Treasury knew of IRS audit, but likely little more

Updated
The Internal Revenue Service building, Washington DC.
The Internal Revenue Service building, Washington DC.
Ann Hermes/The Christian Science Monitor via Getty Images

Senior Treasury Department officials were aware early last summer of an audit into political targeting at the Internal Revenue Service, the department acknowledged Friday. That’ll likely intensify Republican questions about when other parts of the Obama administration learned of the controversy, in which, we now know, keyword searches were used to target Tea Party groups for special scrutiny. But no evidence has yet emerged that key damning details about the targeting were known beyond the IRS itself.

Inspector General J. Russell George told the House Ways and Means committee Friday that on June 4 he had informed the department’s general counsel that he was conducting an audit relating to IRS’s treatment of tax exempt organizations. George said he told Deputy Treasury Secretary Neil Wolin later, but could not recall the exact date.

In a statement released after George’s testimony, Treasury confirmed that department officials were told of the probe in June 2012. The statement noted: “Mr. George also testified that he did not inform Treasury officials at the time of any results or audit findings.” It said it’s “standard practice” for George to tell Treasury officials about the audits he was working on.

Treasury also appeared to argue in the statement that it would have been improper for officials to take any action upon learning of the audit’s existence. ”Treasury strongly supports the independent oversight of its three Inspectors General, and it does not interfere in ongoing IG audits,” the statement said.

Claims of an administration cover-up are undercut by the fact that lawmakers probing the issue were given similar information about the IG’s audit not long afterwards. In July 2012, George sent a letter to Rep. Darrell Issa, who chairs the House Oversight committee, The New York Times reports, telling him: “We would be happy to provide a status update [on the audit] to the subcommittee staff.”

And in October, George’s office posted on its website a list of the audits it was conducting, including one on the IRS’s treatment of political groups seeking tax-exempt status.

Issa and other lawmakers have complained that IRS officials kept them in the dark until last week about details of the targeting. Lois Lerner, the director of the agency’s exempt organizations division, Doug Shulman, its commissioner until last fall, and Steven Miller, its acting commissioner until last week, knew by last year—earlier in Lerner’s case—that the agency had conducted improper targeting of Tea Party groups, but failed to tell Congress despite being asked directly.

But there’s no evidence that Wolin and other Treasury Department officials had similarly detailed knowledge. Rather, they appear to have been told only of the existence of the audit—just as Issa was a month later.

A senior White House official told the Times that last month, the White House’s top lawyer, Kathryn Ruemmler, was informed of the audit’s completion, around the same time that Treasury Secretary Jacob Lew—a former White House chief of staff—also was told. Again, there’s no evidence that either was told of the report’s findings.

Still, the confirmation that Treasury was aware of the investigation last year seems likely to fuel Republican efforts to implicate the Obama administration more broadly in the controversy.

“We’re going to continue this investigation and get to the bottom of this, Rep. Paul Ryan said on Fox News Sunday. “Who knew? What did they know? Why did they do this?  How high up in government did it go?”

Dan Pfeiffer, a senior White House adviser, pushed back on that line. “Look at what the Independent Inspector General said in the report and to Congress on Friday,” Pfeiffer said. “One, there is no evidence this came from anyone other than the IRS. Two, this was not necessarily based on political motivation.”

Treasury knew of IRS audit, but likely little more

Updated