IG letter to Geithner: Targeting not among top concerns
May 18th, 2013
07:45 PM ET
11 months ago

IG letter to Geithner: Targeting not among top concerns

(CNN) - Treasury officials were made aware in June 2012 that the IRS inspector general was reviewing the office that handles tax-exempt applications, but a letter from October shows that the inspector general did not highlight the audit as a top concern for the agency.

In a memo dated October 15, 2012, to then-Treasury Secretary Tim Geithner about IRS challenges for 2013, Inspector General J. Russell George noted other problem areas, but made no mention of the investigation taking place at the time of the agency's intense scrutiny of conservative groups seeking tax-exempt status.

Instead, the memo stated that "while the Exempt Organizations function has greatly improved its timeliness with regard to acknowledging complaints against tax-exempt organizations, referrals were not always controlled or processed timely."

A spokesperson for the inspector general told CNN this letter was intended to single out what George considered to be the most serious issues for the IRS among all the cases listed in the IG's annual audit, which had already been published.

A spokesperson for the Treasury Department said the current treasury secretary, Jack Lew, and his deputy first learned of the audit’s findings from press reports last week.

The inspector general made headlines Friday when he told the House Ways and Means Committee that he had notified Treasury officials, including Deputy Secretary Neal Wolin, as early as June 2012 that he was reviewing the office that handles tax-exempt applications.

CNN has confirmed that notification came in early June.

According to George, he told Treasury that he was conducting a review but did not disclose the nature of the findings. He said the review was prompted by a request from someone he described as a congressional staff member.

"It was not to inform them of the results of the audit, it was to inform them of the fact that we were conducting the audit," George later clarified.

A Treasury official, who discussed the matter on the condition of not being identified, told CNN that when Wolin learned of the review he did not discuss it with anyone outside the Treasury Department. The same official said Treasury strongly supports the "the independent oversight of its three inspectors general, and it does not interfere in ongoing IG audits." In other words, the political appointees who run Treasury do not take action until such audits are complete.

According to the Treasury official, it wasn't until mid-March of this year that anyone inside the department was informed of the targeting at the office of tax-exempt programs.

That’s when the inspector general discussed a draft audit with one or more staff-level Treasury officials. In April, George first gave Treasury staff a copy of the draft audit and that information was not shared with the treasury secretary or his deputy.

According to officials at both the inspector general and Treasury offices, Lew knew an audit was taking place because George mentioned it during an introductory meeting on March 15, 2013, but he had no window into the results.

Lew was confirmed as Treasury secretary in late February.

The inspector general for the IRS is one of three inspector generals who report to the Treasury and conducts approximately 120 audits per year.


Filed under: 2013 • IRS • Treasury
soundoff (58 Responses)
  1. just sayin

    of course the targeting wouldn't be a top concern. they wanted it to go on as long as possible in order to interfere and harass obama's political opponents. they had a long time to develop their cover story and excuses.

    May 18, 2013 07:51 pm at 7:51 pm |
  2. ifeoma njaka

    Nothing that could be termed as a scandal.

    May 18, 2013 08:36 pm at 8:36 pm |
  3. Larry L

    The "top concern" (and only concern) for the Republican Party is creating a smoke-screen hoping nobody remembers their failure to help Americans find jobs, get healthcare, or keep from losing their homes. They use the Congress as a factory of obstruction, deception and distortion. They offer nothing but bigotry and Monday-morning quarter-backing.

    May 18, 2013 08:45 pm at 8:45 pm |
  4. Don Jones

    The Tea Party and their ilk is a cancer on this country. This isn't their country to take back and it never was.

    May 18, 2013 09:08 pm at 9:08 pm |
  5. Sue

    I've been waiting and watching but no one yet has explained why it is wrong for the IRS to do it's job and determine the legitimacy of groups declaring themselves tax-exempt. How is this a problem? The IRS has a huge, complicated job to begin with but when you change the laws so that many new groups can become tax-exempt there is definitely going to be many who are going to try to takke advantage of the new rules; it only makes sense that the process is going to get bogged down for awhile. What's wrong with the IRS trying to do their job properly? We'd be screming bloody murder if they had granted tax exemptions to groups carte blanche and those groups didn't actually qualify.

    May 18, 2013 09:11 pm at 9:11 pm |
  6. PJ

    Are you kidding me?
    Lois Lerner, appointed by GW Bush, has hired a lawyer and may not testify
    Doug Shulman, appointed by GW Bush, quit Commissioner's job early,
    IG J. Russell George, appointed by GW Bush, twice, in 2002 and 2004, "not a top concern for his agency"???
    What will it take for the so-called "investigative reporters" to wake up and smell the set-up?

    May 18, 2013 09:13 pm at 9:13 pm |
  7. PJ

    PS: This reminds me of that stupid commercial where food is slapping people in the face. How many slaps does
    it take to add two and two?

    May 18, 2013 09:15 pm at 9:15 pm |
  8. DeepeThought

    The fact that officials in the IRS knew about this scandal in June proves that the agency is politically biased. A neutral agency would have revealed the information when they discovered it. This biased agency held on to the information to prevent potential harm to Obama before the election. They even went so far as to deny this very issue by Congress! A serious wound has been dealt to the Republic and the public trust.

    May 18, 2013 09:18 pm at 9:18 pm |
  9. Mary

    Absolutely disgusting. To think that these guys will keep health info confidential is a dream. They may not see the records, but if they know you had a psych admission, or alcohol problem, think they won't release that under the table? Not a stretch to think this will happen.

