By STEPHEN OHLEMACHER, Associated Press
WASHINGTON (AP) — Three days of congressional hearings about the Internal Revenue Service's targeting of conservative political groups have lawmakers looking for ways to widen an investigation that has so far been largely contained within the tax collection agency.
More than 11 hours of testimony and an inspector general's report have revealed plenty of wrongdoing within the IRS. But so far, investigators have not produced evidence that anyone outside the IRS authorized the targeting, or even knew about it before a few weeks ago.
They will keep trying.
Three congressional committees are investigating the matter, and the leaders of those committees say they are just getting started. The Justice Department has launched a criminal investigation, and the new acting head of the IRS says he is conducting an internal review.
"The first step in this effort must be to get to the bottom of the recent allegations regarding the criteria to determine eligibility for tax-exempt status," Danny Werfel, the new acting IRS commissioner, said in an agencywide internal memo to employees Wednesday.
"The missteps uncovered in the recent inspector general report are inexcusable and cannot be tolerated by any of us," wrote Werfel, who was appointed by President Barack Obama last week and started Wednesday. "That is why we must work together with the inspector general, the Justice Department and Congress to ensure that responsible parties are held accountable for the inappropriate activities that occurred and that we correct the breakdowns in process and oversight that allowed them to occur."
The White House has not been unscathed. Obama's top spokesman said Wednesday the White House was facing "legitimate criticisms" for its shifting accounts about who knew what, and when they knew it about the IRS targeting of conservative political groups.
Press secretary Jay Carney first said that only Obama's top lawyer knew the IRS was being investigated in the weeks before the inspector general's report was released. Later, he said the chief of staff and other top officials also knew.
"There have been some legitimate criticisms about how we're handling this," Carney said. "And I say 'legitimate' because I mean it."
The inspector general's report, which was released last week, said IRS agents in a Cincinnati office targeted tea party and other conservative groups for additional scrutiny when they applied for tax-exempt status. They started targeting these groups in March or April of 2010. By August 2010, "tea party" became part of a "be on the lookout," or "BOLO," list of terms to flag for additional screening.
Lois Lerner, who heads the IRS division that handles applications for tax-exempt status, learned in June 2011 that agents were singling out groups with "Tea Party" and "Patriots" in their applications for tax-exempt status, the report said. She ordered agents to scrap the criteria immediately, but later they evolved to include groups that promoted the Constitution and the Bill of Rights.
It finally stopped in May 2012, when top agency officials say they found out and ordered agents to adopt appropriate criteria for determining whether tax-exempt groups were overly political.
Former IRS Commissioner Douglas Shulman told two congressional committees this week that he first learned in the spring of 2012 that conservative groups had been improperly singled out for additional scrutiny. However, after learning that the practice had stopped and that the inspector general was investigating, Shulman said he didn't tell anyone in the Treasury Department or the White House about it. The IRS is part of the Treasury Department.
Shulman, who was appointed by President George W. Bush, left office in November, when his five-year term expired.
Lerner was subpoenaed to testify Wednesday before the House Oversight and Government Reform Committee. Her appearance was brief. She read an opening statement in which she denied any wrongdoing. Then she refused to answer questions, invoking her constitutional right against self-incrimination.
"I have not done anything wrong," Lerner said. "I have not broken any laws, I have not violated any IRS rules or regulations, and I have not provided false information to this or any other congressional committee."