Whistleblower Letter to Select Subcommittee on Weaponization of the Federal Government

This letter below and links to citations within, as well as the estimated timeline was emailed to the U.S. House of Representative's Committe on the Judiciary's Select Subcommitte on Weaponization of the Federal Government's published whistleblower e-mail at https://judiciary.house.gov/contact/whistleblowers. 

Full story available at https://www.rcreader.com/commentary/if-irs-can-do-peter-schiff-they-can-do-it-you

03 January 2024

Dear Chairman Jordan:

I am providing you with information on a matter that merits an investigation. Your committee, particularly its Select Subcommittee on Weaponization of the Federal Government is appropriate for Americans like me who wish to see an investigation of the IRS for its targeted investigation of and resulting damages to Euro Pacific Bank (EPB) and its owner Peter Schiff [1, 2].

Schiff started EPB in 2011 after the 2008 financial crisis; the bank tailored its offerings for what depositors demanded - Safe, Digital, and Global banking. EPB provided risk free international banking, foreign currency exchange, investments in precious metal and brokerage accounts, and mutual funds. EPB was a full-reserve (100% reserve) bank - meaning the bank did not lend out depositors’ assets; all accounts at EPB had zero level of risk because deposits are always available. Its account holders could liquidate gold and silver into international currency 24/7, and utilize the funds with bank cards via ATM withdraws or transactions with merchants across 210 countries and territories. The bank had no U.S. citizen customers, but Schiff was intending to expand its customer base to include them. With nearly one million Twitter and over half a million YouTube people following his regular analysis of financial markets, the federal reserve, predictions of the demise of the world reserve currency and other fiat currencies, the return to gold and silver as money, and criticism of the United States’ taxation, economic, and monetary policies, EPB’s future was looking very favorable.

EPB’s model challenged world central banks’ existing fiat currencies and their natural evolution toward digital fiat currencies. Is it coincidence that the IRS investigation led to a forced closure and liquidation of the bank and the defamation of Mr. Schiff? All despite EPB having implemented one of the strictest, if not the most stringent, screening process for account holders world-wide. Unsurprisingly, EPB, its employees, customers, and owner were found to never have utilized the bank to facilitate money laundering, tax evasion or similar crimes. The OCIF appointed trustee has still not returned account holders’ assets [3].

Meanwhile, the second and third largest bank failures in U.S. history occurred in 2023; both failed banks were fractional reserve banks, i.e., they lent customer deposits. Excessively risky loans and investments led to insolvency. Federal bailouts followed, upto the maximum FDIC insured account level of $250,000. But bailouts of ~$0.3B to $1B (~1,000 to ~4,000 times the FDIC maximum) were also made. According to federal regulators and officials, the bailouts were a necessary “systemic risk exception” for Americans with bank accounts, i.e., to avoid bank runs [4].

The IRS worked in conjunction with international tax authorities of four other countries called the ‘J5’ targeting a bank owned by a United States citizen; the bank was Euro Pacific Bank (EPB) and the United States citizen Mr. Peter Schiff [5-7]. On behalf of the IRS and the J5, Agent Jim Lee (Chief, IRS Criminal Investigation) publicly announced their investigation on 30 June 2022 at a press conference and named EPB specifically as their target. Lee claimed ‘Operation Atlantis’ coordinated ‘Day of Action’ related to EPB suspected crimes (simultaneous action on the same day in all J5 countries for interviews, evidence collection, subpoenas, and so forth) took place two years earlier, but an email from the Dutch government to a EPB customer indicates the IRS/J5 investigation of EPB was active as early as 2018 when the J5 was formed [8].

The IRS/J5 statement was coordinated with Puerto Rico’s OCIF Commissioner’s announcement of her issuing a Cease & Desist Order to EPB [6]. The OCIF order was limited to accusations of failure to comply with regulations, not crimes, as affirmed by the Commissioner’s statement in the press conference that, “[T]he action is solely based on the lack of controls and lack of compliance with the requirements to operate, and the level of insolvency that the institution is. The action is not based upon claims of money laundering or other financial crimes.” However, the bank was not insolvent, as the trustee’s calculation on the same day of the press conference support [9]. And discovery in a defamation suit in Australia revealed EPB’s controls, screening of account holders and transactions, was proven to be very rigorous. However, Chief Lee and the J5 implied criminal wrongdoing in statements made in both the press conference and formal IRS/J5 media releases, all without any charges or any indictments to date [1,2,5-7,8].

