[House Hearing, 113 Congress]
[From the U.S. Government Publishing Office]
IRS OBSTRUCTION: LOIS LERNER'S MISSING EMAILS
=======================================================================
HEARING
before the
COMMITTEE ON OVERSIGHT
AND GOVERNMENT REFORM
HOUSE OF REPRESENTATIVES
ONE HUNDRED THIRTEENTH CONGRESS
SECOND SESSION
----------
JUNE 23, 2014
----------
Serial No. 113-129
----------
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
IRS OBSTRUCTION: LOIS LERNER'S MISSING EMAILS
IRS OBSTRUCTION: LOIS LERNER'S MISSING EMAILS
=======================================================================
HEARING
before the
COMMITTEE ON OVERSIGHT
AND GOVERNMENT REFORM
HOUSE OF REPRESENTATIVES
ONE HUNDRED THIRTEENTH CONGRESS
SECOND SESSION
__________
JUNE 23, 2014
__________
Serial No. 113-129
__________
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
______
U.S. GOVERNMENT PRINTING OFFICE
89-598 WASHINGTON : 2014
____________________________________________________________________________
For sale by the Superintendent of Documents, U.S. Government Printing Office,
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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
C O N T E N T S
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Page
Hearing held on June 23, 2014.................................... 1
WITNESSES
The Hon. John Koskinen, Commissioner, Internal Revenue Service
Oral Statement............................................... 9
Written Statement............................................ 12
APPENDIX
Opening Statement by Chairman Issa............................... 90
Lerner emails submitted by Rep. Cummings......................... 95
Opening Statement of Rep. Cummings............................... 98
Opening Statement of Rep. Connolly............................... 100
HR 1234 submitted by Chairman Issa............................... 103
April 7, 2014, Majority Staff Report ``Debunking the Myth that
the IRS Targeted Progressives,'' submitted by Chairman Issa.... 116
July 4, 2013, NYT article submitted by Rep. Connolly............. 163
June 20, 2014 Reason Magazine ``The IRS Had a Contract With an
Email Backup Company,'' submitted by Rep. Mica................. 167
Supplemental IRS Statement regarding the Contractor's software
application.................................................... 169
Democratic Staff Report ``No Evidence of White House Involvement
or Political Motivation in IRS Screening of Tax-Exempt
Applicants,'' submitted by Rep. Cummings....................... 172
Majority Staff Report ``How Politics Led the IRS to Target
Conservative Tax-Exempt Applicants for their Political Beliefs. 240
June 3, 2011, Letter from Ways and Means Chairman Camp to IRS
Doug Shulman, submitted by Rep. Speier......................... 317
June 2008 GAO Report ``National Archives and Selected Agencies
Need to Strengthen E-Mail Management, submitted by Rep.
Duckworth...................................................... 320
Chicago Tribune Op-ed ``More Smoke at the IRS-and not only from
the hard drives,'' submitted by Rep. Chaffetz.................. 322
June 18, 2014, letter from the White House to Reps. Camp and
Wyden, submitted by Rep. Horsford.............................. 323
Feb 4, 2014, Washington Post article ``IRS Reinstates employee
bonuses, ending sequester-related hold on awards, submitted by
Chairman Issa.................................................. 324
IRS Policy book submitted by Rep. Meadows........................ 326
June 17, 2014, letter from the National Archives to IRS submitted
by Rep. Meadows................................................ 333
Andrew Jackson's Petition for Relief of the Whisky Tax, Feb. 12,
1803, from National Archives, submitted by Chairman Issa....... 335
IRS OBSTRUCTION: LOIS LERNER'S MISSING EMAILS
----------
Monday, June 23, 2014
House of Representatives,
Committee on Oversight and Government Reform,
Washington, D.C.
The committee met, pursuant to call, at 7:16 p.m., in Room
2154, Rayburn House Office Building, Hon. Darrell E. Issa
[chairman of the committee] presiding.
Present: Representatives Issa, Mica, Turner, Duncan,
McHenry, Jordan, Chaffetz, Walberg, Amash, Gosar, DesJarlais,
Gowdy, Farenthold, Hastings, Lummis, Woodall, Massie, Collins,
Meadows, Bentivolio, DeSantis, Cummings, Norton, Tierney,
Lynch, Connolly, Speier, Duckworth, Kelly, and Horsford.
Staff Present: Melissa Beaumont, Assistant Clerk; Molly
Boyl, Deputy General Counsel and Parliamentarian; Lawrence J.
Brady, Staff Director; David Brewer, Senior Counsel; Caitlin
Carroll, Press Secretary; Sharon Casey, Senior Assistant Clerk;
Steve Castor, General Counsel; Drew Colliatie, Professional
Staff Member; John Cuaderes, Deputy Staff Director; Adam P.
Fromm, Director of Member Services and Committee Operations;
Linda Good, Chief Clerk; Tyler Grimm, Senior Professional Staff
Member; Frederick Hill, Deputy Staff Director for
Communications and Strategy; Christopher Hixon, Chief Counsel
for Oversight; Jen Jett, Staff Assistant; Michael R. Kiko,
Legislative Assistant; Mark D. Marin, Deputy Staff Director for
Oversight; Ashok M. Pinto, Chief Counsel, Investigations;
Jeffrey Post, Senior Professional Staff Member; Laura L. Rush,
Deputy Chief Clerk; Jessica Seale, Digital Director; Andrew
Shult, Deputy Digital Director; Jonathan J. Skladany, Deputy
General Counsel; Katy Summerlin, Press Assistant; Peter Warren,
Legislative Policy Director; Rebecca Watkins, Communications
Director; Aryele Bradford, Minority Press Secretary; Susanne
Sachsman Grooms, Minority Deputy Staff Director/Chief Counsel;
Jennifer Hoffman, Minority Communications Director; Elisa
LaNier, Minority Director of Operations; Valerie Shen, Minority
Counsel; Donald Sherman, Minority Chief Oversight Counsel; and
Katie Teleky, Minority Staff Assistant.
Chairman Issa. The committee will come to order.
The Oversight Committee exists to secure two fundamental
principles: First, Americans have a right to know that the
money Washington, through the IRS, takes from them is well-
spent; and, second, Americans deserve an efficient, effective
government that works for them. Our duty on the Oversight and
Government Reform Committee is, in fact, to protect these
rights.
Our solemn responsibility is to hold government accountable
to taxpayers, because taxpayers have a right to know what they
get from their government. Our job is to work tirelessly, in
partnership with citizen watchdogs, to deliver the facts to the
American people and bring genuine reform to the Federal
bureaucracy.
Would you go ahead--hold on. I'll do it this way.
Thank you. That's what I was looking for.
Without objection, the chair is authorized to declare a
recess of the committee at any time.
Without objection, so ordered.
The committee meets today as we continue our effort to get
the truth and the full truth on the obstruction by the IRS and
the targeting of Americans because of their conservative
political beliefs.
When the IRS Commissioner, John Koskinen, appeared before
this committee in March, he promised that he would produce what
this committee had made its top priority: all of Lois Lerner's
emails. The Commissioner made these promises without any
qualification or limitation. He even reiterated that statement
to the ranking member when asked.
Would you please go ahead and play the video for reflection
and memory?
[Video shown.]
Chairman Issa. The committee requested all of Lois Lerner's
emails. The Commissioner told us he would provide all of Lois
Lerner's emails. We requested them over a year ago. We, in
fact, subpoenaed them in August in order to make it clear that
we were not being complied with, and, again, a new one when you
became Commissioner in February of 2014.
Transparency clearly did not compel the IRS to tell the
truth about Lois Lerner's lost emails. You worked to cover up
the fact that there were missing emails and came forward to
fess up only on Friday afternoon after you had effectively been
caught red-handed.
I'm struck that your acknowledgment of missing Lois Lerner
emails came just 2 weeks after we had found some of them at the
Justice Department. When you were looking for emails, one of
the questions today will be, did you look at the Justice
Department, where she had sent over 1.1 million documents,
including some that were 6103--in other words, prohibited-to-
be-released documents?
Did you ever give the committee the courtesy of a direct
communication about missing emails after your false or
misleading testimony? Instead, your staff shared a
communication you made to a Senate committee controlled by the
President's party.
In your previous testimony, you had said it might take
years, I believe 2 years, to deliver all of these emails.
Welcome back. It hasn't been 2 years.
Did you hope you could run out the clock on this scandal?
Another question. Perhaps you thought Congress would never
realize that there were missing emails until we found them at
the Justice Department perhaps.
Commissioner, I called you to testify tonight because the
American people deserve answers about what happened to Lois
Lerner's emails and why the IRS hid this for years.
This hiding did not begin--and I repeat, did not begin--on
your watch. Clearly, the missing documents were known by many
people who have jobs at the IRS today under your predecessor
and your predecessor's predecessor. The fact that Lois Lerner's
emails were ever transferred out of the exclusive custody of
the IRS so that they could be lost or destroyed by Lois Lerner
should concern all of us.
The Federal Records Act--and we will meet tomorrow with the
Archivist--the Federal Records Act envisions that important
documents will be maintained, not just for investigations of
Congress, but, in fact, in perpetuity for the benefit of the
American people. This event in history, like Watergate, like
Teapot Dome, and like many other historic events, will be
studied by future generations without the benefit of many of
the thoughts and actions of Lois Lerner and others at the IRS
as a result of your organization's failure.
I subpoenaed you here tonight because, frankly, I'm sick
and tired of your game-playing in response to congressional
oversight. You, Commissioner, are the President's handpicked
man to restore trust and accountability at the IRS.
You testified under oath in March that you would produce
all of Lois Lerner's emails subpoenaed by this committee.
Before you testified, you took an oath you will take again
tonight to tell the truth, the whole truth, and nothing but the
truth. Mr. Commissioner, at a minimum, you did not tell the
whole truth that you knew on that day.
You gave your commitment to produce all emails to the
committee. You gave your word, sir. And we are just a little
questioning what your word is worth if, in fact, you cannot
enlighten us about what you know that is germane to our
inquiry, whether or not it is explicitly asked. Do we have to
grill you for days or weeks or months with every possible
question, every possible way something could be asked? Or will
the meaning of a question mean that you will, to the best of
your ability, give us a true and complete answer?
The American people have no trust in the IRS by comparison
to just a few years ago. The American people have never loved
the IRS. No one does love the organization that takes your
taxes and if they don't feel you treated them right--if they
don't feel they got the right amount, they come back and have
huge power over your lives. It's hard to love the IRS. But it
should not be hard to trust the IRS. The American people
deserve this agency, which was previously believed to be
nonpartisan--they need to be able to trust that it will once
again become nonpartisan, nonpolitical.
Your agency has a set of rules for taxpayers and,
apparently, another set of rules for themselves. The American
people understand that if they cannot prove that they did the
right thing in their tax return 5, 6, and 7 years ago it will
be disallowed and they will pay taxes with penalties. Well, in
fact, you maintain only 6 months of records and then,
apparently, count on people, good and bad, to maintain
documents they think are important beyond that. And you do so
without safeguards to protect the American people from the loss
of those documents.
Commissioner, tonight you will say that you have produced
thousands of documents; it will be an impressive number. Quite
frankly, that production is pushing a button and printing
documents out and then having people scratch out almost
everything of value, in many cases. It is not producing the
documents that you don't want to produce, the documents that
embarrass you.
The fact is, it's the last documents, not the first
documents, that normally do us good. It's the documents we
receive the night before we're going to depose somebody that
often tell us things we've waited months or years for.
I know tonight will be difficult, and it deserves to be
difficult for both sides. We have a problem with you, and you
have a problem with maintaining your credibility. Again, you
promised to produce the documents; you did not. You promised to
be forthcoming and candid; you were not.
In our first meeting, my subcommittee chairman, who will
also be making an opening statement, Mr. Jordan, irritated you
because you felt he questioned your integrity. I defended you
at that time, and I, quite frankly, gave you a bit of an
apology that he meant no harm, it was just his style. Tonight,
quite frankly, I wish I could take that back, and I wish I
could say what I'll say to you tonight: You believe you earned
trust before you came here, and it was yours to lose. I believe
you needed to earn our trust, and you failed at that task.
Either way, the American people do not believe the IRS is
dealing fairly with them in this investigation.
With that, I recognize the ranking member for his opening
statement.
Mr. Cummings. I'm going to get right down to the heart of
the accusation Republicans have been making for the past week.
It is interesting, Commissioner, that you've been accused
of false testimony or misleading testimony and been accused,
actually, if it's false testimony, of committing a crime.
What are we really saying? And what are the Republicans
here saying? They're saying that Lois Lerner intentionally--
intentionally--destroyed her emails and that IRS officials
helped her cover it up.
Chairman Issa has been leading the charge. Here are some of
the accusations he's made. June 13th, Chairman Issa suggested
that this was, ``a nefarious conduct that went much higher than
Lois Lerner.'' On June 18th, he said, ``The emails of a
prominent official don't just disappear without a trace unless
that was the intention.'' On June 19th, he said Ms. Lerner,
``made the decision not to have this drive recovered.'' And
just this morning, he said, ``The Justice Department, the IRS,
and the White House are interested in her succeeding in hiding
what she's hiding.''
Chairman Issa has made these accusations on national
television without first obtaining a briefing from IT officials
at the IRS who could have explained what really happened, and
he made them before hearing from the IRS Commissioner.
Mr. Koskinen testified last Friday before the Ways and
Means Committee, and now that we have the facts, they tell a
vastly different story. Truth, whole truth, nothing but the
truth.
Our committee has obtained no evidence to support Chairman
Issa's claim that Lois Lerner intentionally destroyed her
emails. To the contrary, we have now obtained contemporaneous
evidence from 2011 showing the exact opposite, that this was a
technological problem with her computer. Truth, whole truth,
nothing but the truth.
In Mr. Koskinen's testimony last Friday, he walked through
email after email from 2011 showing that Ms. Lerner sought help
from IT staff at the IRS and that they went to great lengths to
recover her data but at the end of that process they could not
do so.
Mr. Koskinen also testified last week that the IRS took
extraordinary steps--the extraordinary step of sending Ms.
Lerner's hard drive to experts in the forensic lab at the IRS
Criminal Investigation Division, but even they could not
recover her data. The truth, the whole truth, and nothing but
the truth.
On August 5th, 2011, Ms. Lerner received an email with the
bad news, and it said this, and I quote: ``Unfortunately, the
news is not good. The sectors on the hard drive were bad, which
made your data unrecoverable. I am very sorry. Everyone
involved tried their best,'' end of quote.
So if anyone wants the actual evidence of what happened in
this case, now we have it.
I ask unanimous consent that all of these emails from July
19th, July 20th, August 1st, and August 5th be entered into the
official hearing record.
Chairman Issa. Without objection, any Lois Lerner emails
that any Member wants to put in the record will be placed in
the record in the next 7 days.
Mr. Cummings. Thank you very much, Mr. Chairman.
These emails are all from 2011, well before any
congressional investigation began. And they show that Ms.
Lerner's computer crashed before she was informed that IRS
employees in Cincinnati were using inappropriate search terms,
according to the inspector general. I didn't say that; the
inspector general.
Now, we can certainly take issue with why the IRS did not
have backup tapes for this data. As Mr. Koskinen testified last
week, IRS policy in 2011 was to recycle backup tapes after 6
months to save money. He also explained that this policy was
changed in 2013 to save all backup tapes.
The fact is that there are longstanding problems with
electronic recordkeeping at Federal agencies. The Bush
administration lost millions--millions--of emails relating to
the U.S. attorney firings, the outing of covert CIA agent
Valerie Plame, and other investigations--millions. In 2007, the
White House spokeswoman, Dana Perino, admitted that they lost 5
million emails--5 million. And she said at the time, ``We
screwed up, and we're trying to fix it.''
There's been some progress since then, but I've always
believed we need to do more. I've always believed that we could
do better. That is why, nearly a year and a half ago, I
introduced the Electronic Message Preservation Act. My bill
would have required Federal agencies to preserve emails,
records electronically. Although this committee voted on a
bipartisan basis to approve my legislation, it has languished
since then, and the House Republicans have declined to bring it
to the floor for a vote.
I believe our committee's work should be a responsible
effort to obtain the facts and a responsible effort to find the
truth, the whole truth, and nothing but the truth. It should
not be an unseemly race against other Republicans to hold the
first hearing in front of the cameras. And it should not be a
ludicrous competition for some hyperbolic sound bites based on
the least amount of evidence.
In this case, Republicans have been trying desperately and
unsuccessfully for more than a year to link this scandal to the
White House. Rather than continuing on this path, I sincerely
hope that we will turn to constructive legislation with
concrete solutions to help Federal agencies run more
effectively and efficiently.
And, with that, Mr. Chairman, I yield back.
Chairman Issa. I thank the gentleman.
I might note for the record that, in today's briefing, a
briefing we asked for a week ago and were denied repeatedly, in
today's briefing, after we sent interrogatory questions to the
Commission, they said they would answer orally, which they did
not.
However, in today's briefing, when asked, can you assure us
that Lois Lerner did not intentionally crash her hard drive,
they could not verify that she did or didn't; can you assure us
that there was nothing nefarious in the loss by Lois Lerner of
her emails, and your CIO could not answer definitively. So we
still have a lot of----
Mr. Cummings. Mr. Chairman----
Chairman Issa. --facts to do.
Mr. Cummings. --may I be heard?
Chairman Issa. Of course.
Mr. Cummings. Just before today's hearing, both the
Democratic and the Republican staffs, as you said, had a
briefing from the IRS Deputy Chief Information Officer, a
career IT professional. While he was not involved in the
original 2011 examination of Ms. Lerner's hard drive, he has
reviewed documents surrounding the hard-drive crash and the IT
office's response to it.
He was asked, do you have any reason to believe that Ms.
Lerner intentionally crashed her hard drive? And he responded,
``I have no reason to believe it and haven't seen anything that
would say that she did that, no.''
He also told the committee, ``Ms. Lerner was insistent in
trying to recover whatever documents she could.'' He further
stated that ``I have no indication that there was anything
nefarious about the loss of Ms. Lerner's emails.''
And when asked whether he was, quote, ``aware of anyone at
the IRS intentionally destroying documents that are relevant to
a congressional investigation,'' he said, quote, ``Absolutely
not,'' end of quote.
Thank you very much, Mr. Chairman.
Chairman Issa. Thank you.
I might note for the record, as I go to the chairman of the
subcommittee, that we sent you those interrogatories 48-hours-
plus ago so we would not need to have an extensive, long
hearing. It is likely that we will recess this hearing tonight
and have you back after those interrogatories are fully
answered, since the briefing today in no way addressed any of
the interrogatories.
With that, I go to the chairman of the subcommittee, Mr.
Jordan.
Mr. Jordan. First, they denied it, Mr. Chairman. Two years
ago, Lois Lerner met with committee staff and said there's no
targeting going on. Doug Shulman came in front of a
congressional committee and said there's no targeting, I can
assure you there's no targeting.
Then they tried to spin it. May 10th, in an unprecedented
fashion, before the IG's report went public, Lois Lerner at a
Bar Association speech, with a planted question, tried to put
her spin on this story.
Then they tried to blame someone else. It wasn't us, two
rogue agents in Cincinnati. Then they attacked the messenger,
the fact-finder, that said the IG's report is flawed.
And now, Mr. Chairman, and now, they hide the evidence.
This is as old as the hills. Any third-rate, B-actor crime
drama follows this same script. The bad guy always says--he
denies it, he spins, he blames someone else, he tells the
police they got the wrong guy. And, of course, he always says,
``Officer, I didn't throw the gun in the river. I don't know
what happened to the murder weapon.''
I mean, Mr. Chairman, this would be laughable if it wasn't
so serious.
But here is one big difference between the common criminal
on the street and this scandal--one huge, important difference:
The bad guy on the street doesn't get to have his friends run
the investigation. And I will talk about this until we get to
the truth. The fact that Barbara Bosserman, a maxed-out
contributor to the President's campaign, is running this
investigation is a joke. It is wrong.
The fact that the FBI leaks to the Wall Street Journal on
January 13th of this year that no one's going to be prosecuted
is wrong. And the fact that the President of the United States,
the highest official in the executive branch, goes on national
television and says there's no corruption, not even a smidgen,
is wrong.
The bad guy doesn't get to have his friends run the
investigation, like we see here.
Here's the important point, Mr. Chairman. I hope--I've been
hoping that someone in this administration would have the
courage to step up and say it's time for a special prosecutor;
in light of this fact pattern, it is time for a special
prosecutor. Dallas Morning News said it today. They said it's
time for one. Five weeks ago, 26 Democrats had the courage to
step up and vote with every single Republican and say it's time
for a special prosecutor.
I would hope, if nothing more happens in tonight's hearing,
I would hope that the guy who heads the agency where the
targeting of people for exercising their First Amendment rights
took place, I would hope that, at a minimum, that guy, to show
his independence, to show us he really wants to establish some
credibility back in this agency, would have the courage to do
what 26 Democrats did 5 weeks ago and say it's time for a
special prosecutor so we can get to the truth and get past this
sham of an investigation that the Justice Department is doing.
With that, Mr. Chairman, I would yield back.
Chairman Issa. Would the gentleman yield to Mr. Turner?
Mr. Jordan. Oh, I would be happy to yield.
Chairman Issa. You're good? Okay.
We now go to the gentleman from Virginia, Mr. Connolly.
Mr. Connolly. Thank you, Mr. Chairman.
Mr. Koskinen, you and those watching this hearing now
understand that the stage is set. This is about theater. Fair
play, presumption of innocence, civility, respect for an
honored public servant who is serving his country yet again are
out the window, because there's an agenda that presupposes some
guilt that is based, in part, on supposition, on paranoia, on
conspiracy theory, all of which fires up the base of the other
party and plays well on right-wing media outlets--at the
expense, of course, of the truth, at the expense of any
semblance of bipartisan cooperation, at the expense of trying
to fix problems where we find them.
You don't think for a minute, Mr. Koskinen, that part of
the solution here is to provide the IRS with more resources to
address its IT problem. You don't think for a minute that the
solution contemplated might involve more resources for more IRS
agents to try to deal with the backlog of tax-exempt
applications, or to say nothing of money left on the table owed
the government that could actually help reduce the debt.
Because, for ideological reasons, those are beyond the pale.
And then we come to your honor, Mr. Koskinen.
I first met you when we were worried about something called
Y2K back in 1999, 1998, and 2000. And it was an IT problem. We
were worried that at the stroke of midnight 2000 our banking
systems would collapse, red lights would go off, you know, all
of our computer systems would go awry, and so we had to make
investments to make sure that didn't happen. And you were the
Y2K czar.
I saw then and I see now an honorable public servant who
cared about his country. He served Republican as well as
Democratic administrations and was cited explicitly, including
in the Bush administration, for his exemplary service and for
his integrity and personal honor.
The fact that you would be subjected tonight to the barrage
of innuendo and accusation, backed up by nothing, for the
purpose of political theater is, to me, reckless and
disgraceful and brings enormous dishonor on this committee.
And I want you to know personally, Mr. Koskinen, that there
are a number of us who still honor your public service, who
still respect your integrity, and who understand this dynamic
and are willing to call it out for what it is. So I hope none
of that shakes your faith in your value and in your years of
service.
And I hope you will continue your tenure at IRS to clean up
what problems there are and to try to make the IRS a more
accessible, more accountable, and more efficient agency on
behalf of the U.S. taxpayers and this country. That's why you
undertook a thankless assignment.
Thank you for your service, Mr. Koskinen, and thank you for
being here tonight.
I yield back.
Chairman Issa. I thank the gentleman.
I now ask unanimous consent that H.R. 1234 be placed in the
record at this time.
Chairman Issa. We now go to our one and only witness for
this evening. John Koskinen is the Commissioner of the Internal
Revenue Service.
Pursuant to the committee, all members are to be sworn.
Would you please rise to take the oath and raise your right
hand? A little higher. Thank you.
Do you solemnly swear or affirm that the testimony you will
give will be the truth, the whole truth, and nothing but the
truth?
Mr. Koskinen. I do.
Chairman Issa. Thank you. Please be seated.
Let the record reflect the witness answered in the
affirmative.
You're the only witness. You certainly have some 'splaining
to do. Take such time as you need.
STATEMENT OF THE HON. JOHN KOSKINEN, COMMISSIONER, INTERNAL
REVENUE SERVICE
Mr. Koskinen. Thank you.
Chairman Issa, Ranking Member Cummings, and members of the
committee, thank you for the opportunity to appear before you
this evening to provide you with an update on recent IRS
document productions to Congress.
