[House Hearing, 113 Congress]
[From the U.S. Government Publishing Office]
IS THE OBAMA ADMINISTRATION CONDUCTING A SERIOUS INVESTIGATION OF IRS
TARGETING?
=======================================================================
HEARING
before the
SUBCOMMITTEE ON ECONOMIC GROWTH,
JOB CREATION AND REGULATORY AFFAIRS
of the
COMMITTEE ON OVERSIGHT
AND GOVERNMENT REFORM
HOUSE OF REPRESENTATIVES
ONE HUNDRED THIRTEENTH CONGRESS
SECOND SESSION
__________
FEBRUARY 26, 2014
__________
Serial No. 113-92
__________
Printed for the use of the Committee on Oversight and Government Reform
Available via the World Wide Web: http://www.fdsys.gov
http://www.house.gov/reform
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COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM
DARRELL E. ISSA, California, Chairman
JOHN L. MICA, Florida ELIJAH E. CUMMINGS, Maryland,
MICHAEL R. TURNER, Ohio Ranking Minority Member
JOHN J. DUNCAN, JR., Tennessee CAROLYN B. MALONEY, New York
PATRICK T. McHENRY, North Carolina ELEANOR HOLMES NORTON, District of
JIM JORDAN, Ohio Columbia
JASON CHAFFETZ, Utah JOHN F. TIERNEY, Massachusetts
TIM WALBERG, Michigan WM. LACY CLAY, Missouri
JAMES LANKFORD, Oklahoma STEPHEN F. LYNCH, Massachusetts
JUSTIN AMASH, Michigan JIM COOPER, Tennessee
PAUL A. GOSAR, Arizona GERALD E. CONNOLLY, Virginia
PATRICK MEEHAN, Pennsylvania JACKIE SPEIER, California
SCOTT DesJARLAIS, Tennessee MATTHEW A. CARTWRIGHT,
TREY GOWDY, South Carolina Pennsylvania
BLAKE FARENTHOLD, Texas TAMMY DUCKWORTH, Illinois
DOC HASTINGS, Washington ROBIN L. KELLY, Illinois
CYNTHIA M. LUMMIS, Wyoming DANNY K. DAVIS, Illinois
ROB WOODALL, Georgia PETER WELCH, Vermont
THOMAS MASSIE, Kentucky TONY CARDENAS, California
DOUG COLLINS, Georgia STEVEN A. HORSFORD, Nevada
MARK MEADOWS, North Carolina MICHELLE LUJAN GRISHAM, New Mexico
KERRY L. BENTIVOLIO, Michigan Vacancy
RON DeSANTIS, Florida
Lawrence J. Brady, Staff Director
John D. Cuaderes, Deputy Staff Director
Stephen Castor, General Counsel
Linda A. Good, Chief Clerk
David Rapallo, Minority Staff Director
Subcommittee on Economic Growth, Job Creation and Regulatory Affairs
JIM JORDAN, Ohio, Chairman
JOHN J. DUNCAN Jr., Tennessee MATTHEW A. CARTWRIGHT,
PATRICK T. McHENRY, North Carolina Pennsylvania, Ranking Minority
PAUL GOSAR, Arizona Member
PATRICK MEEHAN, Pennsylvania TAMMY DUCKWORTH, Illinois
SCOTT DesJARLAIS, Tennessee GERALD E. CONNOLLY, Virginia
DOC HASTINGS, Washington MARK POCAN, Wisconsin
CYNTHIA LUMMIS, Wyoming DANNY K. DAVIS, Illinois
DOUG COLLINS, Georgia STEVEN A. HORSFORD, Nevada
MARK MEADOWS, North Carolina
KERRY BENTIVOLIO, Michigan
RON DeSANTIS Florida
C O N T E N T S
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Page
Hearing held on February 26, 2014................................ 1
WITNESSES
The Hon. George J. Terwilliger, III., Partner, Morgan, Lewis &
Bockius LLP
Oral Statement............................................... 6
Written Statement............................................ 9
The Hon. Eileen J. O'Connor, Former Assistant Attorney General
(2001-2007), Tax Division, U.S. Department of Justice
Oral Statement............................................... 14
Written Statement............................................ 17
The Hon. Hans A. Von Spakovsky, Manager, Election Law Reform
Initiative and Senior Legal Fellow, Edwin Meese III, Center for
Legal and Judicial Studies, The Heritage Foundation
Oral Statement............................................... 21
Written Statement............................................ 23
Mr. Glenn F. Ivey, Partner, Leftwich and Ludaway LLC
Oral Statement............................................... 29
Written Statement............................................ 31
Mr. Richard W. Painter, S. Walter Richey Professor of Corporate
Law, University of Minnesota Law School
Oral Statement............................................... 37
Written Statement............................................ 39
APPENDIX
June 11, 2007 letter to the Senate Rules Committee from members
of The Voting Section, submitted by Rep. Connolly.............. 64
IS THE OBAMA ADMINISTRATION CONDUCTING A SERIOUS INVESTIGATION OF IRS
TARGETING?
----------
Wednesday, February 26, 2014
House of Representatives,
Subcommittee on Economic Growth, Job Creation, and
Regulatory Affairs,
Committee on Oversight and Government Reform,
Washington, D.C.
The subcommittee met, pursuant to call, at 1:35 p.m., in
Room 2154, Rayburn House Office Building, Hon. Jim Jordan
[chairman of the subcommittee] presiding.
Present: Representatives Jordan, DeSantis, DesJarlais,
Lummis, Meadows, Bentivolio, Issa (ex officio), Cartwright, and
Connolly.
Staff Present: David Brewer, Senior Counsel; Drew
Colliatie, Professional Staff Member; Linda Good, Chief Clerk;
Tyler Grimm, Senior Professional Staff Member; Christopher
Hixon, Chief Counsel for Oversight; Ashok M. Pinto, Chief
Counsel, Investigations; Sarah Vance, Assistant Clerk; Jeff
Wease, Chief Information Officer; Meghan Berroya, Minority
Counsel; Susanne Sachsman Grooms, Minority Deputy Staff
Director/Chief Counsel; Jennifer Hoffman, Minority
Communications Director; Adam Koshkin, Minority Research
Assistant; Julia Krieger, Minority New Media Press Secretary;
Elisa LaNier, Minority Director of Operations; Juan McCullum,
Minority Clerk; Brian Quinn, Minority Counsel; Donald Sherman,
Minority Counsel.
Mr. Jordan. The committee will come to order. Today's
hearing constitutes the committee's ongoing oversight of the
Department of Justice's investigation into the IRS'
inappropriate treatment of conservative groups applying for
tax-exempt status. On May 10th, 2013, Lois Lerner apologized
for the IRS' targeting of Tea Party groups while answering a
pointed question at some obscure Friday morning tax law panel.
She said, ``They use names like 'Tea Party' or 'Patriots,' and
they selected cases simply because the applications had those
names in the title. That was wrong. That was absolutely
incorrect, insensitive, and inappropriate.''
Immediately after Lerner's apology, the President and the
Attorney General vowed to get to the bottom of the targeting.
Attorney General Holder called it, ``outrageous and
unacceptable,'' and the President said his administration would
not tolerate this behavior in any agency.
One month later, I asked then FBI Director Mueller a couple
of basic questions. I said, Who is the lead agent? How many
agents have you assigned to the case? And have you interviewed
any of the victims? His answers were, I don't know, I don't
know, I don't know. Not exactly inspiring a lot of confidence
in the quality of this investigation, one month after the
President and the Attorney General had made the statements that
they made.
We sent letters to the FBI and the DOJ seeking information
about the investigation. At every turn, they refused to
cooperate. There is new information raising concerns about the
integrity of the Administration's investigation. Department of
Justice Attorney Barbara Bosserman is leading the
investigation. Publicly available records show that Ms.
Bosserman contributed almost $7,000 to President Obama's
political campaigns and the Democratic National Committee over
the last few years.
Last month, anonymous sources in the Justice Department
leaked information to the Wall Street Journal that no criminal
charges would be filed in the IRS matter, despite the fact that
many victims of the targeting had not yet been interviewed. And
shortly thereafter, on national television, the President
declared that there was, ``not a smidgeon of corruption in the
IRS targeting.''
I don't know how the President can make this claim because
the Department of Justice had told me and lot of other members
that it cannot discuss an ongoing investigation. Earlier this
month, the committee heard from victims Catherine Engelbrecht
and Becky Gerritson, who testified that they have not been
interviewed. Jay Sekulow testified that not one of his 41
clients had been interviewed. He also testified under oath that
Ms. Bosserman was the highest ranking Department of Justice
official he had spoken with about the investigation.
Just imagine how this looks to the American people. The
President says, there is not a smidgeon of corruption. The
Administration leaks that it will not file charges, and yet
witnesses have not been interviewed, and a substantial
contributor to the President is leading the investigation.
Again, doesn't inspire much confidence that this is a true
investigation. There is still serious questions that needs to
be answered. Our witnesses this afternoon come with years of
experience, either working at the Department of Justice or
advising the President on governmental ethics. Through their
testimony, the hope is we may understand the dangers of
perceptions of bias and politicized leaks in how the
Administration can work to restore public faith in this
critical investigation.
The American people are rightly outraged. They deserve the
truth. And that is what we are going to get to today. And with
that, I would yield to the ranking member for his opening
statement.
Mr. Cartwright. I thank you, Mr. Chairman.
Today marks the second hearing that this subcommittee has
held in a span of 3 weeks about the IRS. In less than 24 hours
from now, it will be convening yet another hearing on this very
same matter. Thus far, the Oversight and Government Reform
panel has interviewed no fewer than 38 IRS and Treasury
Department employees and has received more than 385,000 pages
of documents to review in this matter. Responding to
congressional investigations in this matter has now cost
American taxpayers at least $14 million so far and still
counting.
And none of the evidence uncovered so far shows any
political motivation or any White House involvement, which is
exactly the same thing that the Inspector General of the
Treasury Russell George told us in this room many months ago
that he found no evidence of a political animus either.
The Department of Justice and the FBI are conducting their
own independent investigation to determine if there was any
crime committed by anybody at the IRS. They do not rely on our
investigative findings, and they will reach their own
conclusions. Today's hearing is about allegations that there is
some political bias in the Department of Justice's
investigation.
Republicans have criticized the Department for failing to
discuss the details of its ongoing criminal investigation and
that this is somehow a coverup for the political bias that they
are alleging. As the majority knows well, the Department of
Justice has a longstanding practice, to which I have alluded
many times from this side of the dais of not disclosing
information about ongoing criminal investigations. It is a
practice that Americans are familiar with. When the county
sheriff at home is involved in an investigation and is
interviewed on television, he or she always says, ``I can't
comment on an ongoing investigation,'' and Americans understand
that, and they're comfortable with it.
The Justice Department handles it the same way, and this is
a practice spanning Democratic and Republican administrations
in longstanding practice of not commenting. That is why none of
the witnesses testifying today have any direct knowledge about
the investigation and including who in the Department is
actually leading that investigation, what they found, and when
they will conclude.
