US Attorney General Eric Holder pauses as he testifies during a hearing before the House Judiciary Committee on oversight of the US Department of Justice on Capitol Hill in Washington, DC.
Reuters/Washington
US Attorney General Eric Holder said on Tuesday he had ordered the FBI to open a criminal probe in a growing scandal over the Internal Revenue Service’s targeting of conservative political groups for extra tax scrutiny.
Holder’s announcement came about four hours before an inspector general’s report on the IRS portrayed the tax agency as plagued by disarray and “insufficient oversight” during its struggles to review the cases of hundreds of advocacy groups that claimed they should be tax exempt.
The audit, which drew some backlash from IRS officials, also underscored what the agency had acknowledged last Friday: that the IRS had used “inappropriate criteria” for evaluating tax-exempt groups, in part by singling out scores of conservative Tea Party and “Patriot” organisations for increased scrutiny.
The report by the Treasury Inspector General for Tax Administration sharply criticised the way the IRS had screened the conservative groups, citing poor management and processing delays. The report suggested that such practices could damage public confidence in the agency.
The criteria used to target the conservative groups “gives the appearance that the IRS is not impartial in conducting its mission,” the report said. However, the report stopped short of saying the IRS actions had been politically motivated.
For President Barack Obama - who late on Tuesday said the report showed that the IRS had failed to apply the law fairly in dealing with conservative groups - the revelations have added to a sense of a White House under siege.
Republicans continue to bash the Obama administration’s handling of the attack last year on the US mission in Benghazi, Libya, that killed a US ambassador and three other Americans. And on Monday, Obama’s Justice Department came under bipartisan fire for seizing phone records of journalists from the Associated Press as part of a wide-ranging criminal probe into intelligence leaks.
In Washington on Tuesday, the IRS case appeared to have the most potency, as lawmakers and administration officials alike described the symbolic and legal importance of having a non-partisan tax agency that Americans can trust.
For the IRS and the US government, the stakes are particularly high in the scandal because the tax agency is playing an increasingly significant role not only in vetting the tax status of non-profit groups that dabble in politics, but also in enforcing parts of Obama’s ongoing overhaul of the nation’s healthcare system.
Some of the IRS’s conservative critics, including Republican Senator Ted Cruz, have said the current scandal is a sign that the agency shouldn’t be trusted to enforce a vast array of tax regulations related to healthcare.
The IRS’s embattled acting commissioner, Steven Miller, met privately with lawmakers on Capitol Hill, apparently seeking to calm the political uproar, even as some Republicans called for his resignation.
The IRS said on Monday that Miller, then the IRS deputy commissioner, was first informed in early May 2012 that some groups seeking tax-exempt status had been “improperly identified by name” and subjected to extra scrutiny.
Lawmakers say that neither Miller nor his predecessor, Douglas Shulman, ever made them aware of the targeting.
Senator Orrin Hatch, the top Republican on the tax-writing Finance Committee, said that Miller - who spent more than two decades working his way up through the IRS bureaucracy and was named acting chief six months ago - should step down.
“He basically misled me,” Hatch told reporters. “I really think it is time for him to leave.”
Hatch was part of a growing Republican chorus on Capitol Hill calling for the resignations of Miller and Lois Lerner, head of the IRS tax-exempt organisations office. Lerner apologised on behalf of the agency when she revealed the targeting of conservative groups last week.
Conservative groups, particularly those that have sprung up in recent years to promote limited government and lower taxes, have long complained about mistreatment by the IRS.
On Tuesday, Miller met with Senator Max Baucus, the Democratic chairman of the Finance Committee who has promised that his panel will conduct its own investigation of the IRS case. Miller later declined to answer reporters’ questions.
Senate Republican leader Mitch McConnell urged Obama to make all of those who knew about IRS misconduct available for questioning, and said there should be “no more stonewalling.”
“Heads need to roll today,” said Republican Representative Vern Buchanan, a member of the tax-writing House Ways and Means Committee, which oversees the IRS and is scheduled to hold a hearing on the scandal tomorrow.