The IRS, over the past year, made a massive document
production in response to inquiries from Congress relating to
the investigation of the processing and review of applications
for tax-exempt status, as described in the May 2013 report from
the Treasury Inspector General for Tax Administration.
This committee has received, as noted, over 600,000 pages
of materials, redacted to protect taxpayer information. The
tax-writing committees have received over 835,000 pages of
unredacted material. As of last Friday, the tax-writing
committees already had more than 27,000 emails from Ms.
Lerner's computer account and more than 18,000 emails from
other custodians' accounts for which Ms. Lerner was an author
or a recipient.
I understand that this committee and the other
investigators were provided, beginning last fall, with copies
of emails indicating that Ms. Lerner had experienced
difficulties with her computer 3 years ago. So it should be
clear that no one has been keeping this information from
Congress.
The IRS expects to complete its production of the remaining
Lerner emails in unredacted form by the end of the month. As
soon as possible thereafter, we will complete redaction of
those emails and produce them to this committee.
At that time, this committee will have all the emails,
43,000 of them, that we have from Ms. Lerner's computer and
email account for the period January 2009 through May 2013. In
addition, this committee will have 24,000 Lerner emails from
other custodians' accounts, for a total of 67,000 Lerner
emails.
In the course of responding to congressional requests, the
IRS in February reviewed the email available from Ms. Lerner's
custodial computer account, which was limited to search terms
developed in cooperation with the investigating committees, and
identified the possibility of an issue because the date
distribution of the email was uneven. It was not clear whether
Lerner emails were overlooked, missing, or had other technical
issues involved. IRS information technology professionals
identified documents that indicated Ms. Lerner had experienced
a computer failure in 2011.
In mid-March 2014, the IRS focused on redacting materials
for the non-tax-writers and processing the rest of Ms. Lerner's
emails for production. As we reviewed additional emails, the
IRS review team learned additional facts regarding Ms. Lerner's
computer crash in mid-2011, which occurred long before these
congressional investigations opened or when the TIGTA review
began.
During this review, we learned that, as noted, in 2011 the
IRS information technology division had tried using multiple
processes, at Ms. Lerner's request, to recover the information
stored on her computer's hard drive. A series of emails
available after all of Ms. Lerner's email was loaded this
spring recounts the sequence of events in 2011.
A frontline manager in IT reported to Ms. Lerner in an
email on July 20th, 2011, ``I checked with the technician, and
he still has your drive. He wanted to exhaust all avenues to
recover the data before sending it to the hard-drive cemetery.
Unfortunately, after receiving assistance from several highly
skilled technicians, including HP experts, he still cannot
recover the data.''
Ms. Lerner was told by email on August 1st, 2011, ``As a
last resort, we sent your hard drive to CI's,'' the IRS
Criminal Investigation Division, ``forensic lab to attempt data
recovery.''
In an email already read on August 5th, 2011, Ms. Lerner
was advised, ``Unfortunately, the news is not good. The sectors
on the hard drive were bad, which made your data unrecoverable.
I am very sorry. Everybody involved tried their best.''
In light of the hard-drive issue, the IRS took multiple
steps over the past months to assess the situation, ensure that
no emails had been overlooked or lost during this
investigation, is producing as much email as they have for
which Ms. Lerner was an author or recipient.
As the search for and production of Lerner emails was
concluding, I asked those working on this matter to determine
whether computer systems of the other 82 custodians had
experienced any similar difficulties. After the IRS public
report was delivered on June 13 to Congress and the Treasury
Inspector General for Tax Administration, it was determined
last week that several additional custodians may have
experienced hard-drive failures during the search period.
It's not unusual for computers anywhere to fail, especially
at the IRS, in light of the aged equipment IRS employees often
have to use, in light of the continual cuts in the budget these
past 4 years. Since January 1 of this year, for example, over
2,000 IRS employees have suffered hard-drive crashes.
It's important to remember that a hard-drive failure does
not automatically mean that all or even any emails have been
lost or cannot be reconstituted. We are still assessing what
effect, if any, computer failures had on the emails of any
other custodians, although some custodians apparently lost no
emails at all.
The question is, what emails outside the agency prior to
April 11, 2011, are not in the 24,000 Lois Lerner emails sent
to other IRS employees during that period? Last week, I
understand, the White House and the Department of Treasury
stated they were providing all of their Lois Lerner emails,
which should help fill those gaps and answer that question.
The Treasury Inspector General for Tax Administration has
already begun an investigation of this matter, and his report
will provide an independent review of the situation concerning
Ms. Lerner's computer crash 3 years ago. We are committed to
working cooperatively and transparently with this committee and
the six other investigations going on, and we will continue to
provide you with updates.
This concludes my testimony, and I would be happy to take
your questions.
Chairman Issa. Thank you.
[Prepared statement of Mr. Koskinen follows:]
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Chairman Issa. Commissioner, do you remember the name
Braulio Castillo?
Mr. Koskinen. I do not.
Chairman Issa. Did you ever hear the name Gregory Roseman?
Mr. Koskinen. No.
Chairman Issa. Well, Castillo is now on trial for murdering
his wife, but, before that, this committee discovered that he
had wrongfully received $500 million in contracts, IT
contracts, from the IRS.
And Gregory Roseman took the Fifth. He was one of your
employees who helped get him that contract.
When you go home tomorrow or the next day, you might want
to see Congresswoman Duckworth asking him how his ankle that he
hurt at the prep school feels, because, in fact, he claimed to
be a disabled veteran some 27 years later. And his old college
buddy, a lifelong friend, helped him get that contract.
At that time and now, we rely on the ability to recover
emails as part of the chain of discovery. TIGTA Russell George,
your IG, relies on that. Tomorrow we'll hear from the head of
the National Archives, the Archivist. He relies on your
organization to comply with Federal law.
The question I have for you is, how can we expect--you have
servers that run Microsoft Exchange. It captures every email in
and out. How can we sit here and expect to trust an
organization in which the C drive, the local hard drive, of
Lois Lerner is supposed to be the only place that email
existed?
Mr. Koskinen. That is not the only place that email
existed. There is email on her email system in the server that
has been found and produced. Any email that existed anywhere,
even any hard copy of official records that existed anywhere,
has been or will be provided to this committee.
Chairman Issa. Right. So, in 2011, when her hard drive
failed, if you were properly backing up all the information
required under the Federal Records Act, which would include the
information she selected to have and apparently deleted from
the exchange server, you would have had all of those emails in
your backup, wouldn't you?
Mr. Koskinen. All emails are not official records under any
official records act. Only emails are saved that reflect agency
actions or----
Chairman Issa. Would you put your mic pointed toward you so
we could hear?
Mr. Koskinen. Sure. Sorry about that.
Chairman Issa. No problem.
So the bottom line is that you apparently were not
capturing all emails. You were allowing her to delete emails
but retain emails on her C drive so that, 6 months after--I
just want to make sure we get the record straight--6 months
after she moved them to her C drive, you were no longer in
possession of those. Is that correct?
Mr. Koskinen. No.
Chairman Issa. Well, what is correct?
Mr. Koskinen. What is correct is that each employee is
limited to basically now 6,000 emails that they can hold on
their email account which is stored on the agency's server.
The reason there is a limitation is the agency does not
have servers large enough to sustain the retention of all
emails. A decision was made 2 years ago when people looked at
that and it was determined it would cost anywhere from $10
million to $30 million to upgrade the system so that, in fact,
all emails on the server would be preserved. Because of the
budget constraints the agency was operating with 2 years ago,
the decision was made not to proceed.
Chairman Issa. One-point-eight billion dollars in IT is
your budget--$1.8 billion. On $1.8 billion, isn't the retention
of key documents that the American people need to count on,
like whether or not they're being honestly treated by your
employees, especially somebody at such a high level, isn't
that, in fact, a priority that should have allowed for full
retention?
Mr. Koskinen. If we had the right resources, there would be
a lot of priorities we'd have. The budget for this year----
Chairman Issa. So the American people should believe that
if they don't have the resources to pay their taxes, they
shouldn't pay their taxes, because if the IRS doesn't have the
resources, it won't keep records. That's pretty much what
you're telling us here tonight, is that resources are a
question of whether or not you maintain key documents.
Let me just go into one thing in my limited time. You came
here and you said--put it up on the board--that, as you did
today, you were going to tell the truth, the whole truth, and
nothing but the truth.
You saw that montage in the opening. You knew there was a
problem with some of Lois Lerner's emails when you came to
testify in March; isn't that true?
Mr. Koskinen. I knew that I'd been told there was an issue
that no one knew the ramifications of.
Chairman Issa. Did you reasonably believe that at least one
email may have been lost?
Mr. Koskinen. No. I did not have any basis for knowing what
the answer to that was----
Chairman Issa. So you knew there was a problem, but you're
going to----
Mr. Koskinen. I knew there'd been a problem--somebody said
there's an odd development in the way the emails are showing
up, we're going to pull all of her emails and investigate it.
The first time I knew that emails had been lost from her
account was in April.
Chairman Issa. So when you knew in April that you said you
were going to give us all of it, you said to Mr. Cummings and
myself you were going to give us all, you went and told
political appointees at Treasury, didn't you----
Mr. Koskinen. I did not.
Chairman Issa. You did not?
Mr. Koskinen. I did not.
Chairman Issa. So who did you tell in April when you knew?
Mr. Koskinen. Who did I tell? I didn't tell anybody. I was
advised-- I had no one I was going to tell.
Chairman Issa. You didn't tell your IG that some of the
documents weren't going to be provided?
Mr. Koskinen. I did not----
Chairman Issa. Or did you cause someone to find out at the
White House, at Treasury, or your IG?
Mr. Koskinen. I did not. And if you have any evidence of
that, I'd be happy to see it.
Chairman Issa. I asked a question.
Mr. Koskinen. And I answered it.
Chairman Issa. You did not cause anyone to find out.
Mr. Koskinen. I absolutely did not.
Chairman Issa. So you told us that all the emails would be
provided. When you discovered that all emails would not be
provided----
Mr. Koskinen. All the----
Chairman Issa. --you did not come back and inform us; is
that correct?
Mr. Koskinen. All the emails we have will be provided. I
did not say I would provide you emails that disappeared. If you
have a magical way for me to do that, I'd be happy to know
about it. I said I would provide all of the emails. We are
providing all the emails.
The fact that 3 years ago some of them, not all of them,
but some of them were not available, I never said I would
provide you emails we didn't have. And, in fact, we are going
to provide you 24,000 emails from the time----
Chairman Issa. My time has expired, and I've lost my
patience with you.
We now go to the ranking member.
Mr. Cummings. I want you to talk about resources. You were
starting to say something about resources.
Mr. Koskinen. Resources. We have----
Mr. Cummings. Yes.
Mr. Koskinen. --a wide range----
Mr. Cummings. How does that affect what you do?
Mr. Koskinen. What it affects is that--we have a wide range
of responsibilities. The IT budget has been cut by over $100
million over the last 4 years. This year's budget for 2014
required $300 million just for the implementation of the
Affordable Care Act, but Congress provided us zero. That meant
that that $300 million to implement a statutory mandate had to
be taken from other IT programs. That's been our challenge for
the last 3 or 4 years.
Mr. Cummings. Now, Commissioner Koskinen, last week, many
Members of Congress, including our own chairman, suggested that
Lois Lerner intentionally crashed her computer to destroy
emails. But, last Friday, you testified about the facts. You
provided Congress with evidence from 2011, contemporaneous, by
the way, emails showing exactly the opposite and that this was
a technological problem. Since some Members of Congress are
still pushing this accusation, I want to walk through these
emails.
And let me ask staff to put up the slides.
On July 19th, 2011, Lois Lerner emailed Associate Chief
Information Officer at the IRS for help in recovering her hard
drive. And it says, ``I'm taking advantage of your offer to try
and recapture my lost personal files. My computer skills are
pretty basic, so nothing fancy. But there were some documents
in the files that are irreplaceable. Whatever you can do to
help is greatly appreciated.''
Commissioner Koskinen, is that right? Is that accurate?
Mr. Koskinen. That's an email that has been found and been
produced, yes.
Mr. Cummings. Next slide.
Later that day, that IT employee sought help from the field
director of the Customer Support Division. And he wrote, ``If
she can't fix it, nobody can.''
Is that a document that you--part of a document that you
produced?
Mr. Koskinen. Yes.
Mr. Cummings. Next slide.
The next day, the field director emailed Ms. Lerner and
said, ``I checked with the technician, and he still has your
drive. He wanted to exhaust all avenues to recover the data
before sending it to the hard-drive cemetery. Unfortunately,
after receiving assistance from several highly skilled
technicians, including HP experts, he still cannot recover the
data.''
Is that a part of a document that you supplied to----
Mr. Koskinen. Yes.
Mr. Cummings. --our committee?
Next slide.
On August 1st, 2011, the IT field director wrote again to
Ms. Lerner and informed her that, ``As a last resort, we sent
your hard drive to CI's forensics lab to attempt data
recovery.''
Now, Mr. Koskinen, ``CI'' stands for Criminal Investigation
Division at the IRS. And what do they do in the forensic lab in
that division?
Mr. Koskinen. They're an expert at, in that lab, taking
hard drives in computers that have been seized by criminals,
tax evaders, and others and reconstituting emails wherever
necessary.
Mr. Cummings. Now, is this a step typical when an employee
computer crashes? Do you normally do that?
Mr. Koskinen. No. It's extraordinary that we would--the IRS
would send a hard drive to CI for their help.
Mr. Cummings. And why did you do that?
Mr. Koskinen. Because Ms. Lerner, I am advised, insisted
that all possible efforts be made.
Mr. Cummings. Now, despite all of these efforts, the field
director finally emailed Ms. Lerner with the results.
Next slide, please.
``Unfortunately, the news is not good. The sectors on the
hard drive were bad, which made your data unrecoverable. I'm
very sorry. Everyone involved tried their best.''
So the technical experts concluded 3 years ago that the
sectors on her hard drive were bad. Is that accurate?
Mr. Koskinen. That's what the email says.
Mr. Cummings. Now, these emails are concrete evidence of
what really happened back in 2011, but my Republican colleagues
just want to ignore them. They want to pretend they don't
exist, those stubborn facts. But they do exist. And they show
this was not intentional, this was not nefarious, this was not
a conspiracy.
Mr. Koskinen, are you aware of any evidence, documents,
emails--and I remind you you are under oath; I also remind you
you have been accused of false statements--are you aware of any
evidence, documents, emails, or other information from IT
professionals that calls into question the accuracy and the
legitimacy of these emails?
Mr. Koskinen. No.
Mr. Cummings. And, finally, and just so everyone is clear,
Mr. Koskinen, when you testified before this committee on March
26, did you know about this email claim? Did you know Ms.
Lerner's emails were lost forever?
Mr. Koskinen. No.
Mr. Cummings. Thank you very much.
Chairman Issa. Thank you.
We now go to the gentleman from Florida, Mr. Mica.
Mr. Mica. Well, thank you, Mr. Chairman.
I have known the Commissioner for many years, and I know
him to be a good public servant. I'm a little bit baffled.
I know, John, I think that you're probably in a position of
the guy at the end of the parade with the broom and shovel here
and in a very difficult situation.
Let me, if I can, just take people back to the history of
this, and to you, Commissioner. This targeting began sometime
in March or April of 2010. In June of 2010, Chairman Issa
alerted IRS and it made an inquiry. In February of 2011, Lois
Lerner sent an email to IRS employees stating that the Tea
Party is a very dangerous matter.
Then the chairman of the committee with jurisdiction, in
June of 2011, June 3rd, Dave Camp, who you spent time with
recently, sent a letter to IRS the heat--it looks like the heat
really started to come on at that point.
Now, an entire administration and one of the biggest
scandals in government was back during Watergate when, what, 18
minutes of tape was lost. And somehow, between June 3rd and
June 13th, Lois Lerner's hard drive crashes and is gone in 10
days.
And it's not just a couple of days or 18 minutes like Rose
Mary Woods had the misfortune of losing, but 27 months, is that
correct, of hard drive that's lost?
Mr. Koskinen. That's correct. All the emails before June--
--
Mr. Mica. From June of 2009 to April of 2011. So it raises
many questions.
Now, you came on in December, right, John?
Mr. Koskinen. Yes, the end of December.
Mr. Mica. And they briefed you. You were briefed about this
whole situation the beginning, I guess, of January.
In February, you testified today that you learned that
there was a problem recovering some of the emails. Is that
correct?
Mr. Koskinen. No, I--yes, I--what I learned was that there
was an issue with her emails, that there was a problem with the
dates.
Mr. Mica. But then, in March, what troubles me is you came
to us and you said--last week informed this committee and
others, ``We believe we've completed our production to the Ways
and Means Committee and all the documents that are asked for in
light of these document productions.'' This is to us here. ``I
hope the investigations can now be concluded in the very near
future.''
You went through and told us what you just started out
with, of how much money you spent and how many documents you
produced. But nowhere did we hear, until just a few days ago,
that the hard drive crashed and all of this was unrecoverable.
But they--again, the information we have is they briefed
you in February. You gave us this testimony in March and never
spoke to this.
Mr. Koskinen. Right. In February, as I said, they briefed
me that, with the emails that they had pulled subject to the
search terms, they were concerned that there was an issue with
the date issues. I did not, was not advised, did not know----
Mr. Mica. But----
Mr. Koskinen. --that there was a hard-drive crash.
Mr. Mica. John, I gave you the benefit of the doubt. I went
back and looked through all of what you gave us in March. This
is your testimony. And even what you gave us today conflicts.
So that does--it raises questions, because it appears that you
knew and others knew and----
Mr. Koskinen. Others knew----
Mr. Mica. --the Congress wasn't informed until just
recently.
Now, I don't have much time. I understand, I just learned a
little about this Sonasoft backup, Sonasoft backup contractor.
And they were retained--are you familiar with them--to back up
emails and----
Mr. Koskinen. I was not familiar then, but I do have the
information was provided me today.
Mr. Mica. Well, I have the same information, and I
understand that they were dismissed in 2011, and they had
started 2005. And, actually, in their advertisements, they
bragged about how they could retain emails.
Do you know if they have a backup that exists?
Mr. Koskinen. They were under a contract with the Chief
Counsel of the IRS for about 3,000 employees and an internal
disaster recovery program that would allow you to move emails
from one system to another as a backup. That contract was
terminated when the IRS Chief Counsel upgraded to Outlook 2010
and that alternate system was no longer needed.
Mr. Mica. But you don't know if that backup exists.
Mr. Koskinen. If the backup before----
Mr. Mica. But they were in place, they had that
responsibility for the backup between, I think, 2005 and 2011.
Mr. Koskinen. But that's for the Chief Counsel. That's for
3,000 employees in the Chief Counsel, not for anybody else in
the entire----
Mr. Mica. So that might exist? That data may exist?
Mr. Koskinen. If any of the data exists, it's been searched
for, all of the emails. I'm told we've searched every word of
every----
Mr. Mica. Did you ask that company for that information?
Mr. Koskinen. The company didn't have any data on their
servers. The data was all inside the IRS.
Mr. Mica. And that's gone, too?
Mr. Koskinen. No, everything that we have and all the--that
was a disaster recovery system for the Chief Counsel. All of
those emails across the system have been--any data that the
Chief Counsel has or that the IRS has has been searched.
Mr. Mica. Again, Mr. Chairman, many questions.
Chairman Issa. I thank the gentleman.
We now go to the gentlelady from the District of Columbia,
Ms. Norton.
Ms. Norton. Thank you, Mr. Chairman.
Like Mr. Mica, John Koskinen, I have known you well before
you came to Congress. Since coming to Congress, I have been
impressed, not a little bit, by the confidence you have
inspired in Republican and Democratic Presidents alike. It's as
if they saved you for jobs that others couldn't do, didn't have
the guts to do, or didn't have the integrity to do. You are
well-known on both sides of the aisle as the government's most
versatile turnaround artist. When an agency is in trouble, turn
to John Koskinen.
Therefore, I begin my series of questions simply by
offering you an apology. I believe you deserve one. You deserve
one because of accusations designed to sacrifice the reputation
of a public servant with a spotless reputation, for political
advantage, without a scintilla--and I use my words advisedly--
of evidence.
It's vile enough to look a man in the face and accuse him
of perjury without submitting any evidence. It is much worse
when all of the evidence supports the version of the facts of
the man you are facing. Whether it is that the Lerner crash
occurred well before this investigation began--she must be
clairvoyant; whether it's been confirmed by the
decriminalization lab, all the evidence is on your side, Mr.
Koskinen.
And I want to point out for the record that the line of
conspiracy hunting has shifted with the Lerner crash. For the
longest time, the line of questioning was about one subject
alone. So we've moved from one scapegoat to another. What we've
just moved off of, the notion that this was all a conspiracy
directed on behalf of the White House, that also without a
crumb of evidence. Lacking evidence, the crash provides new
fodder.
Just for the record, Mr. Koskinen, have you identified any
evidence since you have been Commissioner that IRS employees
before you came or now were part of a conspiracy to
intentionally target the President's political enemies?
Mr. Koskinen. No. I have done no investigations. I have
read the IG's report that said inappropriate criteria were used
to identify organizations for review. And the IG had nine
recommendations, and we have accepted all of those
recommendations.
I think it's important for the public to be confident that,
whoever they are, they're going to be treated fairly by the
IRS, whether they're Republicans, Democrats, belong to
organizations of one kind or another. Wherever they show up,
wherever they speak, they should understand they'll be treated
fairly. If there's an issue, it's because something in their
tax return; if somebody else had that issue, they would get the
same response from the IRS.
I think it's critical that the public have that confidence,
and we're doing everything we can to restore that confidence.
Ms. Norton. Well, 41 individuals have testified, just as
you have, that there's no evidence of the first conspiracy, now
that we're on to the second conspiracy. And so did the IG.
Do you recall that the IG also testified, ``The Inspector
General, when asked by the Ways and Means Committee, was there
any evidence of political motivation from the White House,'' he
said, ``we have no,'' we did not have--we had no--``Did you
have any evidence?'' ``We did not, sir.''
So I just want to say that your strong reputation, your
character should hold you in good stead as you face baseless
accusations. And when a man faces accusations and no evidence
is put before him, I think he's got nothing to worry about.
Thank you very much for your extraordinary service to the
people of the United States.
Chairman Issa. Would the gentlelady yield?
Ms. Norton. Be happy to yield.
Chairman Issa. I appreciate it.
I just would wonder if that quote from March, ``We can find
Lois Lerner's emails''--would the Commissioner stand behind
that statement or would he have to qualify it with, ``We will
find some of Lois Lerner's emails''?
Ms. Norton. I'm sure he was trying to find all of Lois
Lerner's emails. And they were lost--the crash occurred before
we even began.
Chairman Issa. But not after Mr. Camp had sent letters, not
after we had begun our investigation. Her crash came after we
began investigating.
Ms. Norton. And therefore? And, therefore, what, Mr.
Chairman?
Chairman Issa. And, therefore----
Ms. Norton. And, therefore, she did what?
Chairman Issa. And therefore documents disappeared after--
--
Ms. Norton. And, therefore, she did what or Mr. Koskinen
did what?
Chairman Issa. I didn't say Mr. Koskinen----
Ms. Norton. Well, that's what we're here to learn. And I
repeat there is no evidence that this man had anything to do
with any malfeasance or that he should be accused of perjury
before this committee.
Chairman Issa. Only that he said that he was aware that
Lerner's emails were overlooked, missing, or had other
technical issues.
Mr. Koskinen. There was no evidence at that time to know
whether they had been overlooked, missing, or had other issues.
I did not say that we knew that.
I said, at that time, we had no idea whether any of those
applied. That's why they were investigating. That's what I was
told then in April, when they came back with the findings as
they had reviewed it all.
I never said, at the time, that, in fact, we had any idea
whether any of that was true.
Chairman Issa. And, Eleanor, that's the inconsistency that
we're talking about here tonight.
Ms. Norton. What's the inconsistency, Mr. Chairman?
Chairman Issa. If you know that you have a difference in
the numbers and----
Ms. Norton. What numbers? We don't know the number yet, Mr.
Chairman.
Chairman Issa. The Commissioner knew that there was a
problem, but he didn't know the details. We were never told
there was a problem----
Ms. Norton. So he should talk before he knows the details?
Chairman Issa. When every person up on the dais, including
the ranking member, wants to know if you're going to get all
and you know there's at least some sort of a problem or
concern----
Ms. Norton. Mr. Koskinen, what is your response to that?
