Newly released testimony from an IRS whistleblower offers fresh details about how the Department of Justice denied search warrants, prevented witness interviews, and shut down lines of inquiry during the investigation of Hunter Biden’s foreign business dealings.
The House Ways and Means Committee voted on Thursday to make transcripts of the testimony public, just days after Biden pleaded guilty to tax offenses and a gun charge in a deal that will spare him prison time.
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Gary Shapley, a supervisory special agent with the IRS’s criminal division, had provided the testimony behind closed doors earlier in May after approaching the committee with allegations of misconduct in the yearslong Hunter Biden investigation.
Another IRS whistleblower, who remains anonymous, also provided testimony that the committee released on Thursday.
The actions Shapley and the anonymous whistleblower described underscored how much more aggressively the Justice Department has moved against former President Donald Trump than against Biden despite the apparently significant evidence collected by the IRS and the FBI in the five years since the investigation began.
The investigation into Biden began in November 2018 through another inquiry the IRS was already conducting into a “foreign-based amateur online pornography platform,” Shapley said.
The anonymous whistleblower elaborated on the opening of the case, noting that he became aware of potential illegal activity involving Biden while reviewing bank records from the company.
“Those bank reports identified Hunter Biden as paying prostitutes related to a potential prostitution ring,” the anonymous whistleblower testified. “Also included in those bank reports was evidence that Hunter Biden was living lavishly through his corporate bank account. This is a typical thing that we look for in tax cases — criminal tax cases, I should say.”
Months passed as IRS supervisors and Justice Department officials resisted the opening of the case, the anonymous whistleblower said.
And when it was opened, both men said high-ranking officials tried to stop it from moving forward.
Shapley said the U.S. attorney’s office in Delaware and the Department of Justice “provided preferential treatment and unchecked conflicts of interest in an important and high-profile investigation of the President's son, Hunter Biden.”
“The criminal tax investigation of Hunter Biden, led by the United States Attorney's Office for the District of Delaware, has been handled differently than any investigation I've ever been a part of for the past 14 years of my IRS service,” Shapley testified, according to the transcript. “Some of the decisions seem to be influenced by politics.”
Shapley noted that decisions benefiting Biden were made “at every stage” of the yearslong inquiry.
Under his supervision, the IRS team investigating Biden signaled in March 2020 that they had established enough probable cause to seek physical search warrants in California, Arkansas, New York, and Washington, D.C., as well as to conduct 15 witness interviews.
By June 2020, career Justice Department officials still would not allow “overt investigative actions” to proceed.
But the IRS team continued to investigate using what measures they could, Shapley testified, including by accessing Biden’s iCloud in August 2020. That search turned up messages that investigators “clearly needed to follow up on.”
“Nevertheless, prosecutors denied investigators' requests to develop a strategy to look into the messages and denied investigators' suggestion to obtain location information to see where the texts were sent from,” Shapley testified.
Shapley cited one text message from 2017 that Biden sent to Henry Zhao, a Chinese Communist Party official and businessman, that explicitly mentioned the involvement of Joe Biden.
"I am sitting here with my father and we would like to understand why the commitment made has not been fulfilled,” Hunter Biden wrote, according to Shapley, before unleashing a tirade of demands that included threats. ”I am sitting here waiting for the call with my father."
The text, along with other communications, led investigators at that time to believe they should search the guest house at the Bidens’ Delaware residence, where Hunter Biden had lived.
In September 2020, an assistant U.S. attorney, Lesley Wolf, told the IRS team that while they had amassed “more than enough probable cause for the search warrant” of the guest house and that they were likely to find the evidence they wanted at the residence, she felt “there is no way we will get that approved.”
It was not the only physical search warrant that prosecutors denied; in December 2020, after learning that Hunter Biden had an abandoned storage unit in Washington, D.C. that likely contained documents, U.S. Attorney David Weiss and other investigators agreed that preparations should be made to execute a warrant to search the storage unit.
Wolf called Hunter Biden’s attorney to tip him off that investigators were interested in the storage unit, Shapley said, and no search warrant was ever approved.
The anonymous whistleblower said a number of developments in 2020, including the dust-up over the storage unit, led him to conclude that Weiss — the Delaware U.S. attorney who charged Hunter Biden this week with lower-level crimes — “wasn’t really in charge.”
Indeed, Shapley testified that while the Justice Department touted Weiss, a Trump appointee, as the head of the investigation, it was a Biden appointee in the U.S. attorney’s office for the District of Columbia that refused to bring charges Weiss supported. Weiss needed that U.S. attorney’s permission to charge a tax crime that physically occurred in a different jurisdiction, and he did not get it.
Weiss brought charges this week only for tax crimes that occurred in the years Hunter Biden filed returns in Delaware. For two previous years, 2014 and 2015, when Hunter Biden filed in Washington, DC, the Biden appointee allegedly would not allow any charges to move forward.
“The years in question included foreign income from Burisma and a scheme to evade his income taxes through a partnership with a convicted felon,” Shapley testified, referring to the Ukrainian energy company on whose board Hunter Biden sat.
“There were also potential FARA issues relating to 2014 and 2015,” he added, referring to the Foreign Agents Registration Act, which requires lobbyists to register any work they do on behalf of foreign clients. “The purposeful exclusion of the 2014 and 2015 years sanitized the most substantive criminal conduct and concealed material facts.”
