WASHINGTON (CNN) - The community organizing group ACORN is under review by a Treasury Department inspector general as part of an investigation into the Internal Revenue Service's oversight of non-profit organizations.
It is one of several steps taken - including an investigation initiated by ACORN itself - since the release of videos - shot by conservative activists with a hidden camera - showing ACORN workers apparently giving advice on how to conduct illegal activity.
The office of the Treasury Inspector General for Tax Administration has confirmed to CNN that it is "initiating a review of ACORN." Office spokeswoman Li-Yun Chien told CNN that the inquiry is related to a non-profit fraud investigation, and how IRS internal processes handle possible fraud issues in organizations that are classified as non-profits, like ACORN.
She said the request for an investigation by the inspector general, J. Russell George, came from the offices of Sen. Susan Collins, R-Maine, and Rep Darrell Issa, R-California. They asked for a multiple-agency review of ACORN and how it uses its tax exempt status
ACORN - the Association of Community Organizations for Reform Now - did not immediately respond to a CNN request for comment.
After the Treasury Department announcement, Collins and Issa responded by issuing a statement in which Collins said, "I am heartened by the agreement of the Treasury Department's inspector general to examine the troubling financial questions that have been raised about ACORN.
"At a time when so many American families are facing difficult economic situations, it is completely unacceptable that even one penny of taxpayer money
be misused. We must bring all agencies and groups that use taxpayer funds into
the spotlight of accountability."
Issa added, "The lack of an appropriate firewall between ACORN's charitable activities and its political arm has raised significant questions regarding the appropriateness of their status as a taxable nonprofit corporation and their management of federal dollars. Cutting ties with ACORN is a good first step for the federal government, but since they have been the recipients of taxpayer dollars, we have an obligation to investigate to discover whether or not those dollars were misused in anyway."
ACORN was in the headlines during the recent presidential campaign after allegations of voter registration fraud. Some of its voter registration workers were prosecuted and some other employees resigned.
Even greater controversy was ignited by the videos, which show some ACORN workers advising two conservative activists - posing as a pimp and a prostitute - how to set up a prostitution business involving underage, foreign girls.
Because ACORN is involved with many community programs that take advantage of government funding, Collins and Issa asked for a review of "grants, contracts, entitlements and other forms of assistance to ACORN and its affiliates."
The Justice Department inspector general already has announced an investigation, the Census Bureau has terminated ACORN's involvement in its public outreach program, and both chambers of Congress have voted to deny federal funding to the organization.
In addition, ACORN suspended tax preparation services it carried out as part of an IRS program. And the group announced that it has retained a former attorney general of Massachusetts to conduct an independent inquiry into its delivery of social services as well as a general review of ACORN's management.