No tax charges filed in SPLC probe after IRS lawyers found informant program lawful

Exclusive Politics No tax charges filed in Southern Poverty Law Center probe, after IRS lawyers determined informant program legally structured, sources say By Sarah N. Lynch Sarah N. Lynch Senior Justice Department Reporter Sarah N. Lynch is the senior Justice Department reporter for CBS News, based in Washington, D.C. Read Full Bio Sarah N. Lynch Updated on: May 29, 2026 / 2:49 PM EDT / CBS News Add CBS News on Google Federal agents previously investigated the Southern Poverty Law Center's paid informant program for possible tax crimes, but the probe failed to yield any charges after Internal Revenue Service lawyers determined it was legally structured, sources familiar with the matter told CBS News.Agents from IRS Criminal Investigation in 2019 and 2020 homed in on shell bank accounts that a former chief financial officer at the civil rights nonprofit opened to pay informants in exchange for intelligence about hate groups. The agents sought to determine whether the SPLC unlawfully failed to file tax returns for those payments, sources said.But a Treasury Department rule exempts 501(c)(3) nonprofits from filing tax returns in connection with payments to informants who provide information about potential criminal activity. As a result, IRS lawyers later cautioned against seeking an indictment on tax charges, several of the sources said.A spokesperson for IRS Criminal Investigation declined to comment. A spokesperson for the Justice Department declined to comment beyond its filings in the criminal case.The tax portion of the investigation, which has not been previously reported, was initiated during President Trump's first term as an expansion of an FBI probe into whether that same former chief financial officer may have embezzled money from the SPLC, the sources said.The Justice Department in April obtained an 11-count wire and bank fraud indictment against the SPLC over its informant program, alleging it defrauded its donors and duped its banks by creating shell a...