[House Hearing, 113 Congress]
[From the U.S. Government Publishing Office]




                               before the


                                 of the

                         COMMITTEE ON OVERSIGHT
                         AND GOVERNMENT REFORM

                        HOUSE OF REPRESENTATIVES


                             SECOND SESSION


                             JULY 23, 2014


                           Serial No. 113-133


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                 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
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

                   Lawrence J. Brady, Staff Director
                John D. Cuaderes, Deputy Staff Director
                    Stephen Castor, General Counsel
                       Linda A. Good, Chief Clerk
                 David Rapallo, Minority Staff Director

  Subcommittee on Economic Growth, Job Creation and Regulatory Affairs

                       JIM JORDAN, Ohio, Chairman
PATRICK T. McHENRY, North Carolina       Pennsylvania, Ranking Minority 
PAUL GOSAR, Arizona                      Member
PATRICK MEEHAN, Pennsylvania         TAMMY DUCKWORTH, Illinois
SCOTT DesJARLAIS, Tennessee          GERALD E. CONNOLLY, Virginia
DOC HASTINGS, Washington             MARK POCAN, Wisconsin
CYNTHIA LUMMIS, Wyoming              DANNY K. DAVIS, Illinois
DOUG COLLINS, Georgia                STEVEN A. HORSFORD, Nevada
MARK MEADOWS, North Carolina

                            C O N T E N T S

Hearing held on July 23, 2014....................................     1


The Hon. John Koskinen, Commissioner, Internal Revenue Service
    Oral Statement...............................................     8
    Written Statement............................................    11


Timeline for OGR hearing with Commissioner Koskinen, submitted by 
  Chairman Issa..................................................    72
E-mail from TIGTA's Deputy Inspector for Investigations, 
  submitted by Rep. Connolly.....................................    73
Pages from transcribed interviews of DOJ Officials Richard Pilger 
  and Jack Smith, submitted by Rep. Horsford.....................    74
July 11, 2014 letter from IRS Commissioner Koskinen in response 
  to letter from Chairman Issa and Mr. Jordan, submitted by Mr. 
  Cummings.......................................................    84