But maybe the most troubling criticism is the chairman's
claim that the investigation has, ``the appearance of a
substantial and material conflict of interest,'' and the basis
for the chairman's claim is that a career prosecutor who is one
of at least 13 DOJ and FBI employees involved in the
investigation exercised her constitutional right to participate
in the democratic process and made political donations.
During the last hearing we had on this very same topic, I
entered into the record the legal opinion of Professor Daniel
Richman of Columbia University Law School, who has spent
decades working on just such issues, and prior to serving in
academia, served as an assistant U.S. attorney in the Southern
District of New York and was the chief appellate attorney in
that office. Professor Richman categorically rejected the
chairman's interpretation of the law saying any claim that
these contributions in and of themselves create a conflict of
interest strikes me as meritless.
The plain and undisputed--and indisputable language of the
law allows career civil servants, like any other American, to
exercise their constitutionally protected right to participate
in the democratic process. Can you imagine, Mr. Chairman, if a
private employer looked into a private citizen's participation
in the political process before hiring them or didn't give them
an assignment based solely on whether they were a Democrat or a
Republican? Where would it end? Would it end at campaign
contributions, or what about signing a petition to get their
Member of Congress on the ballot or about whether they--whether
or not they simply voted in the last election.
In fact, what is even more interesting is that this is the
exact same thing that some of the groups applying for the
(c)(4) status at the heart of this matter are complaining
about, that they are being scrutinized excessively because of
their political stances and their involvement in the political
process.
So let me make this final point clear: If the Justice
Department were to adopt the Republican position here and start
screening career Federal prosecutors for their participation in
the democratic process before assigning them cases, it would
not only be illegal; it would be unconstitutional and downright
un-American.
I yield back, Mr. Chairman.
Mr. Jordan. I would just remind the ranking member, no one
is talking about Ms. Bosserman not keeping her job. No one has
ever questioned the character and the professionalism of Ms.
Bosserman. All we are saying is, is that 28 CFR. 45.2, says
``Disqualification arising from personal or political
relationship, the employee's participation would not create an
appearance of conflict of interest likely to affect the public
perception of the integrity of the investigation or
prosecution.''
It couldn't be any clearer. This is not--this is not me
making this up. This is straight from the rules that apply to
the Justice Department personnel. So, to equate it to the
private sector, it has just simply no bearing whatsoever on the
issue at hand.
With that, I recognize our distinguished panel today.
Excuse me, is Mr. Connolly giving an opening statement? I
was looking for the--I thought the chairman and the ranking
member of the full committee were going to be here for an
opening statement, but if they are not, we are willing to see
if Mr. Meadows or Mr. Bentivolio has an opening statement, or
Mr. DeSantis.
Mr. Connolly.
Mr. Connolly. Thank you, Mr. Chairman.
I don't really have an opening statement, other than I just
heard the ranking member statement and your own. I would just
say if we are going to, you know, apply the standard across the
board equally, then frankly, it would tend to disqualify the
credibility of the IG, Mr. Russell George, who has done
precisely the same kind of political activity, has contributed
to Republican causes was a member of the Republican staff, has
met exclusively with the Republican staff of this committee. So
if we are going to cast aspersions of somebody else's character
or just questioning whether she meets the standard, we could
apply the same thing to the IG, whose testimony we rely on to
create, you know, a great scandal, that turns out to be very
limited testimony and rather cherry-picked at that, so I look
forward to hearing us explore this issue. I hope we will do it
fully and across the board in an evenhanded way.
Thank you, Mr. Chairman.
Mr. Jordan. We are going to pause for just a second because
I know the chairman is on his way and would like to make an
opening statement, and I know we do have votes any minute now.
Let me introduce our panel.
Maybe we can swear them in and then come back to Mr.
Chairman Issa's opening statement.
We have first Mr. George Terwilliger, who is a partner at
Morgan Lewis law firm. We have Ms. Eileen O'Connor, who is a
partner at the firm Pillsbury Winthrop Shaw Pittman. Mr. Hans
von Spakovsky is the Edwin Meese, III,
Center for Legal and Judicial Studies senior legal fellow
at the Heritage Foundation. Mr. Glenn Ivey is a partner at
Leftwich and Ludaway. And finally, Mr. Richard Painter is a
Walter Richey professor of Corporate Law at the University of
Minnesota School of Law.
I want to thank you all for being here. We know it is not
easy always to come for these, and--but we appreciate your
expertise and your willingness to share with us that expertise
today.
Pursuant to committee rules, all witnesses will be sworn in
before they testify, so if you will please stand and raise your
right hand.
Do you solemnly swear or affirm that the testimony you are
about to give will be the truth, the whole truth and nothing
but the truth, so help you God?
Let the record show that each of our witnesses answered in
the affirmative.
The rules are, you are going to get 5 minutes, more or
less, close to 5 is how we will do it, and we will work right
down the line, but unfortunately, that is not going to happen
until after we vote, and I am hoping chairman--so we are going
to recess now, and the chairman will have an opening statement
when we come back and we will get to your testimony. This is a
good way to break as we are going to get on a day like today,
so you can retire to either room. There are restroom
facilities, coffee, whatever you need, and we will be back in,
how many votes again?
Mr. Connolly. Three votes.
Mr. Jordan. Two or three. Three. So, 45 minutes. 30 to 45
minutes is what it is going to take, so thank you very much,
and we stand in recess.
[Recess.]
Mr. Jordan. The committee will be in order. And we
recognize the chairman of the full committee with the
understanding that Ms. O'Connor is on her way back. But
recognize the chairman for his opening statement.
Chairman Issa. Thank you, Mr. Chairman.
And I took special note of your hearing today. The series
of hearings you have held really are critical to a full and
complete understanding of the scope of the injustice going on
before, during, and after the discovery of the IRS targeting of
501(c)(4) groups. Today's panel is an excellent panel, and I
look forward to hearing all of their testimony. I think the one
thing that we all know is that solutions for large
bureaucracies, and particularly ones that operate by necessity
behind closed doors, must first start with a full admission of
what has happened, what safeguards existed and were not
observed, and what safeguards did not exist.
This committee has discovered that the safeguards of
confidential information are selective and that in fact the
safeguards to protect against the release of private
information, although they failed at times at the IRS, are
currently being used to hamper investigation and the public's
right to know who was targeted and for how long and, in fact,
who is still being targeted. I know tomorrow you will have a
list of groups, both nonprofit 501(c)(3)s and 501(c)(4)s, all
of whom are opposed to the very selective partisan change that
the President has proposed. I am more concerned today with this
hearing because DOJ's decision, prosecutory discretion, appears
to be a clear abuse of discretion. There is no doubt that DOJ
claimed to be doing investigations, but the highest law
enforcement officer at the FBI could not name someone. The
Attorney General seemed not to know anyone. And there have been
mixed statements about nothing was expected to come, but maybe
it would come. This is as ambiguous as the Attorney General's
statement that he will leave sometime in 2014, or he won't.
I believe that our committee, and with your leadership, Mr.
Chairman, has an absolute responsibility to make sure that the
Department of Justice reconsiders their investigations and
their possible prosecutions of people who abused the trust of
the American people. And so, for that, I am already in your
debt, Mr. Chairman. I look forward to this hearing, and I very
much believe that this committee has a special role in making
sure this never happens again. Thank you.
I yield back.
Mr. Jordan. I thank the chairman for his statement and for
his leadership on this issue and many others.
With that, we will turn to our distinguished panel.
Mr. Terwilliger, you are going to start. You have got 5
minutes. There will be members trickling in and out of here,
but you have done this before, so fire away.
WITNESS STATEMENTS
STATEMENT OF THE HONORABLE GEORGE J. TERWILLIGER, III
Mr. Terwilliger. Thank you, Mr. Chairman, Chairman Issa,
Mr. Cartwright, members of the committee.
Thank you for inviting me to express my views concerning
the Justice Department's investigation of possible abuse of IRS
authority. I am not here today to opine on the merits of the
underlying allegations of improper conduct involving the IRS.
Rather, I agreed to speak to what is, in my experience and best
judgment, the appropriate means for the Department of Justice
to conduct such an investigation.
That background and experience at the Department of Justice
began when I served while in law school as a law clerk in the
Civil Appellate Section and ended when I was the acting
Attorney General at the conclusion of the Bush One
administration. In the 15 years in between, I served as a
career assistant United States attorney, and as the Deputy
Attorney General, as well as a Presidential-appointed United
States attorney.
I also would like to note at the outset that so long as we
have a tax system that depends on voluntary payment by our
citizens, we need a strong IRS capable of performing tax
examinations and enforcement that can render the tax system
equal and fair for all. I am sure most IRS personnel work hard
to do just that. But if, from either within or without, their
work has been despoiled by the actions of a few, then,
obviously, that needs attention.
Two fundamental points establish why questions need to be
answered concerning how the matter is being addressed by the
DOJ investigation. First, any credible allegation that IRS
powers of inquiry or approval are being influenced by or used
in furtherance of partisan political objectives is a matter of
the utmost concern and needs to be investigated credibly and
thoroughly. Second, and equally important in my view, public
confidence in such an investigation is critical, not just to
this specific matter, but more broadly to the Justice
Department's institutional responsibility to secure the
independent administration of justice. These two very critical
objectives affecting public confidence in government have now,
due to a combination of circumstances, been put in jeopardy by
legitimate questions concerning at least the appearance of
independence of the current DOJ investigation. How can the
public have confidence that an investigation under the control
of the Attorney General and subordinates at the Department of
Justice will be vigorous in its pursuit of the truth and fair
in its analysis of the facts when the President has already
stated, in effect, that there is nothing to it, as he has
publicly stated while the investigation has been pending.
Public reports also state that the prosecutor leading the
investigation, or substantially responsible for it, has
provided financial support to Democratic Party campaigns,
including the President's. I do not believe such contributions
should disqualify this lawyer, nor do I believe that the lawyer
assigned is on account of such political contributions
incapable of conducting a vigorous and thorough investigation,
nor do I believe as a general proposition that the decision as
to whom to assign to a case for investigation or prosecution
ought to turn on whether a given prosecutor has a particular
political affiliation or association.
However, given the circumstances as they have developed in
this matter, if the objective is to assure the public that an
investigation of allegations that government officials in this
administration may have intentionally impeded the exercise of
First Amendment rights by private citizens, then this is a case
where more investigative independence, rather than less, is
needed. I am no fan of the now expired independent counsel
statute, and nothing I say today should be construed as
suggesting that we put that law back on the books. It is not
needed because the Attorney General already has wide authority
to make investigative assignments to persons within or outside
the Justice Department that can assure the public of the
independence and integrity of an investigation.
Such appointments are not new, and examples of them abound.
Current FBI Director Comey, for example, while serving as
acting Attorney General under President George W. Bush, made
such appointments. So did Attorney General Reno during the
Clinton administration. And while I served as Deputy Attorney
General and acting Attorney General, we made such appointments.
In each of these and many other instances, the common factor in
making such an appointment is taking steps to assure the public
that an investigation of unquestioned integrity will be
conducted.
In my view, it is past time for the Attorney General to act
in this instance to use these authorities and appoint a lead
counsel for the investigation of alleged IRS abuse who will
have a charter of independence. Such an appointment is needed
to provide assurance of the integrity of the investigation that
the public deserves, and respect for venerable Justice
Department practice is required. I thank you.