In 2020, the Justice Department also slow-walked the process for obtaining a separate search warrant for emails related to Blue Star Strategies, a lobbying firm for the Ukrainian energy company on whose board Hunter Biden sat.
Blue Star Strategies had not registered its foreign lobbying activity with Burisma, the Ukrainian energy company, and was under investigation by the Justice Department until the DOJ closed the inquiry without any charges last year.
By early September 2020, Shapley testified, the Justice Department “issued a cease and desist of all overt investigative activities due to the coming election” despite the evidence investigators had collected over the few weeks prior.
The turmoil around the results of the 2020 election gave the Justice Department an excuse to delay activity further, but by early December 2020, the IRS had secured approval to seek an interview with Hunter Biden.
One day before the interview was to take place, however, officials at FBI headquarters notified the Biden transition team and Secret Service leaders that investigators planned to show up for the interview the following morning.
“This essentially tipped off a group of people very close to President Biden and Hunter Biden and gave this group an opportunity to obstruct the approach on the witnesses,” Shapley testified.
When the day came for investigators to make contact with Hunter Biden and a slimmed-down list of the witnesses they could get approval to interview, Shapley said investigators only managed to land one meaningful interview.
That was with Rob Walker, a business associate of Hunter Biden who had funneled large sums of money to the president’s son.
Shapley recited a key part of the interview conducted by the FBI, which was hampered because investigators had been instructed not to ask any questions related to Joe Biden and his interactions with his son’s business partners.
“The FBI agent continued: ‘Any times when he was in office, or did you hear Hunter Biden say that he was setting up a meeting with his dad with them while dad was still in office?’ Walker answered: ‘Yes.’ And, inexplicably, the FBI agent changed the subject,” Shapley testified.
The slow-walking and stonewalling continued throughout 2021 and 2022.
Shapley said the Justice Department, without explanation, delayed any ability for prosecutors to ask the U.S. attorney for the Central District of California for permission to charge Hunter Biden for the years he filed taxes there until September 2022. That same month, President Joe Biden’s appointee for that office was confirmed.
The Biden appointee in California, like the one in Washington, D.C., denied the request.
In October 2022, Weiss told the investigators on the team that Justice Department leaders had also refused his request to grant him the authority of a special counsel, which would have allowed him to move the case forward with less interference.
“U.S. Attorney Weiss stated that he subsequently asked for special counsel authority from Main DOJ at that time and was denied that authority,” Shapley testified. “Instead, he was told to follow the process, which was known to send U.S. Attorney Weiss through another President Biden-appointed U.S. Attorney.”
Attorney General Merrick Garland has repeatedly held Weiss out as the sole authority in the Hunter Biden investigations and used Weiss as a shield against accusations of bias, given that Trump appointed Weiss to his position.
But both whistleblowers testified that Weiss’s efforts to charge Hunter Biden were blocked.
And after the October 2022 meeting in which Weiss informed investigators that he could not get approval to bring charges — a meeting that, Shapley testified, got heated — Shapley and his team were cut off from the investigation, and Weiss’s office demanded all of Shapley’s emails.
Shapley’s claims contradict congressional testimony from two top Biden administration officials that Republicans are likely to explore as potential perjury.
One is Garland, who in March denied any of the conflicts Weiss faced when trying to get permission to bring charges in other districts.
"The United States Attorney has been advised that he has full authority to make those referrals you're talking about or to bring cases in other districts if he needs to do that. He has been advised that he should get anything he needs,” Garland testified. “I have not heard anything from that office that suggests they are not able to do anything that the U.S. Attorney wants them to do.”
Shapley and the anonymous whistleblower also shared claims that contradict testimony from the head of the IRS, who assured Congress that no whistleblower would face retaliation.
"I can say without hesitation, any hesitation, there will be no retaliation for anyone making an allegation," IRS Commissioner Daniel Werfel told a House Ways and Means Committee hearing in late April.
Shapley told congressional staff that, since October 2022, the IRS “has taken every opportunity to retaliate against me and my team.”
The retaliation he faced included the loss of a promotion and what he described as threats sent from Washington, D.C., officials to his field office.
In addition to those revelations, Shapley and the anonymous whistleblower shed new light on the saga of Hunter Biden’s laptop.
Shapley laid out a timeline of events regarding the laptop that differ sharply from the public record at the time.
When the New York Post published a story in October 2020 using emails from the laptop, revealing the existence of the device for the first time, Joe Biden and Democrats quickly dismissed the material as disinformation.
A leak to NBC News almost immediately afterward suggested federal investigators had opened an investigation into whether the published Hunter Biden emails were “linked to a foreign intelligence operation.”
But federal investigators already knew that to be false, Shapley said.
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The FBI verified the authenticity of Hunter Biden’s abandoned laptop as early as November 2019, Shapley said, by matching the device’s serial number to Hunter Biden’s iCloud. The bureau’s interest in the laptop stemmed from its belief that the device may contain evidence of a crime, and it had had the laptop in its possession for 10 months before the New York Post story was published.
More than 50 former intelligence officials signed a letter claiming the Hunter Biden laptop material appeared to be a “Russian information operation.” Joe Biden went on to cite the letter during a debate against then-President Trump to claim his opponent was spreading Russian disinformation by even mentioning the laptop.