Did CAIR Fail to Report Proceeds to the IRS?

From Frank Gaffney at Biggovernment.com:

On November 17, 2009, a prominent Senator and five leading Members of Congress sent a letter to the IRS asking for an investigation of the Council on American-Islamic Relations (CAIR) concerning their possible violation of the Lobbying Disclosure Act which limits the expenditures a non-profit can spend on lobbying  If CAIR has exceeded the limits of that law, they risk losing their non-profit status.  Other penalties may be more severe:  if the Secretary of the Senate or Clerk of the House of Representatives determines that CAIR should have registered and find “a knowing violation by a preponderance of the evidence,” CAIR could be “subject to a civil fine of not more than $200,000, depending on the extent and gravity of the violation,”  and if CAIR “knowingly and corruptly failed to comply,” they could be subject to imprisonment up to 5 years.    Our separate analysis of CAIR tax returns, compared to audio evidence recorded in 2006, reveals another potential issue for IRS investigators – more on that follows below…

The November 17 letter to the IRS was signed by Senator Tom Coburn (R-OK), Ranking Member on the Permanent Subcommittee on Investigations for the Homeland Security and Governmental Affairs Committee.    The members of Congress signing the letter also have extensive experience in intelligence, counter-terrorism and investigations:

  • Rep. Sue Myrick (R-NC), Deputy Whip, founder of the Congressional Anti-Terrorism Caucus, who also serves on the House Permanent Select Committee on Intelligence
  • Rep. Trent Franks (R-AZ), who serves on the Judiciary Committee and the Armed Services Committee
  • Rep. Paul Broun (R-GA), who serves on the United States House Homeland Security Subcommittee on Intelligence, Information Sharing, and Terrorism Risk Assessment
  • Rep. John Shadegg (R-AZ), who serves on the  Committee on Energy and Commerce and the Select Committee on Energy Independence and Global Warming
  • Rep. Patrick McHenry (R-NC), who serves on the Subcommittee on National Security and Foreign Affairs for the Committee on Oversight and Government Reform

Our own investigation revealed another problem CAIR may have with the IRS.

 Their most recent publicly available tax return, from 2006, reports gross receipts for their annual fundraiser that are significantly less than they announced at the event itself.  On that 2006 990 form, they reported that they had raised $89,775, but left blank (or zeroed) several key fields:

CAIR 2006 IRS 990 statement3

But our investigative team attended that 2006 annual CAIR event and recorded the fundraiser Master of Ceremonies, Rodwan Saleh of the Islamic Society of Greater Houston, announcing that they raised much more than $89,775 – at least $250,000, and possibly as much as $600,000 due to a matching grant.  Below is a partial transcript and the audio:

Partial Transcription:

RODWAN SALEH: We are now at $250,000. Takbir.

AUDIENCE: Allahu Akbar.

SALEH: Takbir.

AUDIENCE: Allahu Akbar.

SALEH: Now, listen carefully [unclear] requirements. There is a family, there is a family that says if we all now can put this amount of money from 250 to 300, they will match the 300. You understand what I’m saying? Now, so we need now to make sure that we get $50,000 in no time because if we can make 300 this family will put another 300 [unclear]. Did you hear me?

So here are two more questions for IRS investigators:   Did CAIR raise only $89,775 at the fundraiser and if so, what happened to the rest of the $250,000 (or $300,000 0r $600,000)?  Or did CAIR raise the larger amount, and if so, why did they report less to the IRS?

On November 3, 2009, we called CAIR Executive Director Nihad Awad for comment on this apparent discrepancy.  Mr. Awad said he would look into the matter and get back to us, but so far he has failed to do so.

CAIR’s supporters include foreign businesses and members of various Middle Eastern royal families, and at the 2006 annual fundraiser in question, tables were assigned to the embassies of Malaysia, Pakistan, Jordan, Qatar, Saudi Arabia, the UAE, and the Interests Section of Iran.   The Holy Land Foundation terrorism finance trial documents, along with numerous Arab and English news articles, show CAIR receiving foreign contributions and pledges ranging from hundreds of thousands to millions of dollars.  During 2005 and 2006, CAIR had additional capital to purchase properties valued at over $10 million, as detailed in the investigative best-seller book Muslim Mafia.

Yet in 2006 their membership dues from actual Muslim Americans were only $41,383 –  one percent of their total reported revenues of over $2.7 million.

One percent from Muslim Americans’ dues.  And just $89,775 gross receipts from the annual fundraiser, partially reported to the IRS.

And 99% from…somewhere else.

Incidentally, we were able to obtain copies of the 2007 990 tax forms for fifteen CAIR chapters, and the 2008 990 tax forms for five CAIR chapters, but the CAIR national office has still not made public their 2007 and 2008 tax returns.

A key question for both the IRS and the Department of Justice: Is CAIR really an organization representing Muslim Americans, or is it representing the interests of foreign principals?

To be continued….

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