You said, ``We're going to get--we're getting find them all.''
Were you lying when you said, ``We're going to find them all''?
Mr. Koskinen. Absolutely not.
Chairman Issa. Thank you.
We now go to Mr. Turner.
Mr. Turner. Mr. Koskinen, you are touted as a man of
integrity, and I've even heard you say it about yourself on
television. So I'm going to ask you to use that integrity to
help me understand a few things that have become confusing to
me.
Now, you said that you want to restore confidence to the
Agency, and I have no question to question that. I have no
basis upon which to think that that isn't your goal.
But you have to understand that this discussion of the
missing emails goes right to the heart of the issue of
confidence and of the issue of your ability to do that and of
your integrity.
So let's start first with just some general concept of
ethics, back to your integrity.
Now, you agree, as Commissioner, that you can't both be the
manager of the Agency, the investigator of the Agency, judge,
jury, and prosecutor of matters that are being undertaken under
and by the Agency. Right?
There's inherent conflict and bias in those positions. You,
by basic concepts of an ethics with integrity, can't fill all
of those. Correct?
Mr. Koskinen. I'm not sure I understand that question.
I'm in charge of the Agency, I'm responsible for its
activities, and I'm accountable for its activities.
Mr. Turner. So you believe that you can testify under oath
today that no crime has been committed by Lois Lerner at the
IRS?
Chairman Issa. I can testify I have seen no evidence of a
crime.
Mr. Turner. I understand that.
And that is the question that has been bantered back and
forth here. I can tell you I have no evidence that Lois Lerner
has committed a crime.
But I don't have it within--I don't have the Agency and I
certainly don't have the ability to go to the FBI and others
and have them take things from you that can give that.
Mr. Koskinen. All right.
Mr. Turner. Just because you haven't seen all the evidence
doesn't mean that you have the ability to just blanketly say no
crime was committed.
Mr. Koskinen. I didn't say no crime. I said I've seen no
evidence. I would note again----
Mr. Turner. And that's the distinction.
Mr. Koskinen.--that the Inspector General----
Mr. Turner. Because you can't testify here under oath that
no crime was committed.
Mr. Koskinen. The Inspector General has started an
investigation----
Mr. Turner. I'm asking you. Do you have any ability to say
no crime has been committed?
Mr. Koskinen. I have the ability to say I have seen no
evidence of any crime.
Mr. Turner. Of course. But you cannot say what I've asked
you, that no crime has been committed.
So let's go to Lois Lerner. She came before this committee
and, under--while she was placed under oath, she evoked the
Fifth because she indicated that she wanted to assert those
rights, albeit that she did that incorrectly, because she had
fear of prosecution. Let's say that again. Prosecution. Fear of
criminal prosecution.
Now, you can't testify today that Lois Lerner has no need
for a fear of criminal prosecution because you can't testify
that Lois Lerner didn't commit a crime.
Now, here's what I'm concerned about, since you are a man
who is placed before us with integrity.
If in the process of these emails being destroyed there
were those in your Agency that knew that it was a possibility
that a crime was committed, then they committed a crime because
destruction of evidence of a crime is, in fact, a crime.
And you can't testify today that no one--that there was no
crime committed in the destruction of her emails. Right? You
can only say you have no evidence of a crime having been
committed in the destruction of these emails. Right.
Mr. Koskinen. I have no evidence whether she beat her dog,
whether she beat children. I have no evidence of a whole series
of things.
Mr. Turner. Right.
That's why it's so important, getting to what Jim Jordan
has said about a special prosecutor, and that's what my
question is to you today.
If you are truly a man of integrity and you know the
difference between you--you--there's no--that you have--you
don't have any evidence that a crime has been committed versus
you know no crime has been committed, you have to understand
that the whole integrity of your Agency is at risk.
You possibly have people at the IRS who are committing
crimes and they're not being held accountable. The only way you
can know that is to--by pick up the phone, call the FBI and ask
them to come in and do an investigation on the disappearance of
these emails.
So my question to you is: Will you call the FBI and ask
them to come in and investigate these missing emails that their
destruction could possibly have been a crime?
Mr. Koskinen. At this time, the Inspector General, an
independent agency not controlled by us, started an
investigation----
Mr. Turner. They're not a criminal investigating agency.
Mr. Koskinen. They are actually capable of doing criminal
investigations as well as civil. They make recommendations----
Mr. Turner. Will you call the FBI?
Because the integrity of your Agency is absolutely at
stake. It is--we have Lois Lerner having invoked the Fifth in
front of this committee, indicating that she's fearful of
criminal prosecution, which should be enough for you, a man of
integrity, to pause and think, ``Maybe crimes were committed
within my Agency and, now that these emails are missing, maybe
someone not of integrity committed a crime in destroying
them.''
You should call the FBI. You should call for a special
prosecutor.
Mr. Koskinen. I cannot enter into Lois Lerner's mind--I've
never met her--as to what she----
Mr. Turner. I asked you to pick up the phone and call the
FBI, not enter Lois Lerner's mind.
Mr. Koskinen. I am not going to call the FBI. The Inspector
General has started--when the Inspector General has completed
its----
Mr. Turner. Then, that is an issue of your personal
integrity, because the integrity of this Agency and the concern
that Americans have of it is at stake.
Mr. Koskinen. I reject the suggestion that my integrity
depends upon my calling the FBI. The Inspector General will
issue a report. We will all get the benefit of that report, and
then we can determine what the appropriate action is.
Mr. Turner. I have always believed that what happened in
your Agency with Lois Lerner is a crime. I believe that there
were others involved.
I believe the emails that are missing are the ones that
would probably give us an ability to establish that. And I
believe that somebody undertook a criminal act in its
destruction.
And I believe that, since you can't tell me I'm wrong and
it's enough of a doubt in your mind, as the Commissioner of
that Agency, you should call the FBI.
Mr. Koskinen. That's an interesting set of----
Chairman Issa. Gentleman's time has expired.
Mr. Koskinen. --with no facts behind them.
Chairman Issa. Thank the gentleman.
We now go to the gentleman from Massachusetts, Mr. Tierney.
Mr. Tierney. Thank you.
Mr. Koskinen, good evening. And thank you for being here
night.
I don't think I've seen a display of this kind of
disrespect in all the time I've been here in Congress, and it's
unfortunate that anybody would have to be subjected to it.
This is an incredible thing, a public servant being----
Chairman Issa. Would the gentleman yield?
Mr. Tierney. No. I will not yield.
Chairman Issa. Okay. The gentleman will suspend.
Is the gentleman----
Mr. Tierney. No. I won't suspend either. I'm in the middle
of my time----
Chairman Issa. Is the gentleman asking----
Mr. Tierney. --and I will continue to ask questions----
Chairman Issa. The gentleman will suspend----
Mr. Tierney. I won't suspend.
Chairman Issa. Please stop the clock.
The time is suspended.
I would caution all Members not to characterize the intent
or the character of your fellow Members here on the dais.
Mr. Koskinen. But it's fair game to question the integrity
of the witness?
Chairman Issa. With all due respect, the rules of the House
do--excuse me--the rules of the House speak to questioning the
integrity of Members.
I would caution all of us that, while the chair has
questioned the testimony earlier as to whether it was the truth
or the whole truth, that, in fact, to question the motives of
the witness should be done only on evidence.
But to question the motives of your fellow Member is, in
fact, within the rules of the House, an action for which the
floor can take down words.
Mr. Horsford. Mr. Chairman?
Chairman Issa. Yes, of course.
Mr. Horsford. Thank you.
You talk about the rules of the committee and the rules.
Chairman Issa. The gentleman will state his parliamentary
inquiry, please.
Mr. Horsford. Has the chairman violated the rules of the
committee and the rules of the House?
Chairman Issa. Please state your point of parliamentary
inquiry.
Mr. Horsford. When the chairman cut off----
Chairman Issa. If the gentleman will state a point of
parliamentary inquiry.
Mr. Horsford. Has the chairman violated his own rules in
the----
Chairman Issa. That's a question.
Do you----
Mr. Horsford. --in the process of conducting----
Chairman Issa. Do you have a question of parliamentary
inquiry to ask?
Mr. Cummings. May he ask the question, Mr. Chairman?
Chairman Issa. You'll state it as a point of order.
Mr. Cummings. Just let him ask the question, please.
Chairman Issa. I will not.
State a point of inquiry. If not, we will go on.
The gentleman may continue. Mr. Tierney.
Mr. Tierney. I think the understanding is the rules of the
House say that Members should conduct themselves in a way that
reflects credibility upon the House. I think people watching
this hearing today can decide whether or not that's been
followed on that.
Look, I think what you're trying to tell people at one
point is that it's the Inspector General's responsibility to
review this matter and file a report and, in that report, make
recommendations as to what action might be done or, upon
reviewing that report, you or others might make recommendations
of what might be done, such as refer to a--another body like
the FBI or somebody else. Is that correct?
Mr. Koskinen. That's correct.
Mr. Tierney. So we're not even to that point yet.
Mr. Koskinen. That's correct.
Mr. Tierney. I guess, you know, as opposed to shoot and
then aim, we might be trying to first gather some information
and then decide where we go from there. Is that correct?
Mr. Koskinen. Correct.
Mr. Tierney. Have you testified tonight to anything that
was not discussed at last Friday's hearing?
Mr. Koskinen. I'm sorry. What?
Mr. Tierney. Have you discussed tonight with this committee
anything--any matter pertinent to this subject that was not
discussed last Friday?
Mr. Koskinen. Thus far, no.
Mr. Tierney. So just to get it right, you--you were
scheduled to testify originally in front of Chairman Camp's
committee tomorrow, on the 24th. Is that correct?
Mr. Koskinen. That's correct.
Mr. Tierney. Had they been in touch with you or your staff
before scheduling that date?
Mr. Koskinen. Yes. They actually had asked whether I would
be available in the morning on Tuesday, and I was not. Then we
agreed that I would testify in the afternoon.
Mr. Tierney. So you agreed to testify voluntarily?
Mr. Koskinen. I've always agreed to testify voluntarily
over the course of the last 20 years.
Mr. Tierney. So after you discussed and agreed to testify
before Chairman Camp, you received a unilateral subpoena from
Chairman Issa. Is that correct?
Mr. Koskinen. That's correct.
Mr. Tierney. And that subpoena asked you to come here--in
fact, it compelled to you come here tonight?
Mr. Koskinen. Correct.
Mr. Tierney. Did Mr. Issa ever call you and ask you to come
voluntarily?
Mr. Koskinen. No.
Mr. Tierney. Did any of his staff ever call you and ask you
to come voluntarily?
Mr. Koskinen. No.
Mr. Tierney. Did he ever explain to you why it was so
urgent that you come here at 7:00 on Monday night when you were
already scheduled to appear voluntarily before a different
committee of jurisdiction on Tuesday, the 24th, the following
day?
Mr. Koskinen. No.
Mr. Tierney. Now, I won't ask you to speculate, but I think
some might speculate either people don't think that Mr. Camp
could do the job, which I would sort of think is suspect--he's
been known to be a pretty good Member--or that there's some
sort of competition going on here. I don't know. Some might
speculate that.
But when Chairman Camp heard that Chairman Issa had
subpoenaed you for tonight, you were all of a sudden notified
that there was going to be a hearing in Chairman Camp's
committee on Friday of last week. Is that correct?
Mr. Koskinen. That's correct.
Mr. Tierney. How were you notified of that?
Mr. Koskinen. Staff asked if I was avail--would be
available on Friday. They had to get the approval--or agreement
of the minority, since I understand there's a 7-day rule. I
told them that I could make myself available on Friday.
Mr. Tierney. Now, how long did you testify on Friday?
Mr. Koskinen. Total length of the hearing was 4 1/2 hours
with a recess for about 45 minutes in the middle.
Mr. Tierney. I would think that, having testified all that
time on the subject matter, that tonight's hearing might be
somewhat redundant on that. And, so far, it has been. Is that
correct?
Mr. Koskinen. It has similarities to Friday.
Mr. Tierney. And I am looking on this. I think the only
thing that might be different in the sequence of what's going
on is now I understand that Chairman Issa has invited Ms.
Jennifer O'Connor to testify tomorrow.
Do you know Ms. O'Connor?
Mr. Koskinen. I do not.
Mr. Tierney. Do you know whether or not she worked at the
IRS from May to November of 2013?
Mr. Koskinen. I do understand she did.
Mr. Tierney. Now, she left in November of last year. Is
that right?
Mr. Koskinen. That's my understanding.
Mr. Tierney. And that would have been well before there was
any discovery of Ms. Lerner's emails gone missing. Is that
correct?
Mr. Koskinen. That's correct.
Mr. Tierney. Do you know where Ms. O'Connor works now?
Mr. Koskinen. My understanding is she works at the White
House.
Mr. Tierney. So I think some would speculate that maybe
people on this committee think that now trumped Mr. Camp on his
committee and maybe that gets some cameras in the action here,
but nobody would want to speculate like that.
Again, I will just end my questioning here by saying that I
think it's unfortunate that you have to be subjected to this
after having gone through it last Friday, and I hope that
Members will reflect the credibility of the House from here on
in, at least, if hasn't been done so far.
Thank you.
Chairman Issa. I thank the gentleman.
We now go to the gentleman from Tennessee, Mr. Duncan.
Mr. Duncan. Well, thank you very much.
And, first, Mr. Chairman, let me thank you for pursuing
this investigation the way you have because, in a free country,
no individual--no group of individuals should be targeted for
their political beliefs. And, certainly, I think almost
everyone who has looked closely at this feels that that
happened in this situation.
Although, on March 26th, when Mr. Koskinen was here before
us, he said there had been no targeting, just inappropriate
criteria, the Washington Post said Mr. Koskinen fell ``back on
bureaucratese.'' And the Washington Post, of course, is
probably the main defender of the Federal bureaucracy.
And their Fact Checker said that Mr. Koskinen should be
given three Pinocchios for that testimony. And they--in their
classification, three Pinocchios is one Pinocchio under what
they call whoppers.
So I don't know if what the--what his opinion is on that.
But I will say this: All over the country people are saying
that there's one--there's a double standard being applied here.
They're saying there's one standard for everybody else and one
standard for the IRS.
And I can tell you that--you know, I've been following
politics and government ever since I was in high school, and I
can tell you that I believe there's more anger and resentment
and disgust toward the Federal Government today than anytime in
my lifetime because everybody seems to feel today that we've
ended up with a government of, by, and for the bureaucrats
instead of one that's of, by, and for the people.
Mr. Koskinen was given a chance on Friday to apologize on
behalf of the IRS, and he didn't do so. But I can tell you that
I think the people of this country deserve at least an apology
that a different standard has been applied by the IRS than
would be applied to individuals who were having problems on
their taxes.
And this--it seems that every time the Federal Government
screws up, which is often, they always fall back on one or both
of two excuses. They always say they're either underfunded or
their technology is out of date. And, of course, that's what
we've heard today.
But I can tell you the people of this country are sick and
tired of the arrogance within the Federal Government. And this
hearing and others that will follow about this I think will
help assure that this does not happen again.
And so I commend you for it, Mr. Chairman.
And I yield back the balance of my time.
Chairman Issa. Would the gentleman yield?
Mr. Duncan. Yes, sir.
Chairman Issa. I thank the gentleman.
I'd like to go through the question one more time,
Commissioner.
When--you testified that, in fact, you knew there was this
problem when you were here last time, but you didn't know that,
in fact, emails were lost. Is that correct?
Mr. Koskinen. That's correct.
Chairman Issa. But you knew there was a problem. You knew
that there was this sequence problem or numbering problem. Is
that correct?
Mr. Koskinen. Correct.
Chairman Issa. Did you take any steps to find out what that
sequence or numbering problem is? I mean, people tell you
there's a problem. Almost always, at least in my experience as
a CEO, you say, ``Well, tell me about the problem. What does
the problem mean?'' Did you do that?
Mr. Koskinen. No. I asked to be kept updated. There were
200 people working on this issue, and they said they would let
me know. And they did let me know.
Chairman Issa. So there's 200 people working on the problem
of delivering emails?
Mr. Koskinen. Correct.
Chairman Issa. And it took this long to find out that there
were missing ones from Lois Lerner?
Mr. Koskinen. It took until----
Chairman Issa. It's almost a year.
Mr. Koskinen. Well, that's right. From the time there was--
anybody thought there was a problem, it took about 2 months.
Chairman Issa. Okay. So----
Mr. Koskinen. Nobody knew there was a problem last year.
Chairman Issa. But you knew there was this inconsistency
when you came before us.
Mr. Koskinen. Yes. I knew it'd been identified--that a
problem had been identified and was under investigation.
Chairman Issa. Why is it you did not answer when asked a
dozen times, really, on both sides of the aisle, ``Will you
deliver?'' ``We can find Lois Lerner's emails''?
Mr. Koskinen. Right. That was my assumption at the time.
Chairman Issa. But you knew there was some problem with
some part of her emails; you'd been briefed on that?
Mr. Koskinen. But we had no idea--at that time, nobody
understood what the ramifications were, were there emails
that--was it part of the production process.
They ran the whole production process again. They searched
all the files again to make sure that the production process
itself hadn't caused emails to be lost.
So at the time I testified, no one had any idea whether
there were any emails missing or not.
Chairman Issa. Right.
But were you aware when you testified the last time that
there'd been a crash in Lois Lerner's disc drive some years
before?
Mr. Koskinen. When I testified here?
Chairman Issa. Yes.
Mr. Koskinen. No.
Chairman Issa. Were the people reporting to you aware of
that?
Mr. Koskinen. The IT people apparently were. I'm advised
that they knew that--discovered there was an issue with her
computer in late February.
Chairman Issa. Thank you.
We now go to the gentleman from Massachusetts, Mr. Lynch--
Mr. Stephen Lynch.
Mr. Lynch. Thank you, Mr. Chairman.
I do want to raise the issue that, while the IRS is not
held in very high repute these days, neither--neither is the
United States Congress. And I want to thank you for your
willingness to testify.
I would like to refocus on the evidence here. You know, I'm
a little bit surprised at the chronology that Mr. Tierney has
laid out here where you originally were invited by Mr. Camp and
the Ways and Means Committee to testify and then it seems like,
when Mr. Issa found out about that, you were subpoenaed--
unilaterally subpoenaed here to testify before you were going
to testify tomorrow at that other hearing, and then Mr. Camp
jumps in front of him.
And now I have billboards and I had a video clipped up
there earlier. Great showmanship. And I'm just worried I'll
come in here tomorrow, there'll be a 16-piece orchestra to sort
of cap out the show.
That's not the way this is supposed to happen. That's not
the way this is supposed to go down. I think there are some
serious issues here that we have to get to. But all of this
fanfare, all of this showmanship, is clouding it over.
I think we're doing a disservice to the people that we
represent, and I think we are failing greatly in meeting the
high expectations of the American people. I think that's
probably an understatement.
I would like to focus on the evidence. And going back to
the heart of this issue, we did have a situation where there
was evidence and an admission on the part of the IRS that they
were using search terms such as ``Tea Party,'' ``patriots,''
``9/12 Project,'' in terms of be on the lookout for--for groups
that were applying with those characteristics.
They also were looking for any issues in an application
that included government spending or government debt or taxes.
They were also looking for statements in the case file
criticizing how the country was run.
That's evidence. When the IRS goes after citizens of the
United States because of this criteria, that is evidence of
their state of mind. That is relevant evidence.
Now, that's not all they looked for. They also looked for
any search terms regarding progressives or these emerge groups,
which were also very progressive groups, 501(c) applications.
They also went after any successor organizations to ACORN
because they were highly progressive.
So there was--there was a widespread--it's not just going
after conservative groups, but it's--it's going after American
citizens who have various political views. And that is
evidence. That's hard evidence.
Would you agree?
Mr. Koskinen. They're evidence. Exactly.
Mr. Lynch. Right. Okay.
So when these emails go missing for 27 months on Lois
Lerner's account, you realize how that--that just feeds into
the suspicion that there's something going on here?
Mr. Koskinen. I understand that. That's why I think it's
important to understand we were able to find 24,000 emails in
that period.
Mr. Lynch. I know what you found. I appreciate that. And I
think you went at it legitimately and honestly.
Let me ask you: When the--when Mr. Russell, the IG for the
IRS--when he looked at it, he was looking at the search term
issue for us.
Did he look at the other issue of the missing emails? Did
he do any of that or was that known to him?
Mr. Koskinen. It was not known to anyone at that time.
Mr. Lynch. So we didn't look at that.
Mr. Koskinen. Pardon?
Mr. Lynch. We didn't look at that.
Mr. Koskinen. The IG, to my understanding, did not look at
that. He has started an investigation of that now.
Mr. Lynch. Okay. Well, I think that's--that's something we
might want to revisit, then.
Do you think that it would be worthwhile to have the
Inspector General go back and look at the way these emails went
missing?
And I also know that there are some allegations--unfounded
allegations about six other employees about their emails going
missing.
Mr. Koskinen. He should look at it and he is looking at it.
I expect that, when they complete that investigation, they'll
provide a report to the public, us, and this committee and
other investigators.
Mr. Lynch. Okay. My time has expired.
I yield back.
Chairman Issa. Thank you.
The gentleman just said it was unfounded. Are there other
drives that led to other emails not being available, to your
knowledge?
Mr. Koskinen. At this point there aren't. We noted last
week--I had asked--because I said in my testimony in May, as we
were finally getting our arms around Lois Lerner--I said could
we look at the other 82 custodians and determine whether there
are other hard drives that would affect this.
As I noted, we now have found several custodians. It is not
clear what emails, if any, were lost. Again, that was part of
what we had hoped to complete in our full review of all of
this, at which point we would have provided you with that
information.
Chairman Issa. Okay.
Mr. Koskinen. As we find it----
Chairman Issa. So we don't know today about others. There
may be others because there were other crashes.
Mr. Koskinen. There may be others. Yes. We have provided
information on what we know. We just learned about that last
Monday.
Mr. Lynch. Just a follow-up on that?
Chairman Issa. Of course.
Mr. Lynch. I'm trying to remember her name. Nikole Flax.
There was a story last week that her emails were missing.
Have we made any progress on trying to figure out her
email----
Chairman Issa. I think that was cleared up, that it was
just one of her two computers.
Mr. Lynch. Are her emails missing?
Mr. Koskinen. There's no evidence now any email is missing.
Mr. Lynch. Okay. Thank you.
Chairman Issa. Thank you.
I now ask unanimous consent that the 141-page staff report
from April 7, 2014, be placed in the record. Without objection,
so ordered.
The title of it is ``Debunking the Myth that the IRS
Targeted Progressives.''
Chairman Issa. We now recognize the gentleman from North
Carolina, Mr. McHenry.
Mr. McHenry. Mr. Koskinen, there's a lot of discussion, and
you've been through multiple hearings related to this Lois
Lerner targeting of conservative groups.
Do you understand what the fuss and fury is about this
week? Do you understand the reason why many folks are really
upset about this?
Mr. Koskinen. I understand, having been around Washington
in a long time.
Mr. McHenry. Yeah. I mean, you've had a long career.
Mr. Koskinen. And one of the reasons we've taken it
seriously is that, if there has been a hard drive crash and
emails disappear, that's a matter that should be reviewed.
As I say, we've provided all the information we have about
the emails and, in fact, it appears that Ms. Lerner was working
very hard to retrieve the emails, not to lose them.
Mr. McHenry. But you had the ability to share with Congress
in realtime and share with the American people in realtime what
you were finding.
Why didn't you do that?
Mr. Koskinen. Because my judgment was that what we should
do is produce all of the information when we had it and not
dribble it out. We actually provided----
Mr. McHenry. Even if that meant along the way people are
questioning how you answered Congressional inquiries?
Mr. Koskinen. We answered a Congressional inquiry
completely and totally----
Mr. McHenry. No. I understand that.
But, for me, this is really not about you. It's not about
anybody up here on the dais. It's not about a hearing. It's
about the American people.
Your Agency sends fear up the spines of every American when
you contact them. And if there's one receipt missing, a small
business person goes--searches far and wide for that one last
receipt.
And, yet, we have evidence that--and you've testified that,
you know, Lois Lerner's hard drive crashed and that, you know,
erased emails from January 2009 to April 2011, just the time
period that Congress was most concerned about with the
targeting of conservative and Tea Party groups.
So, look, I mean, I understand. And you can answer very
reasonably. But when you see that type of thing happen, it
almost defies anyone's sense of capacity that that could
happen.
