Sen. John Cornyn (R-Texas) and Sen. Thom Tillis (R-North Carolina) both raised issues they would like the Justice Department to address before giving their full support to Blanche.
President Trump’s settlement with IRS may collapse as judge demands answers
Last Friday, a federal judge in Miami sought answers in Trump’s lawsuit against the Internal Revenue Service, at the request of dozens of retired judges who alleged fraud.
Acting Attorney General Todd Blanche’s nomination to the top post is in jeopardy after two leading Republican senators expressed concerns about the status of a tax exemption settlement that the Justice Department helped reach with President Donald Trump and the Internal Revenue Service.
The Senate Judiciary Committee, where Republicans lead by a 12-10 margin, is scheduled to vote on July 30 on whether to advance Blanche’s nomination to the full Senate for a vote. But at least two Republicans on the committee, Sen. John Cornyn of Texas and Sen. Thom Tillis of North Carolina, have expressed concern about voting “yes” without concessions from Blanche’s Justice Department.
Cornyn said he is asking the Justice Department to amend the agreement in writing to make clear that it only benefits Trump, his two eldest sons and the Trump Organization, and protects them from audits of past tax years, but not from investigations by federal agencies other than the IRS and Treasury Department.
“I don’t know if it’s the Justice Department employees or who they are, but they just know what they have to do and they’re not going to do it,” Cornyn told reporters on July 29.
A Justice Department official told USA TODAY that the department submitted the proposal to Mr. Cornyn’s staff on July 28 after “ongoing discussions” with the Senate Judiciary Committee and Mr. Cornyn’s office.
“We look forward to further discussion on outstanding concerns,” the official said. The official did not elaborate on the terms offered by the ministry.
Tillis’ office did not immediately respond to USA TODAY’s request for comment, but Cornyn said he believes Tillis has similar concerns.
“I think Sen. Tillis is pretty much on the same page as me, so you better get serious. We don’t have much time left.”
Tillis previously said he wanted changes to the settlement agreement, according to media reports.
President Trump nominated Blanche, a former personal attorney, to head the Department of Justice in June. Blanche began serving in the acting role in April after President Trump fired then-Attorney General Pam Bondi.
Blanche oversaw the department’s efforts to resolve litigation with Trump, his two eldest sons and his businesses, including proposing to waive past tax obligations and creating an “anti-weaponization” fund that could potentially pay taxpayers to Trump supporters who committed crimes during the Jan. 6, 2021, riot at the U.S. Capitol.
An addendum to the settlement signed by Blanche states that the U.S. government is permanently barred from pursuing any claims against the Trumps and the Trump Organization related to matters pending before “the IRS or any other agency or department,” including the Trumps’ previous tax returns.
The deal raised widespread ethical concerns. Multiple government watchdog agencies argued that it was improper for lawyers at the Justice Department, presumably under the president’s control, to contract with the president’s personal lawyer without a judge’s approval. In their lawsuit, the Trumps claim the IRS owes them $10 billion for failing to prevent contractors from leaking their tax information.
In the face of bipartisan opposition, Blanche said the Justice Department would not move forward with the fund, which a federal judge also blocked.
The tax portion of the settlement could be a huge financial boon for the president. The New York Times reported in 2020 that President Trump has been in a decade-long dispute with the Internal Revenue Service over an audit of a suspected $72.9 million tax refund. Losing this battle could cost the president more than $100 million, according to the Times.
On July 13, Florida federal judge Kathleen M. Williams ruled that the Trump lawsuit was an improper attempt to justify tax benefits to the Trumps and the establishment of an “anti-weaponization” fund. She blocked the Trumps from using or mentioning the agreement in any official proceedings, but it’s unclear exactly how the order restricts the president’s personal dealings with the Justice Department and Internal Revenue Service.
Cornyn said on July 29 that the Justice Department has “ample time” to address concerns before the 4 p.m. ET deadline that day to notify Senate Judiciary Committee Chairman Chuck Grassley whether a committee vote scheduled for July 30 should be canceled.
“Maybe they think I’m just going to give up or comply, but that’s not true,” Cornyn said.
Cornyn and Tillis are scheduled to resign from the Senate in January when their terms expire. Tillis had previously held off on supporting Blanche over concerns that he was unable to meet with people who say they were sexually abused by convicted sex offender Jeffrey Epstein. Cornyn also said that he thinks it’s a “good thing” for Blanche to do so. Blanche then met with those people.
