Muslim Groups' IRS Files Sought
Homeland Security
By By Dan Eggen and John Mintz
Washington Post
January 14, 2004
Web site: washingtonpost.com
The Senate Finance Committee has asked the Internal Revenue Service to turn over confidential tax and financial records, including donor lists, on dozens of Muslim charities and foundations as part of a widening congressional investigation into alleged ties between tax-exempt organizations and terrorist groups, according to documents and officials.
The request marks a rare and unusually broad use of the Finance Committee's power to obtain private financial records held by the government. It raises the possibility that contributions to charities such as the Holy Land Foundation or the activities of such groups as the Muslim Student Association could be subjected to Senate scrutiny.
An IRS official said the agency expects to comply with the request because the committee clearly has the statutory authority to examine such records. The request includes leadership lists, financial records, applications for tax-exempt status, audit materials and the results of criminal investigations.
The Senate-led probe follows more than two years of investigations by the FBI, the Treasury Department and other federal agencies into the activities of Islamic charities suspected of having ties to al Qaeda; the Islamic Resistance Movement, also known as Hamas; and other groups designated as terrorist organizations by the U.S. government. The United States has frozen more than $136 million in assets allegedly linked to al Qaeda or other terrorist groups and has effectively shut down the operations of the largest U.S.-based Islamic charities.
"Government officials, investigations by federal agencies and the Congress and other reports have identified the crucial role that charities and foundations play in terror financing," the committee's leaders, Chairman Charles E. Grassley (R-Iowa) and ranking Democratic member Max Baucus (Mont.), wrote in a Dec. 22 letter to the IRS. "We have a responsibility to carry out oversight to ensure charities, foundations and other groups are abiding by the laws and regulations, to examine their source of funds, and to ensure government agencies, including the IRS, are policing them and enforcing the law efficiently and effectively."
But many Muslim leaders and attorneys for the charities complain that the government's tactics have unfairly smeared law-abiding Muslims and have dried up financial support for groups that try to provide medicine, food and other goods to the Middle East and elsewhere. Several representatives of the groups said the Senate Finance Committee's probe is needlessly intrusive and will scare away more contributors.
"The Muslim community would view this as another fishing expedition solely targeting Muslims in America," said Ibrahim Hooper, spokesman for the Council on American-Islamic Relations (CAIR) in Washington. "Are they now going to start a witch hunt of all the donors of these now closed relief organizations, so that Muslims feel they're going to be targeted once more based on their charitable giving?"
Roger C. Simmons, a Frederick, Md., lawyer who represents the Illinois-based Global Relief Foundation, whose assets have been frozen by the government, said: "This kind of blanket request would further chill the tendency for American Muslims to give money. As far as the organizations themselves, I'm not sure what else they can do to them that they haven't already done."
Committee staffers said the investigation is based not on ethnicity or religious affiliation but rather on concerns that the groups may have ties to terrorists or their supporters. "This is not a fishing expedition targeting Muslims," one Senate aide said. "All the groups we're looking at are suspected of having some connections to terrorism or of doing propaganda for terrorists. We're not presuming anybody's guilty."
The Senate Finance Committee is one of a handful of congressional panels that have the authority to request information from the IRS that is covered by privacy protections under Section 6103 of the Internal Revenue Code. Although such information has been requested in the past, including as part of the probe into the Enron Corp. scandal, committee staffers and outside experts said the scope of this request is unusual because of its breadth and because it is part of a wide-ranging terrorism-related investigation.
Donald Alexander, a former IRS commissioner, said the request "is rather broad," but he added that he expects the committee will be judicious in releasing any private information to the public.
"The Finance Committee has indicated its concerns in the past as to whether the IRS has been properly policing charities, and this is a reflection of that," Alexander said. "They've done a good job in the past of protecting the information and using it wisely."
The letter addressed to IRS Commissioner Mark W. Everson includes a request for 990 forms, which are public documents that list a group's leaders and large donors, and 1023 forms, which organizations use to apply for tax exemptions as nonprofit groups. Grassley and Baucus, who asked that the material be turned over by Feb. 20, also requested "any and all materials from examinations, audits and other investigations, including criminal investigations."
The foundations and charities named by the committee in its request include many that remain targets of ongoing investigations by U.S. authorities. Among them are the SAAR Foundation and its affiliated entities, a defunct network of organizations based in Northern Virginia; Global Relief, whose founder was deported to Lebanon; and the Texas-based Holy Land Foundation for Relief and Development, the largest Muslim charity in the United States, which was singled out by President Bush for allegedly supporting Hamas. Its assets have been frozen.
Other groups on the list include the Muslim World League, the World Assembly of Muslim Youth and the Islamic Society of North America.
The latest probe stems from recent Finance Committee hearings on fundraising and financing by radical Islamic groups and will be focused on whether the organizations on the list deserve their tax-exempt status, committee staffers said.
"We want to look into where all their money comes from," one committee aide said. "Is it from foreign embassies? Does money come from obscure individuals in the Persian Gulf? We're the only ones that can look at this."
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