it has between attended 30 percent payout we maintain the revenue to be anywhere between
400,000,200,000,000,000. >> so just to confirm you've never worked for the clinton foundation. >> no. >> you have not had access to internal files. >> no. >> so in your written taste one - - testimony you stated your sent to your submission to the irs 2017. you also conceded "we recently received a letter of preliminary denial. >> what does that mean and we asked for a copy of a letter from the irs why won't you give us a copy that you did receive a letter of
preliminary denial crack. >> we're in appeal status. >> they actually say in the letter please submit an appeal as if we are wrong so we sent it in with a photocopy of the fbi removing boxes from the foundation taking materials out we sent that with our appeal it demonstrates to the irs the letter coming from atlanta does not reconcile what is going on. >> the chair recognizes himself i will do a little follow-up. so your conversations with these agents in little rock was that you crack. >> that was me so your conversations with them they
acknowledge they had received your submission and pages of documents. >> correct selected they acknowledge any work they are doing with that directly or indirectly? >> they did not comment. >> so they just said thank you quick. >> we will record your professional conversation i cannot comment thank you very much we are very grateful for your efforts. >> so what makes you believe there is a criminal investigation out of little rock quick. >> i spoke to him twice in august and then again. >> what makes you think there is a criminal investigation? if it was just cordial quick. >> in the august conversation he said this is a developing
an ongoing situation? investigation? >> i'm sorry investigation that he could not comment on. >> yes so that would indicate there is an investigation. >> chairman i do work with these cases so the fact that they followed up with a second inquiry not thanks to let the door hit you on the way out and then follow up again that is not the sign of a closed investigation. >> but i cannot take your experience with the dea. i appreciate the thought but if they said they would open an ongoing investigation that you recall.
>> to the best of my memory that is what i recall. >> if there is an open and ongoing investigation you have given the information to the them, why would the irs not view that as substantial? >> do they know there is an open and ongoing investigation? >> we sent the picture. >> i heard that. >> so they know that. >> to that point honestly the irs individual i would say was more than mildly surprised our interaction with the fbi. >> why do you think he waited until november 30th to call you about four letters you sent prior you said them on the 14th and the 19th of april the 29th of may as i
recall and october 10th why did they wait until november 30h to give you a call? >> we don't know did that have to do with the fact you were coming here to testify? >> this testimony i don't know why. >> because we asked them to come and be a witness now all of a sudden you get a phone call from mister huber who was second in command? >> so i find it very coincidental that on novembe noh after we give them notice to come testify now all of a sudden they would follow up what did they say about the documents you provided then? did they have them all quick.
>> he said we are reviewing your material i asked if he could comment further beyond that if this was ongoing he said we are reviewing the material he call me back a few hours later and asked specifically want exhibit and then asked further if i have these on a disk i said i have them on a thumb drive he said please resend them and i resent that the afternoon. >> was at the first time he had his time actually got the documents from you crack. >> that was the third time. >> on november 30th they called you back and they could not find the first two submissions you made? they wanted you to send them again quick. >> we are concluding that ourselves. >> but what i have been told by doj which i do not believe
to be frank that this was the normal process to follow up on recent correspondence what was the most recent correspondence you had with the department of justice quick. >> october 10th. >> i had the correspondence. >> prior to the phone call what was the most recent you had with the department of justice. >> we sent materials. >> october 10 delivered by fedex october 12th. >> i have a copy of the fedex delivery. they did not respond to your aph letter they did not respond to the letter later in april or to the may 29th letter they find any respin responded to october 10th later a few days before a hearing was coming up.
>> do you think that shows the level of interest a special prosecutor would show quick. >> we don't know his caseload but frankly we are disappointed that three-year level of effort goes into this we are not paparazzi we are not the media we are financial investigators that's what we do we get paid to do this for a living we work for ourselves we don't get paid by anybody else it is disappointing that it took that long. >> we shared our materials not only with the office in little rock but other us attorneys offices as well as they indicate to provide support working on clinton matters also materials with us postal inspection service. various jurisdictions we felt would be interested at the state and federal level.
>> you have shared all of those documents with those entities but yet somehow do not believe you should share with congress and the american people? >> answer that for me. i want to hear this because quite frankly. >> are you going to prosecute or bring an action against the clintons i don't think you are. don't get cute with me. i promise you i thought you said you were all about the rule of law in your opening statement. >> that is why we presented to the law enforcement agencies which are not. >> let me just say this we have an oversight responsibility and i can assure you that when you come in here, it is incumbent upon you to be open and transparent.
we can make criminal referrals just like anybody else. we cannot prosecute. you are right but i can tell you that when you come before us you have shared it with all kinds of entities and did not actually listen to my friend to the right to say you deserve to see the same evidence you shared with others? i don't know how that provides a good foundation for truth and transparency. >> we're looking at it from a different perspective we are financial investigators we do cases and present evidence to those jurisdictions in this case, the irs to bring a case. that is not what you do. that's why we presented it to them and not to use. >> i can assure you that will compel us to get the information from you or from
the agency. i can assure you that my good friend to my right and the entire committee can review these documents to make their own claim. >> we would welcome that from you. >> you said anywhere from 400 million through two two.$5 billion might be subject to taxation. so you saying worst case in your opinion $400 million were improperly used in a charitable foundation named in the clinton foundation crack. >> correct. >> it could be all of it. >> if there is no further business before the committee we are adjourned. [inaudible conversations]
mr. heller: mr. president, i rise today with gratitude to address my colleagues and address my colleagues and >> madam president i rise today with gratitude with members of my staff to reflect on one of my life's greatest honors to serve the people of the great state of nevada. like to begin with a profound honor to represent nevada and united states congress 12 years and then in the senate almost eight years. thank you for granting me the privilege every day for a state that i am so proud to call my home. and joined by my immediate familyid especially my wife through all these years of public service into my children and their