Why Didn't I.R.S. Targeting Get Reported to Congress?

The Inspector General Act of 1978 mandates that “particularly serious or flagrant problems” be shared with Congress by the relevant agency within seven days. During yesterday’s congressional testimony Inspector General George argued that such reporting would be “impractical” and “counter-productive.”

Section five of the IG Act deals with semiannual reports and transmittal of findings to Congress, but also contains a section dealing with “abuses” that demand more prompt attention. Subsection (d) reads as follows:

Each Inspector General shall report immediately to the head of the establishment involved whenever the Inspector General becomes aware of particularly serious or flagrant problems, abuses, or deficiencies relating to the administration of programs and operations of such establishment. The head of the establishment shall transmit any such report to the appropriate committees or subcommittees of Congress within seven calendar days, together with a report by the head of the establishment containing any comments such head deems appropriate.

To parse that a bit, Inspector General J. Russell George should arguably have recognized the seriousness of political targeting by the I.R.S. and informed the head of either the I.R.S or Treasury or both. Treasury then would have had seven days in which to transmit a report on that activity to Congress. But for some reason, none of that happened.

It is particularly difficult to explain this lack of response given that Congress had asked I.R.S. Commissioner Douglas Shulman to testify on potential political targeting in March 2012. At that time, Shulman denied it in the strongest terms. But we now know that just two months later he learned that political targeting had taken place. Shulman never returned to Congress to correct the record.

At about the same time, IG George initiated an audit of the apparent targeting activity. Even as Members of Congress continued to send letters to the I.R.S. complaining about long delays (some over 1,000 days), IG George failed to report the situation to Congress. Chariman Issa made multiple requests for information including a letter sent to George in August 2012 which cited the 7-day rule from the IG Act. In sum, the situation at the IRS was a big deal both before and after IG George learned about it. He had a mandate to report serious or flagrant abuses to Congress, but chose not to do so.

Asked about this directly during Wednesday’s testimony, IG George claimed it would be “impractical” to transmit partial information to Congress. Here is the relevant exchange:

Chairman Issa: I have reviewed my committee staff documents…we certainly did not have the information in any way, shape or form…

IG George: Mr. Chairman there are established procedures for conducting an audit and once again this is an audit. And to insure fairness and to insure that we are completely accurate with the information that we convey to Congress, we will not report information until the IRS has had an opportunity to take a look at it to ensure that we’re not misstating facts.

Issa: Mr. George that is not the statute. That is not the statute.

George: But it would be impractical for us to give you partial information which may not be accurate. It would be counter-productive, sir, if we were to do that.

Issa: Well…this committee, last August, made it very clear that the statute as written does not give you the ability to, or any IG, to use us as a whipping boy when you want to and in fact keep us in the dark until an investigation is complete.

A copy of Chairman Issa’s August letter to IG George is available here. It points to the same section of the IG Act quoted above and specifically asks George if there are any outstanding “serious or flagrant” problems to report. Apparently, IG George did not believe the situation at the IRS–which included targeting criteria such as “Statements…critical of how the country is being run”–qualified. For his part, Commissioner Shulman testified that he left the transmittal of information completely up to the Inspector General.