                       Wednesday, July 23, 2014,

                  House of Representatives,
   Subcommittee on Economic Growth, Job Creation & 
                                Regulatory Affairs,
              Committee on Oversight and Government Reform,
                                                   Washington, D.C.
    The subcommittee met, pursuant to call, at 10:00 a.m., in 
Room 2154, Rayburn House Office Building, Hon. Jim Jordan 
[chairman of the subcommittee] presiding.
    Present: Representatives Jordan, DeSantis, Meehan, Lummis, 
Collins, Meadows, Bentivolio, Issa, Cartwright, Connolly, 
Horsford, Kelly, and Cummings.
    Also Present: Representative Gowdy.
    Staff Present: Melissa Beaumont, Majority Assistant Clerk; 
Molly Boyl, Majority Deputy General Counsel and 
Parliamentarian; David Brewer, Majority Senior Counsel; Drew 
Colliatie, Majority Professional Staff Member; Linda Good, 
Majority Chief Clerk; Christopher Hixon, Majority Chief Counsel 
for Oversight; Mark D. Marin, Majority Deputy Staff Director 
for Oversight; Jessica Seale, Majority Digital Director; Andrew 
Shult, Majority Deputy Digital Director; Sarah Vance, Majority 
Assistant Clerk; Rebecca Watkins, Majority Communications 
Director; Tamara Alexander, Minority Counsel; Portia Brown, 
Minority Counsel; Aryele Bradford, Minority Press Secretary; 
Susanne Sachsman Grooms, Minority Deputy Staff Director/Chief 
Counsel; Elisa LaNier, Minority Director of Operations; Donald 
Sherman, Minority Chief Oversight Counsel; and Katie Teleky, 
Minority Staff Assistant.
    Mr. Jordan. The committee will come to order.
    I want to thank our witness for being here again.
    We will start with some opening statements. I will start 
first by recognizing the chairman of the full committee, the 
gentleman from California, Mr. Issa.
    Mr. Issa. Thank you, Mr. Chairman, that is very kind.
    Commissioner, I know that this is unprecedented, to have a 
commissioner of the IRS in front of this committee so often, 
and I appreciate the fact that you have been willing to be 
briefed and participate even beyond our requests at times.
    As we continue to explore a number of questions, the time 
line of the crash, the inconsistency of the probability of lost 
emails by multiple people within Government, we appreciate that 
you were not in Government; you were not doing this at the 
time. But as you can imagine, not just the Internet, not just 
Fox, but America is beginning to question how convenient so 
many emails of so many people at the heart of targeting 
conservative groups for their views, for their politics, and 
for the fact that Citizens United was objected to by the 
President, how many of them had loss of data and how much is 
not available to the American people.
    A cover-up is normally described as something that happens 
during an investigation around here. In other words, things go 
missing during the investigation. But when it comes to the loss 
of data, it is clear that data began disappearing and not being 
able to be yet found at a time when Congress was just beginning 
to look at wrongdoing that is now confirmed that began with the 
President objecting to Citizens United, that began with 
Democratic members of the House and Senate writing letters 
asking for investigation of people that were politically the 
opposite of their party, not asking for investigations about 
all people who may be involved in political activities in 
addition to their nonprofit work.
    It is clear they were driven within the IRS, and perhaps 
other areas, by political bias and a belief that the President 
wanted a fix and that the fix had to occur.
    Again, commissioner, you weren't in Government at that 
time, but Government is today; it is their time, it is their 
watch. It is their responsibility. Whether it is the FEC, the 
IRS, the Department of Justice, or any and all of Government's 
activities that led to the unfair treatment on the eve of 
campaign elections of conservative groups, it is clear that 
there was a convenient loss of far more data by far more people 
than is explained by the normal arithmetic probabilities.
    Today we will explore not only the time line, but when this 
committee received that time line. It was your watch to give us 
accurately and keep us up to date on developments related to 
Lois Lerner and other parts of our investigation. It is my view 
that you could have done better. You will and have paid a price 
in public opinion for not being as forward-leaning and 
proactive as you could have been.
    But that was yesterday. Today what we are asking you to do 
is to continue working with your IG, and, if we are fortunate 
enough to get a special prosecutor, work with him or her and, 
of course, work with the groups that now have Federal judges 
ordering the IRS to show particular information and bringing it 
all together back to this committee, because this committee has 
an intent to make to the greatest extent possible public what 
we can find is being done on behalf of the American people to 
bring back the confidence in the IRS.
    So, again, I appreciate your willingness to be here. These 
are not easy hearings, and each time you come you leave with 
more questions from us than you come with answers to us, and 
that is the nature of an investigation that continues to 
    So, Mr. Chairman, I want to thank you for recognizing me 
    Commissioner, again, you need to be part of the solution. I 
believe you have to a certain extent and I believe you are 
committed to do more, and for that I thank you, and I yield 
    Mr. Jordan. I recognize the member from Maryland, the 
ranking member of the committee, Mr. Cummings.
    Mr. Cummings. Thank you very much, Mr. Chairman.
    Commissioner Koskinen, I want to thank you for testifying 
before this committee yet again. This is the third time in the 
past month you have appeared before us, and that does not count 
a fourth appearance you made before the Ways and Means 
Committee last month on the same topic.
    Unfortunately, it appears that you and other IRS employees 
are now becoming collateral damage in a fight for the spotlight 