Mr. Jordan. I thank the gentleman.
[Prepared statement of Mr. Terwilliger follows:]
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Mr. Jordan. Ms. O'Connor.
STATEMENT OF THE HONORABLE EILEEN J. O'CONNOR
Ms. O'Connor. I thank the chairman, ranking member, members
of the committee. Thank you so much for inviting me.
I speak on my own behalf as a private citizen and not on
behalf of my firm or partners or clients. I hope to bring to
you some of the understanding I have gained through my many
decades of working with the Internal Revenue Code and therefore
with the Internal Revenue Service, including the 6 years I was
privileged to lead the honorable and dedicated men and women of
the Justice Department's Tax Division.
Americans deserve to trust and respect the institutions of
their government. Revelations that the machinery of government
might have been turned against our own citizens damaged that
trust. And I am grateful for your efforts to learn the whole
truth about the group of government activities that have
collectively come to be called IRS targeting. Perhaps you are
more limited than this in your current inquiry, but for my
purposes, the targeting you should be considering is not just
the disparate and apparently discriminatory treatment of
certain groups in the processing of applications for tax
exemption, but also the leaking of confidential information,
the disproportionate selection of certain groups for
examination, what appears to be a coordinated attack by a
multitude of Federal agencies based on information that might
be available only to the Internal Revenue Service.
I hope that you are looking into the entire spectrum of
what looks very much like serious misconduct by IRS and perhaps
other government personnel. The U.S. tax system depends on
Americans taking upon themselves to gather their tax
information and prepare and file their tax returns every year.
One reason they are willing to do this, to provide personal
information to the government, is the government's solemn
promise, embodied in law providing criminal consequences for
its violation, that the information they provide will be kept
in the strictest confidence.
When people form organizations and apply for tax-exempt
status, they are entitled to expect that their confidential
information will be respected as such, that their applications
will be processed promptly and considered fairly, in accordance
with the applicable law, not in accordance with special
procedures designed just for them.
On a Friday last May, a planted question at an ABA
conference prompted an IRS official, just in time to get out
ahead of an IG report, to admit that the IRS had, as some had
long suspected, been targeting conservative groups for
additional scrutiny. By Monday, according to news reports, Ways
and Means Committee Chairman Camp, Senate Finance Committee
Chairman Baucus, the President, Senate Majority Leader Reid,
former Speaker Pelosi, Senator Warner of Virginia all had
expressed outrage and said something must be done.
These were all a day before the IG's report was even
issued. The day it was issued, news reports noted that the
President's half brother had received, in just over a month, a
determination of tax-exempt status for a questionable
organization he had been operating for more than 2 years. Early
the following week, a group of nearly 20 organizations spanning
the political spectrum had expressed concern about this serious
threat to the First Amendment.
What a shame that Members of the House and Senate
squandered the opportunity then to immediately use the tools at
their disposal to specially authorize an investigating
committee, to appoint a special counsel, to engage in outside
counsel to investigate them.
I turn now to the administration's investigation of these
matters. My written testimony outlines the Federal regulations
that describe the authorities of the civil--excuse me, the
Civil Rights, Criminal, and Tax Divisions. Generally speaking,
the Tax Division handles all litigation, civil and criminal,
trial and appellate, arising under title 26, the Internal
Revenue Code. But when criminal offenses to be investigated and
prosecuted involve allegations of misconduct by IRS personnel,
the investigation and prosecution is the responsibility of the
Criminal Division. The Civil Rights Division is charged with
the enforcement of the Nation's civil rights laws.
DOJ officials have selected a career attorney in the Civil
Rights Division to conduct the investigation. Some have
criticized the selection as inappropriate because of her
political contributions. But when does support for a sitting
President and his party make a person an imprudent choice for
an assignment? Not usually. But perhaps it does when the
assignment is to investigate the administration's alleged
mistreatment of its political adversaries.
Here is why: Justice must not only be done; it must be seen
to be done. This has two elements. First, when wrongdoing comes
to light, the public deserves to know that those responsible
have been identified and dealt with appropriately. Second, not
only must laws be enforced impartially, but they must be seen
to be enforced impartially. This is why judges recuse
themselves from cases; not because they can't rule on them
impartially, but because there might be something that would
make the public think they are not impartial, and damaging the
public trust is a dangerous thing to do.
In 1959, Ian Fleming had his character Goldfinger say,
``Once is happenstance. Twice is coincidence. Three times is
enemy action.'' We know, because the Treasury IG's
administration report says so, that groups banding together to
promote an understanding of, and fidelity to, our Nation's
founding principles were targeted for special scrutiny that was
harsh, intrusive, probably unnecessary, and resulted in delay,
if not the constructive denial, of their applications for tax-
exempt status, effectively silencing them during the better
part of two election cycles. We know, because they had the
courage to come forward and tell us about it, that people
engaged in activities directed at improving the integrity of
our elections were targeted for scrutiny, not just by the IRS
but also by other arms of the Federal Government.
We know because we have seen it in the public domain that
the private information of people who contributed to
organizations devoted to preserving traditional values was made
public, in violation of laws providing for fines and
imprisonment of up to 5 years. As an American who cares about
our country and our laws and our future, I thank the committee
for continuing to press to learn the truth about what appears
to be the administration's targeting of people who disagreed
with its policies and encourage you to use all the tools
available to you to do so. Thank you.
Mr. Jordan. Thank you, Ms. O'Connor.
[Prepared statement of Ms. O'Connor follows:]
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Mr. Jordan. Mr. von Spakovsky.
STATEMENT OF THE HONORABLE HANS A. VON SPAKOVSKY
Mr. von Spakovsky. Thank you, Mr. Chairman.
I appreciate the invitation to be here today. I am a career
veteran of the Civil Rights Division of the Justice Department.
I also spent 2 years as a commissioner at the Federal Election
Commission, where we worked with the public integrity section
of the Criminal Division when there were potential civil and
criminal violations of the Federal Election Campaign Act.
Now, on May 14th of last year, Attorney General Eric Holder
announced that he was opening up an investigation of the IRS
targeting of conservative organizations, something that he
called outrageous and unacceptable. Yet the Justice Department
has refused to provide this committee with any information or
updates on the investigation.
Now, it is certainly true that the Justice Department
cannot reveal sensitive information. But an active
investigation does not prevent the FBI and the Justice
Department from giving Congress basic information that does not
compromise the investigation. There is no reason why the
Justice Department can't provide this committee with a briefing
on, for example, how many FBI agents and Justice Department
lawyers have been assigned to the investigation; who the lead
lawyer and supervising FBI agent are; what Federal statutes the
lawyers are reviewing that they believe might have been
violated; what the general plan is for the investigation of
this matter; and without identifying them specifically, what
types of witnesses they have already interviewed or intend to
interview. The Justice Department----
Mr. Jordan. Mr. von Spakovsky, if I could just interject
for a second, I apologize, but in your experience, were those
kind of pieces of information given to congressional committees
and to people inquiring about an investigation? Were those done
in the past?
Mr. von Spakovsky. We would give basic information, yes.
Mr. Jordan. All the time?
Mr. von Spakovsky. Not specific information.
Mr. Jordan. But I mean basic information you just outlined
in your----
Mr. von Spakovsky. Yeah.
Mr. Jordan. Okay. Thank you.
Mr. von Spakovsky. They could also provide you with how
long they expect the investigation to take, what progress has
been made to date, and when they expect to conduct their
preliminary or final review. None of this information would
compromise the integrity and confidentiality of the
investigation. Yet lawyers representing dozens of the targeted
conservative groups say their clients have not even been
contacted or interviewed by the FBI.
I find it simply incredible that 9 months after the
investigation was opened, little or no basic interviews have
been done with the victims about their dealings with the IRS
employees who may have been involved in wrongdoing. In
addition, there is the troubling selection of Barbara
Bosserman, a lawyer in the Criminal Section of the Civil Rights
Division, where I used to work, as the lead lawyer in the
investigation. She has given almost $7,000 in political
donations to President Barack Obama's Presidential campaigns.
Now, the Criminal Section where she works prosecutes cases, and
this is according to their own Web site, quote, ``Involving the
violent interference with liberties and rights through the use
of force, threats, or intimidation.'' Now, as bad as what the
IRS may have done, I don't think anyone would characterize the
actions of IRS employees as violent. I find it difficult to
understand why the Public Integrity Section of the Criminal
Division is not conducting this investigation in its entirety.
This scandal involves possible corruption, public
corruption by IRS employees. It is the Public Integrity Section
of the Criminal Division, not the Civil Rights Division, that
has long been responsible for investigating and prosecuting
this type of public corruption. That is made clear on its own
Web page. And General Holder would certainly know that. Why?
Because the very first job he got out of law school, when he
went to the Department of Justice, was in the Public Integrity
Section of the Criminal Division.
Now, DOJ claims, and others have said, that Ms. Bosserman
can't be removed because it would be, according to Justice, a
prohibited personnel practice to consider political affiliation
making personnel decisions. That claim totally mischaracterizes
the situation. Taking a lawyer off a particular case because of
a conflict of interest or the possible appearance of a conflict
of interest is not a prohibited personnel practice. A
prohibited personnel practice would be if they terminated her,
changed her pay, disciplined her because of her political views
or her political donations.
No one questions the fact that Federal employees can give
political donations. But the rules that govern the Justice
Department specifically say that lawyers are supposed to avoid
even the appearance of corruption and anything that would cause
the public to question the integrity of an investigation. Now,
that certainly is the case where we have an investigation that
potentially could embarrass the administration being conducted
by a lawyer who has given a large amount of money to the
President. And we have a situation where the President had
already told her and others in the Justice Department how he
wants their investigation to come out, because he says there is
not a smidgen of corruption involved.
Taking a lawyer off a case at the Justice Department to
avoid a conflict of interest is a routine occurrence at the
Justice Department. DOJ should be making every effort to
conduct a thorough investigation and avoid any questions about
the objectivity of the attorneys and investigators involved in
the investigation. The possible bias of one of the supervising,
if not lead, lawyers in this investigation, is a very serious
issue. When combined with the refusal of DOJ to provide even
basic information about the status of the investigation, as
well as the seemingly unjustifiable delays in talking to key
witnesses, substantial questions are raised about whether or
not a serious and unbiased investigation is being truly
conducted. Thanks.
Mr. Jordan. Thank you.
[Prepared statement of Mr. von Spakovsky follows:]
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Mr. Jordan. Mr. Ivey. You have 5 minutes.
STATEMENT OF GLENN F. IVEY
Mr. Ivey. Thank you, Mr. Chairman, members of the
subcommittee. I appreciate the opportunity to testify before
you today. My name is Glenn Ivey. I am a partner at the
Washington law firm of Leftwich & Ludaway, where I specialize
in civil and criminal litigation. I am a former Federal
prosecutor and elected State prosecutor, and an adjunct
professor of law.
I am very familiar with these types of issues you are
considering here today in the Oversight hearing. By way of
introduction, I spent about half my career as a prosecutor. I
served as an assistant U.S. attorney in Washington, D.C., from
1990 to 1994, first under U.S. Attorney Jay Stephens, and then
for 2 years under U.S. Attorney Eric Holder. Before leaving, I
handled about 45 criminal jury trials and argued appeals and
conducted grand jury investigations.
