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Clinton foundation told in 08 to stop illegal activities

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Leaked Clinton Foundation "Smoking Gun" Memo Reveals It Was Breaking The Law

No matter what the leadership decides about the larger, over-arching question, it must act immediately to bring the Foundation into compliance with the law and standards that govern not-for-profits, and must create strong legal and HR offices so to prevent any lapses in the future.
Simply stated, what this means is that, as of the day the memo was written, the Foundation was not in compliance with the law and with standards that govern "not-for-profits."

* * *

Among the policies and procedures that Gibson found missing or inadequate at the Foundation were the following, some of which - such as the procedures the CF was utilizing in Harlem - may be in violation of the law. Here is a brief sample of the findings:

The Foundation lacks important policies and procedures and a real process to ensure compliance, resulting in increased risks, confusion, conflicting (and perhaps arbitrary) decisions, and inefficiencies.
The Foundation does not have a record retention policy, and the procedures currently utilized in Harlem may violate the law.
It is unclear whether lower level employees actually meet the definition of exempt under the Fair Labor Standards Act.
Processes and employment decisions are made on an ad hoc basis.
Staff complained about the lack of comprehensive and/or written policies and procedures.
Staff complained about the lack of a real complaint and/or whistleblower policy.
And many more.

Furthermore, and more troubling, the review pointed to a high-ranking but unnamed foundation executive who was “being paid by [President Clinton], the government and the foundation” who “allowed the foundation to host what may have been (or may have been viewed as) a political event, apparently without official pre-approval from the foundation’s legal department and without regard, before the fact, to the impact of that decision on the foundation’s tax exempt status.”

While the conclusion avoids repeating the explicit accusation of operating outside of the law - we assume Gibson did not want to scare the Clinton Foundation too much, and thus avoid repeat work - it is a stark condemnation of the underlying practices and principles of operation:

The challenges and deficiencies plaguing the Foundation cannot be over-stated: They are real and undermine the organization’s effectiveness, immediately and more long term. To address the issues that present immediate threats, the Foundation should revamp its Legal and HR operations, should review its governance structure and documents; and should have an open and honest discussion with the President about the future of the Foundation.
It is illegal for tax-exempt non-profit foundations like the Clinton Foundation to be linked with partisan political events as described in the review report.

The Lindsey memo was distributed just two days before the Clinton Foundation signed an agreement with Obama’s transition office Dec. 12, 2008, as part of the president-elect’s decision to appoint Hillary Clinton as the nation’s chief diplomat. Obama wanted assurance that no conflicts of interest would arise between Clinton’s work as Secretary of State and the foundation, which had operations in numerous foreign countries.

It is unclear if any of these recommendations were implemented, or if the CF is now in "compliance with the law and standards that govern not-for-profits." It is clear, however, that at least at one point it was not. It remains to be seen if such illegal activity will be grounds for the DOJ to permit the FBI to do its job and indict a foundation that, as lawyer determined, was operating in a fraudulent fashion.
"The test of a first-rate intelligence is the ability to hold two opposed ideas in the mind at the same time, and still retain the ability to function." F. Scott Fitzgerald

"Prediction is very difficult, especially if it's about the future." Niels Bohr


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