WASHINGTON. A year after he revealed a federal investigation into his “tax affairs” in late 2020, President Biden’s son, Hunter Biden, has paid off a significant tax liability, even as the grand jury continued to collect evidence as part of a wide-ranging review. its international business dealings, according to people familiar with the case.
Biden’s failure to pay all of his taxes has been the focus of an ongoing Justice Department investigation. While exonerating him doesn’t rule out criminal charges against him, the payment could make it harder for prosecutors to get a conviction or a lengthy sentence for tax offenses, according to tax law experts, because juries and judges tend to be more sympathetic. defendants who paid their bills.
But Mr. Biden’s taxes are just one element of a broader investigation based on his work around the world. A Yale-trained lawyer, Hunter Biden’s professional life intersected with his father’s public service, including working as a registered domestic interest lobbyist and, when his father was vice president, making deals and closing deals with clients in Asia and Europe.
Most recently, last month, a federal grand jury heard in Wilmington, Delaware, the testimony of two witnesses, one of whom was a former Hunter Biden employee whose lawyer was later subpoenaed to file financial statements reflecting the money that Mr. Biden received from a Ukrainian. energy company.
The investigation, which began as a tax investigation under the Obama administration, expanded in 2018 to include possible criminal tax violations, as well as foreign lobbying and money laundering regulations, according to people familiar with the investigation.
But prosecutors face a number of hurdles to bring criminal charges, people familiar with the investigation say, including evidence that Mr. Biden intentionally violated the Foreign Agents Registration Act, or FARA, which requires lobbying or liaison assistance to be disclosed to the Justice Department. with the public. on behalf of foreign clients.
The Justice Department has given no public indication that it has made a decision on any element of the case, and no charges have been filed against Mr. Biden.
When he spoke about the investigation following the 2020 election, Hunter Biden said that “a professional and objective review of these matters will demonstrate that I have conducted my business in a lawful and proper manner.”
Biden’s attorney, the Justice Department and the Delaware Attorney’s Office, which is overseeing the investigation, declined to comment.
It is unclear if the criminal investigation is solely focused on Hunter Biden or if he is part of a group of individuals and companies under scrutiny. Prosecutors also looked into possible FARA violations by Blue Star Strategies, a Washington-based consulting firm that worked for a Ukrainian energy company in an agreement in which Mr. Biden helped mediate, according to documents and people familiar with the investigation.
For President Biden, this protracted case is fraught with both political and personal problems. Hunter Biden’s job at Burisma Holdings, a Ukrainian energy company, was a flashpoint in his father’s 2020 race against President Donald J. Trump and helped spark the events that led to Mr Trump’s first impeachment.
The elder Mr. Biden now oversees the Justice Department, which is conducting the investigation. And Hunter Biden, who has pursued a career as an artist in recent years, has acknowledged serious drug addiction and other problems as he sought international business while dealing with the illness and death of his brother Beau.
The investigation is being overseen by David S. Weiss, US Attorney for Delaware. He served in the office during the Bush and Obama administrations and was appointed by Trump to lead. Mr. Weiss was allowed to remain in office until the Biden case was resolved.
Hunter Biden has told colleagues in recent months that he has paid federal taxes that have been the subject of a Justice Department scrutiny. He told one employee that he had over $1 million in tax liabilities and that he had to take out a loan to pay it off.
Federal tax prosecutors typically fight to keep juries from knowing whether a defendant paid their tax bills, arguing that a crime occurs when a tax return is filed falsely or not filed at all, said Jeffrey Neumann, a former Justice Department tax attorney and partner. to Marcus, Neumann, Rushbaum and Pineiro. Such knowledge can affect the jury, even if the judge asks them not to take it into account.
Mr. Neiman said defense lawyers encourage clients to pay their back taxes if they believe they could be charged with federal tax crimes, as this often helps in sentencing.
Mr. Biden’s extensive work with foreign companies was scrutinized by prosecutors to see if he should register with the Justice Department as a foreign agent.
Investigators looked into Mr. Biden’s dealings with interests in Kazakhstan, the Chinese energy conglomerate and Ukrainian energy company Burisma, according to people familiar with the investigation.