among two Republican committee chairmen, Representative Issa 
and Representative Camp. This is unseemly, it is embarrassing, 
and is not a proper way to run an investigation or to spend 
millions of dollars in taxpayer funds.
    As the commissioner knows very well, when Chairman Camp was 
informed about the crash of Lois Lerner's hard drive, he 
quickly announced that he would be holding the first public 
hearing before the Ways and Means Committee. Ten minutes later 
Chairman Issa issued a unilateral subpoena compelling the 
commissioner to testify first before our committee. You did not 
contact the commissioner before issuing the subpoena and you 
did not hold any debate on the vote or vote. In response, 
Chairman Camp chose to move his hearing up several days so he 
was the first one in front of the cameras.
    It did not seem to matter to either chairman that the IRS 
provided numerous contemporaneous documents showing that Ms. 
Lerner's computer crash was a technological problem that she 
and multiple IT officials attempted to remedy. Those facts 
apparently were irrelevant. The goal was to stoke the fire and 
to be the first to do so publicly. Chairman Camp has now asked 
the inspector general to conduct an investigation into Ms. 
Lerner's hard drive crash, which he has agreed to do. 
Commissioner Koskinen testified last time he was here that the 
inspector general asked him to make his investigation the top 
priority, which meant not subjecting IRS employees to any other 
interviews while the inspector general's interviews were going 
on. That was the IG's request.
    Rather than waiting a few weeks, Chairman Issa disregarded 
the IG's request and demanded that the IRS make its employees 
available to him now. Commissioner Koskinen explained that the 
inspector general did not want IRS employees subjected to 
multiple interviews, but Chairman Issa just began issuing more 
unilateral subpoenas. He forced the IRS employees to appear 
before the Oversight Committee and he excluded Chairman Camp's 
staff from participating. When the commissioner testified here 
before, Republicans accused him of obstruction, claiming that 
he was hiding witnesses from the committee. When he again 
explained that the inspector general asked him not to subject 
IRS employees to multiple interviews, Chairman Issa said he was 
going to follow up with the inspector general directly.
    Well, that apparently didn't happen. Yesterday I asked my 
staff to contact the inspector general's office to find out 
exactly what was going on. They spoke with the Deputy Inspector 
General for Investigations, and I can report what he told us. 
The Deputy IG for Investigations confirmed that his office is 
now conducting the investigation that Chairman Camp requested. 
He confirmed exactly what Commissioner Koskinen told us, which 
is that the inspector general prefers that IRS employees not be 
subjected to multiple interviews in order to avoid ``tainting 
their testimony.''
    Without directly criticizing the chairman's actions, the 
Deputy IG for Investigations stated that, as investigators 
working for the inspector general, they want everyone to allow 
them to complete their interviews first ``without 
distraction.'' As he stated then, there is no confusion of 
witness testimony and the integrity of the investigation is not 
    Contrary to these requests, Chairman Issa has been forcing 
IRS employees to come before our committee for transcribed 
interviews, and since he is excluding Chairman Camp's staff, 
IRS employees are also being forced to appear before Ways and 
Means. Invariably, after each of these interviews, Chairman 
Issa and Chairman Camp issue dueling press releases with 
tidbits of information or cherry-picked transcript excerpts in 
their effort to compete for more headlines, no matter how 
unsubstantiated their claims are.
    The Deputy IG for Investigations also told us something 
else. Over the past year and a half, they have obtained no new 
evidence that would change the conclusions in the audit from 
    As I close, there is simply no evidence whatsoever of any 
White House involvement in the screening of tax-exempt 
applications. The IRS has already spent $18 million responding 
to the duplicative congressional investigations, and 
Commissioner Koskinen is now testifying before Congress for the 
fourth time in just over a month. Yet, Chairman Issa informed 
committee members yesterday that he will be holding yet another 
hearing on the topic next Wednesday. We have the notice here.
    With that, I will yield back.
    Mr. Jordan. I thank the gentleman.
    Mr. Issa. Mr. Chairman?
    Mr. Jordan. The chairman of the full committee is 
    Mr. Issa. Point of privilege. There were a number of words 
in the gentleman's statements that disparage me, and I object 
to his words and debate, and ask that he withdraw or modify 
them, and ask unanimous consent that among the terms that be 
withdrawn would be not only the unseemly statement, but in fact 
when the ranking member disparaged me for a number of areas, 
including my intent and essentially said that the items I said 
were not true.
    Additionally, the ranking member, while objecting to 
multiple claims of cherry-picking releases or interfering with 
the IG, fails to mention that in June of 2013 he released the 
entire John Schafer transcript, which has compromised this 
investigation by statements made in future transcribed 
interviews, saying that they had reviewed these in preparation 
for those.
    So I certainly would say that while questioning the intent 
in some argument about Republicans not getting along, the 
ranking member managed to go beyond the ordinary opening 
statement and claiming the intent. In fact, the ranking member, 
in June of 2013, went on national television claiming the 
investigation was over. This investigation is not over. I would 
ask that such items, including unseemly, be taken down.
    Mr. Jordan. Without objection?
    Mr. Cartwright. I object.
    Mr. Jordan. Okay.
    Mr. Issa. The gentleman objects. I understand, but I would 
reiterate that the decorum of this committee should not lead to 
