• Official: Treasury knew of IRS inquiry in ’12
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     | May 18,2013
     

    WASHINGTON — The Treasury Department’s inspector general told senior Treasury officials in June 2012 he was investigating allegations that the Internal Revenue Service had targeted conservative groups, disclosing for the first time on Friday that Obama administration officials were aware of the matter during the presidential campaign year.

    At the first congressional hearing into the IRS scandal, J. Russell George, the Treasury inspector general for tax administration, told members of the House Ways and Means Committee that he informed the Treasury’s general counsel of his investigation June 4 and Deputy Treasury Secretary Neal Wolin “shortly thereafter.” The information came as part of a routine briefing of the investigations that the inspector general would be conducting in the coming year, and he did not tell the officials of his conclusions that the targeting had been improper, he said.

    Still, George’s testimony will most likely fuel efforts by congressional Republicans to show that Obama administration officials knew of efforts to single out conservative groups applying for tax-exempt status for additional scrutiny but did not reveal that knowledge during President Barack Obama’s re-election campaign.

    Rep. Paul Ryan, R-Wis., who joined the Republican ticket as the vice presidential candidate later in the year, said, “That raises a big question.”

    Steven T. Miller, the acting IRS commissioner who has resigned, called the agency’s actions “obnoxious” but told the House Ways and Means Committee they were not motivated by partisanship. In testy exchanges, he said he had not misled Congress, even though he did not divulge the targeting efforts of a Cincinnati unit examining 70,000 applications for tax exemption.

    He called the group’s centralization of applications from groups with names that included the words “tea party” or “patriots” simply “foolish mistakes” that “were made by people trying to be more efficient in their workload selection.”

    With two additional hearings already scheduled for next week, it is clear the focus of congressional inquiries will extend well beyond the selection of conservative groups for special scrutiny of their tax-exemption applications.

    Camp pressed Miller and George on the releasing of tax information on Koch Industries, the giant family business of conservative benefactors Charles and David Koch, by a former White House economist, Austan Goolsbee. He also hit on the publication of donor lists for the National Organization for Marriage, which opposes same-sex unions, and the release of confidential applications for tax-exempt status to the investigative reporting outfit Pro Publica.

    The incidents of releases of confidential tax information were referred to the inspector general for investigation but were found to be inadvertent, the witnesses said.

    When Republicans asked Miller whether the targeting of conservative groups was divulged to Obama administration officials outside the IRS, Miller said “that would be a violation of law.”

    “I would be shocked” if that occurred, he said.

    Miller did concede that the IRS’ apology for targeting was prompted by a question planted by the agency May 10 at an American Bar Association meeting. At that meeting, Lois Lerner, the head of the IRS’ division overseeing tax-exempt organizations, was asked about an inquiry of the targeting issue, eliciting an apology that quickly leaked out of the closed-door session. The IRS then scrambled to issue a formal release on the issue.

    Miller divulged that the exchange was not an impromptu apology but a planned exchange between Lerner and Celia Roady, a tax attorney at the Washington law firm Morgan Lewis. That revelation only underscored the ham-handed way the scandal has burst into view.

    Obama has tried to get on top of the scandal, condemning the program, vowing changes and requesting Miller’s resignation. But many Republicans have greeted each of these moves scornfully. Miller, as an acting IRS chief, was likely to step down in June anyway, unless nominated for the permanent position.

    According to the inspector general’s report, Miller was aware of the political targeting in March 2012, sending a team from IRS headquarters in Washington to discuss it with the program’s leaders in Cincinnati. Yet a month later, Miller, then the deputy IRS commissioner for enforcement, wrote a letter to Republican senators saying there was no targeting of conservative groups.

    The hearings will continue next week. On Tuesday, the Senate Finance Committee will hold its hearing, and its Democratic chairman, Sen. Max Baucus of Montana, hopes to question Douglas Shulman, a Bush administration appointee who was IRS commissioner during most of the targeting program.

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