June 2nd, 2013
10:14 AM ET
9 years ago

Issa: Cincinnati IRS employees say direction came from Washington

Updated 5:56 p.m. ET Sunday 6/2

(CNN) – In an exclusive interview Sunday on CNN's “State of the Union” with Candy Crowley, Republican Rep. Darrell Issa said interviews with workers in the Cincinnati IRS office show targeting of conservative groups was "a problem that was coordinated in all likelihood right out of Washington headquarters - and we're getting to proving it."

“My gut tells me that too many people knew this wrongdoing was going on before the election, and at least by some sort of convenient, benign neglect, allowed it to go on through the election,” he said. “I’m not making any allegations as to motive, that they set out to do it, but certainly people knew it was happening.”

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A bipartisan group of investigators from two House committees – Ways and Means, and Government Reform and Oversight – interviewed two front-line employees from the tax-exempt office last week.

One of the employees hit back against accusations that lower-level employees were responsible for the scrutiny of conservative groups seeking tax-exempt status in 2010, telling congressional investigators that the Ohio employees were being “thrown underneath the bus.”

A second "more senior" Cincinnati IRS employee said they began seeking other jobs when they were assigned to look out for applications from tea party groups, because they felt it was inappropriate.

According to excerpts released to CNN by the oversight committee, one of the employees said their supervisor told them the direction to single out conservative groups came from the Washington headquarters in March 2010.

By April, seven hard-copy versions of applications had been sent to Washington, the employee said. In addition, the employee said Washington had requested part of an application by two specific groups, though the excerpts do not disclose the names of those two groups.

Shortly after news of the scandal broke and IRS Commissioner Steven Miller announced his resignation, the IRS said two "rogue" employees in the agency's Cincinnati office were principally responsible for the "overly aggressive" handling of requests by groups with the words “tea party” and “patriot” in their names, a congressional source told CNN.

Issa’s committee released only excerpts and not the full transcripts of the interviews, citing the fact that the investigation is ongoing. CNN asked for the full transcripts, but the committee did not agree to the request. CNN has not seen the full transcripts or the context of the questions and answers.

Read the excerpts below.

However, Rep. Elijah Cummings, ranking member on the House oversight committee, described Issa's remarks based on the interviews as "reckless" and "unsubstantiated."

“So far, no witnesses who have appeared before the Committee have identified any IRS official in Washington DC who directed employees in Cincinnati to use ‘tea party’ or similar terms to screen applicants for extra scrutiny," Cummings said in a statement.

"Chairman Issa’s reckless statements today are inconsistent with the findings of the Inspector General, who spent more than a year conducting his investigation," he continued. "Rather than lobbing unsubstantiated conclusions on national television for political reasons, we need to work in a bipartisan way to follow the facts where they lead and ensure that the IG’s recommendations are fully implemented."

Cummings' spokeswoman Jennifer Hoffman said it was not "standard practice" for the majority in the committee to keep the transcripts rather than share it with the minority.

"The standard practice would have been for them to provide the transcripts to us when they got them. We have requested them, but have not gotten them," she said.

Issa said the full transcripts would be made public, and he has also subpoenaed the administration for more documents that he says will support claims made in the employee interviews. “As we get those documents ... we will learn the whole truth,” he said.

The oversight committee clarified after the interview that subpoenas have not been issued to the IRS.

For now, however, he has not said he has evidence to verify there was a direct link between Washington and the over-scrutinizing of tea party groups. But he points to the interview, in which one of the employees named an IRS attorney in Washington, D.C. (the name was redacted in the excerpts), who was heavily involved in the process of applying further scrutiny to conservative groups. The employee expressed frustration with the attorney’s “micromanagement,” according to the excerpts.

Citing the decision by IRS tax exempt director Lois Lerner to plead the Fifth in her recent congressional hearing appearance, Issa said “This is a problem that's coordinated in all likelihood right out of Washington headquarters, and we're getting to proving it. We have 18 more transcribed interviews.”

As the IRS began to disclose information about its admitted mistake, Lerner told reporters that the Cincinnati office, which handles the tax-exempt applications, was overwhelmed with applications in 2010 and began funneling documents from conservative groups into a file that called for further review as a “shortcut,” chalking it up to more of a clerical error.