personal attacks as to the intent of individuals on either 
side. The fact is this committee is conducting vigorous 
oversight. We do so as a matter of our obligation as a 
    And I would make one last request. I ask unanimous consent 
that the staff be able to place the time line into the record 
so that the ranking member's clearly erroneous claim that our 
request for the first hearing came after the events, when in 
fact the time line will show that the subpoena had been served 
prior to the announcement from Ways and Means. And as the 
ranking member would know if he had ever chaired this 
committee, the fact is it takes a long period of time to 
prepare a subpoena, to write a subpoena, to go to the clerk and 
get it approved, and then to serve it. So I would hope that the 
ranking member, once he sees that in the record, would 
recognize that in fact he has been clearly erroneous in his 
    And I yield back.
    Mr. Jordan. I thank the gentleman for yielding.
    If we can, without objection, let's allow the time line in 
and let's move to the next opening statement. Would that be 
satisfactory with----
    Mr. Connolly. Mr. Chairman?
    Mr. Jordan. Would that be satisfactory?
    Mr. Connolly. It certainly is satisfactory.
    Mr. Jordan. I thank the gentleman.
    Mr. Connolly. I just wonder, though, would just a brief 
response to the distinguished chairman?
    Mr. Jordan. Do you really have to?
    Mr. Connolly. No, I don't really have to, other than to say 
to you, Mr. Chairman, I certainly associate myself, and I know 
my colleagues do on this side of the aisle as well, with the 
sentiments expressed by the distinguished chairman that we 
should always speak with respect about each other.
    Mr. Jordan. Well said.
    Mr. Connolly. We should never question each other's 
intentions. That has not been the practice as often as I would 
like on this committee. So I certainly hope that this would 
reflect a new day dawning here in the committee and that we can 
proceed civilly.
    I thank the chair.
    Mr. Jordan. Thank the gentleman for his comments.
    Our subcommittee meets today to continue its oversight of 
the IRS and the targeting of conservative tax-exempt 
applicants. We welcome back our witness, IRS Commissioner John 
Koskinen. All kinds of questions need to be answered, and that 
is why, for the third time in a month, we have Mr. Koskinen 
here to answer and address many of those unanswered questions.
    First, we were promised that the IRS would produce all of 
Lois Lerner's emails. Then we learned that some of Ms. Lerner's 
emails had been destroyed and there was absolutely no way he 
could produce all of Ms. Lerner's emails to Congress.
    Second, we were told the IRS had confirmed that all backup 
tapes with Lois Lerner's emails had been destroyed. Then we 
learned last week from IRS attorney Thomas Cain that a backup 
tape may in fact exist.
    Third, we were told that there was one hard drive crash, 
Lois Lerner's. Then the Ways and Means Committee disclosed that 
there were seven or eight total crashes. And now we learn from 
Mr. Cain that there may be as many as 20.
    Now, think about this. The IRS has identified 83 custodians 
of documents and information. The IRS has identified these 
people associated with this targeting of conservative groups 
and now almost a fourth of them may have had hard drive 
crashes. Unbelievable.
    Fourth, we were told that the IRS found out in April 2014 
that Ms. Lerner's emails were lost. But then we learned from 
Mr. Cain that the IRS knew on February 4th, 2014 about Ms. 
Lerner's hard drive crash and that it found out just days later 
that the hard drive had been recycled and its contents were 
    That is why we continue to have hearings. That is why we 
have Mr. Koskinen back for the third time in a month. We would 
like to get some straight answers.
    We have convened this hearing because today, over a month 
after the IRS first told Congress that it lost Ms. Lerner's 
emails, there are still many unanswered questions. There are 
still unanswered questions about why the IRS delayed for 
several months in notifying Congress, the Justice Department 
and the American people about the problems with Ms. Lerner's 
    Deputy Attorney General Cole told us last week that the 
Justice Department learned of the missing Lois Lerner emails 
from press accounts in the media. Imagine that. One of the 
highest profile investigations in years, and the Justice 
Department has to learn about critical evidence by the central 
player in this investigation. They learn about that in news 
accounts, not directly from the Internal Revenue Service. And 
that is why last week, sitting at this very table where Mr. 
Koskinen sits today, Deputy Attorney General Cole said he would 
have liked to have known about the emails earlier and he 
announced that the Justice Department was investigating why 
Commissioner Koskinen failed to disclose the missing emails in 
a timely manner.
    Let me just reiterate that. James Cole, Deputy Attorney 
General of the United States Department of Justice, said last 
week, in that same chair, to this same committee, that they are 
investigating why the Internal Revenue Service delayed months 
in telling the Congress, the American people, and, most 
importantly, the FBI and the Justice Department about the loss 
of Lois Lerner's emails. Rather than the IRS coming to Congress 
and informing us what it knew when it knew it, the IRS waited 
four months. The IRS only came forward to finally acknowledge 
the missing emails when it had no choice, and it disclosed the 
news the only way it knows how, by burying the information on 
page 7 of enclosure 3 in a Friday afternoon letter to the 
Senate. Information obtained by the committee in the last few 
days provides more questions than answers about the missing 
    But remember this isn't information the IRS is offering up 
willingly. It has taken almost a month for the IRS to finally 
start coming clean and it has taken subpoenas to get people to 
talk. Mr. Cain, we tried for weeks to get Mr. Cain to come 
