WASHINGTON — The Senate Finance committee has asked the Internal Revenue Service to turn over confidential tax and financial records, including donor lists, for 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, and raises the possibility that individual contributors to the Holy Land Foundation or the activities of 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 Islamic American Relief Agency, based in Columbia, was among the groups whose IRS records are being requested by the Senate panel. The charity has previously denied any connections to terrorist groups.
Ibrahim Kahleel, who answered the phone at the Islamic American Relief Agency on Saturday, said that he was unaware of the Senate committee request. Kahleel said Missourian inquiries about the listing had been forwarded to agency officials, who had not replied as of Saturday evening.
The Senate-led probe follows more than two years of investigations by the FBI, Treasury Department and other federal agencies into the activities of Islamic charities suspected of having ties to al-Qaida, 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-Qaida 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 Grassley, R-Iowa, and Ranking Member Max Baucus, D-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 dried up financial support for innocent groups that attempt to provide medicine, food and other goods to the Middle East and elsewhere. The committee’s probe is needlessly intrusive and will scare away more contributors, several representatives said.
“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 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?”
Attorney Roger Simmons, 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 was 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 with the authority to request information from the IRS that is covered by privacy protection 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 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 predicted 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 Everson includes a request for 990 forms, which are public documents that list a group’s leadership and large donors, and 1023 forms, in which organizations apply for tax exemptions as nonprofit groups. Grassley and Baucus, who asked for the material by Feb. 20, also requested “any and all materials from examinations, audits and other investigations, including criminal investigations.”
The foundations and charities named in the 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 the Washington suburbs of Northern Virginia; Global Relief, whose founder was deported to Lebanon; and the Texas-based Holy Land Foundation for Relief and Development, the nation’s largest Muslim charity, which was singled out by President Bush for allegedly supporting the Islamic Resistance Movement or Hamas. Its assets have also been frozen.
The list also includes 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 fund-raising and financing by radical Islamic groups and will focus 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.”
— Missourian reporter Christie Smythe contributed to this report