    May 18, 2013 09:31 pm at 9:31 pm |
  10. Thomas

    IG letter to Geithner: Targeting not among top concerns

    Nor mine eather !

    I'm more concerad about Obama being a Hindu .

    May 18, 2013 09:31 pm at 9:31 pm |
  11. p

    Hey, GOP! Scandal? Really? This seems like a whole lot of nothin' to me. How bout we make all the groups with a bogus 501(c)4 PAY THEIR TAXES, and let's all taxpayers stop paying the way for political groups, left or right. Let's all stop
    paying Karl's Rove's Crossroads GPS expenses...

    May 18, 2013 10:25 pm at 10:25 pm |
  12. Donkey Party

    Sorry GOPers, again, no smoking gun to try and pin another phony scandal on the President.

    May 18, 2013 10:33 pm at 10:33 pm |
  13. cormac

    I don't have a problem with a group like the Tea Party being investigated by the IRS since the Tea Party claims to be financed solely by 'true americans' who send in small donations of whatever amount they can afford when in reality the Teap Party is financed by the Koch Brothers ... who are the Koch Brothers? look it up ... if the brothers were one person they top the list of richest people beating out Bill Gates and Warren Buffet ... the news media doesn't want to cover that aspect of the Tea Party but rather prefers to reinforce the lie that this group is a grass roots organization ... it is anything but ... it is a far-right wing and wreckless political group that lies and lies about their financing ...

    these are the types of groups the IRS should be investigating

    May 18, 2013 10:34 pm at 10:34 pm |
  14. Mema

    How many other escape goats will Obama use? There is a pattern that is coming to light when it comes to Obama/Biden when it comes to sacrificing others for their actions, directly or indirectly. Not too many people believe in Obama/Biden, anymore.

    May 18, 2013 11:00 pm at 11:00 pm |
  15. Rodboy

    Something smells fishy here – Lerner, the Lady in charge new the report was coming and ask a lawyer friend to raise the question at a meeting of tax lawyers. If that is true how did everybody not know the report was coming – stinks a lot here.

    May 18, 2013 11:05 pm at 11:05 pm |
  16. Bette

    Remember IG Walpin, when he discovered one of Obama's Caifornia friends was in his sights for some infraction; he was fired immediately and then smeared as senile. It is not plausible that no one knows anything.

    May 18, 2013 11:14 pm at 11:14 pm |
  17. DarthVaderMentor

    We need more canaries to start singing. Turbo Timmy is the next logical juicy target to turn into a canary. Tell him he's losing his cushy bankster job on Wall Street and he gets a date with Bubba on a cozy federal Penitentiary jail cell. If he sings well, however, he gets to be Turbo Tax support for all the inmates and a private cell until Bendover Ben unites with him later! LoL

    May 18, 2013 11:18 pm at 11:18 pm |
  18. Pete

    Firing the head of the IRS who was going to retire anyway in June is not taking action c'mon now. By the way, what was the name of the person from MMS (Minerals Management Service) who checked off the boxes stating that the Deepwater Horizon's Ram shears worked and there were no hydraulic leaks? Prosecuted? Fired? or just reassigned? Obama is all talk when he says "Individuals will be held accountable".

    May 18, 2013 11:51 pm at 11:51 pm |
  19. simplyput

    Of course the memo sent by Inspector George didn't mention timely handling of applications on Oct. 15, 2012: the election was a month away, and the damage had already been done.

    May 19, 2013 12:14 am at 12:14 am |
  20. Dennis

    That's very clear now that nobody knew anything at anytime.

    May 19, 2013 12:17 am at 12:17 am |
  21. Frank Landa

    obama knew when he unleashed his dogs what they would do. He gave the woman in charge a BONUS and a PROMOTION for her dirty work. This is the TIP of the iceberg of unsavory behavior of this administration. I notice CNN and most media outlets play this down as much as possible. Only FOX is giving it full exposure. Nixon was forced to resign for less !

    May 19, 2013 12:39 am at 12:39 am |
  22. cyndi

    This sounds like a mountain out of a mole hill. It's not like anything illegal was occuring. The IRS merely investigated a few applications for tax exempt status which it should have been doing anyway. As far as I know noone's application was denied because of their political views.

    May 19, 2013 12:52 am at 12:52 am |
  23. joeinalabama

    Just some Demo minions at the IRS try to help their king get re-elected.

    May 19, 2013 12:54 am at 12:54 am |
  24. Big_D

    I am sad that the poor decision in Citizens United set the stage for this. None of these groups should have had that status. Corporations are not people and that notion simply forgets equal protection. Can you send a corporation to jail when they break the law? Well you can a person, so that's not fair either. Which way do you want it? It doesn't work and it was an immoral illegitimate failure of the Court.

    May 19, 2013 01:14 am at 1:14 am |
  25. Larry L

    Let's send Republican Congressmen copies of all e-mails, classified and unclassified messages, transcripts of phone calls, personal notes, and all other exchanges of information in every Agency and Department of our Federal Government. This best enables them in their quest for treasonous scandels and helps fuel their conspiracies. Why not? It's all they do anyway in this way some of the things they say might actually be true. Surely with that volume of material they'll find many things to distort, rant about and ultimately "call for a special commission". The most under-educated hick Congressmam could look like somebody important back in Bum-F+#k. They would get to say "impeachment" a lot – they like that word best when said in front of a camera. At least they'd be doing SOMETHING!

    May 19, 2013 01:34 am at 1:34 am |
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