In 2002, I was elected State's Attorney for Prince George's
County, Maryland, a jurisdiction of about 850,000 people that
covers the eastern border of Washington, D.C. During my two
terms there, we handled a variety of high-profile
investigations that sometimes overlapped with the U.S.
Department of Justice. I also became a founding chairman of the
Association of Prosecuting Attorneys.
Finally, for the past 17 years I have taught courses on
advanced criminal procedure, white collar crime, and others at
the University of Maryland School of Law. With respect to the
length of the investigation, I understand from my review of
statements by subcommittee members and hearing testimony that
there is concern about the length of this investigation. While
I was State's attorney, my office conducted several
investigations, in fact many, that took long periods of time to
complete. Sometimes I was accused of taking longer than I
should. But as my father used to say, you measure twice and cut
once. It's critical for prosecutors to be extremely careful and
thorough in conducting their investigation because they might
not get a second chance to do it right. Certainly, when it
comes to a matter as sensitive as this one, there should be no
rush to judgment and no pressure to cut corners. It is more
important to do it right than to do it fast. Moreover, I also
had the experience of waiting for the Department of Justice to
complete investigations my office had referred to the
Department. In one case, an accused cop killer was found dead
in his prison cell just 2 days before he was arrested for the
murder. And in another, a college student was beaten by local
police officers when a college celebration spun out of control.
In these and other cases, my office sometimes waited months or
even years before the Federal investigation was completed.
So I understand that there can be frustration in waiting
for the results of Department of Justice investigations,
especially in high-profile matters that have captured a good
deal of public attention. Sometimes long investigations lead to
public questions about how the prosecutors are conducting the
investigation or whether it could have been completed more
quickly. Nevertheless, I think it is critical to give
prosecutors the time they need to conduct a careful and
thorough investigation, particularly in matters with this
degree of sensitivity.
With respect to confidentiality, I know from personal
experience, there can be a great deal of pressure on
prosecutors to release information while an investigation is
ongoing. But it is important for prosecutors to control the
flow of information made public during the course of their
investigations for several reasons: First, prematurely
disclosed information can undermine an investigation by tipping
off potential witnesses about the scope, direction, and details
of the investigation. Second, individuals who might be named in
the course of an investigation but ultimately cleared of
wrongdoing should be shielded from the negative impact of
disclosing incorrect information about them. Finally, any
information that is gathered pursuant to the laws that require
secrecy, like rule 6(e), might require a court order to be
released. That reflects the longstanding view held by both
Congress and the courts that matters before a grand jury should
largely remain secret before trial. In the short run, these
secrecy rules may conflict with the goal of transparency and
disclosure. Elected officials want updates; the public and the
media want real time information. But in the long run, it
usually makes more sense to allow the criminal investigation to
run its course before public disclosures are made that might
undermine or even preclude a criminal prosecution.
With respect to the politics issue, a hallmark of the
Justice Department is that it allows its line prosecutors to do
their jobs without forcing them to disclose their political
views or bend to political considerations. That is why the
department has career prosecutors who have sometimes spent
decades in office despite the changes in Presidents and
Attorneys General. This provides consistency in the handling of
cases, helps to retain top talent, and preserves institutional
memory. It also helps to reassure the public that regardless of
who is at the top, the line prosecutors will wield their power
and handle their cases based solely on the merits.
I know the committee has received letters from the
professors that the ranking member mentioned a moment ago, so I
won't speak to that. But I do want to say that with respect to
my personal experience, I saw these principles in action while
I worked at the Department. Fortunately, during the transition
that I was present for from the Bush administration to the
Clinton administration, line prosecutors were insulated from
the politics of the day and allowed to conduct their work in an
apolitical environment. After my election, I brought that
approach to my State office. I worked hard to reduce the
politics that swirled around the office, where line prosecutors
had been expected, essentially as a condition of employment, to
donate to their bosses' campaigns and to work for their
reelections as well. Eventually, my line prosecutors came to
understand that they did not have to contribute to my campaign,
and I was not going to check whether they worked on political
campaigns or made political contributions. My line prosecutors
learned that they did not have to sacrifice their
constitutional rights to work for me and that they could handle
their cases based solely on the merits. That is the way it
ought to be, even in high-profile matters like this. So thank
you again for giving me a chance to testify today. I look
forward to questions.
Mr. Jordan. Thank you, Mr. Ivey. We appreciate you being
here.
[Prepared statement of Mr. Ivey follows:]
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Mr. Jordan. Mr. Painter, you are recognized for 5 minutes.
STATEMENT OF RICHARD W. PAINTER
Mr. Painter. Thank you, Mr. Chairman.
I teach corporate law, securities law, lawyers ethics, and
government ethics at the University of Minnesota. For 2 and a
half years, I was the chief White House ethics lawyer under
President Bush.
For the vast majority of Americans, the burden of Federal
and State and local taxes is excessive, and the regulations
under which taxes are collected are excessively complex.
Taxpayers are entitled to competence and impartiality from the
government agencies that collect our taxes. It is unacceptable
for the Internal Revenue Service to use politicized search
terms to single out individuals and organizations for
additional scrutiny. Whether such actions result from gross
incompetence or from political motivation of IRS employees, it
is serious misconduct.
This misconduct took place in one of the most powerful
agencies in the executive branch. The President must accept
responsibility for it and make sure that it never happens
again.
Now let me discuss for a moment the 501(c)(4) organizations
and the issues related to campaign finance. These organizations
are growing in number, and they have proliferated since the
Supreme Court's decision in the Citizens United case. I discuss
them extensively in my own book on government ethics that was
actually written before that case was decided. I share the
concerns of many Americans who are disgusted with the current
state of affairs in campaign finance. And I believe that the
future of our republican form of government depends on finding
some way for ordinary Americans, the vast majority of us who
cannot afford to set up our own 501(c)(4) or fund it, to have a
meaningful voice in our government.
There are many options, including enactment of
constitutionally acceptable campaign finance reform
legislation, enhanced disclosure obligations, and additional
taxpayer funding of political campaigns.
Close IRS scrutiny of 501(c)(4) applications to discern so-
called political purpose of an organization, however, is not
the way to arrive at a better system of campaign finance. The
notion that social welfare is somehow distinguishable from
politics is in my view unworkable, particularly in a society
where politics is the process by which we choose our
government, and social welfare is to a great extent help or
hindered, I believe usually hindered, by government taxation,
expenditure, and regulations.
Now, the IRS needs focus on its mission, which is
collecting taxes from people who owe the taxes. And if the
statutes and regulations invite the IRS to inquire into the
political opinions or political purpose of persons or
organizations in determining an organization's tax status,
those regulations and statutes need to be changed.
Now, more specifically with respect to the IRS, American
taxpayers are entitled to an IRS which responds promptly to
their requests. And delay in the response to a 501(c)(4)
application for any reason is unacceptable. And I believe
Congress should impose on the IRS specific deadlines for taking
action with respect to applications for particular taxpayer
matters. And if they can't meet their deadlines, perhaps they
should be paying us penalty and interest like we have to pay
them when we can't meet our deadlines. As for the DOJ
investigation, the Department has opened an investigation, but
I believe that it has been compromised by the controversy over
the staffing of the investigation. No particular ethics rule
explicitly prohibits a career prosecutor who has made campaign
contributions from participating in or even directing an
investigation such as this one. Not knowing the present scope
of the DOJ investigation or where it might lead, however, I
cannot be certain that such a conflict would not arise. I
discuss in my written testimony the impartiality rule at 5 CFR.
2635.502 that I believe should have led to a discussion within
the Department of Justice about the staffing of this
investigation. If I had been a senior official at the
Department of Justice, I would have chosen in this instance to
choose someone to lead the investigation who did not have a
strong affiliation with either of the two major political
parties.
Finally, I want to point out that there are serious Hatch
Act issues here if--and I emphasize if because I do not know
the facts in this matter--if IRS employees were politically
motivated in the conduct that occurred. If there was an attempt
here to influence an election, these 501(c)(4) organizations do
have an enormous impact on the outcome of elections. We all
know that. And if IRS employees were politically motivated in
these decisions, there are serious Hatch Act concerns. And I
believe the Office of Special Counsel should be involved in
this, whether they conduct their own investigation or whether
they review the Inspector General's investigations and
determine that no further action is required. But they cannot,
in my view, responsibly remain silent. Thank you, Mr. Chairman.
Mr. Jordan. Thank you, Mr. Painter.
[Prepared statement of Mr. Painter follows:]
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Mr. Jordan. I want to thank all our witnesses for their
testimony.
We go now to the vice chairman of the committee, Mr.
DeSantis.
Mr. DeSantis. Thank you, Mr. Chairman.
Thank you, witnesses, for your testimony.
I think there is a little confusion here with what I am
hearing from the other side in terms of, yeah, you can give to
a political candidate and be perfectly fair and do your job.
And the idea that that should disqualify you I don't think is
what anyone up here on this side is saying.
But I think what I am saying and what I think some of my
colleagues are saying is this is not like you are just
investigating corruption at the Department of HUD for someone
lining their pockets. You are talking about a misuse of one of
the most potent agencies we have in this government to target
dissent from the administration in power seeking to be returned
to office in 2012. So that really strikes at the heart of what
the First Amendment is all about, what limited government is
meant to ensure. And I think the American people need to have
the utmost confidence in the investigation.
And so what do we know right now? Well, we know that Jay
Sekulow came in front of this committee a couple weeks ago, and
he has 40 clients who have been targeted by the IRS in one form
or another. Not one of them, as of a couple weeks ago, had been
interviewed by anyone associated with this investigation. What
do we also know? We know the President went on national TV and
said there is not a smidgen of corruption involved with any IRS
targeting. It is amazing how he would know that, but
nevertheless, you know, that is what he said. And of course, we
haven't gotten even rudimentary cooperation from the Department
of Justice and the department of FBI. So it may not be against
the regulations to have Barbara Bosserman. Look, she is a loyal
Obama supporter, and there is nothing wrong with that. And it
may not be proscribed exactly. Maybe someone makes the argument
it is. Just because it is not, doesn't mean it is the right
thing to do. So I would say, in this situation, given the
sensitivities involved, why would you not steer clear of any
appearance of impropriety, particularly given what we have seen
over the last several months.
I think, turning to all these other career people in the
Department of Justice would have made probably a lot more
sense, who maybe just don't have any bone in this either way.
But to go with, you know, you give $7,000 to the Democratic
Party and President Obama, you are a loyal foot soldier in the
Army of Hope and Change. Let's just be clear about what we are
talking about here. So I think--and so, from my perspective,
what I see now is I think we need a special prosecutor to look
into this just to avoid any of this. Because guys like me, guys
like the chairman, if this keeps going on and it just ends with
a whimper, we are not going to have a lot of confidence in what
happened.
And I know the people who have testified in this committee,
they are not going to have any confidence if that one ends up
being the outcome. And also, how are you supposed to react when
your boss, the President, says there is no corruption? I mean,
what kind of signal does that send to these folks? So I think
what we need is some independence here.
So let me just go down, Mr. Terwilliger, do you think that
a special prosecutor would be in order given these facts?