talk. We finally had to subpoena him. The IRS wouldn't provide 
him. We had to subpoena him to get him to come for the 
deposition last Thursday.
    The American people have this information only because the 
committee has been asking questions, and that is why 
Commissioner Koskinen is here today. He is the individual 
handpicked by the President to clean up this agency, and that 
is why he is here today, to answer our questions. Until we know 
all the facts, until we clear up all the confusion and all the 
misstatements about Lois Lerner's missing emails, the committee 
will continue to press for the truth. That is the mission of 
the oversight committee and, again, that is why we meet today.
    With that, I yield to the ranking member of the 
subcommittee, Mr. Cartwright. The gentleman from Pennsylvania 
is recognized.
    Mr. Cartwright. Thank you, Mr. Chairman.
    First off, thank you, Mr. Koskinen, for coming today. You 
know, we schedule these things on these little doohickeys, and 
it asks you do you want to make this a recurring entry. And 
when I see Koskinen, I want to say yes at this point.
    At this point, I am concerned that committee Republicans 
are no longer using these hearings for the purpose of 
investigating what happened to the groups that were the subject 
of the inspector general's May 14, 2013 report. This seems to 
be something different. And I want to say we all ought to agree 
that the point of this committee, the Oversight and Government 
Reform Committee, is not publicly to harass Federal agency 
heads, Mr. Koskinen; it is to conduct responsible oversight of 
the legitimate critical issues within our jurisdiction. I 
believe that these repeated hearings that we are seeing today 
are both an abuse of authority and a dereliction of this 
committee's duty. I think it is abundantly clear that Chairman 
Issa and Chairman Camp are in some kind of taxpayer-funded 
footrace over who can make the first headlines about Lois 
Lerner's lost emails.
    And we heard about requests for a time line, and we ought 
to look at that time line because it was on June 16, shortly 
after Chairman Camp, of Ways and Means, announced that he would 
be holding a hearing with you, Commissioner Koskinen, on June 
24th, that Chairman Issa of this committee issued a unilateral 
subpoena compelling the commissioner to testify before this 
committee on June 23rd. In response, Chairman Camp moved his 
hearing up to June 20th. So it is something like a children's 
fairy tale that we are looking at here.
    In addition, Chairman Issa is no longer allowing staff from 
the Ways and Means Committee to participate in the Oversight 
Committee interviews. Chairman Issa's refusal to hold joint 
interviews is resulting in wasted taxpayer money, as IRS 
employees like you, Mr. Koskinen, are now being subjected to 
multiple, duplicative interviews.
    I also want to address Republican claims that the alleged 
targeting of conservative groups is this Government-wide 
conspiracy initiated after the Citizens United decision 
involving the President, the IRS, a conspiracy including the 
Department of Justice and other Federal agencies. This 
committee has obtained no evidence linking these accusations to 
what we all know now were inappropriate criteria used by IRS 
employees in Cincinnati. Some of my colleagues on the other 
side of the dais have chosen to overlook the funneling of dark 
money into the political system of the United States. 
Republicans have demanded accountability from the IRS, but have 
not demanded the same from corporations who influence our 
national elections.
    In January 2010, the U.S. Supreme Court, in a five to four 
decision on Citizens United, allowed for-profit corporations, 
unions, and nonprofit groups to raise unlimited funds and 
register for tax exempt status under the 501(c)(4) designation, 
and the IRS then became flooded with applications for this kind 
of status. The 501(c)(4) designation is exclusively meant for 
organizations whose primary activity is social welfare, defined 
in the tax code as making charitable, educational, and 
recreational contributions to a community.
    Now, while 501(c)(4)s are not barred from participating in 
political campaigns, it is stated plainly and clearly that 
political participation must be an insubstantial amount of the 
group's overall activity, accounting for less than 50 percent 
of expenditures. The IRS's job was to make sure these groups 
were following the rules so they weren't taking tax breaks 
meant only for groups contributing to the community, not hiding 
the influence that a select few individuals have on our 
nation's electoral politics.
    As I said before in previous hearings, this is about groups 
doing everything they can do to hide where they get their 
money, obscure their true intentions, and have undue influence 
on the political system tax-free. Anonymous money in politics 
is something we don't need in this Country, something that 
disrupts the democratic process, and something that has to be 
    I commend Chairman Leahy and Senator Udall of the Senate 
Judiciary Committee for advancing S. J. Res. 19, a joint 
resolution proposing an amendment to the U.S. Constitution 
which would negate these damaging effects of Citizens United.
    I have cosponsored the House companion to that bill, 
introduced by my friend, Representative Ted Deutch of Florida.
    With that, I will conclude my comments and yield back to 
you, Mr. Chairman.
    Mr. Jordan. I thank the gentleman.
    Members will have seven days to submit written statements 
to the committee.
    We are pleased to have with us today the Honorable John 
Koskinen, Commissioner of the Internal Revenue Service.
    Mr. Koskinen, you know how this works; you have done it a 
few times before. Please stand and raise your right hand. Do 
you solemnly swear or affirm that the testimony you are about 
to give will be the truth, the whole truth, and nothing but the 
truth, so help you, God?
    [Witness responds in the affirmative.]
    Mr. Koskinen, you are now recognized for your opening 
statement, and then we will get right to questions.