"It was an error in judgment and it wasn't appropriate," Lerner said May 10 on a conference call with reporters. "But that's what they did."

But two Democratic congressional sources involved in the IRS investigation told CNN's Dana Bash that Issa's characterization of the interviews is misleading.

Their impression from the Cincinnati employees was that the Washington connection the employees were referring to were tax attorney specialists. These individuals answer questions from the tax-exempt division in Ohio about what level of political activity is acceptable for 501(c)(4) status, the sources said.

The tax attorneys work in what is known as the EO Technical Unit–which is in Washington.

According to the sources, an employee identified a tea party case in February 2010 with a problem: The group had checked the box saying it engaged in political activity, but the line agent was not sure how much political activity was allowed for tax exempt status.

(IRS rules dictate that tax exempt groups are allowed to do some type of political advocacy as long as social welfare is their primary activity.)

The employee's question was sent up through the line to Washington, the sources said, where the tax attorney experts were asked to develop future guidance to answer that question, as multiple tea party groups were beginning to take shape in 2010.

The Democratic sources said that's why Washington asked for more cases, like in the example of the Cincinnati employee who was asked to send two specific cases.

However, the sources maintained this was not when the actual targeting began, nor who did it. They're hoping to get more answers in interviews with two other employees next week.

When pressed by reporters in briefings last month, White House Press Secretary Jay Carney–whom Issa referred to as a "paid liar"–reiterated the IRS statement that the activity came from line employees in the Cincinnati office.

Asked by the congressional investigators about the allegations, one employee said, “It’s impossible.”

“As an agent we are controlled by many, many people. We have to submit many, many reports. So the chance of two agents being rogue and doing things like that could never happen,” the employee said.

Further pressed to give a reaction to reports that the blame lies within the Cincinnati office, the employee said: “Well, it's hard to answer the question, because in my mind I still hear people saying we were low-level employees, so we were lower than dirt, according to people in D.C. So, take it for what it is.”

The employee maintained that the office was following directions from Washington. Asked again if the directions to single out tea party applications specifically came from Washington, the employee gave a less certain answer, saying, “I believe so.”

The "more senior" employee told the investigators they were searching for another job in July 2010 after feeling uncomfortable with the task.

“The subject area was extremely sensitive and it was something that I didn't want to be associated with,” the employee said.

Ultimately, Issa said, the employees shouldn’t get a pass.

“Ethically, they clearly knew this was wrong. They should have become whistle-blowers. They should have done something on behalf of the American people,” he said.

The IRS has told House GOP investigators it has identified 88 IRS employees who may have documents relevant to the congressional investigation into targeting of conservative groups.

The agency has so far missed two deadlines to provide documents requested by Congress, but said in a statement Friday that the new acting commissioner, Danny Werfel, is “moving aggressively and taking the data requests very seriously.”

“As a precautionary measure, the IRS is casting a wide net to capture any potentially related materials. Our goal is to be exceedingly thorough during this process to ensure we identify any and all pertinent records," the IRS statement said. "The IRS has received numerous congressional requests involving an extensive set of questions and calls for data. Responding to these requests is a top priority for us. We have been in contact with committee staff, and we continue to provide them updates as we diligently work through these requests."

Read the excerpts below:

One Cincinnati IRS employee interviewed by the Oversight Committee rejects the White House assertion (that the Cincinnati office was responsible) and points to Washington as being responsible for targeting effort (from 5/30 interview):

Q In early 2010, was there a time when you became aware of applications that referenced Tea Party or other conservative groups?
A In March of 2010, I was made aware.


Q Okay. Now, was there a point around this time period when [your supervisor] asked you to do a search for similar applications?
A Yes.
Q To the best of your recollection, when was this request made?
A Sometime in early March of 2010.
Q Did [your supervisor] give you any indication of the need for the search, any more context?
A He told me that Washington, D.C., wanted some cases.


Q So as of April 2010, these 40 cases were held at that moment in your group; is that right?
A Some were.
Q How many were held there?
A Less than 40. Some went to Washington, D.C.
Q Okay. How many went to Washington, D.C.?
A I sent seven.


Q So you prepared seven hard copy versions of the applications to go to Washington, D.C.?
A Correct.


