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Key IRS official refuses to testify

Published: Thursday, May 23, 2013 10:24 a.m. CDT

Key IRS official refuses to testify

(MCT) WASHINGTON — In a contentious climax Wednesday to a series of congressional hearings, Lois Lerner, a key IRS manager, invoked her right to not testify about the agency’s targeting of conservative groups, igniting howls from Republicans and sparking a threat to bring her back for another round.

Deprived of a crucial witness, members of Congress from both parties alternately grilled and scolded former Commissioner Douglas Shulman about the Internal Revenue Service’s improper screening of conservative groups applying for tax-exempt status.

Although new details and documents have emerged about how IRS staff scrutinized organizations for political activity, the three hearings on three different days turned up no evidence that the aggressive screening stemmed from partisan motives or was ordered from above, either by the White House or by senior IRS management.

The hearings, launched by the release last week of a scathing inspector general’s report, instead have painted a picture of a bungling agency in which top managers in Washington were largely out of touch with how their staff in a Cincinnati field office was handling applications for tax exemptions.

Many questions have not been answered, including how the improper screening started, why it continued on and off for two years, and why top IRS officials did not reveal it for more than a year despite pointed questions from Congress and loud complaints from the targeted conservative groups.

Lerner, who still supervises the IRS staff that handles those applications, and Shulman appeared Wednesday before the Oversight and Government Reform Committee, but provided little illumination.

Lerner, who revealed the inappropriate targeting two weeks ago, read a statement saying she did nothing wrong, then invoked her Fifth Amendment right to not answer questions. “Because I’m asserting my right not to testify, I know that some people will assume that I’ve done something wrong. I have not,” she said.

Her decision did not sit well with Republicans angered that conservative groups, including local tea party organizations, faced intrusive questions and long delays when they applied for nonprofit status.

“Ms. Lerner has invoked her constitutional rights not to answer our questions about her involvement or the IRS’ involvement, ironically, about denying others their constitutional rights,” said Rep. Michael R. Turner, R-Ohio.

Lerner, noting that the Department of Justice had launched a criminal investigation, said her lawyer advised her not to testify. It is relatively rare for witnesses to invoke the Fifth Amendment. In April 2012, a federal official refused to answer questions about a lavish conference in Las Vegas. And a year earlier, executives of Solyndra invoked the right during a congressional probe of federal grants to their failed solar-energy firm.

The oversight committee chairman, Rep. Darrell Issa, R-Calif., excused Lerner, but said he may ask her to appear again, on the grounds that she may have waived her rights by first offering a defense of her actions.

Legal experts were divided on the question. Stanley Brand, former general counsel to the U.S. House, said other witnesses have made introductory statements before invoking the Fifth. But Paul Rothstein, a professor of judicial process at Georgetown University Law Center, said Lerner is on “pretty thin ice” because her remarks touched on the subject of the hearing.

The IRS did not respond to questions about Lerner.

“It’s important to find the facts before you hold people accountable,” White House spokesman Jay Carney said Wednesday when asked why Lerner was still at the IRS.

The new acting commissioner, Daniel Werfel, started Wednesday. President Barack Obama asked him to report back in 30 days on what action he had taken to hold accountable staff who acted inappropriately. “There is a commitment here to get to the bottom of what happened,” Carney said.

Also testifying Wednesday was the first Obama administration official, Deputy Treasury Secretary Neal S. Wolin. He said he learned an inspector general’s audit was underway in 2012, but did not learn any details from J. Russell George, the Treasury inspector general for tax administration. “I told him that he should follow the facts where they lead. I told him that our job is to stay out of the way and let him do his work,” he said.

Republicans and Democrats on the oversight committee, without Lerner to question, focused most of their attention on Shulman, who ran the IRS for five years before leaving in November 2012.

Shulman, who also testified on Tuesday, again said that he never knew much about what his staff was doing to look for political activity in organizations seeking tax exemptions. He said he didn’t take action when he learned about it in early 2012 since he was told the problem had ended.

“People in your own internal operation knew,” Issa told Shulman. “If you didn’t know, you were derelict in your duty, or your management style was such that you didn’t get informed. Either way, that is certainly not something you should be proud of.”

Shulman repeatedly parried questions about why he didn’t do more. “At the time I learned about this list I felt I was taking the appropriate actions and I felt my course was the right one, and I still feel that way today,” he said.

Many of the exchanges were testy. Some Republicans, trying to build a trail to the White House, asked Shulman what he talked about during his frequent visits to the executive mansion.

One, he pointedly noted, was “the Easter Egg roll with (his) kids.” But he said he steered clear of the subject: “It would not have been appropriate to have a conversation with anyone at the White House about the subject of discriminating against conservative groups in any part of our operations.”

The oversight committee staff has begun questioning IRS officials who were directly involved with supervising screeners and obtaining emails from the staff in Cincinnati who dealt with the issue.

One of those officials, Holly Paz, an attorney who worked under Lerner in Washington, said she first uncovered the improper screening in June 2011. She said the employees in Cincinnati didn’t realize that using terms such as “tea party” to single out applications crossed the line.

“They were not even aware of, you know, politics,” she said, according to committee staff. “Being outside of Washington, it was not something that they followed or had interest in.”

Many of the groups were sent letters with intrusive requests for information, such as lists of donors and details of their conversations at their events. Paz told the staff that no IRS managers looked at those letters before they went out, a practice that has since been changed.

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©2013 Tribune Co.

Visit Tribune Co. at www.latimes.com

Distributed by MCT Information Services

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