In the least, the IRS & J5 disclosures were inappropriate; however, the actions appear to be against federal policy [10] and the Federal Rules of Criminal Procedure. Furthermore, the context and nature of what, when, and how the disclosures were made strongly support that the IRS intentionally misled the public and utilized domestic and international media to defame Mr. Schiff. The close collaboration of the OCIF with the IRS is highly suspect, not because of OCIF actions, rather because of the contrast between so-called reported ‘facts’ and reality. In reailty, the bank was not insolvent, the bank actually used exemplary screening processes of account holders, and the OCIF did not permit the bank while in receivership to be acquired by a qualified buyer willing to add more capital to the bank. The lack of evidence of crimes being committed appears to have led the IRS to alternative options to have the OCIF terminate the license of EPB under misleading and/or false ‘facts’. Per Chief Lee,

“In full transparency, this is not where I thought we would end up two years ago when we were executing our global day of action with the J5. This is what we would call a non-traditional component within an investigation – there is no indictment of the bank or those running it today. But investigations sometimes lead us in a number of different positive directions and this is certainly one of them. One of the focuses of IRS-CI is identifying non-compliance and taking steps to ensure the bad behavior is corrected. … This cohesive approach ensures that all options are considered and the resolution is appropriate when considering the facts learned during the investigation.” [7].

False accusations and innuendos of financial crimes led to damages of Schiff’s reputation and monetary damages resulting from being forced to close EPB; there have not been any criminal charges or indictments to date.

Mr. Schiff won a defamation suit in 2023 against multiple media actors in an Australian federal court [1,2, 11-13] based upon seven imputations of criminal wrongdoing that were mirrored publicly by the lead investigator Chief Lee [5-7]. A letter to the IRS Commissioner by Mr. Schiff’s attorney seeking an internal IRS review has not been answered [14]; multiple FOIA requests to obtain information relevant to the matter made by Mr. Schiff have not been answered [8]; and a journalist received an interim response to a FOIA request with a significant material redacted [15].

I find that IRS actions are certainly within the jurisdiction of the Committee on the Judiciary over matters related to criminal law enforcement, administrative practice and procedure, and civil liberties. Americans’ constitutionally protected freedom of speech is at stake, as are their lives, liberties, property, and pursuit of happiness.

Additional materials may well be available from Mr. Schiff, with documents available on his blog [16]; he certainly can provide more details in testimony, some of which he has shared on his podcasts after he won his law suit in Australia. For your convenience, I have provided an approximate timeline of events and links to facilitate a deeper understanding and appreciation  on the matter, as my summary is not chronological and is too short to include numerous details. I believe that internal IRS, J5, and OCIF records, if preserved, could reveal evidence of unlawful acts, such as leak(s) of confidential information regarding ongoing investigations to Australian media and intentions of shutting down EPB based upon known false accusations.

I appreciate your consideration of the matter, and look forward to a determination that it warrants an investigation by your Committee of the Judiciary or its Select Subcommittee on the Weaponization of the Federal Government.

Regards,

Concerned Citizen

References [Footnotes]:

[1] ‘The Government Can Destroy Anyone’: How An IRS-Led Global Alliance Ruined An Innocent American Banker, Luke Rosiak, 13 July 2023, Daily Wire; https://www.dailywire.com/news/the-government-can-destroy-anyone-how-an-irs-led-global-alliance-ruined-an-innocent-american-banker

[2] Court Says Media Outlets Defamed Conservative Economist, Orders Them To Pay Massive Settlement, Luke Rosiak, 28 Nov 2023, Daily Wire; https://www.dailywire.com/news/court-says-media-outlets-defamed-conservative-economist-orders-them-to-pay-massive-settlement

[3]https://epbprliquidation.com/#:~:text=Euro%20Pacific%20Bank%20is%20now,Institutions%20(%E2%80%9COCIF%E2%80%9D).

[4] The FDIC has accidentally released a list of companies it bailed out for billions in the Silicon Valley Bank collapse, Lizette Chapman, Jason Leopold, and Bloomberg, 23 June 2023, Fortune; https://fortune.com/2023/06/23/fdic-accidentally-released-list-of-companies-it-bailed-out-silicon-valley-bank-collapse/

[5] https://www.irs.gov/pub/irs-utl/j5-media-release-6-30-2022.pdf

[6] OCIF Press Conference, 30 June 2022; https://www.youtube.com/watch?v=IsdLJuXMFRA

[7] https://www.irs.gov/pub/irs-utl/j5-media-release-7-1-2022.pdf

[8] Personal correspondence with Peter Schiff, 31 Dec 2023.