Holder says he didn’t make AP phone records decision
Reuters/Washington
US Attorney General Eric Holder said on Tuesday he did not make the controversial decision to secretly seize telephone records of the Associated Press but defended his department’s actions in the investigation of what he called a “very, very serious leak.”
The decision to seek phone records of one of the world’s largest news-gathering organisations was made by Deputy Attorney General Jim Cole, Holder said.
Holder, speaking at a press conference, said he recused himself from the matter to avoid a potential conflict of interest because he was interviewed by the FBI as part of the same leak investigation that targeted the AP records.
That seizure, denounced by critics as a gross intrusion into freedom of the press, has created an uproar in Washington and led to questions over how the Obama administration is balancing the need for national security with privacy rights.
Combined with a separate furor over the Internal Revenue Service’s targeting of conservative political groups for extra scrutiny, it also is stoking fears of excessive government intrusion under President Barack Obama.
The White House has said it had no advance knowledge of the IRS or Justice Department actions.
Lawmakers from both parties on Tuesday criticised the Justice Department’s decision to obtain the AP records. Senate Majority Leader Harry Reid called the action “inexcusable.”
But in a letter to AP president Gary Pruitt, Cole on Tuesday defended the department’s unusual action against a member of the media, saying it was a necessary step in the year-old criminal probe of leaks of classified information.
A law enforcement official said the probe is related to information in a May 7, 2012, AP story about an operation, conducted by the CIA and allied intelligence agencies, that stopped a Yemen-based Al Qaeda plot to detonate a bomb on an airplane headed for the US.
Cole declined Pruitt’s request to return the records.
“We strive in every case to strike the proper balance between the public’s interest in the free flow of information and the public’s interest in the protection of national security and effective enforcement of our laws,” he wrote. “We believe we have done so in this matter.”
Pruitt, in a statement responding to Cole’s letter, said “it does not adequately address our concerns,” which include that the subpoena’s scope was “overbroad under the law” and that the AP was not notified in advance.
The AP story at issue, he said, contradicted White House assertions that there was no credible threat to the American people in May 2012 around the first anniversary of the killing of Al Qaeda chief Osama bin Laden.
Cole disclosed that investigators conducted more than 550 interviews and reviewed tens of thousands of documents in the probe before seizing the toll records of AP phone calls.
Boehner: ‘Who’s going to jail’ over IRS scandal?
AFP/Washington
US House Speaker John Boehner said yesterday he wants someone to go to jail over the IRS’s targeting of political groups, as his Republicans blasted the Obama administration’s “culture of rot and abuse.”
The Internal Revenue Service acknowledged in an inspector general’s report that its agents used “inappropriate” political criteria when probing conservative groups seeking tax-exempt status, and that lax management allowed the abuse to continue for 18 months.
President Barack Obama, under assault by critics amid a series of scandals gripping Washington, immediately pledged to hold tax agency staff accountable for the “intolerable and inexcusable” behaviour, but Boehner appeared unmoved.
“My question isn’t about who is going to resign. My question is, who’s going to jail over this scandal?” he told reporters.
“Clearly someone violated the law.”
Boehner stopped short of identifying who he thought might be guilty of any legal offences, but he stressed that “someone made a conscious decision to harass and hold up these requests for tax-exempt status.”
“I think we need to know who they are.”
Several House committees have announced plans to hold hearings on the abuse, in which agents searched for applications with ‘Tea Party,’ ‘Patriots,’ or ‘9/12’ in the organisation’s names, which in some cases delayed the processing of applications.
Congressman Charles Boustany, who has looked into allegations of IRS abuse for two years, said that “after months of misleading testimony and evasive answers... they’ve now been caught red-handed.”
“I can tell you right now this culture of rot and abuse at the IRS is going to be rooted out,” he added.
Republican congresswoman Lynn Jenkins piled on, describing a “Washington gone wild.”