Mr. Koskinen. Congress is very interested in what happened
from April of 2011 until May of 2013. And we have produced all
of those--or are in the process of producing all of those
emails.
So we have significant amounts of emails----
Mr. McHenry. I understand.
Mr. Koskinen. --not lost that we determined from Lois
Lerner email--43,000 unlost Lois Lerner emails. Plus, we've
been able to find another 24,000.
But the point, I think, is important, as I have said. The
question is: In the period in which we found the 24,000, what
are the emails that she sent outside the Agency that would not
be reflected in anybody's accounts and----
Mr. McHenry. Right. And how are they going to magically
come forward.
The other thing----
Mr. Koskinen. They are going to come forward because the
White House and Treasury have provided this committee and other
committees a response to those emails----
Mr. McHenry. So that means she didn't email outside the
White House or Treasury.
Mr. Koskinen. Pardon?
Mr. McHenry. That means she didn't email outside of the
White House or Treasury.
Okay. But the point about this----
Mr. Koskinen. I'm sorry. But that's what I thought was a
big issue, was whether, in fact, this was all part of her----
Mr. McHenry. It is. But it's not the question I'm asking
you, sir.
Mr. Koskinen. I'm sorry. Go ahead.
Mr. McHenry. And I've been very respectful of your time and
giving you an opportunity to answer.
Mr. Koskinen. I appreciate that.
Mr. McHenry. So the reason why I'm asking this question is
I just want you to be able to convey to the American people
that running the IRS, a very frightening Agency--right?--a very
frightening Agency for my constituents at home, that you get
it, that you understand why the American people look at this
and say, ``This is so far beyond my ability to reason. An
Agency that has a more than billion-dollar--nearly $2-billion
IT budget lets a hard drive crash.''
It just seems absolutely ridiculous and beyond
comprehension that this would happen in such a convenient
context and, yet, we have Lois Lerner, who's been a major focus
of this inquiry--and she's the one who's searching desperately
to make sure that we recover her hard drive that may
incriminate her. We won't know, though, because this has been
recycled.
So I'll yield the balance of my time to Mr. Jordan.
Mr. Jordan. I thank the gentleman.
I just have one question in the few seconds we have.
What date did you learn that you could not get all of her
email?
Mr. Koskinen. I learned that in April. I don't recall when.
Mr. Jordan. You don't know the day?
Mr. Koskinen. I do not know the day.
Mr. Jordan. Early April?
Mr. Koskinen. I have no recollection.
Mr. Jordan. Mid-April?
Mr. Koskinen. April.
Mr. Jordan. Your--well, Mr. Chairman, I'll yield back the
time. Wait for my 5 minutes. Thank you.
Chairman Issa. Would the gentleman yield?
Mr. Jordan. Be happy to.
Chairman Issa. You only know within a month? Could you
provide the committee with some evidence from the calendar that
would indicate what day you were briefed?
Mr. Koskinen. I'd be delighted to. There's going to be
nothing on my calendar that shows that, but you can look at the
entire month of my calendar----
Chairman Issa. Well, but who briefed you?
Mr. Koskinen. Pardon?
Chairman Issa. Who told you that email had been lost?
Mr. Koskinen. I don't recall who. I've addressed all of the
people doing the work. I've talked to people as it goes along.
There's not a----
Chairman Issa. Okay. So your testimony today is you don't
remember the name of the person that told you sometime in
April----
Mr. Koskinen. All I know is that by--sometime in April I
was aware, A, that there had been emails lost, B, that we were
reconstituting emails to the extent we could from other
custodians. And by mid-May, we were able to determine----
Chairman Issa. But you don't remember the name of the
people who told you that?
Mr. Koskinen. I do not remember when I was told or by whom.
I just know it was that time frame.
Chairman Issa. Okay. ``I don't remember'' is an answer.
We now go to the gentleman from Virginia, Mr. Connolly.
Mr. Connolly. Thank you, Mr. Chairman.
I'd ask unanimous consent that an article dated July 4,
2013, by Jonathan Weisman of the New York Times, taking direct
issue with your staff report that you entered it into the
record with unanimous consent, be entered into the record at
this time.
Chairman Issa. Would the gentleman state the date of that
article, please.
Mr. Connolly. Yes. July 4, 2013.
Chairman Issa. So somebody disputes my April 7, 2014, with
a July 2013 article?
Mr. Connolly. Mr. Chairman, he kind of lays out a pretty
good case. But I think it should be in the record just like
your staff report.
Chairman Issa. I certainly think that it's fine for
somebody to determine almost a year ahead of a report that the
report is invalid.
Without objection, so ordered.
Mr. Connolly. I thank the chair for his courtesy.
Mr. Koskinen, from your testimony, the IRS does not permit
all of its 90,000 employees to store all of their email in
their active inboxes. Is that correct?
Mr. Koskinen. That's correct.
Mr. Connolly. Why is that?
Mr. Koskinen. Because we do not have the server capacity to
absorb all of those emails.
Mr. Connolly. Why don't you have the server capacity to
absorb all those emails?
Mr. Koskinen. Because of the expense.
Mr. Connolly. What would be the cost of expanding that
capacity?
Mr. Koskinen. The estimate made when the IRS considered
expanding or--its system was it would cost somewhere between
10- and $30 million. That was an estimate 2 years ago.
Mr. Connolly. Okay. IRS employees instead move their emails
when they want to store into archive files on their hard
drives. Is that correct?
Mr. Koskinen. That's correct.
Mr. Connolly. Would one alternative be the cloud?
Mr. Koskinen. There's no way of the emails on the IRS go
into the cloud at this time.
Mr. Connolly. Why?
Mr. Koskinen. Because we're very sensitive to security of
taxpayer information. And so, thus far, the IRS has not moved
any information to the cloud, although my understanding is that
the IDT department continues to look at that issue.
Mr. Connolly. Hard drives crash especially in older
computers. Industry experts say that businesses should replace
their employees' computers every 3 to 4 years. Is that correct?
Mr. Koskinen. That's the general industry standard.
Mr. Connolly. And how often does the IRS meet that
standard?
Mr. Koskinen. We refresh them over time. Sometimes it takes
as long as 5 to 7 years.
Mr. Connolly. So could part of the problem be we're dealing
with an aging set of PCs in IRS because we haven't invested in
new equipment?
Mr. Koskinen. There's no doubt about that. As I noted on
Friday, we have thousands of employees still running Windows
XP. We're trying to move on to Windows 7. Windows XP is no
longer supported by Microsoft.
Mr. Connolly. Well, surely this concern we have up here
with hard drives crashing and emails not being properly
archived or stored and all kinds of other problems and given
precisely the sensitivity of the data that the IRS possesses--
surely the Congress has provided an investment portfolio, a set
of resources for you to quickly update your computer
technology--your information technology in the IRS. Is that
correct?
Mr. Koskinen. We are provided significant amounts of money,
but significantly less than we need.
Mr. Connolly. Has your budget gone up or down in the last
4----
Mr. Koskinen. Budget has gone down regularly every 4 years.
Mr. Connolly. How much has your budget declined?
Mr. Koskinen. Budget has declined over the last 4 years
$850 million. The number of taxpayers has gone up by 7 million.
And we've been asked to implement the Foreign Account Tax
Compliance Act and the Affordable Care Act.
Mr. Connolly. Your budget's gone down $800 million in real
dollars?
Mr. Koskinen. Yes.
Mr. Connolly. Nominal dollars, not including index for
inflation?
Mr. Koskinen. That's right. That's the actual dollar
number.
Mr. Connolly. Huh. That's amazing, given our concern, that
we wouldn't be providing you with resources to try to turn this
around and make sure this kind of thing doesn't happen again.
Mr. Koskinen. The House mark for this year's upcoming
fiscal year 2015 cuts us by another $350 million.
Mr. Connolly. $350 million in one fiscal year?
Mr. Koskinen. Yes.
Mr. Connolly. Well, surely that will change in light of our
deep and profound concern for what happened to Lois Lerner's
hard drive.
Mr. Koskinen. We have high hopes.
Mr. Connolly. Well, surely you've been called to these
midnight sessions to try to see what help you need, right,
you've been asked?
Have you been subpoenaed or voluntarily requested before
any committee of the House of Representatives to testify as to
what your needs are and why the $350-million cut on top of an
$800-million cut in the last 4 years might do to your Agency?
Mr. Koskinen. I've testified before the House
Appropriations Subcommittee, and we have provided updated
information to the House and Senate appropriators about the
negative impact of a $350-million cut.
Mr. Connolly. And there are----
Chairman Issa. Gentleman's time has expired.
Mr. Connolly. And their heart bled for you, undoubtedly.
Thank you, Mr. Koskinen.
Chairman Issa. I thank the gentleman.
Mr. Mica. Mr. Chairman?
Chairman Issa. For what purpose does the gentleman seek
recognition?
Mr. Mica. A quick unanimous consent request.
I'd like entered in the record without objection, if I may,
the Reason magazine article from the weekend of June 21st that
IRS had a contract with email backup service from vendor
Sonasoft starting in 2005.
And then I'd like to also put in the record the motto of
Sonasoft from an email they have, which said: If the IRS uses
Sonasoft products to back up their services, why wouldn't you
choose them to protect their services?
And then they had this service--way to have a second--a
third article. The Daily Caller on June 21st, this weekend,
said Sona--it's an article that cites Sonasoft 6 years'
relationship with IRS came to an abrupt close at the end of
fiscal year 2011 as Congressional investigators began looking
into IRS conservative targeting scandal.
Chairman Issa. Without objection, it will all be placed in
the record.
With that, we go to the gentleman from Ohio, Mr. Jordan.
Mr. Jordan. I thank the chairman.
Mr. Koskinen, I want to go to your testimony. IRS in
February of 2014 identified documents indicating Ms. Lerner had
experienced a computer failure in 2011.
In mid-March 2014--again, your testimony--the IRS focused
on Lerner email for production. During this review, i.e.,
during the mid-March review, the data stored on her computer
hard drive was determined at the time to be unrecoverable.
So mid-March you knew the data was unrecoverable. Late
March you came in front of this committee and did not tell us
that--you didn't tell us her computer failed. You didn't tell
us, ``We can't recover emails.'' You said, ``We're going to
give them all to you.'' Fine.
Your testimony is, you know, ``I was still checking. I
wasn't quite sure we'd lost them all. Even though the IT
professionals said we lost them all, I wasn't quite sure.''
Last round, I just asked you when did you learn and you said
sometime in April.
Mr. Koskinen. Correct.
Mr. Jordan. I want to focus on when you did officially
learn, according to definition.
The chairman asked you who told you this information. You
can't remember?
Mr. Koskinen. No. I do not remember.
Mr. Jordan. Did someone tell you in person? Did they send
you an email? How did you get the information?
Mr. Koskinen. I don't recall. I do not get emails on these
subjects. So I'm sure--I'm sure it was someone in person.
Mr. Jordan. Someone in--this has been a major news story
for the last 13 months and you don't remember who came up to
you and said, ``Hey, boss, we lost Lois Lerner's emails?'' You
don't even remember anything about that situation?
Mr. Koskinen. I remember being told in April.
Mr. Jordan. You don't remember who told you?
Mr. Koskinen. I do not recall who told me. No.
Mr. Jordan. Something that's been a front-page story, you
would think that would be significant enough to remember how it
happened, when they told you, what the actual date was.
Mr. Koskinen. Got to remember----
Mr. Jordan. You might even remember where you were
standing.
Mr. Koskinen. Remember, I'm running an Agency with 90,000
people. We are dealing with all----
Mr. Jordan. This has been the biggest issue in front of
your Agency for the last year.
Mr. Koskinen. We're in the middle of filing season as all
this is going on.
Mr. Jordan. Okay. So here we go. Here we go.
So you find out sometime in April. You don't know who told
you.
What did you do then?
Mr. Koskinen. I was advised--I didn't do anything. I was
advised that they were reconstituting as many emails as they
could from other----
Mr. Jordan. No. No. No.
Who did you tell? Did you tell the White House?
Mr. Koskinen. I never told the White House.
Mr. Jordan. Politico reports you told the White House in
April.
You didn't tell anyone at the White House?
Mr. Koskinen. I don't think that's what Politico reported
Mr. Jordan. Did you tell anyone at Treasury? Did you tell
any of your bosses? Did you tell the Treasury Secretary?
Mr. Koskinen. I did not tell anybody at Treasury either.
Mr. Jordan. Did you talk to anyone about this?
Mr. Koskinen. No.
Mr. Jordan. Talk to anyone outside the Agency about when
you----
Mr. Koskinen. Not outside the Agency. I talked in the
Agency about it. I get the----
Mr. Jordan. When did you tell Congress?
Mr. Koskinen. Pardon?
Mr. Jordan. When did you tell Congress?
Mr. Koskinen. We produced the public report 10 days ago.
Mr. Jordan. So you knew in April and you waited 2 months to
tell this body----
Mr. Koskinen. Correct.
Mr. Jordan. --the body that's been looking into this?
Why did you wait so long?
Mr. Koskinen. Because we actually were going to wait until
we produced all of Lois Lerner's emails----
Mr. Jordan. No. No. No. No.
Mr. Koskinen. --had reviewed all the----
Mr. Jordan. No. No. No.
Mr. Koskinen. I'm telling you.
Mr. Jordan. Hey. Hey. Hey. You can't give us all her
emails. You done lost some. So don't give me that statement.
Mr. Koskinen. Can I give you an answer?
Mr. Jordan. I want to know why you didn't tell us you had
lost some of her emails. Because that's what we care about.
Mr. Koskinen. Can I give you the answer?
Mr. Jordan. Sure.
Mr. Koskinen. All right. Our program was to complete the
production of all Lois Lerner emails, complete the review of
all custodians, and provide----
Mr. Jordan. But it's kind of important, Mr. Commissioner,
to tell us when you lost emails for the person that we're
focused on, don't you think?
Let me ask you this. Let me ask you a more important
question.
Did you tell the Justice Department?
Mr. Koskinen. No.
Mr. Jordan. Why not? There's a criminal investigation going
on. Don't you think that's a pertinent fact that they'd like to
know?
Mr. Koskinen. We have no evidence that there's any criminal
violation involved.
Mr. Jordan. I didn't ask you that.
There's a--the President of the United States said on May
15th, ``We've got to get to the bottom of this.''
The Attorney General said, ``We're going to do everything
we can to find out what happened here.''
And you have information you still--have you talked to the
FBI at all?
Mr. Koskinen. I have never talked to the FBI about it.
Mr. Jordan. Don't you think it's incumbent upon the
Commissioner of the Internal Revenue Service when he gets a--
think about this. Think about the average citizen out there.
FBI is investigating some citizen and they lose documents
over a 2-year time period that are crucial, critical, to the
investigation and they say, ``You know what? We're not going to
tell the FBI'' and then the FBI learns later. Do you think that
person's in trouble? Heck, yeah, they are.
But you as a--you said, ``I don't need to tell anybody.''
You didn't tell--did you tell the Inspector General?
Mr. Koskinen. We issued a public report----
Mr. Jordan. No. No. No. No.
Back in April. You told us just a few minutes ago you
learned in April.
Mr. Koskinen. In April.
Mr. Jordan. Did you tell the Inspector General in April
that you lost Lois Lerner email?
Mr. Koskinen. No. Because we didn't know how many--whether
we'd lost any. We were----
Mr. Jordan. How long were you--here's what I'd like to
know.
If you wait--you waited 2 months to tell anyone. At what
point does it become obstruction of justice? 3 months? 4
months? 2 weeks?
When you got that kind of critical information, you say,
you know, ``I'm going to hang on to this. We got to wait and
make sure we can spin this better, do''--whatever it was.
The fact that you--you didn't tell us and we've been after
this for 13 months. We subpoenaed 6 months ago for this.
You had a hearing on the 26th where everyone on this dais
went after you and said, ``We want all the emails.'' And you
assured us you'd get them all to us, and then you learned you
can't.
And you don't tell anybody? And you give us a report that
you sent to Senator Hatch and Senator Wyden. And on page 9 of
some report you say, ``Oh, by the way''----
Mr. Koskinen. Actually, I have the report.
Mr. Jordan. --``we lost the emails.''
Mr. Koskinen. It starts on page 5. It's half of the 7-page
report.
Mr. Jordan. Page 5. Imagine. I'd like for you to tell us,
not send us in some 37-page document on page 5 on a Friday
afternoon, for goodness sakes.
Mr. Koskinen. It's a 7-page document.
Mr. Jordan. 7-page document on page 5.
This is ridiculous, Mr. Chairman, that we did not know this
when he first knew and that he almost knew everything on the
26th and wouldn't tell us--wouldn't tell us the computer
crashed, wouldn't tell us, ``We think we might have lost them
all. We're not quite sure. We're 99 percent sure.'' And he
wouldn't tell us and then waits 2 months before he does.
Ridiculous.
I yield back.
Chairman Issa. Thank the gentleman.
For the record, Ways and Means Committee referred four
criminal charges to Justice against Lois Lerner months ago.
Ms. Speier.
Ms. Speier. Mr. Chairman, I implore you to enforce the
rules of this committee. Rule XI(k)(4) asks that you control
this committee, that we operate with decorum and
professionalism and order.
Badgering witnesses is inappropriate and shameful for this
committee to conduct itself in that manner. And I would implore
you in the future to rely more heavily on this rule.
I would now like to ask unanimous consent----
Chairman Issa. Is the gentlelady making a motion?
Ms. Speier. No. At this point I just want us to get back to
basics and to run this committee as it should be run, with
respect and decorum.
And badgering this Commissioner, as virtually every Member
on the Republican side has done, is shameful. And it's got to
stop----
Mr. Jordan. Mr. Chairman?
Ms. Speier. --or else I'm telling you one Member here is
going to walk out and not return.
Mr. Jordan. Mr. Chairman?
Chairman Issa. It's the gentlelady's time.
Ms. Speier. And I'm not yielding.
Mr. Jordan. Would the gentlelady yield?
Ms. Speier. No. The gentlelady is not yielding.
Mr. Jordan. Gentlelady please yield?
Ms. Speier. I'm sorry. I didn't hear you.
Mr. Jordan. I said would the gentlelady please yield?
Ms. Speier. That was better. But, no.
Mr. Chairman, I would like unanimous consent to put into
the record the Democratic staff report of May 6, 2014, ``No
Evidence of White House Involvement or Political Motivation in
IRS Screening of Tax Exempt Applicants.''
Chairman Issa. Absolutely. Without objection, so ordered.
Ms. Speier. All right. Thank you.
Commissioner Koskinen, why you are serving our country at
this point in time is beyond me. But thank you on behalf of all
of us.
Because you are a sterling example of what we do need in
this country in government, and that is someone who knows
exactly what they're doing, is not going to be bullied, and is
going to state the facts as they see them.
Now let us start from the very beginning in this time line.
Based on the emails we have obtained, Ms. Lerner's hard
drive crashed on June 13, 2011. Is that not so?
Mr. Koskinen. Yes.
Ms. Speier. All right. June 13, 2011.
Her first indication--the first time she was informed by
IRS employees in Cincinnati that they were using inappropriate
search terms did not happen until after her computer crashed.
Is that not true?
Mr. Koskinen. That's correct.
Ms. Speier. And what date was that?
Mr. Koskinen. That is a week or two thereafter. I don't
know----
Ms. Speier. It was June 29, 2011.
So June 13 it crashes. June 29th she is informed that they
may be using inappropriate search terms.
And the Congressional investigation and the Inspector
General's audit also did not start until after the computer
crashed. Is that correct?
Mr. Koskinen. That's correct.
Ms. Speier. So I just want to make sure I have this clear.
Ms. Lerner's computer crashed before she was informed that
the IRS employees in Cincinnati were using inappropriate search
terms and before there was no Congressional or Inspector
General investigation?
Mr. Koskinen. That's correct.
And we also have emails from April 11 in 2011 forward.
Because, apparently, she archived materials on her hard drive,
but kept emails in her email account which did not go down with
her hard drive.
Ms. Speier. Along with my colleague to my left, who was
talking about the system that exists now, when you archive in
the IRS right now because you don't have the data ability
because you don't have the $30 million invested, you actually
have to print emails.
It has to be determined that an email is appropriate and
necessary to be archived and it has to be printed. Is that
correct?
Mr. Koskinen. That's correct.
Ms. Speier. That's how archaic it is.
All right. So let's move on to the hearing last Friday.
Some of the Republican Members there sprung a document on
you that you had not reviewed beforehand. They argued that
Chairman Camp had sent a letter to the IRS on these exact
issues 10 days before Ms. Lerner's computer crashed and,
therefore, as Representative Roskam said, Chairman Camp sent a
letter on this whole issue and then 10 days later--so think
about the duration of 10 days. 10 days is the ability to panic
within the IRS, reflect, plan, talk, and execute. And there was
a crash 10 days after the chairman's letter.
Now, I have a copy of the chairman's letter here. You've
probably had an opportunity to review it. June 3, 2011. And, as
I understand it, the question that was asked by the chairman of
the Ways and Means Committee to the then-Commissioner was
whether donations to a 501(c)(4) were taxable gifts and if a
gift tax return should be filed.
So there already is law that says and asserts the
applicability of gift taxes to 501(c)(4) donations. And in his
own letter he says it's unsettled area of tax law, but he
further notes that it has been applied in some cases.
Is that not what the gist of that letter was all about?
Mr. Koskinen. That is correct. It was about the application
of the gift tax laws to (c)(4) organizations.
Ms. Speier. All right. So the letter had nothing to do with
the issue of 501(c)(4)s and inappropriate terms being used to
identify certain organizations?
Mr. Koskinen. It did not mention inappropriate terms at
all, as far as I recall.
Ms. Speier. All right. I yield back.
Chairman Issa. I thank the lady for yielding back.
We now go to the gentleman from Utah, Mr. Chaffetz.
Mr. Chaffetz. I thank the chair----
Chairman Issa. Would the gentleman hold off on the time. I
apologize.
I'd like to ask unanimous consent so that it's in with Ms.
Speier that the June 16, 2014, majority staff report be placed
in the record. Without objection, so ordered.
Chairman Issa. It is titled ``How Politics Led to the IRS
to Target Conservative Tax Exempt Applicants for Their
Political Beliefs.'' I think it'll go well with the minority
report.
Ms. Speier. Mr. Chairman, can I----
Voice. This is going to be some record.
Chairman Issa. It is going to be some record.
Actually, Mr. Commissioner, we looked at the Rule XI, and
it turns out what was cited was the audio-video in proceedings.
So we're going to have to figure out how that applies, too.
Ms. Speier. Rule XI(k)(4), Mr. Chairman.
Chairman Issa. That's what we're looking at.
Ms. Speier. Mr. Chairman, could I ask that this letter from
the Chairman of Ways and Means to Doug Schulman be----
Chairman Issa. Of course. That will be placed in the
record.
Mr. Chaffetz is recognized.
Mr. Chaffetz. Thank the chairman.
My understanding is that the backup of emails was only--
only lasted for 6 months. Is that correct?
Mr. Koskinen. Yes. It's actually a disaster recovery
system, and it backs up for 6 months in case the entire system
goes down.
Mr. Chaffetz. And that was in place in 2011?
Mr. Koskinen. That was the rule in 2011, policy.
Mr. Chaffetz. So when Lois Lerner figured out on June 13
that her computer crashed and you've--there have been emails
showing that she was going to great lengths to try to get that
recovered, why didn't they just go to that 6-month tape?
Mr. Koskinen. Because that 6-month tape is a disaster
recovery tape that has all of the emails on it and is a very
complicated tape to actually extract emails for.
But I have not seen any emails to explain why they didn't
do it. So I--it would be difficult, but I don't know why they
didn't.
Mr. Chaffetz. But you said that the IRS was going to
extraordinary lengths to give it to the recovery team.
Mr. Koskinen. That's correct.
Mr. Chaffetz. Correct?
Mr. Koskinen. That's correct.
Mr. Chaffetz. But it's backed up on tape?
Mr. Koskinen. For 6 months. Yes.
Mr. Chaffetz. And that was within the 6-month window.
So why didn't you get them off the backup?
Mr. Koskinen. All I know about that is that the backup
tapes are disaster recovery tapes that put everything in one
lump and extracting individual emails out of that is very
costly and difficult and it was not the policy at the time.
Mr. Chaffetz. Did anybody try?
Mr. Koskinen. I have no idea--indication that they did.
Mr. Chaffetz. So you have multiple emails showing that she
was trying to recover this.