They said prosecutors were investigating payments and gifts Biden or his associates received from foreign investors, including a car paid for by a company linked to a Kazakh oligarch and a diamond from a Chinese energy tycoon. Prosecutors also requested documents relating to legal entities through which Mr. Biden and his associates did business with interests around the world.
But there is a debate within the Justice Department about whether the available evidence proves that Mr. Biden intended to violate FARA, which the government must prove in order to secure a criminal conviction. Prosecutors have discussed approaching potential FARA violations as a civil case, which would require Mr. Biden to retroactively register as a foreign agent but avoid criminal charges, according to people familiar with the case, according to people familiar with the case.
Such a decision could complicate a potential money laundering case, as money laundering is usually accused in connection with another crime.
Over the past two years, Delaware federal prosecutors have issued numerous subpoenas to obtain documents related to Hunter Biden’s overseas work, as well as bank accounts associated with him and his associates, including two former close business partners, Eric Schwerin and Devon Archer. . familiar with the investigation.
Last year, prosecutors questioned Mr. Archer and subpoenaed him to obtain documents and grand jury testimony, people say. Mr. Archer, who was convicted last month in a securities fraud case unrelated to the case in which his conviction was overturned, has served with Mr. Biden on Burisma’s board of directors since 2014. .
People familiar with the investigation said prosecutors have looked into emails between Mr. Biden, Mr. Archer and others about Burisma and other foreign commercial activities. These emails were obtained by The New York Times from a cache of files that appeared to come from a laptop Mr. Biden abandoned at a Delaware repair shop. The email and other data in the cache were confirmed by people familiar with them and with the investigation.
In some emails, Mr. Biden has shown familiarity with FARA and a desire to avoid launching it.
In one email to Mr. Archer in April 2014, Mr. Biden laid out his vision for working with Burisma. In an email, Hunter Biden indicated that the upcoming travel announcement to Ukraine for Vice President Biden, who is referred to in the email as “my boyfriend” but not by name, should “be characterized as part of our advice and reflection.” — but what he will say and do is not in our power.
The announcement “may be a really good event, or it can create too high expectations. We need to moderate expectations for this visit,” Hunter Biden wrote.
Vice President Biden traveled to Kyiv, the capital of Ukraine, about a week after the email.
In the same April 2014 email, Hunter Biden indicated that Burisma officials “must be made clear that we will not and cannot directly interfere in the affairs of national politicians and that we must comply with FARA and any other US laws in the strictest sense. “. cross the border.”
He offered to bring in the law firm he worked for at the time, Boies Schiller Flexner, to help Burisma through “direct negotiations with the state, energy and the NSC,” referring to the two cabinet departments and the National Security Council at the White House.
The firm “can develop a media plan and provide legal protection, as well as mitigate the negative attitude of the US domestic press towards the current leadership, if necessary,” Mr. Biden wrote in an email.
Mr. Biden, Mr. Archer, Boies Schiller Flexner and Blue Star Strategies have not registered under FARA on behalf of Burisma.
In another series of emails reviewed by prosecutors, Hunter Biden and Mr Archer discussed inviting foreign business associates, including a Burisma executive, to dinner in April 2015 at a Washington restaurant where Vice President Biden was staying. It is not known whether the Burisma chief was present at the dinner, although people familiar with the event said the vice president did attend.
Prosecutors also subpoenaed records related to a lawsuit filed by former Mr. Biden associate Lunden Alexis Roberts in Arkansas state court, her attorney said.
According to court records, Ms. Roberts sued Mr. Biden for child support and paternity in 2019 after one of his companies stopped paying her and providing her with health insurance.
Mr. Biden and Ms. Roberts reached an out-of-court settlement in their paternity case in March 2020.
Last year, prosecutors traveled to Little Rock, Arkansas, and questioned Ms. Roberts and her lawyer about Mr. Biden’s finances, including which legal entity he paid her through and whether that legal entity received payments from Burisma, according to the man. familiar with interrogation.
And last month, in response to yet another subpoena, Ms. Roberts testified before a grand jury in Delaware, according to her lawyer.