[9] https://schiffradio.com/ocif-settlement/

[10] https://www.irs.gov/compliance/criminal-investigation/how-criminal-investigations-are-initiated

[11] Federal Court of Australia, New South Wales Registry, NSD1400/2023, Nine Network Australia v Peter David Schiff; https://www.comcourts.gov.au/file/Federal/P/NSD1400/2023/actions

[12] Unedited 60 Minutes Australia interview with Peter Schiff, 2 Sep 2020; https://www.youtube.com/watch?v=UxqhEvbOpvM&t=1175s

[13] “Operation Atlantis - The day the international tax authorities came knocking”, Charlotte Grieve, Nick McKenzie, and Joel Tozer, 18 October 2020, The Age; https://www.theage.com.au/national/the-day-the-international-tax-authorities-came-knocking-20201015-p565lz.html

[14] https://schiffradio.com/letter-to-irs-regarding-euro-pacific-bank-10-18-2022/

[15] https://schiffradio.com/foia-request-interim-response/

[16] https://schiffradio.com/blog/

Timeline (Estimated)

June 30, 2018 - Start Date of J5; see IRS-J5

• “How Criminal Investigations Are Initiated” – IRS Investigation Process
• 2018: email from Dutch government to EPB account holder (contact Peter Schiff)

Jan 24, 2020 –J5 Countries Coordinated Day of Action (Against EPB) – Operation Atlantis (see The Age);

Sep 2, 2020 – Nick McKenzie of 60 Minutes Australia and The Age Interviews Peter Schiff

• Nick accuses (falsely) EPB of crimes based upon communications with international investigators.
• Who leaked Operation Atlantis?

Sep 30, 2020 – Mark Anderson, President of EPB, dies (Peter Schiff on Twitter)

• President of EPB dies of heart attack; added stress from false accusations of the bank committing financial crimes suspected.

Oct 18, 2020 - Australia's Nine Network’s "60 Minutes/Australia," TV Broadcast of Peter Schiff interview (severely edited; out of context; 7 imputations); broadcast removed from internet after Schiff wins defamation suit.

Oct 18, 2020 – Article in The Age (Australian publication).

June 25, 2021 – OCIF Examination of EPB Concluded

June 30, 2022 – OCIF Press Conference w/ IRS & J5

June 30, 2022 – OCIF issues Complaint and Cease and Desist Order, and Temporary Order Designating Trustee to EPB

June 30, 2022 – Trustee Calculations Confirm EPB holds “an excess cash position to cover all deposits”

June 30, 2022 –IRS Press Release(IRS Release: Global Tax Chiefs Stand By Puerto Rico’s Financial Institution Regulator as Bank is Shut Down)

July 10, 2022 – OCIF Hearing (apparent, scheduled per 30 June 2022 Press Release)

Aug 9, 2022 – EPB & OCIF Agreement on final plan to shutdown EPB; Schiff: admits no wrong-doing

Aug 10, 2022 – Schiff PR: OCIF Orders not related to any crimes; Trustee calculated “excess cash to cover all deposits” 30 June 2022

Aug 15, 2022 – PR Newswire: Announcement of Aug 9th agreement

Sep 6, 2022 – Peter Schiff reaches agreement w/ OCIF to on final liquidation of EPB; Qenta, a U.S. based global financial services and technology company.

Sep 15, 2022 – Sep 6 agreement announced

Sep 23, 2023 – PR Newswire: Federal Court of Australia announced its decision

• held that Australia’s Nine Network’s “60 Minutes” published seven defamatory imputations about Peter Schiff (NSD 1086 of 2021)

Sep 28, 2022 – Press Conference, Washington, D.C.; results of 23 Sep 2023 Australian Federal Court finding.

June 30, 2023 – Federal Court of Australia: One of multiple Judgements for Peter Schiff (damages; not a settlement as implied in United States media) (Judgements Peter’s Blog)

Sep 14, 2023 – Daily Wire’s Luke Rosiak Letter to IRS (mentions his own FOIA request)

Sep 14, 2023 – Interim FOIA Response (see Peter’s Blog)

Nov 24, 2023 – Nine Network Sues Schiff: restraining order to distribute unedited interview

• Nine Withdraws Suit: File Number NSD1400/2023: NINE NETWORK AUSTRALIA PTY LTD v PETER DAVID SCHIFF

Jan 29, 2024 – Scheduled hearing of judgement damages in favor of Schiff

• Verification of costs (procedural; not settlement)