E-mails Suggest Collusion Between FEC, IRS to Target Conservative Groups

No matter what side of the aisle you’re on, this should be troubling to you. Right now it’s right wing groups, but what’s to keep it from being left-wing? Or Moderate, or writers, or anyone? This type of conspiracy is not what the US government was created to do.

per nationalreview.com

 

Embattled Internal Revenue Service official Lois Lerner and an attorney in the Federal Election Commission’s general counsel’s office appear to have twice colluded to influence the record before the FEC’s vote in the case of a conservative non-profit organization, according to e-mails unearthed by the House Ways and Means Committee and obtained exclusively by National Review Online. The correspondence suggests the discrimination of conservative groups extended beyond the IRS and into the FEC, where an attorney from the agency’s enforcement division in at least one case sought and received tax information about the status of a conservative group, the American Future Fund, before recommending that the commission prosecute it for violations of campaign-finance law. Lerner, the former head of the IRS’s exempt-organizations division, worked at the FEC from 1986 to 1995, and was known for aggressive investigation of conservative groups during her tenure there, too.

“Several months ago . . . I spoke with you about the American Future Fund, a 501(c)(4) organization that had submitted an exemption application the IRS [sic],” the FEC attorney wrote Lerner in February 2009. The FEC, which polices violations of campaign-finance laws, is not exempted under Rule 6103, which prohibits the IRS from sharing confidential taxpayer information, but the e-mail indicates Lerner may have provided that information nonetheless: “When we spoke last July, you had told us that the American Future Fund had not received an exemption letter from the IRS,” the FEC attorney wrote.

The timing of the correspondence between Lerner and the FEC suggests the FEC attorney sought information from the IRS in order to influence an upcoming vote by the six FEC commissioners. The FEC received a complaint in March 2008 from the Minnesota Democratic Farmer Labor Party alleging that the American Future Fund had violated campaign-finance law by engaging in political advocacy without registering as a political-action committee. The American Future Fund responded to that complaint in June 2008, telling the commission that it had applied for tax exemption in March of that year and was a “501(c)(4) social-welfare organization that was organized to provide Americans with a conservative and free-market viewpoint and mechanism to communicate and advocate on the issues that most interest and concern them.” According to the e-mail correspondence, a month after receiving the American Future Fund’s response, the FEC general counsel’s office — which is prohibited under law from conducting an investigation into an organization before the FEC’s six commissioners have voted to do so — contacted Lerner to investigate the agency’s tax-exempt status.

The FEC general counsel’s office, in its recommendation on the case, apparently didn’t tell the agency’s commissioners about how it had obtained the information about the group’s tax-exempt status. Recommending that the commissioners prosecute the American Future Fund, the general counsel’s office wrote, “According to its response, AFF submitted an application for tax-exempt status to the Internal Revenue Service . . . on March 18, 2008.” The footnote to that sentence reads, “The IRS has not yet issued a determination letter regarding AFF’s application for exempt status. Based on the information from the response and the IRS website, it is likely that the application is still under review.” In fact, an FEC lawyer knew that the organization had yet to obtain tax-exempt status because Lerner provided the confidential information.

The general counsel’s report was issued in September 2008, but it was over five months before the six FEC commissioners voted, in late-February 2009, on whether to prosecute the American Future Fund for violations of campaign-finance laws. (The typical lag time between the submission of a general counsel’s recommendation and a commission vote is about a month, according to a source familiar with the workings of the commission.) As the vote approached, on February 3, 2009, the FEC lawyer went back to Lerner for an update on the status of the American Future Fund’s application. “Could you please tell me whether the IRS has since issued an exemption letter to the American Future Fund? Also if the IRS has granted American Future Fund’s exemption, would it be possible for you to send me the publicly available information and documents related to American Future Fund?”

Despite the recommendations of the general counsel’s office, the six FEC commissioners split on whether to pursue the American Future Fund’s case andvoted six-to-zero to close the case.

House Ways and Means Committee chairman Dave Camp and oversight-subcommittee chairman Charles Boustany are calling on the IRS, in the wake of these revelations, to provide all communications between the agency and the FEC between 2008 and 2012. “The American public is entitled to know whether the IRS is inappropriately sharing their confidential tax information with other agencies,” Camp and Boustany write in a letter they will send to acting IRS administrator Danny Werfel on Wednesday.

The FEC enforcement attorney also inquired about the tax-exempt status of another conservative organization, the American Issues Project. “I was also wondering if you could tell me whether the IRS had issued an exemption letter to a group called the American Issues Project? The group also appears to be the successor of two other organizations, Citizens for the Republic and Avenger, Inc.” Also sought were “any information and documents that would be publicly available in relation to the American Issues Project, Citizens for the Republic, or Avenger, Inc.”

Lerner was placed on paid administrative leave in late May after she revealed the IRS had inappropriately targeted conservative groups. The IRS has yet to respond to requests from lawmakers about her current employment status with the agency.

 

IRS CHIEF: AGENCY ALSO SCREENED LIBERAL GROUPS

I find this hard to believe in all honesty.

 

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WASHINGTON (AP) — The Internal Revenue Service’s screening of groups seeking tax-exempt status was broader and lasted longer than has been previously disclosed, the new head of the agency acknowledged Monday. Terms including “Israel,” ”Progressive” and “Occupy” were used by agency workers to help pick groups for closer examination, according to an internal IRS document obtained by The Associated Press.