Mr. Terwilliger. I do.
Mr. DeSantis. Okay.
Ms. O'Connor?
Mr. Connolly. I do.
Mr. DeSantis. Mr. von Spakovsky?
Mr. von Spakovsky. I do.
Mr. DeSantis. Mr. Ivey?
Mr. Ivey. I guess I have mixed views about it.
Mr. DeSantis. Let me ask you this. So are you still
elected, or you had served two terms?
Mr. Ivey. No, I am in private practice.
Mr. DeSantis. Okay. And you probably had people who were
prosecutors who would be handling cases. You weren't
micromanaging everything. People were probably doing their job.
It is a little bit different for you because you were a
politician, whereas in the bureaucracy, you are not supposed
to. But I mean if you would have come out and said, Oh, well,
there is nothing doing here, there is no corruption there, then
probably your line prosecutors aren't going to then think that
is a good signal for them to go and pursue that matter. I mean
don't you think there was a little bit of a problem for the
President to say that there is not a smidgen of corruption,
given that we are supposedly in the middle of this
investigation?
Mr. Ivey. No. I actually had a similar kind of scenario
with the case I mentioned in my testimony in which the police
officer who had been killed, the guy who killed him was
allegedly found dead in his prison cell. The county executive
at the time announced that this was a lynching. And I had other
elected officials who made similar kinds of statements,
including some statements from police officials who, as you can
imagine, grieving about the loss of a comrade, had strong
feelings.
Mr. DeSantis. But in that instance, you are independently
elected from the county executive, correct? So in other words,
you didn't report to the county executive like someone in the
Justice Department. Ultimately, in our Federal Constitution,
you know, you have one person in the executive branch that is
elected, and everyone--ultimately, the buck stops with the
President. So I take that point, and I think that is a good
point, but I think the difference that I would just draw is
ultimately you had an independent duty to your voters. You were
not somebody who was dependent on any of those elected
officials. Is that correct?
Mr. Ivey. That is correct. Although I will say this, the
police who actually reported directly to the county executive
and many of my prosecutors who had just finished working for
him still had strong allegiances.
But with respect to the point about the Federal level of
independence issue, unlike the independent counsel statute that
Mr. Terwilliger mentioned, you would still have a prosecutor,
even a special prosecutor appointed by the Attorney General,
and still subject to the same kind of chain of command
essentially that is raising concerns here.
Mr. DeSantis. No, absolutely.
Mr. Ivey. So the only reason I kind of hesitated about it
is because the special prosecutor statute and regs looks a lot
like, you know, the sort of just sort of setting it up. And I
don't know that it gives you the type of screen that your
concerns address. I am not saying it is not appropriate here,
but I don't know that it really gets to the heart of the
problem that you have outlined.
Mr. Terwilliger. Let me be clear, Mr. Chairman, if I may,
just quickly, when I said I do to the vice chairman's question,
I was addressing not an appointment under the independent
counsel regulation, but the use of the Attorney General's
plenary authority to appoint a special counsel to whom all the
powers of the Attorney General could be delegated if the
Attorney General believed that was the right thing to do.
Mr. Jordan. Unbiased special prosecutor, in light of the
circumstances, in light of the fact pattern, unbiased special
prosecutor makes sense in this case. Yes, yes, yes.
And Mr. Ivey, you are a maybe.
Mr. Ivey. Maybe.
Mr. Jordan. Mr. Painter, could you answer?
Mr. Painter. If there is evidence of criminal activity,
significant evidence of criminal activity, the Justice
Department should conduct an investigation. And in this type of
situation, I think the investigation should be led either by a
career prosecutor who is not affiliated with either political
party or by an independent prosecutor. If there is no evidence
of criminal activity right now, what I would do is let the
inspector general finish their job, and the Office of Special
Counsel and have DOJ pick up from there.
Mr. DeSantis. Thank you, Mr. Chairman.
Yield back.
Mr. Jordan. Thank the gentleman.
Mr. Cartwright.
Mr. Cartwright. Thank you, Mr. Chairman.
Well, we have had a wide ranging discussion, and I
appreciate the presence of all the witnesses here today. I
always like to say here in Congress people don't realize we
agree on a lot more than what we disagree about. And I want to
talk about what we can agree on. You know, the chairman and I
had a colloquy right before we went to go vote about whether it
was--it would be illegal, whether it would be against the rules
for a person who gave a political donation, such as Ms.
Bosserman. And I believe the chairman was quite forceful in
saying it would be illegal. Am I correct in that?
Mr. Jordan. No, I simply read the rule, which said if there
is an appearance of--the appearance to the public that there
might be bias, then that person should not be heading an
investigation. I read the rule.
Mr. Cartwright. Okay. So what I want to do is I want to
make sure we are all on the same page.
Are any of the witnesses here today able to confirm or deny
that Barbara Bosserman is leading this investigation? Just go
ahead and raise your hand if you can say yes or no.
Seeing no hands, I see that no light is shed on this
question here. In fact, Attorney General Holder has testified
that Ms. Bosserman is, in, fact not leading the investigation.
Mr. Jordan. Would the gentleman yield for a second?
Mr. Cartwright. Certainly.
Mr. Jordan. Do you know something we don't know? Do you
know who is leading the investigation? Because we have asked.
What we do know is Mr. Sekulow testified under oath in front of
this committee that the highest ranking official he has
interacted with in the limited interaction he has had, the
highest ranking official at the Justice Department who has
interacted with him is Barbara Bosserman.
Mr. Cartwright. And reclaiming my time, as is absolutely
crystal clear from all of this discussion, we do not have
evidence that Barbara Bosserman is leading this investigation
or any other. And all we are doing is stabbing around in the
dark and making suppositions here and there, which I suggest,
respectfully to everyone involved, is an inappropriate use of
our time and energy, making suppositions like that. I also want
to follow up on the question of asking line prosecutors about
their political donations. We have a number of people here who
have worked for the Justice Department, people who know about
this. And I will start with you, Mr. Terwilliger, when you were
at the DOJ, did you ever check the political donations of line
prosecutors before assigning them cases? Yes or no.
Mr. Terwilliger. No, but I certainly would consider
removing----
Mr. Cartwright. I only have limited time.
Ms. O'Connor, did you ever check into the past political
donations of line prosecutors before assigning them cases?
Mr. Connolly. I did not, but I did have a trial attorney
who was criticized by a conservative columnist on the basis
that he believed he was a Democrat attacking Republicans.
Mr. Cartwright. I have to make use of my time. Mr. Ivey,
what about you? Did you ever check prosecutors' past political
donations when you were the State's Attorney for Prince
George's County?
Mr. Ivey. No.
Mr. Cartwright. No. In fact, quite the opposite. You made
it very plain to them that you didn't care about their
political donations, you wanted them to operate in a politics-
free environment, didn't you?
Mr. Ivey. Absolutely.
Mr. Cartwright. All right. In fact, doing so, asking about
past political donations, I think Professor Painter has brought
up, would raise some serious legal and ethical concerns under
the Hatch Act, as well as under civil service laws.
Professor Painter, is it appropriate for DOJ officials to
look up career prosecutors' political donations in order to
identify potential conflicts of interest before assigning
cases?
Mr. Painter. No. I wouldn't do that.
Mr. Cartwright. Let me follow up.
Professor Painter, what are some of the problems with DOJ,
or any other prosecuting agency, searching the past political
donations of career employees, such as line prosecutors?
Mr. Painter. Well, once you get into that you get into a
situation, where you could create the appearance of retaliation
against someone because they donated to a political campaign,
usually campaigns that opposed the President. That is not where
you want to go. And that is why the applicable ethics code that
I referred to puts the onus on the employee to identify those
situations where they think there could be a question about
impartiality.
Mr. Cartwright. Thank you.
Mr. Painter. It is the employee's job.
Mr. Cartwright. Thank you, Professor Painter.
I suppose I should call you Professor Ivey as well. Did you
also teach trial advocacy at Harvard?
Mr. Ivey. I do, yes.
Mr. Cartwright. So you are in the Ivy League as well. You
have anything to add to the discussion?
Mr. Ivey. With respect to this issue, I do think that one
concern should be the potential of a chilling effect. You know,
so I get the point about Ms. Bosserman, and there is thoughts
that, you know, maybe if you had it to do over again you
wouldn't put her in place. But now that she is there, if you
remove her, you really do send a message to all the other
prosecutors out there that if you have given contributions, you
better stop. And if you have been thinking about doing it, you
better stop because you might not be able to be assigned to
these types of cases.
Mr. Cartwright. Dangerous precedent. Thank you, Mr. Ivey. I
appreciate it.
Mr. Jordan. Mr. Terwilliger, I just want to give you a
chance to respond fully. You were going to say more. While you
indicated it is not appropriate to examine political
contributions prior to assigning cases, once you have
discovered the facts, once you know she is a maxed out
contributor to the President of the United States, who may be a
potential target of the investigation, would it then be
appropriate to look at saying, Hey, she should be removed after
the fact? After you learn that fact? I agree with my colleague,
no, you can't be looking that information up ahead of time. But
once you know, particularly a case of this sensitive nature
where your most fundamental First Amendment political rights,
your right to speak out in a political nature is what was the
issue at hand, then is it appropriate to say she should be
removed from the case?
Mr. Terwilliger. Of course, it is.
Mr. Jordan. And not just from her, but from her superiors
as well.
Mr. Terwilliger. Absolutely.
Mr. Jordan. Did you do that at your time at the Justice
Department?
Mr. Terwilliger. Of course. I will use an example to take
it out of the political realm. I wouldn't bar a lawyer from
being hired at the Justice Department because in that lawyer's
career, he or she may have represented mafioso in the past. But
I wouldn't necessarily put them in charge of a large organized
crime case either. And it is--even if they were----
Mr. Jordan. Or if they got assigned a large Mafia case and
you found out after the fact in their past, they had
represented people there, would you remove them?
Mr. Terwilliger. Of course.
Mr. Jordan. Of course.
Mr. Terwilliger. And the reason you would do that, and the
reason it is not only proper and not only an exercise in good
judgment, but is required, because there is a duty to avoid
even the appearance of impropriety. A duty that has been
recognized by the Attorney General himself in recusing himself
from other matters. It has been recognized by Preet Bharara,
the United States attorney in New York, who is a highly
reputable and accomplished attorney, who has removed himself
from cases. I have removed myself from cases for that reason.
And if the circumstances require, in order to assure the public
of the integrity of the investigative process, no matter what
kind of case it is, a superior has an obligation to do that.
Mr. Jordan. So the way this really should have worked is
Ms. Bosserman should have said you know what, Mr. Attorney
General, or you know what, Mr. Tom Perez, who headed the Civil
Rights Division, when she was assigned this case, you know
what, I may have a conflict. We need to talk about this. They
talk about it, and he says, Oh, for goodness sakes, you
certainly do. We are going to have to let someone else head
this investigation.
Mr. Terwilliger. That is what one would hope would happen.
Mr. Jordan. Ms. O'Connor, would you agree with that
analysis we just went through with Mr. Terwilliger?
Mr. Cartwright. Would the gentleman yield for one question?
Ms. O'Connor. Absolutely.