Q Did he give you any sort of indication as to why he requested you to do that?
A He said Washington, D.C. wanted seven. Because at one point I believe I heard they were thinking 10, but it came down to seven. I said okay, seven.
Q How did you decide which seven were sent?
A Just the first seven.
Q The first seven to come into the system?
A Yes.


Q Did anyone else ever make a request that you send any cases to Washington?
A [Different IRS employee] wanted to have two cases that she couldn't ¬¬ Washington, D.C. wanted them, but she couldn't find the paper. So she requested me, through an email, to find these cases for her and to send them to Washington, D.C.
Q When was this, what time frame?
A I don't recall the time frame, maybe May of 2010.


Q But just to be clear, she told you the specific names of these applicants.
A Yes.
Q And she told you that Washington, D.C. had requested these two specific applications be sent to D.C.
A Yes, or parts of them.


Q Okay. So she asked you to send particular parts of these applications.
A Mm¬hmm.
Q And that was unusual. Did you say that?
A Yes.
Q And she indicated that Washington had requested these specific parts of these specific applications; is that right?
A Correct.


Q So what do you think about this, that allegation has been made, I think as you have seen in lots of press reports, that there were two rogue agents in Cincinnati that are sort of responsible for all of the issues that we have been talking about today. What do you think about those allegations?
A It's impossible. As an agent we are controlled by many, many people. We have to submit many, many reports. So the chance of two agents being rogue and doing things like that could never happen.


Q And you've heard, I'm sure, news reports about individuals here in Washington saying this is a problem that was originated in and contained in the Cincinnati office, and that it was the Cincinnati office that was at fault. What is your reaction to those types of stories?
A Well, it's hard to answer the question because in my mind I still hear people saying we were low¬level employees, so we were lower than dirt, according to people in D.C. So, take it for what it is. They were basically throwing us underneath the bus.


Q So is it your perspective that ultimately the responsible parties for the decisions that were reported by the IG are not in the Cincinnati office?
A I don't know how to answer that question. I mean, from an agent standpoint, we didn't do anything wrong. We followed directions based on other people telling us what to do.
Q And you ultimately followed directions from Washington; is that correct?
A If direction had come down from Washington, yes.
Q But with respect to the particular scrutiny that was given to Tea Party applications, those directions emanated from Washington; is that right?
A I believe so.

And another more senior IRS Cincinnati employee complained about micromanagement from D.C.:

Q But you specifically recall that the BOLO terms included "Tea Party?"
A Yes, I do.
Q And it was your understanding ¬¬ was it your understanding that the purpose of the BOLO was to identify Tea Party groups?
A That is correct.
Q Was it your understanding that the purpose of the BOLO was to identify conservative groups?
A Yes, it was.
Q Was it your understanding that the purpose of the BOLO was to identify Republican groups?
A Yes, it was.


Q Earlier I believe you informed us that the primary reason for applying for another job in July [2010] was because of the micromanagement from [Washington, DC, IRS Attorney], is that correct?
A Right. It was the whole Tea Party. It was the whole picture. I mean, it was the micromanagement. The fact that the subject area was extremely sensitive and it was something that I didn't want to be associated with.
Q Why didn't you want to be associated with it?
A For what happened now. I mean, rogue agent? Even though I was taking all my direction from EO Technical, I didn't want my name in the paper for being this rogue agent for a project I had no control over.
Q Did you think there was something inappropriate about what was happening in 2010?
A Yes. The inappropriateness was not processing these applications fairly and timely.


Q You have stated you had concerns with the fairness and the timeliness of the application process. Did you have concerns with just the fact that these cases were grouped together and you were the only one handling them?
A I was the only one handling the Tea Party's, that is correct.
Q Did that specifically cause you concern?
A Yes, it did. And I was the only person handling them.
Q Were you concerned that you didn't have the capacity to process all of the applications in a timely manner?
A That is correct. And it is just ¬¬ I mean, like you brought up, the micromanagement, the fact that the topic was just weirdly handled was a huge concern to me.