The testimony of the IRS that they were trying
desperately--in fact, you got a forensic team to try to extract
this. You went to great lengths. You made a big point over the
last week about all the efforts you were going through.
But they were backed up on tape and you didn't do it?
Mr. Koskinen. As far as I know, they did not. But they did
have, as I noted the email, she had 3 months' worth of emails
at that time going from April--or 2 months from April to----
Mr. Chaffetz. That would have been fortuitous with the 6-
month month backup available.
And we need to explore this, Mr. Chairman.
Did I hear you right in the answer to Mr. Lynch, that when
the Treasury Inspector General was doing their work, that they
were unaware that her email had crashed?
Mr. Koskinen. This is last summer?
Mr. Chaffetz. No. The question that Mr. Lynch just asked
here.
Mr. Koskinen. Yeah. He asked whether the Inspector General,
when they did their review of the determination process, was
aware that her email had cashed.
And I said I do not think they were, I wasn't around at the
time.
Mr. Chaffetz. So the Inspector General is trying to get to
the bottom of this matter, and nobody informs them that her
computer had crashed and there were emails lost?
Mr. Koskinen. Not to my understanding. No. I'm not----
Mr. Chaffetz. Were they withholding information from the
Inspector General?
Mr. Koskinen. I wasn't there. I don't know what--the
Inspector General has access to all emails. He has access to
any records he would like. And I have no indication that
anybody did not provide him all of the records.
Mr. Chaffetz. Did they ask for the Lois Lerner emails?
Mr. Koskinen. I have no idea. I was not there then.
Mr. Chaffetz. Do you think it's unreasonable for us to ask
that question?
Mr. Koskinen. I beg your pardon. You can ask the Inspector
General. That would be fine.
Mr. Chaffetz. We plan to.
June 3, 2011--I am glad you brought this up, because Dave
Camp did ask on page 2 the names, titles, and divisions and/or
officers of any and all individuals who were involved or
contributed to the decision to investigate whether taxpayer
contributions to 501(c)(4) organizations should be subject to
gift rules.
It goes on and talks about--actually, before that,
organizations will trigger an IRS audit based on the political
activities of an organization.
May 14--that was in 2011. He's asking for all these emails.
Why wasn't it brought to the attention of the committee
that all of her emails were not available back then?
Mr. Koskinen. At that time?
Mr. Chaffetz. Yeah.
Mr. Koskinen. I have no idea. I was not there at that time.
Mr. Chaffetz. May 14, 2013, also asked for those emails.
Didn't get a response.
You have a--you have a subpoena from the United States
Congress. And I recognize you personally weren't there. But I
don't understand why the IRS wasn't diving into this to figure
out--this is August of 2013. This committee issues a subpoena
asking for her emails.
It was known years before that some of her emails were
gone. Correct?
Mr. Koskinen. Yes. Obviously, people knew in 2011 that
there had been a crash.
Mr. Chaffetz. When you came and testified on March 26, did
you know or should you have reasonably known that you did not
have all of her emails?
Mr. Koskinen. I did not know.
Mr. Chaffetz. Did you think you had all the emails?
Mr. Koskinen. At that point, my understanding was that they
were reviewing the entire process to find out where the emails
might be. I had no idea whether we had more or less.
Mr. Chaffetz. So you didn't know if we had them all?
Mr. Koskinen. At that time.
Mr. Chaffetz. At that time, March 26.
Mr. Koskinen. All I knew was that they were investigating
and we were going to provide all the emails we have. And that's
what we're in the process of doing.
Mr. Chaffetz. But did you or did you not know that you had
all the emails?
Mr. Koskinen. I did not have any idea one way or the other.
Mr. Chaffetz. Then, why did you say, ``We can find''----
Mr. Koskinen. Lois Lerner's emails. And we did find them
and we are producing them.
Mr. Chaffetz. Did you find all--what percentage of them?
Are we supposed to ask you what percentage? I mean, is that
not clear what I asked you----
Mr. Koskinen. At that point, I would have told you we're
going to give you 100 percent of the emails we have, and that's
what we're going to do.
Mr. Chaffetz. Now you're qualifying.
You had reason to know--for years you had reason to know--
--
Mr. Koskinen. I haven't been there for years. I've been
there for 5, 6 months.
Mr. Chaffetz. You had reason to know--this is a hot
investigation. You had reason to know that there was a problem,
and you did nothing to indicate there was a problem. Correct?
Chairman Issa. Gentleman's time has expired.
You may answer.
Mr. Koskinen. Pardon?
Chairman Issa. You may answer.
Mr. Koskinen. Yes. I did not indicate at that time because
I did not know the nature of the problem.
Mr. Chaffetz. But you thought that there might be a
problem.
Chairman Issa. Gentleman's time has expired.
Mr. Chaffetz. If the chairman--if he will please answer
that question.
Did you or did you not think that there was a problem?
Chairman Issa. The gentleman's time has expired.
Commissioner, you may answer that last question.
Mr. Koskinen. No. I have testified before that, at that
time, I did not know the nature of the problem. All I knew,
there was a question being investigated.
Chairman Issa. I thank the gentleman. And I apologize, but
time is up.
We now go to the gentlelady from Illinois, Ms. Duckworth.
Ms. Duckworth. Thank you, Mr. Chairman.
Mr. Commissioner, good to see you here. Thank you for
coming on such short notice.
You know, it's really amazing to me to read that IRS
requires employees to print and file emails that they decide
are relevant to the official record or that the IRS does not
necessarily think that all emails are part of the official
record that's relevant to the Federal Records Act.
Email is critical, and I really feel like it's absolutely
unacceptable that a government Agency with such a critical
public mission cannot produce emails requested during an
investigation.
But what's troubling to me is that this is not an issue
with just the IRS, but is, in fact, government-wide. It's also
not just with this administration.
I'm looking at a report--a GAO report from the--that is
entitled ``National Archives and Selected Agencies Need to
Strengthen Email Management,'' dated June of 2008, that
basically addresses the inadequate email preservation
procedures across government.
And, Mr. Chairman, I'd like to ask unanimous consent that
this report be inputted into the record.
Chairman Issa. Without objection, so ordered.
Ms. Duckworth. Thank you.
Mr. Commissioner, I'd like to hear what steps you've taken
or plan to take to ensure better electronic records-keeping at
the IRS going forward.
Mr. Koskinen. Long before this arose, I asked earlier this
spring when I arrived for us to take a look at what it would
take to develop an email system that was much easier to search.
Right now, as I've noted, if you want to see anything from
90,000 employees, you've got to go to 90,000 hard drives.
I was told more recently that we had looked at creating, in
effect, a broader-based server that would allow us to preserve
emails, and that's the 10- to $30-million cost. We are
reviewing that.
We are also going to review whether we can move for the
National Records Act from a paper system to an electronic
system, but that's part of the upgrade of the email system.
Ms. Duckworth. Thank you.
On June 17, the National Archives and Records
Administration sent a letter to the Office of Records and
Information Management at the IRS regarding the loss of Ms.
Lerner's emails. Is that correct?
Mr. Koskinen. That's my understanding. I have not seen the
letter.
Ms. Duckworth. Okay. So what they--what they're required to
do, the National Archives and Records Administration, is
required to request a report of investigation from any agency
that has an unauthorized disposal of Federal records. Is that
correct?
Mr. Koskinen. That's my understanding.
Ms. Duckworth. Okay. It turns out that these requests from
the Archives are very commonplace among Federal agencies and,
according to the National Archives, they sent 92 similar
requests to Federal agencies during the Bush Administration.
Were you aware of that?
Mr. Koskinen. I was not.
Ms. Duckworth. You know, I believe that the Federal
agencies should take these inquiries from the Archives very
seriously.
Will you cooperate with their request for the IRS to
further investigate this matter?
Mr. Koskinen. We would be delighted to do that. We
cooperate with all investigations.
Ms. Duckworth. And what steps has the IRS already taken to
understand the circumstances around the loss of Ms. Lerner's
documents?
Mr. Koskinen. I've testified at some length that we've
reviewed all of the emails of Ms. Lerner and all emails subject
to the search terms of the custodians that we've been working
with to reconstitute as many emails as possible, and we've
provided--or will provide 24,000 of those emails.
Ms. Duckworth. So would it be accurate to say that, when--
in April, when you found out that some of the emails had been
lost, that your understanding was that the team was still going
to try to recover as many of those emails that had been lost
from her crashed hard drive, but that they would be located in
other people's systems' hard drives, for example, if she sent
an email from her to another IRS official, that you could
probably recover that email that was lost when her hard drive
crashed because it still existed somewhere else. Is that
correct?
Mr. Koskinen. That's correct, if it was in the other email
of one of the 82 custodians and those were selected because
they were the most--they were the operatives working in the
exempt organization area.
Ms. Duckworth. So in April, when you found out that her
hard drive had crashed and it was unlikely that you would be
able to recover from the lost emails, the IRS and the
appropriate people--technical people in the IRS were still
trying to recover as many of those lost emails as possible in
one of those 82 other repositories. Correct?
Mr. Koskinen. Correct. And we're also continuing to produce
her emails post the crash, the 43,000 that we're committed to
produce.
Ms. Duckworth. Okay. Thank you.
The IRS previously proposed reallocating $180 million in
agency funds to sustain and replace its IT infrastructure.
Is it fair to say that these long-standing financial and
budgetary issues have contributed to the current records
retention challenges at the IRS?
Mr. Koskinen. It is true. It's our challenge of--as I say,
we're still moving people off Windows XP onto Windows 7.
Ms. Duckworth. Thank you.
I'm almost out of time. I just want to thank you so much
for your continued public service.
I yield back, Mr. Chairman.
Chairman Issa. I thank the gentlelady.
We now go to the gentleman from Michigan, Mr. Walberg.
Mr. Walberg. I thank the chairman.
And, Mr. Koskinen, thank you for being here.
You said several times that Lois Lerner was very concerned
that her emails be found and was attempting to do above-and-
beyond efforts to achieve that. Am I correct?
Mr. Koskinen. That's correct.
Mr. Walberg. You probably then could understand why there
are some who might conjecture that Lois Lerner pled the Fifth
wrongly, but pled the Fifth because she felt to answer might
incriminate her and that incrimination could possibly come from
the information that were in those emails.
Could you understand that?
Mr. Koskinen. Yes. But I have no way of knowing what her
concerns are as to what exposure she might have.
Mr. Walberg. And we never will, at least at this point,
unless some of those emails can be found, because it's
interesting that that took place.
Let me ask you: Have you fired anybody on your staff that
didn't give you enough information so that you would have made
that statement more accurate for us about information contained
in emails that you couldn't provide to us, but now we find out
that people knew that emails had been lost, but didn't tell
you?
Mr. Koskinen. I have not fired anyone. No one in my staff,
that I'm aware of, has committed any----
Mr. Walberg. Nobody's been fired for not giving adequate
information?
Mr. Koskinen. Mr. Walberg, there's no reason and there's no
basis for considering firing.
Mr. Walberg. Answer accurately and correctly and fully the
Oversight Committee of Congress.
Mr. Koskinen. Yes. And, in fact, the purpose of that
hearing was to talk generally about the investigation. Great
lengths of that hearing were spent about productions in
response to the subpoena, and the chairman and I talked at
length about that. The Lois Lerner emails were then ultimately
agreed upon as the next priority.
Mr. Walberg. Can you understand why there's anger out there
about this situation?
Mr. Koskinen. I can understand people's concerns about the
fact that we do not have----
Mr. Walberg. All the information.
Mr. Koskinen. --knowing whether we have all of her emails.
I think we--as I say, last week the White House and Treasury
provided emails.
Mr. Walberg. And why it's so difficult for us to get to the
bottom of it, because there isn't much help coming.
The President himself on May 15th said: It's inexcusable
and Americans are right to be angry about it, and I'm angry
about it. I will not tolerate this kind of behavior in any
agency, but especially in the IRS, given the power that it has
and the reach that it has into all of our lives. And he said:
I'll do everything in my power to make sure nothing like this
happens again by holding the responsible parties accountable.
Someone much more astute than I once said that the power--
the ability or the power to tax is the power to destroy.
We've seen that, Mr. Koskinen. Before you came and took
your position, we've seen people with First Amendment liberties
being targeted by the IRS, the Agency with the power to
destroy, and they attempted to do it. And now we can't get
answers completely.
Let me go on further----
Mr. Koskinen. Sure.
Mr. Walberg. --with something that you said to me back on
March 26th in a hearing where you had indicated that you were
trying to get to the bottom of the controversy.
And you said, ``Congressman, just to make you
comfortable''--and I don't know if we can have that up on the
screen--``Just to make you comfortable, if there is a problem
that I don't know about, then that is my fault, because that
means that I haven't created a culture where problems and
issues get raised from frontline workers and go easily and
freely to the top.''
Do you stand by your earlier statement to me on March 26th?
Mr. Koskinen. I do.
Mr. Walberg. Are these issues still not getting raised to
the top or are you withholding them from us?
Mr. Koskinen. These issues were raised over time. I've told
you about that. And we reproduced a public record discussing
all of those.
So I'm satisfied that, in regard to this issue the----
Mr. Walberg. How many hard drives fail annually at the IRS?
Mr. Koskinen. I noted that, since January 1st, 2,000 have
failed this year alone.
Mr. Walberg. In your professional career, how many times
has your hard drive failed?
Mr. Koskinen. My hard drive failed once.
Mr. Walberg. Once.
Mr. Koskinen. The average for hard drive failures is 3 to 5
percent. That would mean, that with 90,000 employees, we would
expect that we would have between 2 and--at 5 percent, we'd
have 15,000----
Mr. Walberg. Can it be really understood by our people,
then, involved in this greatest investigation in the IRS's
history that all of these people, several people, in fact, and
especially the one at the center of this investigation, has a
mysterious experience of a hard drive crash on this
information, information that probably caused Lois Lerner to
plead the Fifth?
Mr. Koskinen. I don't know if you can say probably or not.
And I will tell you it's not a mysterious crash. As I say,
we've had 2,000 thus far this year.
Mr. Walberg. This is mysterious for the American people.
They don't understand it. They're angry. We need to get to the
bottom of it.
And, frankly, I think there is all sorts of prevarication
going on, stonewalling, and I'm very disappointed in that.
I yield back.
Chairman Issa. I thank the gentleman.
Mr. Chaffetz. Mr. Chairman?
Chairman Issa. We now go to the----
Mr. Chaffetz. Mr. Chairman, can I ask unanimous consent to
simply enter into the record the op-ed from the Chicago Tribune
yesterday, ``More Smoke at the IRS and Not Only From the Hard
Drives''?
Chairman Issa. Without objection, so ordered.
We now go to the gentleman from Nevada for 5 minutes.
Mr. Horsford. This hearing has been quite an embarrassment.
For over a year now, Republicans have alleged that the IRS
was engaged in a conspiracy directed by or on behalf of the
White House to target its political enemies, but neither this
committee nor the Inspector General has identified any evidence
to back up this allegation.
The whole charade--and, Mr. Chairman, you say that we're
not allowed to ask about the motives of other members. Then,
how about asking about the motives of the hearing itself--the
integrity of the hearing itself, the fact that the chairman has
continued to conclude the outcome without allowing the
information to be presented in an impartial and complete way so
that the members can do our job as we are elected to do?
And this is a serious committee that has serious
responsibilities. And I have said before that I want to get to
the bottom of things, that there was wrongdoing at the IRS and
that we should fix it, but we can't fix it when the House
Republicans continue to establish unfair, unsubstantiated, and
unfounded allegations against what we do have, which are the
facts. So you may be entitled to your own opinion, but you're
not entitled to your own facts.
Commissioner, have you, since you've been in this position,
identified any evidence that IRS employees were part of a
conspiracy to intentionally target the President's political
enemies?
Mr. Koskinen. I'm not aware of any evidence.
Mr. Horsford. Thank you.
This is the same answer that we've received now from 41
other witnesses interviewed by this committee, including senior
officials at the IRS, the Treasury Department, and the
Department of Justice.
The senior group manager in Cincinnati told us that it was
his employees who first came up with the inappropriate
screening criteria in an attempt to treat similar cases
consistently.
Is that your understanding of how that process came about?
Mr. Koskinen. That's my understanding, although I would say
I haven't done any independent investigation.
Mr. Horsford. This employee told us that he is a
conservative Republican. In fact, none of the 41 individuals
told the committee that the White House directed, suggested or
even knew about their conduct when it was going on.
The Inspector General, Russell George, told us the same
thing, that he identified no evidence of White House
involvement. He confirmed that IRS employees in Cincinnati,
``developed and implemented inappropriate criteria.''
Is that your understanding as well?
Mr. Koskinen. That's my understanding from what I've read
in the newspapers and heard in hearings. I have not myself
independently determined that.
Mr. Horsford. When the Inspector General testified before
the Ways and Means Committee on May 17, 2013, the Inspector
General was asked by Ranking Member Sandy Levin whether he had
found any evidence of political motivation in the selection of
the tax-exempt applicants.
In response, the Inspector General answered, ``We did not,
sir.''
Commissioner, do you have any reason to doubt the Inspector
General's findings?
Mr. Koskinen. I do not.
Mr. Horsford. In addition to all of these findings, on June
18, 2014, the White House sent a letter to Ways and Means
Chairman Dave Camp.
This letter explained that the White House also searched
its records and did not identify any emails between Ms. Lerner
and any member of the Executive Office of the President from
January 2009 to 2011.
I ask unanimous consent to enter this letter from the White
House dated June 18, 2014.
Chairman Issa. Without objection, so ordered.
Mr. Horsford. Allegations that the White House directed or
subliminally coerced the IRS to target applicants for tax-
exempt status are unfounded, and I hope that we put these
reckless accusations to rest and finally begin focusing on the
facts.
I agree--one statement that I agree with the other side
about, the public is upset. Part of the reason they're upset is
the behavior of the chairman and this committee of how they
have politicized this issue.
When I listen to my constituents----
Chairman Issa. The gentleman's time has expired.
Mr. Horsford. --what they tell me, Mr. Chairman, is that
they're----
Chairman Issa. The gentleman's time has expired.
Mr. Horsford. --sick and tired of this process being used
against them. We are one Nation, and it's time for us to act
like it.
Chairman Issa. I thank the gentleman.
I now ask unanimous consent that the article dated February
4th of this year by Josh Hicks be placed in the record, in
which it shows that the bonuses paid to IRS employees in fiscal
year 2012 were $89 million as opposed to $10 million it would
take to maintain critical documents.
With that, we go to the gentleman from Arizona, Mr. Gosar.
Mr. Gosar. Thank you, Mr. Chairman.
I appreciate the gentleman's comments prior to me.
I really want to ask you: Do you understand, really, the
gravity of what America feels in regards to the IRS?
Mr. Koskinen. Yes. I think, if the question goes--and the
earlier one--about people being upset about the IRS using
inappropriate criteria, any indication that the IRS is anything
other than apolitical are issues that are serious that we need
to address and that I am committed to addressing.
Mr. Gosar. I love that.
Are you aware that, in the articles of impeachment of
Richard Nixon, in Article II, item number 1, ``He has actingly,
personally and through his subordinates and agents endeavored
to obtain through the Internal Revenue Service, in violation of
the constitutional rights of citizens, confidential information
contained in income tax returns for purposes not authorized by
law and to cause, in violation of the constitutional rights of
citizens, income tax audits or other income tax investigations
to be initiated or conducted in a discriminatory manner.''
Are you aware of that?
Mr. Koskinen. I do recall that from years ago.
Mr. Gosar. That's why it's serious, I mean, because this
is--I mean, if there's one thing I can tell you, that's a dark
light on our history.
And we talked about missing data, once again, missing data
in the Richard Nixon data tapes. Some similarities. Once again,
getting information.
So another investigation that we have here, it takes
Judicial Watch to get information that was supposed to be given
to this committee, yet not given to it.
So you're aware of all this. Right?
Mr. Koskinen. I'm not aware of the Judicial Watch problem.
Mr. Gosar. Do you read the paper?
Mr. Koskinen. I do read the newspaper. Yes.
Mr. Gosar. Then, you should be aware of it because that's
how we came about in regards to Benghazi and the select
committee. That was the kicker because we didn't have that
information until we had Judicial Watch get it for us.
So let's go back to the mindset here. Because I'm a dentist
impersonating a politician.
And you're an attorney. Right?
Mr. Koskinen. I'm an attorney. Right. Gave up practice
years ago.
Mr. Gosar. Well, but, you know, the fundamentals never
leave you. Right?
Mr. Koskinen. One would hope so.
Mr. Gosar. And you're also a businessman?
Mr. Koskinen. Yes. Spent 20 years in the private sector.
Mr. Gosar. So when we have a problem--and you came into
this forest fire, I'm going to call it--you had your eyes wide
open. Right?
Mr. Koskinen. Yes, I did.
Mr. Gosar. So you knew you were going to have lots of
scrutiny?
Mr. Koskinen. Yes. I understood that this was a high-
profile challenge.
Mr. Gosar. So you'd really want to dot your I's and cross
your T's. Right?
Mr. Koskinen. Yes.
Mr. Gosar. Dot your I's and cross your T's.
Mr. Koskinen. That's always actually been my approach to
everything I've done in 45 years.
Mr. Gosar. So--and a big problem.
You've also said that you have 90,000 employees. Right?
Mr. Koskinen. Correct.
Mr. Gosar. So, obviously, you divide and conquer the
problem. Right?
Mr. Koskinen. I'm not sure I'd approach it quite that way.
Mr. Gosar. So what you do is you have people that you trust
formulate battle plans in a consensus aperture and then you
hold them accountable. Right?
Mr. Koskinen. Actually, I spent a lot of time going to the
25 largest offices, talking to 10,000 IRS employees, primarily
frontline workers, to hear from them as well.
Mr. Gosar. So let me ask you a question coming into this.
Were you bothered by Lois Lerner's conduct? I mean, you had
to know about it. Here's a lady that seeds a question in an
audience.
That's kind of odd, wouldn't you say?
Mr. Koskinen. It's not the normal way people would behave.
I would think that's right.
Mr. Gosar. Once again, you know, we're talking about the
IRS and we're seeding a question out there. That's really kind
of odd.
And what was your, what did you take for her comment
sitting here where you sat and taking the Fifth, but not really
taking the Fifth? What did you think about that? Was that kind
of odd?
Mr. Koskinen. I didn't have any thought. She's got her own
lawyers. I don't know her----
Mr. Gosar. Well, let me ask you this as an attorney: Is
that typically how the Fifth Amendment is taken?
Mr. Koskinen. I'm not aware of the Fifth Amendment
practices, whether that's the way it's done or not.
Mr. Gosar. Have you seen anybody else take the Fifth that
way?
Mr. Koskinen. Actually, I don't think I've ever seen
anybody else take the Fifth.
Mr. Gosar. Wow. That's kind of a nice scapegoat.
Because that's really odd. I mean, I'm just a dentist and
I've seen a number of people take the Fifth and I've never seen
anybody take the Fifth like that. And that's pretty
contentious.
In fact, my good friend over here, Trey Gowdy, had a
problem with the way she took the Fifth, and I trust his
interpretation of the Fifth pretty well.
But it seems to me that, if you had this management style,
you would know exactly the precipitant person who told you
about the problem with the hard drive.
Mr. Koskinen. There are at least five different people who
report to me about this situation. We have a major effort going
on.
Mr. Gosar. Oh. But, once again, it seems, if they're
reporting to you, you're asking them a question and holding
them responsible. Right? So you should know.
Do they all have the same task?
Mr. Koskinen. There are four or five people who are
actually involved regularly in this production effort. I get
information from several different people.
Mr. Gosar. My time has expired, and I've run out of time.
I yield back.
Chairman Issa. I thank the gentleman.
We now go to the gentleman from Tennessee, Mr. DesJarlais.
Mr. DesJarlais. Thank you, Mr. Chairman.
Thank you, Mr. Koskinen, for appearing before us today.
I know it's getting late and there's been a lot of
repetition, but let's talk a little bit about revenues again.
You had a discussion earlier about the problem with backing
up emails in the IRS. And it was because why?
Mr. Koskinen. The problem is because, basically, the
server--IRS servers can only hold so much data.
Mr. DesJarlais. Okay. And the reason they haven't been
upgraded?
Mr. Koskinen. Because, I understand, the cost.
Mr. DesJarlais. Okay. And you had a number earlier that it
would take to upgrade those systems.
Mr. Koskinen. To actually turn it into an electronic system
with a broader server, it would be somewhere between 10- to $30
million, depending on, you know, the software and what you
wanted to do with it.