                    INTERNAL REVENUE SERVICE

    Mr. Koskinen. Thank you. Chairman Jordan, Ranking Member 
Cartwright, members of the subcommittee, thank you for the 
opportunity to appear before you today. With your permission, I 
will provide a brief introductory statement and submit a copy 
of my complete testimony for the record.
    Before beginning my statement, I want to thank the 
subcommittee for its willingness to work around my travel 
schedule. In attempting to set the original hearing date, my 
understanding was you were interested in an overview of IRS 
interactions with the Department of Justice. I would like to 
touch briefly on that subject, which is covered in more detail 
in my prepared statement.
    In general terms, the IRS regularly and routinely interacts 
with the Department in the investigation and prosecution of 
criminal and civil tax matters, and also other financial fraud. 
Our Criminal Investigation Division investigates and develops 
cases and recommends them to the Department's Tax Division for 
prosecution. These cases represent a variety of tax issues, 
including refund fraud, abusive tax shelters, return preparer 
fraud, and international tax non-compliance.
    The international area offers a good illustration of what 
our coordinated efforts can accomplish. Recent examples include 
the guilty pleas by Credit Suisse and BNP, two major financial 
institutions that were found to be in violation of U.S. laws.
    Routine interactions between the IRS and DOJ also involve 
the IRS Office of Chief Counsel, which reviews all criminal tax 
cases developed by our Criminal Investigation Division before 
those cases are recommended for prosecution. In addition, when 
the Department of Justice's Tax Division litigates a civil 
matter, IRS Chief Counsel attorneys are actively involved, 
collaborating on the arguments and positions taken.
    Let me now turn to an update of the efforts that the IRS 
has made to cooperate with the investigations into the use of 
inappropriate criteria to evaluate applications for tax-exempt 
status under section 501(c)(4) of the Revenue Code. These 
include four investigations by Congress, one by the Department 
of Justice, and one by the inspector general. Added to that has 
been the recent new investigation by the inspector general of 
circumstances surrounding the crash of Lois Lerner's hard drive 
three years ago.
    To date, we have now produced more than 960,000 pages of 
unredacted documents to the tax writing committees and more 
than 700,000 pages of redacted documents to the House Oversight 
and Government Reform Committee. In addition, at the request of 
the Oversight Committee and other committees, the IRS has been 
working on the identification and production of Lois Lerner 
emails. As part of this document production, the tax writing 
committees have received 67,000 emails that we found involving 
Ms. Lerner. We are continuing to provide redacted versions to 
the Oversight Committee, which to date has received more than 
54,000 emails from Lois Lerner. We are working to provide these 
documents as quickly as we can.
    In the course of collecting and producing Ms. Lerner's 
emails, the IRS determined that her hard drive crashed in 2011. 
At that time, Ms. Lerner had asked IT professionals at the IRS 
to restore her hard drive, but they were unable to do so. 
Nonetheless, the IRS has or will produce 24,000 Lois Lerner 
emails from the period between 2009 and 2011, largely from the 
files of other individuals.
    The IRS provided information about the hard drive crash to 
all six investigating entities in a public report we released 
in June. I would note that our June report, to the extent that 
it focused on Ms. Lerner's hard drive crash, was based in part 
on emails we had already provided to the congressional 
committees, the inspector general, and the Department of 
Justice. Some of those emails were produced as long ago as last 
fall. Those emails were provided in the normal course of 
production related to the search terms agreed upon previously. 
So all six investigators have had initial information about the 
hard drive crash since last fall. Also, additional emails about 
Ms. Lerner's hard drive crash were produced this spring to 
investigators, prior to the release of our June report.
    I also want to point out that, consistent with a bipartisan 
congressional request, the inspector general has noted he is 
proceeding with its own investigation regarding the crash of 
Ms. Lerner's hard drive. The IG, as was noted earlier, has 
asked the IRS not to do anything that would interfere with its 
investigation, and we are honoring that request to the extent 
    In addition, on July 18 we responded to a recent court 
inquiry with detailed information regarding the crash of Ms. 
Lerner's hard drive. This information is consistent with what 
was previously provided in the six investigations, but we have 
provided the Oversight Committee and other investigating 
entities with a copy of that information.
    I understand that during last week's hearing with DOJ there 
was a question as to what information the IRS gave to the 
Department about the hard drive crash. We provided all 
investigating entities with the same information in our June 
report which we released to the public. DOJ did not receive any 
additional information.
    Since releasing our June report, we have continued to 
cooperate with the investigations. Since mid-June we have 
produced to the Oversight Committee more than 100,000 pages of 
documents and made witnesses available for interviews with 
congressional staff. Five of those interviews have already 
occurred. Our deputy chief information officer has given three 
briefings for congressional staff, including one for the 
Oversight Committee, and, as noted, I have testified at four 
hearings, including the one today.
    This concludes my statement, and I would be happy to take 
your questions.
    [Prepared statement of Mr. Koskinen follows:]