Mr. Jordan. Sure. Sure. I am letting Ms. O'Connor answer
because you didn't give her a chance, and then I will come to
you.
Ms. O'Connor. I agree completely.
Mr. Jordan. Okay.
Mr. Cartwright?
Mr. Cartwright. Okay. Again, one of the reasons I am here
is to try to help protect the integrity of this outfit, the
House Government and--Oversight and Government Reform
Committee. And to protect the integrity of this committee, I
say, again, we should stop referring to Barbara Bosserman as
the lead investigator on this investigation. We have no
evidence of that.
Mr. Jordan. Does the gentleman from Pennsylvania know who
the lead investigator is?
Mr. Cartwright. I will read the testimony from Eric Holder.
Mr. Jordan. No, no, no. I asked a specific question. Do you
know who it is?
Mr. Cartwright. It is the Criminal Division of the Public
Integrity Section that has actually got the lead, quote-
unquote, from the Attorney General of the United States.
Mr. Jordan. Do you know who the individual is?
Mr. Cartwright. I do not. Not Barbara Bosserman. I ask that
we stop referring to her as the lead if we want to preserve our
own integrity.
Mr. Jordan. Jay Sekulow under oath confirmed she is the
highest ranking official at the Justice Department who he has
interacted with. Again, we had a chance; we invited Barbara
Bosserman to come here and testify. And you sent me a letter
saying don't subpoena her. We gave the opportunity to the
number two at the Justice Department to answer my question 3
weeks ago, who is heading the investigation? He wouldn't answer
me. So all we know is what we have heard from witnesses who say
she is the highest ranking official, and from Jay Sekulow, who
testified under oath saying she is the highest ranking
official. Mr. von Spakovsky.
Mr. Cartwright. All well and good, but you can't refer to
her as the lead investigator.
Mr. Jordan. The highest ranking official in this
investigation is Barbara Bosserman, who gave $6,750 to the
President of the United States. Reclaiming my time, reclaiming
my time, Mr. von Spakovsky, do you agree with the analysis we
went through with Mr. Terwilliger and Ms. O'Connor that under
the circumstances, Mrs. Bosserman should have been recused from
the case?
Mr. von Spakovsky. Yes. And in fact, every lawyer at
Justice knows, back to this question of whether the supervisor
should be inquiring about their political donations, look,
every lawyer there knows that if you are assigned to a case,
you have an absolute professional duty to raise with your
supervisor any potential conflicts that could bring this into
question. And I would point out that in fact, prior to what the
administration said currently, this administration certainly
agrees with this because a couple of years ago, when evidence
came out that a lawyer in the Office of Professional
Responsibility at the Justice Department had given almost the
same amount of money to the Obama campaign, she was removed by
the administration from the IG OPR investigation of the
dismissal of the New Black Panther Party case.
Mr. Jordan. Thank you. That was supposed to be 1 minute,
but it turned into 5, so I will have to go to the gentleman
from Virginia, and then we will come to Mr. Meadows.
The gentleman from Virginia is recognized for 5 minutes.
Mr. Connolly. Thank you, Mr. Chairman.
Mr. von Spakovsky, based on what I just heard you respond
to the chairman, your view is that Ms. Bosserman, as an
employee of the civil rights division, should be removed from
the case because of her political activity. Is that correct?
Mr. von Spakovsky. She should be removed because her
involvement raises in the public a perception about the
integrity of the investigation. And that is one of the
regulations at the Justice Department.
Mr. Connolly. But the nature of that taint is that she had
partisan political activity of some sort. Is that correct?
Mr. von Spakovsky. Specifically, she supported and gave a
large number of donations to the administration, which itself
is being accused of wrongdoing in this particular matter.
Mr. Connolly. I understand. Now, you have some expertise in
this field because you served as counsel to the Assistant
Attorney General of the Civil Rights Division from 2002 to
2005. Is that correct?
Mr. von Spakovsky. That is correct.
Mr. Connolly. And one of the Deputy Assistant Attorney
Generals that you worked with a was a man named Bradley
Schlozman. Is that correct?
Mr. von Spakovsky. That is correct.
Mr. Connolly. He was a political appointee under the Bush
administration. Is that correct?
Mr. von Spakovsky. That is correct.
Mr. Connolly. Are you familiar with the Department of
Justice's inspector general report on Mr. Schlozman?
Mr. von Spakovsky. Oh, certainly I am aware of it.
Mr. Connolly. And that it concluded he violated Federal law
and department policy by considering political affiliations in
hiring decisions and other personnel actions such as the
assignment of cases for career attorneys. Are you aware of that
finding by the inspector general?
Mr. von Spakovsky. I am aware of the findings of that
report. I wouldn't characterize them quite the way you have.
Mr. Connolly. Well, let me quote. ``We concluded,'' meaning
the IG, ``that Schlozman inappropriately used political and
ideological affiliations in managing the assignment of cases to
attorneys in the sections of the division he oversaw. According
to Sections Chiefs Flynn, Cutler, and Palmer, Schlozman placed
limitations on the assignment of cases to attorneys whom he
described as libs or pinkos, and he requested that important
cases be handled by conservative attorneys he had hired
instead.'' Were you aware of those comments by Mr. Schlozman?
Mr. von Spakovsky. Not all of them, no, I wasn't.
Mr. Connolly. Any of them?
Mr. von Spakovsky. I read the report.
Mr. Connolly. Based on your sworn testimony here today, I
would assume that you would conclude those were inappropriate
remarks by Mr. Schlozman. And based on what you just said to
Mr. Jordan, you would have reported them as inappropriate, and
requiring his recusal from making such decisions because they
are so blatantly partisan. Or are you not consistent when it
comes to a Republican administration?
Mr. von Spakovsky. No, I am consistent in saying that
lawyers who are assigned to specific cases----
Mr. Connolly. Could you answer my question, Mr. von
Spakovsky?
Mr. von Spakovsky. I am answering it.
Mr. Connolly. No, sir, you are not. Did you or did you not
find those comments--Mr. Chairman, I insist on reclaiming my
time. I insist on reclaiming my time. We don't have filibusters
here in the House, Mr. von Spakovsky.
Mr. Jordan. He is trying to answer your question.
Mr. Connolly. No, sir, he is trying to filibuster my
question. Did you or did you not report those comments as
inappropriate based on what you just said to Mr. Jordan?
Mr. von Spakovsky. There is nothing in the IG report that
says that I did anything wrong. In fact, you can----
Mr. Connolly. I didn't ask that. I didn't ask that.
Mr. von Spakovsky. You can go through the entire report. I
was not accused of making any statements of any kind like that,
and I was not--I was not accused of knowing about any
statements like that.
Mr. Connolly. Were you asked to be interviewed by the
Attorney General, Mr. von Spakovsky?
Mr. von Spakovsky. I was.
Mr. Connolly. And did you agree to it?
Mr. von Spakovsky. I set out and said I would be happy to
speak with them if they told me what the questions were and if
I was able to review my testimony. They refused to allow that
to be done.
Mr. Connolly. So you did not in fact allow yourself to be
interviewed.
Mr. von Spakovsky. Because they did not afford me the basic
due process rights that are given to anyone who is interviewed
in a case like that.
Mr. Connolly. Mr. Schlozman sent you a number of emails,
and one of which I will quote from. ``If I recall correctly, a
certain Voting Section attorney is a crazy lib, Hans,'' meaning
you, ``am I right? A detail would be a great way to get him out
of our hair for 6 months.'' Were you aware of that email to you
from Mr. Schlozman?
Mr. von Spakovsky. I recall the email, yes.
Mr. Connolly. Did you think it was appropriate?
Mr. von Spakovsky. Well, appropriate is very different from
whether or not a conflict of interest arises over assignments
to a particular case. And that has nothing to do with what we
are discussing here today.
Mr. Connolly. Well, I will decide that Mr. von Spakovsky.
You are a witness.
Mr. von Spakovsky. Tell me, are you aware of the IG report
from last year?
Mr. Connolly. Did Mr. Schlozman not have a conflict, being
a political appointee, in determining the assignment of cases
based on someone else's perceived political affiliations?
``Crazy lib,'' is that a professional epithet at the Department
of Justice in the Bush administration?
Mr. von Spakovsky. I am not going to characterize what the
IG has said. The report speaks for itself. And if you want
another one, you should look at the IG report from March of
last year that talked about the harassment and intimidation of
conservative employees that has occurred in this
administration, including the fact that an employee within the
Civil Rights Division lied and committed perjury to the IG, and
that employee----
Mr. Connolly. Mr. Chairman, I didn't ask about that. And
the witness is answering questions that he was not asked.
I will ask, however, Mr. Chairman, without objection, that
a letter regarding the possible appointment of Mr. von
Spakovsky to the FEC, opposing that nomination signed by the
chief of the Voting Section, the deputy chief of the Voting
Section, the senior trial attorney of the Voting Section, the
senior trial attorney of the Voting Section, the senior trial
attorney of the Voting Section, and the political geographer of
the Voting Section, dated June 11th, 2007, and enumerating the
reasons why Mr. von Spakovsky was not qualified because of his
partisan political activities be entered into the record at
this time.
Mr. Jordan. Without objection.
Mr. Connolly. I thank the chairman.
Mr. von Spakovsky. Mr. Chairman, could I ask that it be
entered into the record the report of the inspector general
from March of last year about the Civil Rights Division?
Mr. Jordan. We can get that report and have a committee
member enter that into the record.
To view the document, please visit www.justice.gov/oig/
reports/2013/S1303.pdf
Mr. Connolly. Mr. Chairman, I have July 2008 inspector
general report, and am happy to put that in the record as well.
Mr. Jordan. Okay. Without objection.
To view the document, please visit www.justice.gov/opr/oig-
opr-iaph-crd.pdf.
Mr. Jordan. Now turn to the gentleman from North Carolina,
Mr. Meadows.
Mr. Meadows. Thank you, Mr. Chairman.
Thank each of you for your appearance here today and for
your testimony. I guess the American people want to trust their
government again. And the true problem that we have right now
is that many do not trust their government and specifically do
not trust the IRS. And the only avenue to do that is truly to
investigate, to make sure that justice prevails and that a
thorough investigation happens. I would ask very quickly each
of you, do you not find it surprising that over 40 different
individuals that have supposedly been targeted have not been
interviewed by an investigative body of this government? Do you
not find that surprising?
Mr. Terwilliger. I guess if we are going to go in order,
Mr. Meadows, I mean, I think from at least from a distant
perspective, yes, it is surprising. I think the public would be
more reassured if the government were, and the Justice
Department with the FBI, were able to at least say this is what
we are doing generically, without being specific about it.
That being said, however, and having been on the other side
of some of these hearings over the years, the manner in which
an investigation, a vigorous investigation, is conducted may be
staged in such a way that there are valid reasons not to have
known that.
Mr. Meadows. Sure.
Mr. Terwilliger. But I think what is missing here more than
anything, and that your question goes to, is at least some
reassurance of the public by disclosure to this committee and
elsewhere that in fact a vigorous investigation is being
conducted and that there is a strong effort that is appropriate
to these what are really serious allegations, to get to the
bottom of it.
Mr. Meadows. Okay. Very good.