Filed under: Darrell Issa • IRS
soundoff (572 Responses)
  1. lzld

    If Obama is smart and proves to be the long term thinker he has always been, he will breathe through this mess and then make this whole thing about TAX EVASION of big corporations and now non-profits who do only 49% of the big corporations bidding. WAKE UP AMERICA...we are being bought, sold, and traded by corporations. This is the back door way for free marketers to make sure that the country is run by plutocrats.....

    June 2, 2013 01:16 pm at 1:16 pm |
  2. Vad

    @Pander Bear. You are clearly a liberal. Liberals have a self righteous "helping the little guy" thing going on. My question to you is: The IRS first attempted to throw two little guys in the Cincinnati office under the bus while their ring leaders plead the fifth. Sounds like every bank or oil scandal I ever heard of. Why are you defending it when the Obama Administartion does it? Is that your idea of hope and change?

    June 2, 2013 01:17 pm at 1:17 pm |
  3. Norma Vessels

    Reagon Republican .. I applaud you! Thanks for writing down what's been on my mind.

    June 2, 2013 01:19 pm at 1:19 pm |
  4. blakenaustin

    Duh. Obama and Holder authorized the IRS actions. Time for heads to roll.

    June 2, 2013 01:20 pm at 1:20 pm |
  5. DJ Reality

    This needs to be investigated by an impartial independent body. Not by Darrel Issa and behind closed doors. I don't trust Issa to be fair and impartial. He can't be and is not. The IRS is a mess and needs to be overhauled. Until we can make sure it is free of politics. Most importantly no political groups right or left should have tax free status period.

    June 2, 2013 01:21 pm at 1:21 pm |
  6. kols

    Darrel Issa is and always will be a jerk. He says they should have become whistle blowers. Give me a break! We all know what happens to whistle blowers because they don't have enough protections. They are basically mocked and made out to be liars so who in their right mind would become one. Even in private business if you are a whistle blower they cover their asses and act like you made it up to protect the powers that be. Look at people like Sibel Edmonds and Russell Tighe who were made an example and promptly ignored.

    June 2, 2013 01:21 pm at 1:21 pm |
  7. 703NOVA

    When is Issa going to do some actual work instead of wasting his time on witch hunts? The party of no continues to prove that the name fits.

    June 2, 2013 01:22 pm at 1:22 pm |
  8. Gene Brady

    Issa is to the Republican party what the "Birdman" is to Miami Heat.......

    June 2, 2013 01:22 pm at 1:22 pm |
  9. manhandler1

    We out here in California are embarrassed that this creep is from our State. He has absolutely no proof that this is what happened, but that doesn't stop him from shooting his mouth off and lying just to try and paint his investigation as anything but a waste of time.

    June 2, 2013 01:24 pm at 1:24 pm |
  10. steve

    Same Darrell Issa that removed his business records just before his business burned down. Still bitter that he only collected 10 cents on the dollar from insurance?

    June 2, 2013 01:26 pm at 1:26 pm |
  11. Norma Vessels

    It's true .. Issa has been at his wit's end, trying to find a scandal that will 'stick' to our President Obama. And, as soon as they find out that our President had absolutely no part in this so called scandal, then he will dig up something else. Issa will go on investigating one thing after another, no matter how far from the truth it will most likely be, until the end of our President's second term. Some people will pay dearly for these scandals, losing their jobs etc .. not because of President Obama or the White House, but because of Issa.

    June 2, 2013 01:26 pm at 1:26 pm |
  12. The King

    Next up, Issa is going to get to the bottom of Obama's involvment in the building of the ground zero victory mosque!!

    June 2, 2013 01:26 pm at 1:26 pm |
  13. No support

    I still find it hard to follow the logic Issa puts forth. He has actually suggested that since these these tea party groups were not given tax exempt status that it effected the presidential voting. Yes, in his mind the fact that people didn't get a tax exemption they were not able to vote.. because we all know that in order to vote you must be tax exempt.. you must know that you can't go out and support your candidate without a tax exempt status.. we all know that the only time you are able to tell your neighbor the good things your candidate will do for the country, is if you have a tax exempt status.