    Mr. Jordan. I thank the gentleman.
    Now turn to the vice chair of the committee, the gentleman 
from Florida, Mr. DeSantis.
    Mr. DeSantis. Thank you, Mr. Chairman.
    Good morning, Commissioner. Mr. Koskinen, are you aware 
that you currently are under investigation by the Justice 
Department regarding your role in determining when to produce 
Lois Lerner's emails?
    Mr. Koskinen. I am not aware of an investigation. I did see 
the deputy attorney general's statement last week before this 
committee that he would be interested in why we had not 
provided him information in April, as opposed to June, but I 
have not received any notice of an investigation.
    Mr. DeSantis. Well, he told us that it was something that 
the Justice Department would look into, and he said that it was 
information that they did wish they had at the time that you 
discovered it.
    Let me ask you this. The committee interviewed IRS Deputy 
Associate Chief Counsel Thomas Cain, and he testified that 
senior IRS officials, including Catherine Duvall, the counselor 
to the commissioner, realized that Lois Lerner's emails were 
missing, that there was a hard drive crash on February 4th, 
2014, and that by mid-February they realized that the emails 
would not be recoverable off that hard drive. Yet, you 
testified in front of this committee on March 26th, 2014, and 
after being asked numerous times whether you would produce all 
of Lois Lerner's emails consistent with the subpoena, you said 
you would.
    So if the senior IRS officials knew in mid-February that 
the emails could not be recovered off the hard drive, why did 
you tell this committee that you would produce them?
    Mr. Koskinen. As I have testified before, when I testified 
at previous hearings, when I testified in March, I said we 
would provide all Lois Lerner emails, as I have also testified 
since then. I did not mean to imply that if they didn't exist, 
we would somehow magically provide them. We have provided you 
all Lois Lerner emails we have.
    With regard to when officials at the IRS knew the impact of 
the hard drive crash, as I have testified several times in the 
11 hours of hearing since June 13th, what I was advised and 
knew in February was that when you took the emails that had 
already been provided to this committee and other 
investigators, and, instead of looking at them by search terms, 
looked at them by date, it was clear that there were fewer 
emails in the period up through 2011 and subsequently. And 
there was also, I was told, there had been a problem with Ms. 
Lerner's computer. It was not described to me in any greater 
detail than that.
    I was advised near the end of February that we were now 
reviewing all of our production capacity to make sure nothing 
had been done in the production capacity that would have 
explained or would have caused the loss of any emails. That 
process went forward, but at the same time I would remind 
everybody we were focused primarily on the request from this 
committee and the Finance Committee and the Ways and Means 
Committee to complete the production of all documents we had 
related to the determination process, and we did that and, in 
mid-March, provided to the tax writing committees a letter 
saying we had now produced all the documents we had regarding 
the determination process.
    Mr. DeSantis. Okay, I appreciate that. We even asked Mr. 
Cole if someone responds to discovery requests and they say 
they will produce all of them, they can't just do that, 
represent that, and then know, well, gee, we are not going to 
be able to produce all of them; and then once they figure that 
out, they have to come immediately and tell the opposing party. 
In this case it is a congressional investigation, so it is not 
the same. And yet you guys sat on the information for several 
months, and that caused this investigation, from our end, to be 
    Let me ask you this about these backup tapes. The IRS has 
told Congress that backup tapes from 2011 no longer exist. Yet, 
Mr. Cain testified in terms of the interview with this 
committee that backup tapes may in fact exist. So can you now, 
under oath, definitively state that the relevant backup tapes 
that this committee has sought do not in fact exist?
    Mr. Koskinen. As I understand from your press release, what 
Mr. Cain said was the information we provided in June was 
accurate to the best of everyone's knowledge at that time. What 
he said since then is that the inspector general----
    Mr. DeSantis. Well, wait. You said, too, with all due 
respect, you said, on June 20th, 2014, to the Ways and Means 
Committee, that we, meaning the IRS, confirmed that backup 
tapes from 2011 no longer existed because they had been 
recycled pursuant to the IRS's normal policy. So that was a 
definitive statement on your part. Now we are getting 
information from Mr. Cain, well, the IRS isn't exactly sure 
that that is in fact true.
    Mr. Koskinen. What Mr. Cain reported was information that 
the inspector general has started to review tapes to see if 
there is additional information on them. Mr. Cain said, 
therefore, there may be backup tapes that were recycled, but 
may be recoverable. We have no information, I have no 
information what the inspector general is doing with those 
tapes. In fact, the inspector general advised us that he was 
reviewing those tapes and asked us not to do any further 
investigation, not to have any further conversations. And I 
understand he asked this committee as well not to make the 
existence of their review of those tapes public. But at this 
point I have no information as to whether there is anything 
usable on those tapes.
    Mr. DeSantis. We have been told obviously about Lerner's 
hard drive failure, then Ways and Means has identified as many 
as seven or eight additional individuals who are relevant to 
the investigation whose hard drives also crashed during this 
period. Now, based on testimony from Mr. Cain, it could be as 
many as 18 or 19 different hard drives that have crashed that 
would be relevant. So can you definitively state to this 
committee the number of hard drives from relevant individuals 
that crashed during the period in question?
    Mr. Koskinen. I can tell you what I know at this time, 
which is in the first six months of 2011, over 300 hard drive 
crashes occurred, and there were over 5,000 reports of hardware 
problems. In the first six months of this year, for example, 
over 2,000 hard drives have crashed. Not every hard----
    Mr. DeSantis. I understand. But that is your whole agency. 
We are talking about people who happen to be relevant in a 
relatively small universe of people, and the number of hard 
drive crashes seem to be getting higher the more we 
    Mr. Koskinen. Right. And in May I asked our people, once we 
knew that there was an issue with Ms. Lerner's crash, I asked 
for what the industry standards were for hard drive crashes, 
was advised that 3 to 5 percent of hard drives crash. I asked 
then for a review of the question you are asking, of 
custodians, how many of those 83 had hard drive crashes.
    We reported on June 16th to the Ways and Means Committee in 
a staff interview that we knew there were probably at least six 
or seven. The next morning, promptly on receipt of that 
information, the Ways and Means Committee issued what turned 
out to be an erroneous press release saying that all of those 
emails had been lost, including the emails of Nicole Flax. It 
turned out, in a little further investigation, that it appears 
no emails for Ms. Flax were lost because the hard drive that 
crashed was not her office computer.
    Mr. DeSantis. But----
    Mr. Koskinen. I am sorry, can I answer the question?
    Mr. DeSantis. But my question was the number of hard drive 
crashes. I understand you have mentioned the Ways and Means 
press release in numerous statements that you have made before 
Congress and I have read your other statements, but the 
numbers. Where do we stand on the number of hard drive crashes?
    Mr. Koskinen. Where we stand on the number is thereafter 