Ms. O'Connor?
Mr. Connolly. I agree. As I said earlier, justice must not
only be done, it must also be seen to be done. And it would
seem that actually contacting the victims--we know who the
victims are--it would seem as though contacting the victims
would not tip off anyone's hand about the direction that the
investigation is taking, and would therefore not harm its
integrity.
Mr. Meadows. Okay. On down the line.
Mr. von Spakovsky. I agree. Particularly in this case
because, look, I coordinated investigations of probably
hundreds of cases when I was at the Justice Department, and you
talk to the victims first because you want their information,
what they can tell you before you go and you confront the
individuals who are accused of wrongdoing because you use that
information to check what they are saying, to cross-examine
them. And to not have talked to any of the victims after 9
months, like I said, I just find that incredible.
Mr. Meadows. Okay.
Mr. Ivey, I can tell by your response that you have a
different take on it. Mr. Ivey, go ahead.
Mr. Ivey. Well, I would at least say I think I need more
information along the lines of what Mr. Terwilliger suggested.
You want to know what the investigative strategy is. Other
things I would like to know is if these individuals have
already given other statements, whether it is to this body or
to the inspector general or whoever, because of the prosecutor.
Mr. Meadows. Yeah, but in your testimony, you were talking
about the fact that we shouldn't rush to a conclusion, that
sometimes these investigations should take a long time and may
very well take a long time and that we should keep them
private. That is what you said in your opening testimony, I
believe.
Mr. Ivey. Yes.
Mr. Meadows. So, would you say when the President on Super
Bowl Sunday made a conclusion to what the investigation outcome
already is, do you think that undermines the process?
Mr. Ivey. I would hope not. I would hope that the Attorney
General statement and beyond that----
Mr. Meadows. So the President of the United States making a
comment----
Mr. Ivey. With the understanding within the Department of
Justice----
Mr. Meadows. I didn't mean to interrupt. I am sorry.
Mr. Ivey. That they can go forward with the investigation
but to still be protected.
Mr. Meadows. So the President of the United States making a
definitive statement, there is no corruption, wouldn't
influence anybody. Is that your understanding?
Mr. Ivey. We hope not. That is correct.
Mr. Meadows. I know we hope not, but that is your
testimony, you believe that it did not.
Mr. Ivey. If that is not the case, and I know there is a
call for a special prosecutor, then that wouldn't work either.
Mr. Meadows. Right.
Mr. Ivey. We are sort of left with the return of the
independent counsel here, and I share Mr. Terwilliger's that
that would be a bad idea.
Mr. Meadows. So let me follow up with you, Mr. Ivey, one
question, in terms of political contributions. Do you think it
affects the way that people view other people, political
contributions?
For example, you have donated to the Obama and Victory
campaign. You ran----
Mr. Ivey. I am pretty sure I did.
Mr. Meadows. I know you did.
Mr. Ivey. Okay.
Mr. Meadows. You donated to a Democrat that ran against me
in North Carolina, and you ran----
Mr. Ivey. Okay. Sorry.
Mr. Meadows. So you think it would--so do you think it
would affect the way that I would view you?
Mr. Ivey. I hope not.
Mr. Meadows. I would hope not, too.
Mr. Ivey. Yeah.
Mr. Meadows. All right.
But in that, even if it gave the appearance that my
questions were more directed toward you or more definitive
because of that, do you not think that would be good to
recuse--if you had a prosecutor that just, just the appearance
that it might be a problem, don't you think it would be smart?
Your clinical students there at Harvard, don't you tell
them, wouldn't it be a good idea if it is just the appearance
that you ought to recuse yourself? Now, be careful because you
are going to have lots of students answering your question that
may be following this.
Mr. Ivey. I am sure this will be on the internet, but I
mean, the scenario, for example, the U.S. attorney who is of
one party in a State where the leadership is dominated by
another party, I would never say that that U.S. attorney is
incapable of leading an investigation against----
Mr. Meadows. Right.
Mr. Ivey. --the Governor or someone like that.
Mr. Meadows. But this is different. This is the IRS. This
is the very foundations of freedom. This is reaching in and
actually taking--do you not think that this requires a higher
standard?
Mr. Ivey. Doesn't it sort of depend on the scenario? I
mean, the Governor of Illinois----
Mr. Meadows. I think it does. That is what I am saying.
Even with the higher standard?
Mr. Ivey. The Governor of Illinois, who was alleged to be
selling Senate seats, I would say, goes to the heart of
democracy, and nevertheless, you know, the automatic strategy
of the people that represented him was to accuse the U.S.
attorneys of----
Mr. Meadows. I would conclude that the IRS reaching in on
our liberties and our freedoms goes to the heart of what we are
about, and there is no higher calling. I appreciate the
patience of the chair. I yield back.
Mr. Connolly. Would my colleague yield?
Mr. Jordan. The gentleman is recognized briefly.
Mr. Connolly. I just want to confess. I may have
contributed to your opponent, too, I am sorry.
Mr. Meadows. And I will forgive you there.
Mr. Jordan. He expected it out of you but not Mr. Ivey.
Let me just pick up real quickly before going to Mr.
DesJarlais, and we have got votes coming, I think, in about 15
minutes.
Mr. Ivey, in your testimony, you talked--well, first of
all, you talked about the concern about the length. I don't
know anyone is concerned--at least, I know I have not expressed
concern about the length of the investigation. My concern is
about the quality. And later in your testimony, you said this,
``It usually makes more sense to allow the criminal
investigation to run its course before public disclosures are
made that might undermine or even preclude a criminal
prosecution.''
Mr. Ivey. Yes.
Mr. Jordan. I want to go right back to where Mr. Meadows--I
mean, the President said there is no corruption. The FBI has
leaked to the Wall Street Journal no one is going to be
referred for prosecution. So do you think those public
disclosures undermine the investigation at the Justice
Department of targeting of political--targeting of groups for
their political beliefs?
Mr. Ivey. Well, I would honestly say I don't think so, and
I think if we want to talk about sort of historical scenarios
where a President says something----
Mr. Jordan. Tell me what kind of public disclosures are you
referencing here then if the head of the government, who is a
potential target of the investigation, says----
Mr. Ivey. What is the actual disclosure that the
President's statement contains?
Mr. Jordan. It was definitive. It was absolute. It was,
There is not a smidgeon of corruption. I am head of the
executive branch and----
Mr. Ivey. As a defense lawyer, what I would be looking for
for statements from the government, which we seek in every
case, is information that I can use to try and figure out what
is the scope of the investigation, where is it going, what
questions are they asking about my client, what other--who
are--which other individuals their investigating----
Mr. Jordan. Let me see if people have a different opinion
than you, Mr. Ivey.
Mr. Terwilliger, do you think those public disclosures by
the President of the United States and someone at the Justice
Department who leaked to the Wall Street Journal that no one
was going to be referred for prosecution, do you think those
help?
Mr. Terwilliger. Let me take those separately and address.
The President's statement is most unfortunate. I really like to
believe he didn't intend to have that effect, but even if he
didn't intend to have the effect and even if it doesn't have
the effect of changing one iota of how the investigation is
conducted, that doesn't mean it doesn't affect public
confidence in the investigation.
Mr. Jordan. Sure.
Mr. Terwilliger. And confidence in the government. When the
President of the United States, can you imagine if Ronald
Reagan in the middle of Iran Contra, an investigation going on,
had come out publicly and said, Well, there is nothing to all
this. Of course, it is going to shake public confident because
it is telling the public that this is all a big waste of time,
there is--there is nothing really here to look at.
Mr. Jordan. Right.
Mr. Terwilliger. In terms of the leak from the FBI, that--
that is particularly devastating because I think, you know,
objectively, and I hope Mr. Cartwright would agree with this,
that what we are really looking for here, we the public, that
is, are really looking for here is confidence that a thorough
investigation, a law enforcement investigation will be
conducted. And when you have the principal law enforcement
agency in the United States, if in fact that that is the real
view, saying, well, nothing is going to result from this before
the investigation is completed, that shakes public confidence
in the integrity of that process.
Mr. Jordan. Ms. O'Connor or Mr. Painter, would you, and Mr.
von Spakovsky, would you agree with Mr. Ivey's statement, it
makes more sense to allow criminal investigations to run their
course before public disclosures are made that might undermine
the prosecution, do you think that would make--do you agree
with Mr. Ivey's statement in that what took place here is a
direct contradiction to his statement?
Ms. O'Connor. Investigations do need to be permitted to run
their course with the appropriate confidentiality so that they
can be run with integrity.
I would like to address your point about the President's
statement, if I might. President's statements carry a lot of
weight. They do a lot of good or a lot of harm. Markets can
rise and fall on the statement by the President, and not only
did this President say that there was not a smidgeon of
corruption, but back in 2010, he started bashing conservative
groups and suggesting that they were shadowy and had
questionable contributions. And the Internal Revenue Service
started opening unprecedented audits of donors that contributed
to conservative groups, so certainly the statements of a
President have a tremendous impact on the people who work for
the Federal Government.
Mr. Jordan. Thank you.
Allow you to go quickly, Mr. von Spakovsky and Mr. Painter,
if you could.
Mr. von Spakovsky. Of course, a criminal investigation
should be allowed to run its course, but that does not prevent
the Justice Department from providing general information on
the status of the----
Mr. Jordan. Sure.
Mr. von Spakovsky. --investigation to you because of your
oversight functions.
Also, look, the President is the chief law enforcement
officer, everybody else reports to him, and it is completely
inappropriate for him to be telling the people working for him,
here is what your conclusions----
Mr. Jordan. But we got--you use that--we got the worse of
everything here. We couldn't get the basics from the Justice
Department: Who is heading the investigation? How many agents?
Have you talked to any of the victims? We couldn't get the
basics, but we get definitive public disclosures from the
President of the United States and leaks to the Wall Street
Journal saying, No harm, no foul here, no one is going to be
prosecuted, not a smidgeon of corruption, so we got the worst
of everything.
We couldn't get the basics that when you all worked at
Justice, you gave all the time, but we get definitive
statements saying no one is going to be prosecuted, nothing is
wrong here.
So it was exactly backwards what we got from this Justice
Department.
With that, I went over time so I have to yield to the
gentleman from Tennessee. I apologize. The gentleman is
recognized for 5 minutes.
Mr. DesJarlais. No problem. Thank you, Mr. Chairman.
And thank you all for being here today.
The title of today's hearing, ``Is the Obama Administration
Conducting a Serious Investigation of IRS Targeting?'' Based on
the testimony, what we have heard here today, let me just go
down the line and say, just yes or no, do you feel like there
is a serious investigation going on?
Mr. Terwilliger. Honestly, sir, I can't tell, and the fact
that I can't tell is exactly the problem, because the public
needs to understand that in fact a serious investigation is
going on.
Mr. DesJarlais. Okay.
Ms. O'Connor.
Ms. O'Connor. That is exactly right. I have no basis on
which to form an opinion, and the public does deserve to know
that there is a serious investigation under way if there is.
Mr. DesJarlais. Okay.
Is everyone's opinion the same, we really can't tell.
Mr. von Spakovsky. We really can't tell, and that in itself
is a real problem.
Mr. DesJarlais. Okay.