Mr. DesJarlais. Now, the chairman mentioned earlier how
many bonuses were given by the IRS to its employees in 2012.
Did you know what that number was?
Mr. Koskinen. I did not until I heard the chairman say it.
Mr. DesJarlais. So $89 million were given in bonuses to
employees at the IRS just in 2012 alone.
You've talked about how the IRS has been underfunded now
for at least 4 years. If you want to extrapolate that math, I
would say that we probably could have upgraded the equipment so
the IRS could do a better job.
Would you agree?
Mr. Koskinen. There are 90,00 employees. So at $89 million,
it's less than $1,000--or about $1,000 an employee.
Mr. DesJarlais. Did you know that the IRS----
Mr. Koskinen. We could fund a lot if we didn't pay any
bonuses, we gave no pay raises, actually continued to shrink
the organization. We'll have more money, but that's not exactly
what you would design as the best way to organize the Agency.
Mr. DesJarlais. Did you know that a million dollars in
bonuses were given to IRS employees who owed back taxes?
Mr. Koskinen. That issue has come up more recently. And we
actually have a program. And we're negotiating an agreement
with the union because we have a commitment that every IRS
employee will be current in their taxes. And even if you're 3
or 5 days late, you get a letter of admonishment.
Mr. DesJarlais. You probably wouldn't do that for the rest
of America, though, would you?
Mr. Koskinen. What? Hold everybody to----
Mr. DesJarlais. The same standards as yours.
Mr. Koskinen. --paying their taxes on time?
Pardon.
Mr. DesJarlais. The same standards as yours? You would give
bonuses to people for not paying taxes?
Mr. Koskinen. As we go forward, anyone who willfully
doesn't comply with----
Mr. DesJarlais. Oh. Going forward. All right.
Mr. Koskinen. Okay.
-- won't get a bonus. And we've negotiated that with the
union.
Mr. DesJarlais. Okay. I don't think that necessarily sets
well, but that's fine.
Do you think that the IRS improperly targeted conservative
groups?
Mr. Koskinen. My understanding is what I know. And I
support the IG's report. It said in his report improper
criteria were used. The issue has been whether that then turns
into targeting or not, the earlier reference to the Washington
Post.
But the report itself says improper criteria were used. And
we have taken all of the IG's recommendations, accepted them,
and are implementing them. So our goal is for this not to
happen again.
Mr. DesJarlais. During the hearing in March, you testified
that you had never referred to the IRS as targeting. The
Washington Post found that this statement was also not true.
Do you want to revise that statement?
Mr. Koskinen. No. They found an occasion once in the past
where I had used the word ``targeting'' once. They also noted
that the IG Had himself used the word ``targeting.''
And my point was the IG Report says improper criteria. But
once I did use the word ``targeting''--I've now mentioned it in
this criteria again, but, again, the IG's report was improper
criteria.
Either way, my point very strongly has been from the start,
the American public deserves to feel that there will not be
improper criteria used, that people will not be selected for--
--
Mr. DesJarlais. Were you ever coached on how to say that?
Did anyone ever coach you to say it that way as opposed to
targeting? Does it sound more palatable?
Mr. Koskinen. No. That's what the----
Mr. DesJarlais. No one ever coached you?
Mr. Koskinen. No. That's what the IG Report says.
Mr. DesJarlais. So no one at all ever told you not to call
the IRS conduct ``targeting''?
Mr. Koskinen. Nobody tells me what to say. I actually am
responsible for what I say. People talk about a lot of
different things. The IG Report said inappropriate criteria
were used. That's why I referred to it in that hearing.
Mr. DesJarlais. So you're the kind of guy that believes
leadership starts at the top?
Mr. Koskinen. I believe it starts at the top, and I believe
the leader is held accountable for what happens in his Agency.
Mr. DesJarlais. So the IRS acted inappropriately. We can't
get to the bottom of this. We have lost emails.
Do you think it's time that we ask for a select committee
or a special prosecutor?
Mr. Koskinen. No.
Mr. DesJarlais. You wouldn't? Why not?
Mr. Koskinen. There are six--now seven investigations going
on. My position has been that, once we get somebody to write a
report--and particularly in this case where the IG Completes
his review and issues a report on this very issue--we can all
then decide what the appropriate next step is.
To have yet another investigation start, especially while
the IG Is going forward, seems to me a waste of money, as I've
said in the past.
Mr. DesJarlais. Well, you're the face of the IRS right now,
and right now that face doesn't look too good.
Don't you think it would be better to clean the image of
the IRS for the people who are sitting--watching this hearing
tonight?
Mr. Koskinen. We'll clean the image of the IRS when we hear
from the Inspector General and see whether he finds that there
was any malfeasance at all.
Mr. DesJarlais. Yeah. Okay. Well, my time has expired. And
I think that we owe the people a little better than what we're
seeing here.
Chairman Issa. I thank the gentleman.
We now go to the gentleman from South Carolina, Mr. Gowdy.
Mr. Gowdy. Thank you, Mr. Chairman.
Commissioner, you're an attorney. Can you explain for our
fellow citizens what the phrase ``spoliation of evidence
means.''
Mr. Koskinen. I have no idea what that means.
Mr. Gowdy. Well, I'm going to help you with it. Okay?
``Spoliation of evidence'' is, when a party fails to
preserve evidence, there's a negative inference that the jury
can draw from their failure to preserve the evidence.
You with me?
Mr. Koskinen. Gotcha.
Mr. Gowdy. If you destroy documents, the jury can infer
that those documents weren't going to be good for you. If you
fail to keep documents, the jury can infer that those documents
were not going to be good for you.
You've heard the phrase ``spoliation of evidence,'' haven't
you?
Mr. Koskinen. I can't recall ever hearing it.
Mr. Gowdy. It's true in administrative hearings, civil
hearings, criminal hearings.
Mr. Koskinen. I practiced law once 45 years ago, gave it up
for Lent one year and never went back.
Mr. Gowdy. All right. Well, let me tell you what you would
have found if you had stuck with it.
When a party has a duty to preserve evidence or records and
they fail to do so, there is a negative inference that is drawn
from their failure to preserve the evidence. It's common sense.
Right?
If you destroyed something, the jury has a right to infer
that whatever you destroyed would not have been good for you or
else every litigant would destroy whatever evidence was
detrimental to them. Agreed?
Mr. Koskinen. I'm not sure. I think, if you destroy the
evidence and people could prove it, it wouldn't be a good thing
for your defense.
Mr. Gowdy. Well, no. It's worse than that.
The jury can draw and they're instructed they can draw a
negative inference.
Mr. Koskinen. All right.
Mr. Gowdy. And that's true if a taxpayer is being sued by
the IRS administratively, civilly or prosecuted criminally and
they fail to keep documents. The jury can draw a negative
inference from the fact that they didn't keep receipts or
emails or documents.
So if it's true and it applies to a taxpayer, it ought to
apply to the IRS as well. Agreed?
Mr. Koskinen. Is this a trial? Is this a jury? Is that what
you're referring to?
Mr. Gowdy. I said administrative, civil or criminal. If you
want to go down that road, I'm happy to go down it with you,
Commissioner.
Mr. Koskinen. I just----
Mr. Gowdy. In fact, I'm glad you mentioned it.
You have already said multiple times today that there was
no evidence that you found of any criminal wrongdoing. I want
you to tell me what criminal statutes you have evaluated.
Mr. Koskinen. I have not looked at any.
Mr. Gowdy. Well, then, how can you possibly tell our fellow
citizens that there's no criminal wrongdoing if you don't even
know what statutes to look at?
Mr. Koskinen. Because I've seen no evidence that anyone
consciously----
Mr. Gowdy. Well, how would you know what elements of the
crime existed? You don't even know what statutes are at play.
I'm going to ask you again.
Mr. Koskinen. I think----
Mr. Gowdy. What statutes have you evaluated?
Mr. Koskinen. I think you can rely on common sense that
nothing I have seen looks like----
Mr. Gowdy. Common sense? Instead of the Criminal Code, you
want to rely on common sense? No, Mr. Koskinen. You can shake
your head all you want to, Commissioner.
You have said today that there's no evidence of criminal
wrongdoing, and I'm asking you what criminal statutes you have
reviewed to reach that conclusion.
Mr. Koskinen. I have reviewed no criminal statute.
Mr. Gowdy. All right. So you don't have any idea whether
there's any criminal conduct or not because you don't know the
elements of the offense?
Mr. Koskinen. I've seen no evidence of wrongdoing.
Mr. Gowdy. Well, that's very different than no evidence of
criminal misconduct, Commissioner.
Mr. Koskinen. Well, it seems to me, if you haven't done
wrongdoing, it'd be pretty hard to argue that you've had some
criminal violation if you did nothing wrong.
Mr. Gowdy. Well, what did Lois Lerner mean when she said,
``Perhaps the FEC will save the day''?
Mr. Koskinen. I have no idea what she meant.
Mr. Gowdy. What did she mean when she said, ``We need a
project, but we need to be careful that it doesn't appear to
be, per se, political''? You don't think that's a potential
violation of 18-242?
Mr. Koskinen. I have no idea if it----
Mr. Gowdy. Because you haven't looked at 18-242. And you
don't have any idea, Commissioner--you don't have any idea
whether there's any criminal wrongdoing or not.
Mr. Koskinen. With regard to the production of the
evidence, the production of Lois Lerner emails, I have seen no
evidence of wrongdoing.
What else went on----
Mr. Gowdy. Well, if there were, that would be a separate
criminal offense.
Mr. Koskinen. What else went on with Lois Lerner I said in
the past----
Mr. Gowdy. So what you're saying is you don't have any idea
whether she engaged in criminal wrongdoing? You're just saying
that you did not engage in any with respect to the emails.
Mr. Koskinen. I haven't seen any wrongdoing with regard to
the production of Lois Lerner emails.
Mr. Gowdy. But you are not saying there was no criminal
wrongdoing with respect to the targeting of conservative
groups? I want to be very clear. You are not saying that?
Mr. Koskinen. I've made no judgments about that.
Mr. Gowdy. So you disagree with the President when he says
there's not a smidgen of corruption?
Mr. Koskinen. There are people who have been making
judgments both sides about whether there were----
Mr. Gowdy. And you know what? I'm not one of those.
I'm just simply saying we will never know because you
didn't keep the evidence. The evidence was spoliated. And
whether it's negligent, whether it's intentional, whether it's
reckless, we still don't have the evidence, Commissioner.
Mr. Koskinen. Well, you have the evidence that there's no
emails from the White House. You have all of the Treasury
emails. So the basic premise that this was an argument and a
conspiracy driven by the White House does not----
Mr. Gowdy. No, sir. You're wrong about that. You're wrong
about that. You're repeating a talking point from our
colleagues on the other side that we're obsessed with the White
House.
It was Jay Carney who perpetuated the myth that, ``It was
two rogue agents in Ohio. It wasn't any of us.''
Was that accurate? Was that first initial line of defense
that this is just two rogue agents in Ohio--was that accurate,
Commissioner?
Mr. Koskinen. Not that I know of.
Mr. Gowdy. All right. So that wasn't accurate, and that
came from the White House.
Who says there's not a smidgen of corruption? Who said
that, Commissioner?
Mr. Koskinen. My understanding is that was the President.
Mr. Gowdy. It was the President.
So that's Jay Carney and the President both inserting
themselves into the IRS scandal.
And you want to blame us for bringing the White House into
it?
Mr. Koskinen. I haven't blamed you at all.
Mr. Gowdy. You just did, Commissioner. You just did.
Mr. Koskinen. Well, it's a good argument.
All I said was the White House has revealed there were no
Lois Lerner emails. Treasury has given you all of their emails.
So to the extent that the argument was that Lois Lerner was
conspiring and emailing back and forth, thus far, I haven't
seen any----
Mr. Gowdy. Well, you can be engaged in a conspiracy that
doesn't include the White House.
Mr. Jordan. [presiding.] Gentleman, time is up.
Mr. Koskinen. Thank you, sir.
Mr. Jordan. Well, I was wanting to let him go, but the guy
beside me kept grabbing me.
The gentleman from Texas is recognized.
Mr. Farenthold. Thank you very much, Mr. Commissioner.
And there's a lot of passion on this, especially on my side
of the aisle. I was at home this weekend and it's all anybody
was talking about.
The American people don't believe for a second that this
stuff was lost accidentally. Mike Richline, a friend of mine
who used to work at my computer consulting company, still in
the business, emailed me, ``Blake, there's no way this could
happen. You've got to do something about it.''
And that's the frustration that I'm getting from the
American people. And if we came back to you and said, ``Oh, I
don't have the resources to save all the records to comply with
the IRS tax law,'' we wouldn't--I wouldn't--y'all wouldn't let
me skate.
So I don't think you guys ought to be able to skate on the
resource issues. And I'll get back to that in a second.
In the Clinton Administration, you worked in the OMB,
didn't you, and part of your job was to oversee the executive
branch recordkeeping and these Federal Records Act-type
requirements? Did you not do that?
Mr. Koskinen. That was actually done by the Office of
Information and Regulatory Affairs.
Mr. Farenthold. But were you involved in that when you were
with the Clinton Administration?
Mr. Koskinen. I was not involved personally, but I was the
deputy director for management.
Mr. Farenthold. Okay. So are you familiar with the Federal
Records Act?
Mr. Koskinen. I am familiar with the Federal Records Act.
Mr. Farenthold. It says the head of each Federal agency
shall make and preserve records containing adequate, proper
documentation of the organization functions, policies,
decisions, procedures, and essential transaction of the
agencies and goes on along those lines.
Your IRS manual says the way y'all do that is to print out
the emails. Right?
Mr. Koskinen. The official records--any official record.
Mr. Farenthold. Anything that's an official record.
Who decides what's an official record?
Mr. Koskinen. The employees are provided background
information, and then they make a judgment as to whether it's
an official record or not.
Mr. Farenthold. All right. And so, if you're doing
something that you might believe is questionable, you might
lean toward not deciding that----
Mr. Koskinen. It's possible. But we've trained over 2,000
information resource coordinators across the Agency to continue
to oversee and encourage and make sure that we comply.
Mr. Farenthold. All right. So in response to some earlier
questions, you indicated in going through Lois Lerner's emails
that you used search terms. Is that correct?
Mr. Koskinen. There were--search terms were used for all of
the searches in response----
Mr. Farenthold. All right. So how do you use search terms
on the hard-copy emails that she would have been required to
print out from that lost hard drive?
Has somebody gone through all of her files or the files of
people she routinely corresponded with to search those hard-
copy records?
Mr. Koskinen. Yes.
Mr. Farenthold. All right. Don't you think it would have
been easier and saved some money if you'd have had that in
electronic form?
Mr. Koskinen. No doubt.
Mr. Farenthold. All right. Let me--we heard from the other
side that there's an issue with respect to the resources there.
Now--all right. I did this on my cell phone. And let me
find my notes here. Because you've got to--you guys got a lot
of people good at math at the IRS. So I'm going to assume you
guys could figure this out. All right?
So let's say your procedure is to print the records out.
All right. So I went on to--did a Google search, said, ``What's
the average size of a Word document?''
And they said: Well, you can get 64,782 Word documents of
about 9 pages per gigabyte. A terabyte is 1,000 gigabytes.So
that's 64.8 million documents. All right?
Now, I went on Amazon and saw you could buy a terabyte hard
drive for $59--about $59. Buy two of them. So, you know, $120.
The statistics in the industry, average cost to print a
page of documents, it's about 5 to 8 cents when you include
paper and toner and wear and tear on the printer.
So if you do that math and multiply it out, it looks to me
like, for every terabyte of storage you added to the email,
you'd save $21 million in printing fees, not to mention the
greenness of it.
How come some of the mathematicians at the IRS didn't
realize, ``Hey, we go out and''--all right. Let's say you've
got to buy a computer and hook it up. All right. So let's spend
5 grand on a backup system for our email and save $21 million?
Mr. Koskinen. You've got 90,000 employees. Get one of those
for each employee.
Mr. Farenthold. Well, each employee is not going to have
millions of pages of emails and documents. You could do it on a
system-wide basis.
Mr. Koskinen. Not in our system you can't.
Mr. Farenthold. It's not stored on an exchange server?
Can't you get a Barracuda email backup that you see advertised
on TV that captures all the email?
Mr. Koskinen. Well, that's one of the things when we looked
at it I'm told the estimate was $10- to $30 million to create a
server that would hold all of that.
Mr. Farenthold. All right. $10 million. $21 million to
print. You've already saved $10 million.
Mr. Koskinen. If we're printing 21 million dollars' worth
of stuff, probably.
Mr. Farenthold. Well, if you're--and you'd be--no question
you're complying with the Federal Records Act because you're
saving everything. You wouldn't be relying on the judgment. So
this lack of resources thing doesn't fly.
I'm sorry. I ran out of time. I had some other questions.
But I will yield back.
Mr. Jordan. Thank the gentleman.
The gentleman from Kentucky is recognized.
Mr. Massie. Thank you, Mr. Chairman.
Mr. Chaffetz asked why the 6-month backup wasn't applied to
Lois Lerner's emails, and you suspected that it was too much
effort.
Do you have any emails to indicate there was a discussion
about going to the backups to try and get hers?
Mr. Koskinen. There's none that I know of.
Mr. Massie. Have you looked for any----
Mr. Koskinen. I'm not----
Mr. Massie. --to see what the IT staff--what sort of
effort--you mentioned they made an effort to retrieve the hard
drive, but what about the software effort on the servers?
Mr. Koskinen. They actually--as far as I understand, her
email was in her--from April on, she had----
Mr. Massie. Right. But there was some on the servers.
Mr. Koskinen. --in her email account, she had that email.
They then were focused primarily on the hard drive, which is
where she had archived her emails.
Mr. Massie. Right.
Well, that hard drive, you're saying, is gone. And I'll
accept that it's gone.
But what about the software backups? You don't see any
evidence of an email trail where the IT department was trying
to go to the servers to get those emails?
Mr. Koskinen. No. No. They went--they had on the server
emails from April forward. In terms of whether they went and
actually went to the backup----
Mr. Massie. I understand that.
Mr. Koskinen. --backup tapes, I haven't seen anything about
the backup tapes.
Mr. Massie. Her hard drive crashed in April 2011.
Mr. Koskinen. I'm sorry.
In June 2011. We have emails from April 2011.
Mr. Massie. Okay. All right. I'm on to another question.
Was that hard drive replaced?
Mr. Koskinen. Yes.
Mr. Massie. Are you in possession of that hard drive?
Mr. Koskinen. The Inspector General has it.
Mr. Massie. So could we look at that hard drive to see if
she was in the habit of deleting emails?
Mr. Koskinen. You're welcome to ask the Inspector General
for it. He's got it.
Mr. Massie. But, I mean, wouldn't it be possible? Because
you're collecting emails from her associates. So you know which
emails she sent and retrieved.
Did it occur to you to look on her hard drive to see if she
purposely deleted any?
Mr. Koskinen. No. We haven't looked at that. But we do
have--as I say, we've produced all of these emails. It'd be
possible to take a look at that.
Mr. Massie. So next question.
You said there's about a 3 to 5 percent chance that a hard
drive will fail. That's in a year. You testified to that last
week and, also, tonight. Right?
Mr. Koskinen. That's right. That's what I'm advised is the
industry standard.
Mr. Massie. So that's about a 1 in 30 chance if it were 3
percent.
But let's see. Chairman Camp sent a letter to the IRS
demanding the IRS explain allegations of targeting Tea Party
and other groups, and her hard drive failed within 10 days,
just doing a little math here.
The probability of that failing in 10 days instead of a
year is actually 1 in 1,000.
Mr. Koskinen. Well, that's not the way--that's not the way
probability works.
Mr. Massie. I understand.
Mr. Koskinen. Every day----
Mr. Massie. A lot of bad things could have happened. So
maybe it was 1 in 100 or 1 in 10 that something bad happens.
Mr. Koskinen. The way probability works is it's the same
probability every day. It's like, when you flip a coin, if it
lands heads 10 times in a row----
Mr. Massie. Yes. You can tell me how probability works. I
took the class at MIT. It's about 1 in 1,000 that it would fail
within the 10 days that she received that letter.
Mr. Koskinen. We must have taken a different probability
class.
Mr. Massie. I think so.
So can you tell me the timing of the other hard drives that
failed that were her associates? Were there any that failed in
that same time period or near that?
Mr. Koskinen. I don't know. But we've got--they're pursuing
that, and I haven't--I don't know what the list looks like.
Mr. Massie. Because if another one failed, one of her
associates within that same 10 days, that means it's a 1 in 1
million probability that two hard drives failed with somebody
dealing with this case in that 10-day window if there's a 3
percent annual probability.
Mr. Koskinen. As I said, we're investigating that. We'll
provide you a full report, including the names and hard drives,
when they failed and whether emails were lost as a result of
the failure.
Mr. Massie. Correct.
And notice I am not questioning your integrity.
Mr. Koskinen. I appreciate that.
Mr. Massie. We're talking about numbers here.
Mr. Koskinen. Right.
Mr. Massie. I do, though, sort of question your judgment a
little bit about not sharing this bad information with us.
You had some suspicion in February and then in March that
maybe all the emails might not be retrievable. There's a saying
that bad news never gets better with age, never improves with
age.
And what I want to ask you now is: Are there any other
anomalies in the data or in the retrieval of emails that you
can think of now so we can avoid having a second hearing on
this in 6 months?
Mr. Koskinen. That's a fair question, a good question.
I'm not aware of any.
Mr. Massie. Okay. So there's nothing like somebody came to
you----
Mr. Koskinen. Other than we're pursuing the other
custodians.
Mr. Massie. Right. The other eight hard drives that have
failed.
Mr. Koskinen. Right. That's what we knew last week. We're
still looking. I don't know what the final number will be.
Mr. Massie. Okay. So you understood my question?
Mr. Koskinen. I understand your question.
Mr. Massie. A hint of bad news that was similar to the bad
news you had in February, I'm asking you to just share it now.
Mr. Koskinen. And I've said I do not know of any other bad
news, as you put it.
Mr. Massie. Okay. One final question.
If we had a flat tax or a fair tax, would we be here today?
Mr. Koskinen. No. I'm a big supporter of tax
simplification. I support Chairman Camp's attempt to move that
dialogue forward. I'm prepared to be as helpful as I can.
Mr. Massie. I do, too. Thank you very much.
Mr. Jordan. The gentleman from Kentucky with several
patents and a degree from MIT in engineering made some great
points.
We'll now go to the gentleman from Georgia.
Mr. Collins. Thank you, Mr. Chairman.
I appreciate that. I am not a student of MIT. I have three
degrees ranging from a bachelor's degree, to a theology degree,
to a law degree.
And this has been an amazing story. I sat here in front
just a few weeks ago, relative time frame, and I asked you, you
know, and just said without any definition can we provide all
the things you agreed to.
But when you just take a step back, this has just got to
be--I have a 15-year-old that I love dearly. He's different
than my other two children because my 15-year-old has an active
imagination. His active imagination can lead you on some pretty
amazing trips.
And let's just think about this for just a moment. You have
an agency, supposedly, in Cincinnati that decides on its own,
just sua sponte--just say, ``We're going to start looking into
certain files. By the way, then, we don't tell Washington. We
don't let anybody else know,'' all those pretty well set the
fact that that was probably not accordance to good policy.
When the chairman of our--one of our committees makes an
inquiry concerning this kind of information, a hard drive
fails. 2 weeks later all of a sudden then Cincinnati decides to
tell that we have an issue.
We move forward in this progression, and we have seen the
Fifth taken, we've had evidence come here when you said we're
going to have-- you know, all the evidence, all of the facts,
presented. And, again, it's still sort of hard to believe that
even it should have at least come up, ``I'll produce all that I
have. But, oh, by the way, we've got a problem.''
It also seems hard to believe, as you go through this whole
story, that when the Inspector General was going through this
whole thing, nobody seems to have told him, ``Oh, by the way,
we're missing some emails.''
According to him----
Mr. Koskinen. That's right. But nobody that I know knew
that was dealing with the Inspector General they were missing
emails.
Mr. Collins. But we're investigating--but, at that time, it
was investigating this whole thing, which Ms. Lerner was a big
part of.
Mr. Koskinen. Correct.
Mr. Collins. Okay. So, again, I guess, as I go back to my
15-year-old here, at a certain point in time, I have to just
look at him and I have to say, ``Cameron, at a certain point in
time, the load you're carrying in the bull in the back of the
truck don't add up anymore and nobody believes it.''