The IRS has been under fire since last month after admitting it targeted tea party and other conservative groups that wanted the tax-exempt designation for tough examinations. While investigators have said that agency screening for those groups had stopped in May 2012, Monday’s revelations made it clear that screening for other kinds of organizations continued until earlier this month, when the agency’s new chief, Danny Werfel, says he discovered it and ordered it halted.

The IRS document said an investigation into why specific terms were included was still underway. It blamed the continued use of inappropriate criteria by screeners on “a lapse in judgment” by the agency’s former top officials. The document did not name the officials, but many top leaders have been replaced.

In a conference call with reporters, Werfel said that after becoming acting IRS chief last month, he discovered varied and improper terms on the lists and said screeners were still using them. He did not specify what terms were on the lists, but said he suspended the use of all such lists immediately.

“There was a wide-ranging set of categories and cases that spanned a broad spectrum” on the lists, Werfel said. He added that his aides found those lists contained “inappropriate criteria that was in use.”

Werfel ordered a halt in the use of spreadsheets listing the terms — called BOLO lists for “be on the lookout for— on June 12 and formalized their suspension with a June 20 written order, according to the IRS document the AP obtained. Investigators have previously said that the lists evolved over time as screeners found new names and phrases to help them identify groups to examine.

Democrats on the House Ways and Means Committee released one of the lists, dated November 2010, that the IRS has provided to congressional investigators. That 16-page document shows that the terms “Progressive” and “Tea Party” were both on that list, as well as “Medical Marijuana” and “Healthcare legislation.”

Rep. Sander Levin of Michigan, top Democrat on the Ways and Means panel, said he was writing a letter to J. Russell George, the Treasury Department inspector general whose audit in May detailed IRS targeting of conservatives, asking why his report did not mention other groups that were targeted.

“The audit served as the basis and impetus for a wide range of congressional investigations and this new information shows that the foundation of those investigations is flawed in a fundamental way,” Levin said.

George’s report criticized the IRS for using “inappropriate criteria” to identify tea party and other conservative groups. It did not mention more liberal organizations, but in response to questions from lawmakers at congressional hearings, George said he had recently found other lists that raised concerns about other “political factors” he did not specify.

Democratic staff on Ways and Means said in a press release that they had verified that of the 298 groups seeking tax-exempt status that George’s audit had examined, some were liberal organizations — something George’s report did not mention.

Many organizations seeking tax-exempt designation were applying for so-called 501(c)(4) status, named for its section of the federal revenue code. IRS regulations allow that status for groups mostly involved in “social welfare” and that don’t engage in election campaigns for or against candidates as their “primary” activity, and it is up to the IRS to judge whether applicants meet those vaguely defined requirements.

Werfel’s remarks came as he released an 83-page examination he has conducted of his embattled agency. The conclusions, which Werfel cautioned are preliminary, have so far found there was “insufficient action” by IRS managers to prevent and disclose the problem involving the screening of certain groups, but no specific clues of misconduct.

“We have not found evidence of intentional wrongdoing by anyone in the IRS or involvement in these matters by anyone outside the IRS,” he told reporters.

The report found no indication so far of improper screening beyond the IRS offices, mostly in Cincinnati, that examine groups seeking tax-exempt status.

Werfel’s report describes several new procedures the agency is installing to prevent unfair treatment of taxpayers in the future. They include a fast-track process for groups seeking tax-exempt status that have yet to get a response from the IRS within 120 days of applying. He is also creating an Accountability Review Board, which within 60 days is supposed to recommend any additional personnel moves “to hold accountable those responsible” for the targeting of conservative groups, a Treasury Department fact sheet on Werfel’s report.

The top five people in the agency responsible for the tax-exempt status of organizations have already been removed, including the former acting commissioner, Steven Miller, whom President Barack Obama replaced with Werfel.

“The IRS is committed to correcting its mistakes, holding individuals accountable as appropriate” and establishing new controls to reduce potential future problems, Werfel told reporters.

IRS screening of conservative groups had sparked investigations by three congressional committees, the Justice Department and a Treasury Department inspector general.

Werfel’s comments and report drew negative reviews from one of the IRS’s chief critics in Congress, Rep. Darrell Issa, R-Calif., chairman of the House Oversight and Government Reform Committee.

Issa said the review “fails to meaningfully answer the largest outstanding questions about inappropriate inquiries and indefensible delays. As investigations by Congress and the Justice Department are still ongoing, Mr. Werfel’s assertion that he has found no evidence that anyone at IRS intentionally did anything wrong can only be called premature.”

House Ways and Means Committee Chairman Dave Camp, R-Mich., whose panel is also investigating the agency, said the IRS “still needs to provide clear answers to the most significant questions — who started this practice, why was it allowed to continue for so long, and how widespread was it? This culture of political discrimination and intimidation goes far beyond basic management failure and personnel changes alone won’t fix a broken IRS.”

Werfel had promised to produce a report within a month of taking over the agency.

Werfel said he briefed Obama and Treasury Secretary Jacob J. Lew on the report earlier Monday.

Werfel, initially named the IRS’s acting commissioner, is now the agency’s deputy principal commissioner because federal law limits the time an agency can be led by an acting official.

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Associated Press writers Stephen Ohlemacher and Henry C. Jackson contributed to this report.