    June 2, 2013 01:27 pm at 1:27 pm |
  14. valwayne

    Of course directions came from Washington. Folks, during that time period the Director of the IRS went to the White House 157 time. The previous director under Bush went 1x. Despite his snide remark to Congress he wasn't going for 157 Easter Egg hunts. He was going because the most massive criminal conspiracy in the history of the U.S. to punish and harrass Obama's political opposition was being run out of the White House. And it wasn't just conservative groups folks. Obama saw Jewish and Christian groups as enemies also, and they harrassed them. The Obama Regime and the White House are up in this to their eyeballs. We are being governed by the most arrogant, corrupt, incompetent, Chicago Way politician to ever sit in the White House.

    June 2, 2013 01:29 pm at 1:29 pm |
  15. nanonano

    Evidence? We don't need no stinking evidence! Don't confuse me with any facts, my mind's made up.

    June 2, 2013 01:31 pm at 1:31 pm |
  16. asd

    Blatantly lying to the country about foreign attacks, blackmailing and controlling the media and attacking the only other political party.... didn't our ancestors cross the Atlantic twice to remove these kinds of people from power?

    June 2, 2013 01:31 pm at 1:31 pm |
  17. Tcar

    This is getting ridiculous! The GOP couldn't win the election, public opinion is sharply facing downwards and somehow they have an ace in their pocket. This to me sounds more like a set up to get what they want, Obama out! This was their goal from day one of his presidency and continues all the way to today! They are a bunch of racist non-American citizens that only care about what they and their rich friends want and get! What was going on with the Tea Party that got them in the spot light!? Questioning the KKK of political parties on their motive should be of the utmost importance to the safety of America and it's citizens!

    June 2, 2013 01:31 pm at 1:31 pm |
  18. Name

    More than likely under the patriot act, thanks bush, Washington has the legal right to investigate extremist groups for illegal activity.

    I would defiantly consider the Tea Party and extremist group and their member have repeatedly expressed an interest in over throwing the government, seceding from the Union and all out Civil war against their neighbors.

    June 2, 2013 01:32 pm at 1:32 pm |
  19. waheid

    “My gut tells me that too many people knew this wrongdoing was going on before the election, and at least by some sort of convenient, benign neglect, allowed it to go on through the election,” he (Issa) said. Well, my gut tells me he's in charge of a political circus, one that has little interest from his audience. Wouldn't it be nice if Issa and other conservative Congressmen would get to work, do their jobs, and produce a budget that can be signed into law.

    With clowns like Issa, is it any wonder that confidence in the Congress is at an all-time low?

    June 2, 2013 01:33 pm at 1:33 pm |
  20. Guitar

    This from Dan Issa, the same guy arrested for suspicion of Arson, Weapon's Charges, and Auto Theft! Yes, he wasn't convicted, and pleaded to lesser charges, but taking a page from the Republican play book, people are guilty of everything until proven innocent! BTW, you know he probably did it, but his political buddies and money got him off.

    June 2, 2013 01:33 pm at 1:33 pm |
  21. ss31704

    Ok, now the big questions...who issued the BOLO in DC? Usually a bulletin has a name on it. Second, who were these files sent to...they had to be sent to someone's attention. Come on, is, ask ALL the questions.

    June 2, 2013 01:34 pm at 1:34 pm |
  22. Andrew

    Nothing about these groups actually breaking the law, somehow.

    June 2, 2013 01:34 pm at 1:34 pm |
  23. Jean-Sartre

    "Issa’s committee released only excerpts and not the full transcripts of the interviews, citing the fact that the investigation is ongoing. CNN asked for the full transcripts, but the committee did not agree to the request. CNN has not seen the full transcripts or the context of the questions and answers."

    I'm just wondering, when we will get past Issa's comment that Washington did it!

    Was it George Washington?

    Was it the state of Washington?

    Was it Washington D. C.?

    One wonders in this totally superfluous witch hunt, when, if ever, we will be capable of narrowing this oracle for Issa down from the total universe of Washington...

    Stop wasting taxpayer money!

    June 2, 2013 01:38 pm at 1:38 pm |
  24. DavM

    Impeach comrade Obama now

    June 2, 2013 01:40 pm at 1:40 pm |
  25. Debbie

    I don't know about the IRS and Washington but I do know that Issa is a twice arrested car thief so I question his credibility on facts. Stealing/theft is a trust and honesty issue and Issa lacks both.

    June 2, 2013 01:44 pm at 1:44 pm |
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