It's a bad position for you. I would hate to be in your
position. You've had an extended life of great service to this
country.
But what is really troubling and--for the people in the 9th
district of Georgia, whether you figure probabilities or not,
they have a pretty good meter, and the meter right now on
both--really, on both Democrats I know and Republicans I know
has just gotten full.
This story is just becoming more implausible as it goes. It
crashes at a certain time. We can't find it at a certain time.
No one was told about it at a certain time.
I'm going to take you seriously that you really take
responsibility for your job at the IRS. Is that correct?
Mr. Koskinen. Yes.
Mr. Collins. And you take responsibility for the custodians
of the records because you're the man at the top, as you said
before?
Mr. Koskinen. Correct.
Mr. Collins. Then, did you notify the archivist when you
learned of the destruction of Ms. Lerner's emails earlier this
year?
Mr. Koskinen. It was not a destruction of her emails. It
was----
Mr. Collins. Or loss of.
Mr. Koskinen. It was a loss of emails. I did not.
Mr. Collins. Okay. And that is supposed to be.
Now, let me ask you this. In Ms. Lerner's emails that you
found out that we may not be able to obtain--you've talked
about this before. Some things are supposed to be kept. Some
things are not supposed to be kept.
If you knew that there were some emails you might not could
have found, there probably or possibly could have been emails
in there that should have been kept under the Records Act.
Correct?
Mr. Koskinen. If there were emails to be kept under the
Records Act, they would have been printed out. The
responsibility is, if you have an email that's a record, you
print it out in hard copy. It's an archaic system, but that's
the system.
Mr. Collins. But you can't say--especially if there was a
possibility of something not right, you can't have--you cannot
sit here and say that Ms. Lerner would have kept or printed off
emails she would not have wanted to be kept. Correct? If you
can, then there's a whole line of questions a whole lot of
people are going to start coming back for.
Mr. Koskinen. My understanding is every employee is
supposed to print records of--that are official records on hard
copy and keep them. She had hard-copy records. I don't know
whether anything that was lost was an official record or not.
Mr. Collins. So it would be a matter of then just caution--
or prudence that you should have probably told the archivist
this?
Mr. Koskinen. No. I'm supposed to tell the archivist if
there's been a destruction of records.
Mr. Collins. Well, a hard drive destroyed, would that not
qualify as destruction or are we back to parsing terms again?
Mr. Koskinen. No. This is about her--her archives for
record purposes are hard copies printed out of emails.
Mr. Collins. That you know of.
Mr. Koskinen. I don't know--you know, that's what she was
supposed to do.
Mr. Collins. But, again--but, again----
Mr. Koskinen. Whether she did it or not I don't know.
Mr. Collins. --I'm trying to take it off of you.
What you know of, but in a sense, where you've lost it and
it's since been destroyed, no way to go back and find--the hard
drive was destroyed. Only what was printed was left.
There's no way for you to tell if you should or should not
have told the archivist. Correct?
Mr. Koskinen. Correct.
Mr. Collins. So, in prudence, you should have told the
archivist. Would that not be true?
Mr. Koskinen. I could do that. Yes.
Mr. Collins. Mr. Koskinen, again, this is a long story. The
people are just looking for the truth. And there are a lot of,
probably, parents and nonparents and grandparents out there
who've trailed the story this long together and they just don't
understand.
They don't get it because they don't get the same--they can
come with a story at the IRS and the IRS would just basically
say, ``We don't want the story. We don't care how much you're
broke. We don't care how much you couldn't afford to keep it.
We just want the records that you're supposed to provide.''
Mr. Koskinen. Right. And----
Mr. Collins. This is a sad trail down a wrong road.
Mr. Koskinen, your service has been good. Unfortunately,
you're running into a dead end, and the American people are
tired of it.
Mr. Chairman, I yield back.
Chairman Issa. [Presiding.] The gentleman yields back.
We now go to the gentleman Mr. Massie.
Mr. Koskinen. We've had him already.
Chairman Issa. You've already gone?
Mr. Massie. Yep.
Chairman Issa. Thank you. My order here----
Mr. Koskinen. It was an interesting conversation, but we're
done.
Chairman Issa. Well, he may say again. You never know.
We now go to Mr. Meadows.
Mr. Meadows. Thank you, Mr. Chairman. And thank you for
your patience.
So let me follow up on Mr. Collins' line of questioning.
The Federal Records Act requires emails to be part of the
record to be printed out. Is that correct?
Mr. Koskinen. Yeah. If the email is a record, it should be
printed out in hard copy, is the IRS policy.
Mr. Meadows. So what is your definition of a record?
Mr. Koskinen. The record is, as the Act provides, any
record of Agency actions or policies. If you're just sending
emails conversing back and forth, those aren't records.
Mr. Meadows. Conversing back and forth with regards to
what? Because that's not what your manual says.
Mr. Koskinen. Pardon?
Mr. Meadows. That's not what your manual says.
Mr. Koskinen. The manual says any record of Agency actions,
policies or anything that would reveal important Agency
policies.
Mr. Meadows. It says specifically emails are records when
they are created or received in the transaction of agency
business.
Mr. Koskinen. That's correct. So if we're doing an exam or
we have a litigation, all of the information about that exam
and that information is----
Mr. Meadows. So what you're saying is that none of Lois
Lerner's emails are part of Agency business?
Mr. Koskinen. Lois Lerner printed hard-copy emails which
have been provided to you.
Mr. Meadows. Hard copy of how many emails?
Mr. Koskinen. I have no idea.
Mr. Meadows. Of all of them?
Mr. Koskinen. All of her emails were not official records.
Mr. Meadows. And under what definition? Because I pulled
the definition because, you know, really, all I have to go by
is the law. And that's what you would have to go by. And I
pulled the definition out of your policy book.
Mr. Koskinen. I would assure you I have not read very many
Lois Lerner emails. But of the 67,000 you'll ultimately have, I
will guarantee you a reasonable number of them are not going to
be official records.
Mr. Meadows. Under what definition?
Mr. Koskinen. Under the definition in that brochure.
Mr. Meadows. Well, this definition says that they need to
be machine-readable materials. That qualifies to almost every
single email. ``Machine-readable'' is what this said.
Mr. Koskinen. In terms of----
Mr. Meadows. I would like to ask that we put this in the
record, if we could.
Chairman Issa. Without objection, so ordered.
Mr. Meadows. So if I'm following your manual and there has
been no wrongdoing, I think is what your testimony says,
there's been no wrongdoing--isn't that what you said?
Mr. Koskinen. Yes. No wrongdoing in terms of the
destruction--potential loss of these emails.
Mr. Meadows. All right. So when someone did not notify the
National Archives, was that wrongdoing? When you lost these,
when you automatically said, ``Golly, we can't find the emails.
There might be just one email in there that's a record,'' would
that be a wrongdoing or breaking the law?
Mr. Koskinen. If we didn't advise the archivist that we
lost records we knew----
Mr. Meadows. Well, you didn't advise them because I have--
--
Mr. Koskinen. We did not have any evidence at this point
whether they were official records or not. As stated by Mr.
Collins, we could have called and said, ``We've lost some
emails and we don't know whether they're records or not. We
thought we'd let you know,'' but we did not do that.
Mr. Meadows. Okay. Can I submit for the record a letter
from the National Archives expressing their concern over the
fact that there may be official records that were not----
Chairman Issa. Without objection, so ordered.
Mr. Meadows. So all of this in not following up is really,
according to the Democrats--really a money problem, and you've
concurred with that.
Is that what you would indicate?
Mr. Koskinen. We would be in much better shape if we had an
electronics records system that was an official record.
Mr. Meadows. And the reason you don't is because of money?
Mr. Koskinen. I'm told that 2 years ago, when they
considered trying to do that, that they didn't have the funds
to do it.
Mr. Meadows. So can we tell the American taxpayers, then,
that if they just don't have really the money to comply with
IRS statutes, that that's okay, that it's okay to break the law
as long as they don't have the money to comply?
Mr. Koskinen. I don't think we've established that the IRS
broke the law.
Mr. Meadows. Well, there is wrongdoing in terms of not
keeping all the records according to the Federal Records Act.
All of the records--would you agree some of the records are
missing?
Mr. Koskinen. I have no idea whether official records are
missing or not. I have no idea----
Mr. Meadows. So your testimony today--let me make sure.
Your testimony today is that you do not know whether there
are missing emails?
Mr. Koskinen. You just asked about missing official
records. I do know there are missing emails.
Mr. Meadows. Would a normal person assume there may be one
record in all of those emails that are missing?
Mr. Koskinen. We don't know how many are missing. We----
Mr. Meadows. A reasonable person. No. You're an attorney. A
reasonable person.
Wouldn't a reasonable person think that, in thousands of
emails, there would be one official record?
Mr. Koskinen. We don't know if thousands are missing or
not. We are producing 24,000.
Mr. Meadows. I didn't ask you that.
I said: A reasonable person, wouldn't they agree? Are you a
reasonable person?
Mr. Koskinen. Last time I checked.
Mr. Meadows. Okay. Wouldn't you think that there might be
one record in there?
All right. Let me finish out.
Because you say it's a money issue, are you aware that $49
million were spent on conferences during this same time period?
$49 million?
Mr. Koskinen. That was in----
Mr. Meadows. Between 2010 and 2012, $49 million, according
to the TIGTA report.
Mr. Koskinen. A substantial number of those are training
conferences, bringing----
Mr. Meadows. I didn't ask you that.
Were you aware that $49 million was--yes or no?
Mr. Koskinen. I was not aware of the number.
Mr. Meadows. Okay. $49 million. Some of that, $3,500 a
night. We've already talked about a Star Trek video.
Mr. Koskinen. That was all in 2010.
Mr. Meadows. Do you think you could have moved some of that
$49 million to pay to make sure that the Federal records were
really preserved?
Chairman Issa. The gentleman's time has expired.
You may answer.
Mr. Koskinen. I don't know the details of those events and
which were training and what were wasted funds. It's all 3 and
4 years ago, long before I arrived.
Chairman Issa. That wasn't the gentleman's question. The
gentleman's question was: Do you think any of the ``money'' on
those conferences, including the one for making a Star Trek
video--whether or not that could have been used properly for
this purpose?
Mr. Koskinen. Well, you needed 10- to $30 million. Whether
there was $30 million there, $10 million in that or not, I
don't know. If there was money wasted, they certainly could
have used it for this purpose. That's clear.
Chairman Issa. I thank the gentleman.
We now go to the gentleman from Michigan, Mr. Bentivolio.
Mr. Bentivolio. Thank you very much, Mr. Chairman.
Nice to see you again, Commissioner.
Before I forget, I have two questions--or two lines of
questioning.
You said four to five people report to you regularly. Who
are they? Can we have their names and titles.
Mr. Koskinen. Of the people who report to me? I actually
have about 30 people who report to me regularly. There have
been four or five who report to me in this area.
Mr. Bentivolio. Okay. Can we have their names and titles.
Mr. Koskinen. I'll be happy to provide those.
Mr. Bentivolio. Great. Great.
Do you believe there's a difference between objectivity and
neutrality?
Mr. Koskinen. That's an interesting question.
I suppose you could be objective--I don't know. I think
most of the--both terms would imply that you're not involved
personally in an issue. You're objective about it or you're
neutral about it.
Mr. Bentivolio. So they're synonyms?
Mr. Koskinen. I would think they could be viewed as
synonyms. Yes.
Mr. Bentivolio. Objectivity is the ability to judge fairly
despite bias, and neutrality is to have no stance regarding a
particular issue.
Do you think that employees at the IRS have any self-
interest in who's elected as President of the United States?
Mr. Koskinen. I think, as individuals, every American has
an interest in who's elected President of the United States.
Mr. Bentivolio. Would you say they're trying to be
nonpartisan, IRS, nonpartisan?
Mr. Koskinen. IRS is nonpartisan. It doesn't mean they
can't have an interest in understanding the importance of the
presidential election.
Mr. Bentivolio. Okay. But they're not supposed to have--to
back one party or another, are they?
Mr. Koskinen. The Hatch Act does not prohibit IRS employees
on their own time----
Mr. Bentivolio. In their official duty.
Mr. Koskinen. Pardon?
Mr. Bentivolio. In their official duty.
Mr. Koskinen. In their official duties, it's absolutely
prohibited.
Mr. Bentivolio. Okay. So my question is about self-
interest.
Do you believe that employees of the IRS can remain
objective when analyzing the tax implications of groups and
people that want them to lose their jobs?
Mr. Koskinen. Want them to lose their jobs?
I think so. I think that they are professionals. They're
dedicated to----
Mr. Bentivolio. I have no doubt in their professionalism.
I'm not asking you about that. I'm asking you about their
neutrality and how it affects their objectivity.
Do you believe that any person can sustain objectivity
towards someone that they perceive as a threat to their
livelihood?
Mr. Koskinen. I think they could be objective about it. I'm
objective about continuing to hear--this is my eighth hearing,
and I'm objective about it.
I have good friends on all the committees. Even though some
of these hearings are a little more contentious than others,
but I can be objective about it. It comes with the territory.
Mr. Bentivolio. So what are they afraid of?
I mean, the emails just provide all the information. It
seems to me that, if it was just, let's say, somebody got
carried away, you could have said, ``Well, we apologize. We'll
fix it. It will never happen again.''
But the IRS isn't doing that, are they?
Mr. Koskinen. Thus far, since--as I recall, Commissioner
Werfel and I have said it. There--people were unfairly
selected. That was a mistake.
I've apologized to anyone who was actually discriminated
against, and I've said I am committed that that won't happen
again.
Mr. Bentivolio. But we're concerned about where it comes
from. Because it wouldn't be this big of an issue if there was
really just some loose cannons in the outfit, so to speak. I
mean, it seems to me that you could've said they made a
mistake, they shouldn't have done it, we've punished them,
let's move on. But they didn't really do that.
Mr. Koskinen. The people involved in the chain of command
in this issue are all gone.
Mr. Bentivolio. I think there's--or retired?
Chairman Issa. They were----
Mr. Koskinen. They're no longer with the agency.
Mr. Bentivolio. Right. Except the ones in 1600 Pennsylvania
Avenue.
Thank you very much. I yield back.
Mr. Jordan. Would the gentleman yield?
Mr. Bentivolio. Yes. I yield to----
Mr. Horsford. Would the gentleman yield to the gentleman--
--
Chairman Issa. He's already yielded to the gentleman from
Ohio.
Mr. Jordan. I thank the gentleman.
Mr. Koskinen, earlier you said that you did not tell
Treasury--when you learned in April, from who you can't
remember, when you can't remember, sometime in April, you said
you did not communicate with the White House or with Treasury;
is that accurate?
Mr. Koskinen. That's correct.
Mr. Jordan. Here's a story from last week in Politico. It
says, ``In April of this year''--this is from Neil Eggleston,
the White House Counsel. ``In April of this year, Treasury's
Office of General Counsel informed the White House Counsel's
Office that it appeared Ms. Lerner's custodial email account
contained very few emails.''
So they were informed in April, the White House Counsel,
from the Treasury's Chief Counsel. So how did the Treasury
Chief Counsel find out?
Mr. Koskinen. I don't know.
Mr. Jordan. Did you tell people in the IRS, don't go tell
anybody this stuff until we get all the information? Did you
give that instruction to your folks?
Mr. Koskinen. No.
Mr. Jordan. So someone--did you--so someone at IRS told
Treasury's Chief Counsel?
Mr. Koskinen. I assume that must be what happened.
We meet with the Treasury regularly. I meet every 2 weeks--
--
Mr. Jordan. Why you didn't you them, then?
Mr. Koskinen. Pardon?
Mr. Jordan. Why didn't you tell them?
Mr. Koskinen. Because I'm not reporting to the Treasury
about this investigation. It's under our--it's our
responsibility, and we're taking responsibility----
Mr. Jordan. You don't know who told them?
Mr. Koskinen. Pardon?
Mr. Jordan. You don't know who told them?
Mr. Koskinen. I have no ideal who told them.
Mr. Jordan. Did you tell someone else to go tell Treasury
just so----
Mr. Koskinen. No.
Mr. Jordan. --you wouldn't have to?
Mr. Koskinen. No.
Mr. Jordan. You have no idea how the White House and how
Treasury learned that this happened, that Lerner emails were
lost in April and we didn't know till June. You have no idea
how that happened.
Mr. Koskinen. No. I've not had any discussions----
Mr. Jordan. Well, we'd like to know who at IRS told the
Treasury Chief Counsel, who then told the White House Chief
Counsel, and they knew 2 months before we did. So we'd like to
know who that person at the IRS is who informed them about
something that important and you didn't feel it was incumbent
upon you to tell us. Can you find us that person?
Mr. Koskinen. I thought I was--I don't know who it is,
but----
Mr. Jordan. Well, find out. You run the agency.
Mr. Koskinen. Fine. I was going to say, the----
Mr. Jordan. Why don't you send an email to all the
employees in the IRS saying, ``Whoever told the White House
Counsel that we lost Lois Lerner emails or that at least there
was the potential that we were going to lose them, I want to
know who that person is so I can tell--I can tell the chairman
of this committee and we can question them''? Can you do that
for us?
Chairman Issa. The gentleman's time has expired. You may
answer.
Mr. Koskinen. Can I--so you can question them. And what
will you----
Mr. Jordan. Of course. We want to know why they told them.
You didn't want to tell them.
Mr. Koskinen. I didn't not want to--I told you, we run the
investigation. I have not talked to--and the production of
documents. I am not--Treasury doesn't tell me what to do. I
don't tell Treasury what we're doing----
Mr. Jordan. I'm not talking Treasury. I'm talking IRS.
Mr. Koskinen. I'm telling you about the IRS.
Mr. Jordan. Someone from the IRS told Treasury.
Chairman Issa. I thank the----
Mr. Jordan. I want to know who that person is. Because it
wasn't you.
Mr. Cummings. Regular order, please. Regular order.
Mr. Horsford. Mr. Chairman, point of order. You've gone
over a minute----
Chairman Issa. State your point of order.
Mr. Horsford. The point of order is that the----
Chairman Issa. State your----
Mr. Horsford. --gentleman is over 1----
Chairman Issa. State your point of order.
Mr. Horsford. The point of order is the gentleman is over
his time.
Mr. Jordan. The real point of order is he won't answer the
question.
Mr. Horsford. Point of order. The chairman cut me off
when----
Chairman Issa. I'm cutting you off again. We will maintain
decorum.
Mr. Horsford. There is no decorum.
Chairman Issa. The parliamentarians will provide anyone
with the proper way to state a point of order, which is, as Ms.
Speier did, to cite within the rules a point of order as to
whether rules are being properly adhered to. Congresswoman
Speier did a very good job of citing a point of order. And I
would ask all folks to please use the parliamentarians before
they cite a point of order.
We now go to the gentleman from Florida, Mr. DeSantis, for
5 minutes.
Mr. DeSantis. Commissioner, have you reviewed Dave Camp's
letter from June 3rd, 2011, that he sent to the IRS?
Mr. Koskinen. I have not reviewed it. I only saw it this
afternoon briefly.
Mr. DeSantis. Well, this is one of the--so he writes a
letter. Lois Lerner's hard drive crashes 10 days later. You're
supposedly now in charge of writing the IRS. And you haven't
looked at that letter? You haven't reviewed that letter?
Mr. Koskinen. I scanned that letter. I'm not doing the
investigation of what happened around----
Mr. DeSantis. Well, that letter requested that email
records be preserved and turned over to the committee, the Ways
and Means Committee.
And, according to your testimony, when her hard drive
crashed, they never went to the backup servers to retrieve her
emails, correct?
Mr. Koskinen. No. No. They never went to the backup tapes.
Mr. DeSantis. Exactly.
Mr. Koskinen. The backup server is very different. There is
no backup server. There's a server that operates the emails.
Mr. DeSantis. Right. And then the tapes that they're stored
on offsite, they never got the emails back. So even though----
Mr. Koskinen. I think----
Mr. DeSantis. --the Congress requested it, the IRS didn't
care. They just decided they're not going to go the extra mile
to get those.
Now, you testified last week in the Ways and Means
Committee that you knew there was a problem February 2014 with
Lois Lerner's emails, correct?
Mr. Koskinen. I was advised there was an issue.
Mr. DeSantis. Right. And in mid-March, the IRS, according
to your testimony, review team learned additional facts about
her mysterious computer crash, correct?
Mr. Koskinen. That's correct.
Mr. DeSantis. And then you testified in this committee at
the end of March. And you promised this committee--they played
the montage. Gowdy, Chaffetz, Jordan, Issa, everyone: Get us
Lois Lerner's emails, get us Lois Lerner's emails. You said,
yes, we'll do it.
You never mentioned, you never disclosed that there were
real problems about whether you were, in fact, going to be able
to turn over those emails, correct?
Mr. Koskinen. At that time, I did not know they were real
problems. At that time----
Mr. DeSantis. Well, here's what you told Dave Camp. You
said, ``In February''--and this is page 6 of your testimony
last week. ``In February, what we knew was there was a problem
because we were looking at from it the standpoint of where--
what timeframe it was in which her emails appeared, and it
appeared that there were not enough emails in that timeframe.''
So in mid-February you had reason to believe that you were
short of emails in that critical timeframe, per your testimony
last week, correct?
Mr. Koskinen. When I say ``we,'' the review team did that.
I knew simply that there was a problem in the way the emails
were spread throughout the timeframe. I did not know the
details of it.
Mr. DeSantis. Well, your testimony said ``we,'' meaning the
IRS. So I guess----
Mr. Koskinen. The IRS, that's correct.
Mr. DeSantis. --now you're saying that you did not know
that, that you were somehow, even though the Commissioner----
Mr. Koskinen. No.
Mr. DeSantis. --you're not in the loop.
Now, here's the issue.
Mr. Koskinen. Good.
Mr. DeSantis. Jason Chaffetz was going back and forth with
you at the March hearing, and you basically told him, ``We will
get Lerner's emails. They are stored in servers,'' is what you
said.
Now, my question for you is, why say that if you knew, one,
there was a problem with Lerner's email, and, two, you knew
that the backup tapes were only saved for 6 months? Why tell
Chaffetz that you were going to be able to retrieve it when you
had reason to believe that that may not be the case?
Mr. Koskinen. Because, at that time, we had pulled all of
the emails out of her hard drives and others and had put them
into a server system known as Clearwell, is my understanding,
which is the way we search them.
Now, they have to be searched--it's a pool. You have to
then pull out--it's got video----
Mr. DeSantis. No, I understand that. But, again, your
testimony--there was reason in mid-February that there were not
enough emails. So whatever pool you had, there was a time
period in question with the computer crash, you testified that
there was a possibility that this was coming up short.
So the question is, you made a choice, as you testified,
not to disclose this fact to Congress. Now, you've been asked,
when did you know for sure there were emails missing? You said
April. When in April? You said April. You wouldn't get any more
definitive from that.
And then you said you were advised not to disclose it. Who
advised you----
Mr. Koskinen. Nobody.
Mr. DeSantis. --not to disclose it?
Mr. Koskinen. I did not say I was advised not to disclose
it.
Mr. DeSantis. Then why didn't you disclose it?
Mr. Koskinen. Because my sense was what we needed to do was
find out the facts and the details, and when we found those, we
would give you all of the information.
My experience, as I explained to Congressman Camp, is last
Monday we did provide information that we had just learned that
day, our staff did, that we had custodians who had lost--who
had hard-drive crashes.
Mr. DeSantis. I understand that. But you've acknowledged--
--
Mr. Koskinen. And, immediately thereafter, people leaped to
conclusions in the public with press releases which, 3 days
later, turned out to be wrong.
So my point is----
Mr. DeSantis. I think that you have a duty of candor to
Congress and the American people. And you certainly had some
reason to believe that there were going to be issues with
producing her emails in your March testimony----
Mr. Koskinen. We----
Mr. DeSantis. --because you've admitted it with Ways and
Means, that there were issues.
Now, maybe you weren't kept up or maybe you weren't
following closely enough. I don't know. But I think this is
very important, because the average taxpayer looks at this, and
if they are ever in a situation where they can't produce
documents, they are presumed guilty, period, end of story. It's
not even a question. And yet the IRS is in a situation where
they can say, well, we had a computer crash.
The probability of that is very small, as Mr. Massie
indicated. Just so happened to happen 10 days after Dave Camp
asked for information.
And so I don't think that the American people are satisfied
with this. And, with all due respect, I don't think your
testimony is going to be satisfactory to those who have real
concerns about whether we're going to get to the bottom of what
happened with the IRS.
