Justice Dept. investigating IRS - FOX 10 News | fox10phoenix.com

IRS chief ousted

Posted: Updated:

WASHINGTON (AP) -- The Justice Department is opening a criminal investigation of the Internal Revenue Service just as another probe concludes that lax management enabled agents to improperly target tea party groups for extra scrutiny when they applied for tax exempt status.

Attorney General Eric Holder said he ordered the FBI to investigate Friday -- the day the IRS publicly acknowledged that it had singled out conservative groups.

"Those (actions) were, I think, as everyone can agree, if not criminal, they were certainly outrageous and unacceptable," Holder said. "But we are examining the facts to see if there were criminal violations."

Holder is scheduled to testify Wednesday before the House Judiciary Committee.

Three congressional committees already are investigating the IRS for singling out tea party and other conservative groups during the 2010 congressional elections and the 2012 presidential election. But Holder's announcement would take the matter to another level if investigators are able to prove that laws were broken.

Ineffective management at the IRS allowed agents to improperly target tea party groups for more than 18 months, said a report released Tuesday by the Treasury inspector general for tax administration. The report lays much of the blame on IRS supervisors in Washington who oversaw a group of specialists in Cincinnati who screened applications for tax exempt status.

It does not indicate that Washington initiated the targeting of conservative groups. But it does say a top supervisor in Washington did not adequately supervise agents in the field even after she learned the agents were acting improperly.

"The report's findings are intolerable and inexcusable," President Barack Obama said in a statement. "The federal government must conduct itself in a way that's worthy of the public's trust, and that's especially true for the IRS. The IRS must apply the law in a fair and impartial way, and its employees must act with utmost integrity. This report shows that some of its employees failed that test."

The agency started targeting groups with "Tea Party," `'Patriots" or "9/12 Project" in their applications for tax exempt status in March 2010, the inspector general's report said. By August 2010, it was part of the written criteria used to flag groups for additional scrutiny.

Lois Lerner, who heads the IRS division that oversees tax exempt organizations, had been briefed on the matter in June 2011. She ordered the initial tea party criteria to be scrapped, but it later evolved to include groups that promoted the Constitution and the Bill of Rights. The practice was ended in May 2012, the report said.

IRS agents were trying to determine whether the political activities of such groups disqualified them for tax exempt status. These groups were claiming tax exempt status as organizations promoting social welfare. Unlike other charitable groups, they can engage in political activity. But politics cannot be their primary mission.

It is up to the IRS to make the determination.

But by using improper criteria, the IRS targeted some groups, even though there were no indications that they engaged in significant political activities, the report said. Other non-tea party groups that had significant political activities were not screened, the report said.

"The criteria developed by the Determinations Unit gives the appearance that the IRS is not impartial in conducting its mission," the report said.

The additional screening resulted in long delays as IRS agents asked intrusive, sometimes inappropriate questions, or merely let applications languish, the report said. Inappropriate questions included requests for lists of donors and the political affiliation of officers.

"Unfortunately, the report raises more questions than it answers," said House Oversight Committee Chairman Darrell Issa, R-Calif. "What we do know for sure is that the IRS personnel responsible for granting tax exemptions systematically targeted conservative groups for extra scrutiny, and that officials in Washington, D.C., were aware of this practice, even while publicly claiming that it never happened."

The IRS on Friday apologized for singling out tea party and other conservative groups.

On Tuesday, the agency said, "After seeing issues with particular cases, inappropriate shortcuts were used to determine which cases may be engaging in political activities. It is important to note that the vast majority of these cases would still have been centralized based on the general criteria used for other cases."

Acting IRS Commissioner Steven Miller is scheduled to testify before the House Ways and Means Committee at a hearing Friday. Miller became acting commissioner in November, after Commissioner Douglas Shulman completed his five-year term. Shulman had been appointed by President George W. Bush.

------

Follow Stephen Ohlemacher on Twitter: http://twitter.com/stephenatap

  • Your MoneyMore>>

  • Business is good at Coney Island

    Business is good at Coney Island

    Friday, August 29 2014 10:22 PM EDT2014-08-30 02:22:32 GMT
    From the brand-new Thunderbolt roller coaster to the world-famous boardwalk, tourists and business owners alike say Coney Island had a great ride of its own this summer. Toms Coney Island's general manager Vasilios Tourlokas says the mild summer impacted his boardwalk business in the best way possible: a 10 to 15 percent increase.
    From the brand-new Thunderbolt roller coaster to the world-famous boardwalk, tourists and business owners alike say Coney Island had a great ride of its own this summer. Toms Coney Island's general manager Vasilios Tourlokas says the mild summer impacted his boardwalk business in the best way possible: a 10 to 15 percent increase.
  • NYC Denny's features $300 breakfast

    NYC Denny's features $300 breakfast

    Friday, August 29 2014 4:04 PM EDT2014-08-29 20:04:13 GMT
    Diner chain Denny's is opening it's first New York City location, complete with a big-city "deal".   How does a $300 breakfast sound?    The Denny's is located at the corner of Nassau and Spruce in Lower Manhattan's Financial District.  Along with its normal food you can get at just about any location in the rest of the country, this location will offer a Grand Slam breakfast with a bottle of 2003 Dom Perignon champagne.
    Diner chain Denny's is opening it's first New York City location, complete with a big-city "deal".   How does a $300 breakfast sound?    The Denny's is located at the corner of Nassau and Spruce in Lower Manhattan's Financial District.  Along with its normal food you can get at just about any location in the rest of the country, this location will offer a Grand Slam breakfast with a bottle of 2003 Dom Perignon champagne.
  • Some Showboat workers get new jobs within company

    Some Showboat workers get new jobs within company

    Friday, August 29 2014 2:54 PM EDT2014-08-29 18:54:36 GMT
    More than 470 of the 2,000-plus workers at Atlantic City's Showboat Casino Hotel have found new jobs with other casinos owned by its parent company. The Showboat is shutting down Sunday afternoon after 27 years on the Boardwalk.
    More than 470 of the 2,000-plus workers at Atlantic City's Showboat Casino Hotel have found new jobs with other casinos owned by its parent company. The Showboat is shutting down Sunday afternoon after 27 years on the Boardwalk.
Powered by WorldNow

KSAZ-TV & KUTP
511 W. Adams St.
Phoenix, AZ 85003

Phone: (602) 257-1234
Fax: (602) 262-0177

Didn't find what you were looking for?
All content © Copyright 2000 - 2014 Fox Television Stations, Inc. and Worldnow. All Rights Reserved.
Privacy Policy | New Terms of Service What's new | Ad Choices