IRS Unveils Sinister Scheme: Chinese Agents John Chen and Lin Feng Plead Guilty of Bribing IRS Officials

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Tejaswini Deshmukh
Tejaswini Deshmukh
Intrigued by the intersection of finance and technology, I delve into the latest RegTech advancements. With a keen eye for unraveling the complexities of compliance, I dissect current financial news and frauds.

In a notable legal development, John Chen and Lin Feng have pleaded guilty to serious charges, including acting as unregistered agents of the Chinese government and bribing a U.S. IRS official. This case unveils a covert operation aimed at suppressing the activities of Falun Gong practitioners in the United States—a group that the Chinese government deems a major threat.

The Conspiracy Unveiled: John Chen and Lin Feng’s Covert Operation

John Chen, 71, and Lin Feng, 44, were involved in a sophisticated scheme from January to May 2023. Operating under the direction of a Chinese government official known as PRC Official-1, their mission was to advance Beijing’s ongoing campaign against Falun Gong. This spiritual practice, which combines meditation and moral teachings, is banned in China and persecuted as part of the PRC’s “Five Poisons” list—considered significant threats to its rule.

Court documents reveal that John Chen and Lin Feng sought to exploit the IRS Whistleblower Program to undermine a U.S.-based Falun Gong-related entity. Their objective was to challenge the entity’s tax-exempt status, thereby impeding its operations and influence.

The Bribery Scheme

The defendants orchestrated a bribery scheme involving the IRS. John Chen and Lin Feng filed a defective whistleblower complaint with the IRS and then bribed a purported IRS agent (Agent-1), who was actually an undercover officer. They paid an initial $5,000 in cash bribes and promised a larger sum to ensure the agent’s cooperation. The bribes aimed to advance the flawed complaint and initiate an audit of Entity-1.

The scheme was meticulously planned, with John Chen making recorded statements about the bribes’ purpose—to support the PRC’s goal of “toppling” Falun Gong. Wiretap evidence captured discussions between John Chen and Lin Feng about receiving directives from PRC Official-1, deleting incriminating communications, and taking steps to alert their PRC contacts if their plans failed.

The Investigation and Legal Proceedings

The undercover operation involving John Chen and Lin Feng was uncovered through a joint investigation by the FBI and the Office of the Treasury Inspector General for Tax Administration. This case highlights the troubling intersection of foreign influence and domestic law enforcement, demonstrating how international disputes can manifest in legal challenges on U.S. soil.

The charges were announced by Assistant Attorney General Matthew G. Olsen of the DOJ’s National Security Division, U.S. Attorney Damian Williams for the Southern District of New York, and Executive Assistant Director Robert R. Wells of the FBI’s National Security Branch. They emphasized the severity of the crimes, which involve not only bribery but also covert operations as foreign agents.

John Chen and Lin Feng have both admitted guilt to charges of acting as unregistered foreign agents and bribing a public official. They face up to 25 years in prison. Chen’s sentencing is scheduled for October 30, 2024, while Feng’s is set for October 31, 2024. A federal district court judge will set their sentences according to the U.S. Sentencing Guidelines and other relevant factors.

Implications and Consequences

The case involving John Chen and Lin Feng highlights the complexities of modern international relations and domestic law enforcement. The use of bribery and espionage tactics by foreign governments to influence U.S. institutions represents a serious threat to national security and legal integrity. This case serves as a reminder of the lengths to which foreign entities might go to achieve their political and ideological goals.

Moreover, the legal consequences faced by John Chen and Lin Feng reflect the U.S. government’s commitment to countering foreign interference and maintaining the integrity of its institutions. The involvement of high-profile legal and investigative figures highlights the seriousness with which such cases are treated.

To read the original order please visit DOJ website

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