And I yield back.
Mr. Koskinen. Can I make just one point----
Chairman Issa. It is the practice of the committee to
always let a witness answer a question if there's a question
pending. The gentleman may answer.
Mr. Koskinen. I appreciate it. This is just a statement I
want the public to be confident about, and that is: When we're
dealing with taxpayers, and if they can't produce a record, we
are open to their producing other evidence that would be
consistent with that.
So if somebody said, we've lost some emails but I've
reconstructed 24,000 of them, we would take that into
consideration. And, in fact, there's a legal precedent that
says, if your actions and the evidence generally produces
support for what you say happened, even if you don't have the
documents, that's acceptable.
So the idea that if you've lost a document it means you've
lost the case with the IRS, that's incorrect. We actually will
work with taxpayers, trying to make sure that they've got
supporting information of any kind.
Our notices out to corporations say: Here's what we'd like
in documents, but if you haven't got them all, if you've got
something close to that, if you can give us other information,
we'll take that.
So I just want the record to be clear----
Mr. DeSantis. Well, we'd be happy to accept whatever
alternatives you could produce to show what Lerner did.
Chairman Issa. The gentleman's time has expired.
Commissioner, the good news is there aren't as many Members
left for the second round, so this should be fairly brief.
Mr. Koskinen. I liked it in the old days where you only had
one round.
Chairman Issa. How old is that?
Mr. Koskinen. Oh, it must be very old.
Chairman Issa. Well, we'll try to be fairly short.
Mr. Cummings?
Mr. Cummings. Commissioner, let me say this. I really thank
you. I thank you from the depths of my heart for taking on this
task.
I cannot begin to tell you how pained I feel listening to
all of this. You know, when you've got a person who has given
what you've given and have been brought into difficult
circumstances--and I don't know how old you are, but, you know,
at my age, I begin to think about my own mortality and think
about my reputation.
First of all, I want to thank you for being who you are. I
want to thank you for giving a damn and caring about our
country.
Some of the statements that have been made here today make
it look like, you know, you're just coming up here trying to
fool people, when under Republican and Democratic
administrations you have been highly regarded.
I've said it before, and I'll say it again: We're better
than that. We are a better country than that. And we are a
better committee than that.
You know, when I re-reviewed the IRS employees' interviews,
you know what they said? It was very interesting; they said
something similar to what you said. They said they were
constantly asked about their party affiliation and that kind of
thing. Some of them were Republicans; some were Democrats. One
even described himself as a very conservative Republican. But
you know what they said? They said they left their party hats
at the door. You know why? Because they wanted to make sure,
when they went in there and did their job, that they did it in
a way that was fair to all Americans.
And so, yeah, there are issues, but I don't--you know,
sometimes I sit here and I listen to all this--and somebody
asked me about this committee the other day, and they said that
if you were to leave the committee today, what will you most
regret? I said, I would mourn for what could have been. I would
mourn for what could have been.
We are a Committee of Oversight and Government Reform. And
I am glad that the IRS took the nine recommendations of the
IG--who, by the way, was appointed by a Republican, the same IG
that said no White House involvement. But we just push the
facts over there, say, oh, he's coming up here, let's see what
we can do to him.
But you know what? After the hearing is over, I care about
your reputation. I care about what people think of you. And I
really mean that. And I don't want a moment to go by without
you knowing that I appreciate you coming into this institution,
giving it the best you've got, and then having to come in here
and go through this hell.
And that's not to say everything was done perfectly. I
don't think anybody up here is perfect. All of us have had
problems. As I say to my constituents, all of us are the
walking wounded, and if we aren't the walking wounded, we just
keep on living.
And so, again, I want to thank you very much.
And, by the way, if there was any kind of inappropriate
criteria, I've said it before, I have a problem with that with
regard to conservatives, I also have a problem with regard to
progressives and anybody else.
And I'm sure I speak for all our Members when I say thank--
I really do thank you.
Mr. Koskinen. Thank you.
Mr. Cummings. With that, I yield back.
Chairman Issa. I thank the gentleman.
The gentleman from Ohio is next in seniority.
Mr. Jordan. I thank the chairman.
Look, I agree with the ranking member; we're all imperfect,
we all are in need of God's grace. And we do appreciate the
public servants who work hard every day on behalf of the
American people.
But I will tell you something. I also care about the
thousands of people who were denied their First Amendment
rights when this targeting scheme took place. I care about
people like Catherine Englebrecht, who was visited six times by
the FBI after she applied for tax-exempt status, who after she
applied had her personal and business finances audited by the
IRS for the previous 2 years, who got visited by ATF, OSHA. I
care about those people, too, and that's why we're so concerned
about getting to the truth.
And so I just have one question, and I'll be quick.
Mr. Koskinen, you've testified several times here tonight,
answered many questions where we talked about, you knew there
were problems in February, you knew there were more problems in
mid-March, you came in front of this committee in late March,
you didn't disclose to us, but then someone--and the reason you
said you didn't disclose to us was because this was so
important, so critical that you get all the information, get
all the facts, get all the information, and then give it to us,
correct? You wanted to get the full story before you went
public with any of this, correct?
Mr. Koskinen. And I would remind you, when I testified here
in March, I had no idea whether there was a serious problem or
not. I just knew there was an issue.
Mr. Jordan. You knew there was an issue, you knew there was
problems.
Mr. Koskinen. Right.
Mr. Jordan. Based on your testimony, you knew that there
had been a crash of her computer. I mean, that's in your
testimony.
But your testimony is you wanted to get all the facts
before you went public, right?
Mr. Koskinen. Yes.
Mr. Jordan. You thought that was important.
Mr. Koskinen. Yes.
Mr. Jordan. To get all the information.
Mr. Koskinen. Yes.
Mr. Jordan. And yet, one of your employees told the
Treasury and the White House in early April----
Mr. Koskinen. One of our----
Mr. Jordan. Whoa, whoa, whoa, whoa, whoa. So all I'm asking
is, if it was so important, so critical to get the full picture
before this information got out, why didn't--why didn't you
tell all the people who work in your agency, we're not going to
say anything, we're not going to communicate about this until
we get the full picture?
Why didn't you give that instruction to--if it's so
critical that you can't share with Congress--you waited 2
months after you knew in April that there were lost emails. If
it's that important, then why didn't you tell your employees,
don't talk about this, don't tell the White House Counsel,
don't tell the Treasury Counsel? Why didn't you give that
instruction?
Mr. Koskinen. Because I didn't think that--if somebody
actually told anyone--I didn't tell them they shouldn't tell
this committee. I was not telling people what not to do. I set
forward a program in which I said, we need to find all of the
facts, we need to pull it all together, and we will make a
public disclosure of it, which we did.
Mr. Jordan. But that's not what happened, Mr. Koskinen. The
Chief Counsel at Treasury knew about it and talked to the Chief
Counsel at the White House in April, right after you found out
about it. That's what we're concerned about.
All I'm saying is, if it's so important, I think a
proactive leader, a good manager would say, hey, let's get to
the truth first, let's get all this, let's not communicate
this, let's tell everyone at the same time, let's tell Congress
the same--if it's okay to tell the White House, why isn't it
okay to tell the people's house?
Mr. Koskinen. Because the White House is not going to do
what the Ways and Means Committee did with the piece of
information we gave them piecemeal--that is, they're not going
to make a big issue about it--until all the facts out.
Mr. Jordan. Maybe it's because the White House is the same
party. Right? Maybe that had--could that have anything to do
with it, Mr. Koskinen?
Mr. Koskinen. I have no idea. But I would stress again in
your earlier statement----
Mr. Jordan. Oh, well, you may not have any idea, but the
facts are the facts.
Mr. Koskinen. The facts are the facts.
Mr. Jordan. Treasury knew----
Mr. Koskinen. No one in the----
Mr. Jordan. --White House knew in April. We didn't know
till late June.
Mr. Koskinen. No one in the IRS talked to the White House.
You----
Mr. Jordan. Whoa, whoa, whoa. Then how'd they find out?
Mr. Koskinen. Pardon?
Mr. Jordan. How'd they find out?
Mr. Koskinen. I am told by the people who've read the White
House letter the White House found out from Treasury. Nobody
from the IRS talked with the White House.
Mr. Jordan. Someone from the IRS talked to Treasury, then.
Mr. Koskinen. That's what I understand.
Mr. Jordan. Well, and, as I've said before, we'd like to
know who that person is.
Mr. Koskinen. Fine.
Mr. Jordan. I hope you'll find out. Can you make a
commitment to this committee tonight that you're going to go
find out who that individual was, who those individuals were,
who talked to the Treasury Chief Counsel, who then talked to
the White House, 2 months before the people's house got that
same information? Can you make that commitment?
Mr. Koskinen. I'll do my best.
Mr. Jordan. Well, let's hope it's better than that.
I yield back.
Chairman Issa. Would the gentleman yield?
Mr. Jordan. I'd be happy to yield.
Chairman Issa. And I appreciate your trying to find out. It
would save us a lot of trouble of going through all the people
to find out.
But you just said something that I wanted to make sure I
understood. You said, and I'm phrasing, maybe the White House
wouldn't release it the way Ways and Means released a document.
Is that right?
Mr. Koskinen. Yes. In other words, my experience has been
in this issue that any information that comes out piecemeal
immediately gets an overreaction to it.
Chairman Issa. So, I--well, ``overreaction'' is your
statement. I guess the question I have is, hasn't the White
House selectively leaked documents in the past?
Mr. Koskinen. I have no--I'm not involved in any of those
issues if they have.
Chairman Issa. You've probably read the Wall Street
Journal, the New York Times, or the Washington Post. Isn't it
true the White House does put out piecemeal documents that
favor them when they get them and hold back ones when they
don't?
Mr. Koskinen. I'm not familiar with what the White House
activities are.
Chairman Issa. I guess I'll wait for my own time. But I
must admit, I'm a little insulted to hear that the White House
is trustworthy and Congress isn't, in your opinion.
The gentleman from Nevada, Mr. Horsford, is recognized.
Mr. Horsford. Thank you, Mr. Chairman.
It's kind of interesting how positions change over time,
because, looking back on some of the record, it appears that
when the Bush White House lost millions of emails related to
the leak of covert CIA agent Valerie Plame's identity and the
U.S. attorney firings, this same committee held a hearing in
2008. At that hearing, Chairman Issa said this: ``I think it is
fair that we recognize that software moves on and that
archiving in the digital age is not as easy as it might seem to
the public.''
At the same hearing, Chairman Issa discussed how Congress
needs to provide more funding to help agencies improve their
archiving technology. He said this: ``The House of
Representatives needs to begin making sure you are funded. And
that is part of what we do in oversight, fund it to deal with
ever-evolving technologies, where archiving isn't just putting
them away, it is being able to retrieve it.''
Now it appears that Chairman Issa's perspective has
changed. With respect to the loss of Ms. Lerner's emails, he
believes the loss of her emails is evidence of, ``nefarious
conduct.'' Chairman Issa has repeatedly stated this assertion,
but yet said something completely different in a previous
hearing.
Commissioner, as far as you can tell, the only difference
between the statements Chairman Issa made in 2008 and the
statements he made now is that there was a Republican
administration then and that there is a Democratic
administration now. The fact is that the IRS and many other
Federal agencies have struggled to improve their electronic
record retention for years. GAO, the National Archivist, and
others have been reporting on these problems repeatedly.
So I have a main question that I'd like to ask,
Commissioner, and that's, what can you do to explain to this
committee the steps that are being taken to restore the
public's trust in the IRS and the function that it provides to
the American people in this regard to the data and the
protection of that data?
Mr. Koskinen. We are reviewing all of our activities--I've
asked for this some time ago--to see if, at a minimum, we
couldn't create an electronic records system that would be more
searchable. We have spent, as everybody now knows, between $18
million and $20 million trying to produce documents as quickly
as we can and emails as quickly as we can because of the
archaic system that requires us to go to 90,000 individual hard
drives or, in this case, 83 custodian individual hard drives.
We're going to continue to do that.
The Archivist last year made a recommendation that, as a
way to begin to do this, we take the top 35--it's called the
capstone proposal; I'm sure he'll testify tomorrow about it--
that, as a start, recognizing the cost, that we develop systems
with the top 35 people in the agency, where their records are
automatically electronically put into a records system as the
first step. And we're going to take a look at that, which would
obviously be less expensive than trying to archive the entire
agency's records.
But I do think it's important for us to preserve official
records. It's important for history. It's important for people
to understand the basis on which we make decisions. And we're
going to continue to do that.
We are constrained. The issues are how we spend our money.
It's an important issue as to how we do it, but it is in a
situation where we have substantially fewer funds than we had 4
years ago, 10,000 fewer employees, and substantially increased
responsibilities. But it is an important issue for us to
consider, and we're going to do that.
Mr. Horsford. Thank you, Commissioner.
And, again, I want to commend you. You know, I say often on
this committee, we are the Oversight Committee, but we're also
the Government Reform Committee. And I would like to hear your
recommendations as we move forward on how we put those
recommendations in place and what this committee can do to
support you in those endeavors.
It's one thing to have as many hearings as we've had
without any substantiated evidence to suggest continuing. But
to not have one hearing on how we can implement any of the
recommendations to improve the system, I think, is a flaw in
the way this committee is managed.
And, Mr. Chairman, I know my time is up, but under rule 9,
sub A, I think that the chairman needs to ensure that there is
equal time given to each side and that Members should not have
their mics cut off and then Members in the majority allowed to
speak well over their permitted time.
Chairman Issa. We now go to Mr. Massie for 5 minutes or
such time less that he may consume.
Mr. Massie. Thank you. We could probably----
Mr. Koskinen. That's right; he's not required to use the
full 5 minutes, right?
Mr. Massie. And I'll try and----
Chairman Issa. He is not required, but seldom yielded back.
Mr. Massie. It really depends on the answer. I'm going to
try and be short. And I really appreciate your patience and
your stamina here tonight, so I'll be short with this question.
On June 3rd, 2011, Ways and Means Chairman Dave Camp sent
the IRS a letter demanding to explain the allegations of
targeting Tea Party and other conservative groups. He also
requested that emails be provided or preserved. Within 10 days,
Lois Lerner's hard drive crashed.
Now, we know her hard drive crashed because there was a--we
know this for sure because there was a ticket filed with the IT
department, is that correct, for a repair?
Mr. Koskinen. That's correct.
Mr. Massie. Could you provide us with all of the tickets
filed in the month of June 2011 at the IRS for failed hard
drives?
Mr. Koskinen. Yes.
Mr. Massie. Thank you very much.
I yield back.
Chairman Issa. Would the gentleman yield?
Mr. Massie. Yes.
Chairman Issa. I thank the gentleman.
We are nearing the end, but there will be--I'll need a few
more minutes. So I want to be--I want to be brief, but I want
to be thorough.
Ms. Lerner you didn't know. You say you never met her. My
understanding is from the reports that the hard drive that
failed was on her laptop; is that correct?
Mr. Koskinen. I'm not familiar. I know Nikole Flax's travel
computer is where the hard drive failed, not her office
computer.
Chairman Issa. Right.
Mr. Koskinen. I'm assuming, in light of where the archives
were, that it was her office computer where the hard drive
failed.
Chairman Issa. So I want just to understand, from a
procedural standpoint, employees of the IRS download emails,
which may include 6103 information, to their laptops and leave
the building with them. Is that correct?
Mr. Koskinen. That's right. Most of--a number of employees,
their office computer is, in fact, a laptop.
Chairman Issa. And, as a result, when they leave the
office, they take with them emails that may include 6103
information.
Mr. Koskinen. That's possible, yes.
Chairman Issa. To your knowledge, are laptops in the IRS
universally limited so they may not employ USB drives?
Mr. Koskinen. They are now. There was, as I understand, a
situation some years ago in which they were--well, I guess what
I should say is, years ago, USB drives, thumb drives were
usable that were not encrypted. And there was an issue that
came to my attention 3 or 4 months ago where, fortunately, no
information was misused by the public. Since that time, which
is several years ago, all thumb drives are encrypted so that if
a thumb drive is lost nobody can access the data.
Chairman Issa. I appreciate that. Congress has implemented
a similar thing. But we also can go buy at Best Buy normal
thumb drives.
So if Lois Lerner's laptop was, in fact, or any of these
other people's laptops or office computers, in fact, had a USB
on any of them that downloaded information, including 6103
information, to their local drives, could have, in fact, moved
them to USB-based external drives or to thumb drives of their
own purchase. Is that correct?
Mr. Koskinen. That sounds right. I don't know what the
equipment looked like 3 years ago, but I would assume that that
sounds right.
Chairman Issa. So, for the American people, it is very
possible and, in fact, probable that every day individuals
leave the IRS with personally identifiable information covered
under 6103 on their hard drives inside laptops that they take
home, on trips, to conferences, and the like.
Mr. Koskinen. I think that's correct, to the extent of my
knowledge. I may be corrected when I get back, but that sounds
correct.
Chairman Issa. So that means that, in fact, Lois Lerner, an
attorney, may have made a copy of the information on her hard
drive that died and she could have it on a USB product or, you
know, any kind of product but normally a USB-based thumb drive
or external hard drive, to your knowledge. You have no reason
to know that she couldn't have done that.
Mr. Koskinen. That's correct.
Chairman Issa. So, in fact, Lois Lerner may have made
copies of this before the failure of her computer.
To your knowledge, when the Department of Justice
questioned Lois Lerner, was she asked any of those questions?
Mr. Koskinen. I have no idea.
Chairman Issa. To your knowledge, did she have a USB or any
other product that could've taken copies off of her computer?
Mr. Koskinen. I have no knowledge that she did.
Chairman Issa. To your knowledge, did she also have a
laptop or dual-purpose computer that she took home with her or
left the building with?
Mr. Koskinen. I don't know.
Chairman Issa. Okay.
I would now ask unanimous--or let me rephrase that. Let me
just do one more.
You have 90,000 computers that basically use their local
hard drives to store information, emails, instead of on the
server, because after so many days it disappears off of--after
half a year, they disappear off the server. Is that right?
Mr. Koskinen. No. No, no. The server will keep your emails
until you get to 6,000, and then you'll get a notice saying you
have to either archive them or delete them.
The backup tapes that preserve information for 6 months are
separate. The server--you may have emails on your server for 5
years if you've----
Chairman Issa. If you don't hit that number.
Mr. Koskinen. If you don't hit the 6,000.
Chairman Issa. Okay. Obviously, Lois Lerner, with tens of
thousands, did.
I now would recognize myself for my own time.
Continuing on, I spent a lot of time in the electronics
industry, and so I have a bit of a passion for this.
Are you aware that if you back up your systems every 6
months, that the cost that we would be looking at for what it
would've cost to have backed them up essentially once a month
would be cost of the tape drive that, in fact, those tapes or
cartridges that would be retained. And my understanding, pretty
obviously, is that wouldn't be $10 million, would it be?
Mr. Koskinen. No, I don't think so.
Chairman Issa. So, with your limited budget, if instead of
throwing away or recycling after 6 months the cartridges and
simply reusing them, because you're only using them for
disaster recovery, if you bought 12 sets of cartridges so that
every month you made a backup and then, in fact, used the
incremental backup systems that exist, you could've backed up
your systems and retained them for 7 years for a fraction of
$10 million, couldn't you?
Mr. Koskinen. That's correct, but you would simply have a
capacity to--as a disaster recovery system, that process is not
a searchable email system.
Chairman Issa. I appreciate your telling me that, because I
served on this committee in this room in that position when
Henry Waxman--because the Bush White House, in conversion from
Lotus Notes to Windows Exchange Server, or Microsoft Exchange
Server, failed to have good backups and they used their image
backups at a cost of a great deal of money to restore countless
emails so that the Presidential Records Act and the Federal
Records Act would be fully maintained.
Do you have any recollection of those hearings or that
activity?
Mr. Koskinen. I do not.
Chairman Issa. To this committee, it's pretty famous. Mr.
Waxman did not care that it cost an estimated $24 million to
recover every single one of those emails. This committee
aggressively said they had to do it, and they did image backup
restorations.
Had you done image backups and retained them, prior to your
arrival, but had the IRS done it, it would have cost probably
tens of thousands of dollars to maintain 6 or 7 years' worth of
those, and we wouldn't be having the same discussion today,
would we?
Mr. Koskinen. No. It would've cost a lot of money, as you
know, to then get emails off of those recovery tapes. But
that's right; if we had--if we had them, we could then send the
millions of dollars it would take to pull it off the disaster
recovery tapes. But that's not what the disaster recovery tapes
are meant to do.
Chairman Issa. What's interesting is the images, or
disaster recover tapes, the reason it cost so much with the
White House is they wanted every email retained or recovered.
We only wanted Lois Lerner's.
I'd like to enter in the record now a document given to us
by the National Archives.
And I'll show it, because it's a little hard to see, but--
there we go.
Mr. Koskinen. A little hard to read from here.
Chairman Issa. Well, I'll read you just a piece of it.
Andrew Jackson of the State of Tennessee, the first day of
December, 1799, is still burned. And he's complaining through
Congress--this is from--this is essentially a Congressional
Record, where he petitions the United States Congress in 1803
to recover--and he started in 1801 with an affidavit--for his
loss of revenues paid in 1799 because his stills burned after
they collected the revenue in advance for his hundreds of
gallons of liquor.
And I only put that in the record for one reason. The
National Archives and the Archivist, who will be with us
tomorrow, maintains an amazing amount of documents and recovers
documents.
Now, Andy Jackson, General Jackson, wanting his money back
on his still may not be anything other than humorous this late
at night, but it's part of the wealth of information the
American people have access to just across the street.
Your agency came here and said, on a $1.8-billion budget--
you did this tonight--that, in fact, you needed more money if
you were going to maintain records. I would certainly hope that
when you go back and you scrub that $10 million in order to do
X and more to do Y that you go back and you really ask, within
the best practices, whether or not to meet--for your CIO to
meet the requirement of the National Archives having access to
the kind of information, the wealth of information they need.
Working with the National Archives, you can do it and do it for
a reasonable price.
Mr. Horsford was correct. I have been a big believer that,
in fact, maintaining for the American people the transparency
not just of what Mr. Cummings and I are doing here tonight but
for the next generation, the generation beyond, as much
information as we possibly can is an obligation.
Earlier, Mr. DesJarlais, maybe cynically, maybe just doing
the arithmetic, looked at that, sort of, nickel a page to print
out and stick in a file drawer and later turn over to the
National Archives paper. I strongly suggest that this committee
and you, you for your agency, this committee for all of
government, really take a look at how much less expensive it is
to maintain it digitally, to deliver it digitally, so that it
can be machine-searchable for the next generation and, in fact,
be of a benefit to all of us.
Lastly, I'm going to guess that on the $111 per employee's
computer--because that's what $10 million is--you could easily
have covered that expense, that $10 million expense, by simply
downgrading those local drives. Because, in fact, there's very
little reason for them to have large local drives.
Lastly--and I'm going to close with this, and this is
really not as much questions--you're familiar with the
interrogatories we sent, some 50 questions?
Mr. Koskinen. On Saturday afternoon, yes.
Chairman Issa. Yes, 48 hours before the hearing. You're
aware that, for the most part, there was no response, other
than a short oral briefing this afternoon in which
presentations were made that were not part of the
interrogatories, in some cases?
Mr. Koskinen. It's a little hard to get everybody together
on a Sunday, even though it is counted as the 48 hours. We
got----
Chairman Issa. No, I understand----
Mr. Koskinen. --your email, or your request, at about 4:30
Saturday afternoon.
Chairman Issa. No, I understand that. But there was 8 hours
of workday today.
The questions we have, for the most part, are the questions
that you should've already asked. They should've been
answerable immediately.
There will be some additional questions that I will send
interrogatories to you. They will ask you to please see if you
can figure out whether it was the 1st of April that you learned
about the real loss of documents, 7 days after you testified,
or 30 days after, to narrow down the April and to narrow down
who told you--who told you about it.
There obviously is the question of how the White House came
to know, while Congress was never informed about these losses
of documents until your seven-page letter.
So, for that purpose, we will now recess. If I'm able to
get the interrogatories and the follow-up calls done in a
timely fashion, I will be pleased to adjourn this. But for now,
we are recessing subject to recall.
We stand in recess.
[Whereupon, at 10:53 p.m., the committee recessed, to
reconvene at 9:30 a.m., Tuesday, June 24, 2014.]
APPENDIX
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Material Submitted for the Hearing Record
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