Ms. O'Connor, do you think that there is any reason that
this targeting took place other than to affect the political
outcome?
Ms. O'Connor. Well, I certainly can't speak to the
motivations, but that was the result.
Mr. DesJarlais. Okay. Do you think that--that rogue agents
within an agency like the IRS would be capable of independently
constructing a targeting scheme of this magnitude without
direction from higher up?
Ms. O'Connor. That is highly unlikely.
Mr. DesJarlais. Okay. So, you know, the President was very
upset when he learned of this. Well, everybody was, both sides
of the aisle were extremely upset, but now as time has passed,
it is turned into, you know, more of a joke, either that or
this side of the aisle in this committee is the only one that
doesn't have as much information as the President and everyone
else because they seem to have already concluded that there is
not going to be any criminal charges, that there is not a
smidgeon of corruption, but yet a political election could have
been impacted and probably was by the actions of these agents
in the IRS. So, in your opinion, there had to be somebody
giving direction, and therefore, this is something that should
be investigated seriously.
Ms. O'Connor. We have seen the consequences of the
misconduct. We know that it happened. What needs to be found
out is how and why did it happen.
Mr. DesJarlais. Okay. Is there any--I mean, really, can
anyone sit there and think that there is any other reason that
it happened other than to prevent people from expressing their
political opinions?
Mr. Painter. I don't think we know. We are entitled. The
American people are entitled to answers to this, but we just
don't know.
Mr. DesJarlais. But yet we are getting the attitude now
that there is nothing to see here, we need to move on. I think
there was a President a few years ago that claimed he was not a
crook, and we all know how that turned out.
Mr. Ivey, you know, I agree that an investigation should be
thorough, but would you be the first one in line to say this
President should be impeached if he was involved in this?
Mr. Ivey. I have no reason to think that impeachment should
be even part of the conversation with respect to this issue.
Mr. DesJarlais. But this President is competent that there
was not a smidgeon of corruption, yet he was outraged when this
broke, and now all of a sudden he seems to have answers that we
don't have. So, going back to President Nixon, who was not a
crook, if President Obama knows what was going on here, should
he be impeached?
Mr. Ivey. I wouldn't think that impeachment is really a
viable part of the discussion on this at this point.
I did want to say quickly though with respect to President
Reagan. I do recall him making a statement with respect to Iran
Contra that he wasn't aware of any wrong--I believe it was a
statement from the Oval Office because I remember watching it,
and as we know, the investigation took its course. I think that
is what is going to happen here, too.
Mr. DesJarlais. Okay. Well, we hope that we get answers
because that is why we are here today. We are trying to have a
serious investigation, but yet, for some reason, we can't seem
to get answers. We can't get Lois Lerner back here. Hopefully,
that will change because there is certainly something that was
going on. The IRS admitted that they wrongfully targeted these
groups, and we know that these groups were probably going to be
in opposition to this President, and we know that it went to a
political appointee from the White House, so we have learned
all these things through the process of the investigation, but
yet we are sitting here today with basically the Attorney
General and an anonymous source saying that there is not going
to be any criminal charges, so it is hard to think that there
is a serious investigation going on when this is the kind of
runaround that we are getting here. It is getting to look like
somebody really wants us to move on from this. It is not much
unlike Benghazi. It seems to be there is a pattern going on
here.
So, at any rate, you know, we are going to continue to
push. We are going to continue to look for answers, and you
know, this is not going to go away so----
Mr. Terwilliger. If I may.
Mr. DesJarlais. Yes, sir.
Mr. Terwilliger. Before you yield your time, sir, respond
to Mr. Ivey's comment about President Reagan.
If President Obama had come out and said, I was out of the
loop, I didn't know what happened in any of this IRS business,
that would be perfectly fine. He has a political base to cover
and so forth, and that is what my recollection, as with Mr.
Ivey's, is basically what President Reagan said.
But that is not what President Obama said. What President
Obama said was a definitive statement that there was no
corruption, not his personal involvement but everybody else.
And what kind of message does that send to the American people
about a commitment to the kind of investigation that we all
seem to agree is needed?
Mr. DesJarlais. I appreciate that observation.
Thanks to all the witnesses.
I yield back.
Mr. DeSantis. [Presiding.] The gentleman yields back.
I recognize the ranking member.
Mr. Cartwright. Thank you, Mr. Chair.
So, Mr. Terwilliger, you are recommending the President
say, I was out of the loop; is that what you are recommending?
Mr. Terwilliger. Well, if he was going to say anything at
all, all I am saying is that that kind of statement would not
be--would not be inappropriate. The statement that he did make
is ill advised, at best.
Mr. Cartwright. Thank you, sir.
Ms. O'Connor, you are now in the private sector, I take it?
Ms. O'Connor. Yes, I am.
Mr. Cartwright. And you are with a private firm providing
tax advice and assistance?
Ms. O'Connor. I wouldn't exactly call it tax advice, but
yes, I----
Mr. Cartwright. Tax law advice.
Ms. O'Connor. I am in private practice.
Mr. Cartwright. Very good. Do you represent any progressive
or liberal groups that were applying for (c)(4) status?
Ms. O'Connor. I do not, nor conservative.
Mr. Cartwright. Well, the reason I ask you that is we were
here--I am sorry Dr. DesJarlais has left, but we were here on
this committee when the inspector general of the Treasury came,
Mr. Russell George, and he had authored something like a 28-
page report which blew the lid off of the BOLOs, the ``be on
the lookout'' for Tea Party and conservative groups, concerning
liberty--groups with conservative sounding names, and the whole
report detailed the discussion of the conservative groups, and
there was a footnote that said, and some other groups were
involved as well. But he never mentioned that--that progressive
or liberal groups were also on the ``be on the lookout'' list,
that the searches included progressive and liberal groups; in
other words, the opposite end of the political spectrum. He
never revealed that to us, so we were here in this full
committee in a high state of outrage. In fact, Ranking Member
Cummings went through the roof when he--when Russell George was
first here testifying to that report. And I was outraged myself
personally because it is fundamentally un-American the kinds of
things he was talking about to say that one particular type of
political group would be targeted by civil servants in the IRS.
And it was only after that that we found out that both ends of
the political spectrum were targeted, and that is why I ask you
that question, Ms. O'Connor.
Mr. Chairman, I thank you, and I yield back.
Mr. DeSantis. I thank the gentleman.
Ms. O'Connor. Might I comment?
Mr. DeSantis. Sure.
Ms. O'Connor. The--you said that Mr. George hid from you
the fact that some progressive sounding groups had also been
targeted, but you did have the report, and it was in the
report.
I might add that the number of conservative groups caught
in that filter versus the number of progressive groups was
something like 100 to 2.
Mr. Cartwright. I am glad you mention that because when we
start talking statistics and bandying about numbers, one of the
things you wonder is, well, as a percentage, how many--how many
of the progressive groups got targeted, how many of the
conservative groups--is it a fact that there are just way more
conservative groups who were applying for (c)(4) status? I
think that is an appropriate inquiry at some time we ought to
engage in. Thank you, Ms. Connor.
Ms. O'Connor. Happy to.
Mr. DeSantis. Mr. von Spakovsky, just--this is a little bit
tangential, but you have time at the FEC?
Mr. von Spakovsky. Yes.
Mr. DeSantis. Is that correct?
Mr. von Spakovsky. Two years.
Mr. DeSantis. Okay. And I am curious because there is this
issue that has come up recently where maybe the most vicious of
the President's critics in terms of books and movies, Dinesh
D'Souza was indicted for potentially illicit campaign
contributions. And what caught my eye and actually some members
of the Senate Judiciary Committee, Republicans have written to
ask about what the process is because it just seemed weird that
that would just be a routine review to see that there were
$20,000 that I guess the allegation is he reimbursed those. So,
how did it go? How would these reviews take place at the FEC,
and would the FBI come in and do routine reviews? Can you just
give us a brief snapshot on how you understood the process when
you were there?
Mr. von Spakovsky. Well, I don't recall the FBI coming in
for routine reviews when I was there. The odd thing about that
statement is, what--the accusation against Dinesh D'Souza is a
conduit contribution; in other words, that he reimbursed other
individuals for contributions they made. A routine review of
donation records would not turn that up.
Mr. DeSantis. Exactly.
Mr. von Spakovsky. Because the donations that he supposedly
reimbursed folks for would have been made by other individuals
in their names, so just reviewing the records isn't going to
show that. The only way you can discover that is if you get
some kind of information, a witness or somebody, who calls you
and says, I know that this person was reimbursing these
contributions. So a routine review would not reveal that.
Mr. DeSantis. Great. And so do you think that it is worth
writing, as the Senators did, to ask about what the typical
review consists of, and given that that was the explanation
that we have gotten, which is not really sufficient?
Mr. von Spakovsky. I think that is fully within the
oversight responsibilities of Congress.
Mr. DeSantis. Very good.
And then, Ms. O'Connor, this is my final. I mean, you
mentioned the auditing of donors, how that is kind of--and I
just anecdotally, I have had people come up to me and just say,
I have been in business 20, 30 years, started writing checks
for Romney, and now I have gotten audited. Now, that is just--
you know, correlation does not equal causation, but I have
heard it enough to where it is just--it is something that--so
can you speak to that? Is that something that you have dealt
with in your practice.
Ms. O'Connor. It is not something that I have personally
dealt with in my practice, but I was aware of the fact because
I was getting calls about it, that whereas the Internal Revenue
Service had never before audited contributors for 501(c)(4)s
for gift tax obligations, they began doing that, and I think it
was 2010, and again, it was after the President had made public
statements in his weekly radio address, in speeches bashing
contributors to conservative organizations, challenging that
they were shadowy, that they were questionable, just making--
you know, encouraging the IRS, whose obligation it is to look
into these things, to look into these things. And so it was
unprecedented. There were letters from Congress to the
Commissioner of the Internal Revenue saying why are you all of
a sudden looking at the gift tax obligations arising from
contributions to 501(c)(4)s. Steve Miller as deputy
commissioner at the time wisely told everybody at the IRS to
stand down on this issue, that before the IRS started enforcing
laws in this fashion, it was going to have to have some notice
and public comment.
So this, again, is an outgrowth of public statements
letting the Internal Revenue Service know what they ought to be
doing.
Mr. DeSantis. Well, thank you for that.
And I thank the witnesses for your time and your thoughtful
testimony.
I thank the ranking member for your participation.
And I would just say, I think, you know, we can disagree
about--even amongst Republicans. Democrats, Republicans have
different views on some of this stuff, but I think it is true
that at this point, you know, there is at least an appearance
that this investigation is not going the way that we would hope
an investigation would go, and given the sensitivities
involved, I think that we really do need to move in a different
direction. And I would just agree with the witnesses who have
said the Attorney General can appoint a special prosecutor, and
let's just get to the bottom of this because, ultimately,
whatever accountability is there, there has got to be a sense
amongst the public that they have some confidence in what
happened, given this situation.
And so I thank the chairman, who had to leave, for holding
this committee.
And right now, we have votes, so I will excuse all the
witnesses.
Thanks, again, and we are adjourned.
[Whereupon, at 4:02 p.m., the subcommittee was adjourned.]
APPENDIX
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