the IG was requested by Congress to do an investigation and the 
IG asked us not to do any further interviews or investigations, 
so we have not pursued further what the additional implications 
are, how many hard drive crashes of custodians or what the 
implications are because the inspector general is investigating 
that very issue. So I cannot give you a definitive answer at 
this point as to either how many custodians had crashes or, if 
they did, how many of them lost emails, because I would 
emphasize not every crash leads to a loss of emails.
    Mr. DeSantis. Well, Mr. Cain put the upper limit at 20, so 
there seems to be a contradiction there.
    My time is up. Mr. Chairman, thank you for indulging me, 
and I yield back.
    Mr. Jordan. I thank the gentleman.
    The ranking member of the full committee is recognized.
    Mr. Cummings. Commissioner, I want to thank you for 
testifying before the committee today and for the third time in 
a month. When you testified on June 23rd, 2014, and July 9th, 
2014, you told us that the IG was investigating circumstances 
of Ms. Lerner's computer crash. On June 11th, 2014, you wrote 
to this committee reiterating that the IG is conducting an 
investigation into the loss of Ms. Lerner's emails and that, as 
you previously testified, you would honor the Inspector General 
George's request to prioritize his investigation.
    Has the inspector general expressed concern to you about 
the release of non-public information about an ongoing IG 
    Mr. Koskinen. When the inspector general first talked to me 
and asked us to give a priority to his investigation and not to 
do any further investigation or witness interviews ourselves, 
he explained to me that they were concerned that they did not 
want to muddy the waters, they wanted to have their ability to 
talk to witnesses and then go back and talk to them again 
without anyone having conversations in between time. So they 
were very concerned that witnesses that they were interviewing 
in the investigation be allowed to proceed with the inspector 
general only.
    Mr. Cummings. And do you know when that was that you had 
that conversation with the inspector general?
    Mr. Koskinen. The conversation was shortly after they were 
asked by the Finance Committee and Congress to make the 
investigation. I can't remember which the date was in mid-June.
    Mr. Cummings. The IG has expressed similar concerns to our 
committee. For example, on July 2nd, 2014, committee staff held 
a conference call with the inspector general in which the IG 
described the investigation into Lois Lerner's hard drive as 
``very active, open, and ongoing,'' and asked our committee to 
refrain from publicly disclosing the non-public information 
regarding this ongoing investigation. Is the IG's investigation 
into this matter still active and ongoing, to your knowledge?
    Mr. Koskinen. To my knowledge, it is still active and 
    Mr. Jordan. Would the ranking member yield for just a 
    Mr. Cummings. Yes.
    Mr. Jordan. Were majority staff member present at that 
briefing where the inspector general conveyed that information?
    Mr. Cummings. Yes.
    Mr. Jordan. Our staff says that they weren't. And if I 
could, and you will get all your time plus some extra, if you 
would like. The inspector general called our counsel yesterday, 
he happened to be in my office with Mr. Meadows, and said that 
they had talked to you but did not express any of the comments 
you made in your opening statement or, frankly, any of the 
comments you are making in your line of questioning now. So I 
just wanted that on the record.
    The gentleman is recognized.
    Mr. Cummings. Well, why don't we have him here next week 
under oath, since we are having all these IRS hearings, and see 
what he has to say?
    Mr. Jordan. I am open to that.
    Mr. Cummings. Because we can go back and forth on this, and 
I want to be very clear as to what he said. So when you are 
talking about he say, she say, it is better that we have him 
here and we will do that, if you so choose. But I would be 
happy to.
    The IG has expressed similar concerns, again, to this 
committee. So it is your understanding that the IG's 
investigation is still ongoing.
    Mr. Koskinen. It is, as far as I know.
    Mr. Cummings. So in spite of the inspector general's 
request, on July 21st Chairman Issa issued a press release 
stating that based on the interview of IRS Deputy Associate 
General Counsel Thomas Cain, ``new developments'' have created 
uncertainty regarding the existence of backup tapes.
    Commissioner Koskinen, is it your practice to release non-
public information about an ongoing IG investigation?
    Mr. Koskinen. No.
    Mr. Cummings. And why not?
    Mr. Koskinen. Because we made a commitment to the IG that 
we would honor his priority, that we would not do anything that 
would interfere with his investigation. He could talk to 
anybody he wanted, they could look at any evidence they wanted, 
and we would not have an ongoing discussion with any of the 
witnesses he was talking to because we did not want to 
    Mr. Cummings. Of course, Chairman Issa's press release 
released statements from Mr. Cain and other witnesses that 
undermine a partisan narrative. Mr. Cain told the committee 
that he was aware of a ``potential issue'' regarding the backup 
tapes, but he did not know any additional details. When asked 
whether he had seen ``any evidence that any IRS employee 
intentionally destroyed documents or emails to avoid their 
disclosure,'' Mr. Cain said, ``I have not seen anything to that 
    Have you seen any evidence of obstruction by IRS employees?
    Mr. Koskinen. I have not.
    Mr. Cummings. Yesterday the committee staff interviewed IRS 
National Director for Legislative Affairs Leonard Oursler. He 
told the committee staff that based on the information 
available at the time, your June 13th, 2014 letter to the 
Senate Finance Committee stating that backup tapes from 2011 
had been recycled was accurate. Is that right?
    Mr. Koskinen. I don't know what he said, but I understand 
from the press release about Mr. Cain that he said the 
information we had and provided on June 13th was accurate and 
that is what everybody knew at the time.
    Mr. Cummings. Now, Mr. Oursler also told us that earlier 
this month he was made aware of an issue with a backup tape, 
but that he did not know if the backup tape was from 2011 or 
whether it was mislabeled. He said that even if the unrecycled 
backup tapes exist from 2011, the IRS does not know whether 
they contain emails from Ms. Lerner not previously produced to 
the committee.
    Sitting here today, do you know any additional details 
regarding the backup tape issue that the IG is currently 
looking at?
    Mr. Koskinen. No. All I know is actually what Mr. Cain 
said, that at this point nobody had any information as to what 
was on those tapes or whether they were relevant.
    Mr. Cummings. And until the IG determines the facts 
regarding this backup tape issue, are you in a position to 
correct your earlier statements?
    Mr. Koskinen. No. My point has been that we are going to 
honor the IG's investigation. I look forward, as everybody 
does, to his completion, and we will see what his facts are and 
what he determines happened three years ago and we will respond 
    Mr. Cummings. And you were asked earlier about computer 
crashes and you said that you were not aware of the folks who 
may have some relevance to this investigation concerning their 
crashes. Would you normally have that kind of information?
    Mr. Koskinen. Normally, if things had proceeded as they 
might do, when I asked in May for the answers to this question, 
that is, how many custodians had hard drive crashes in light of 
the fact the industry says they crash regularly, I had asked 
for a review of how many had crashed and what the implications 
were. We had not completed that review when we provided our 
June report, and basically we had that morning, the following 
Monday, our IT people had been advised, I had not been advised, 
that we knew there were six or seven custodians that had had 
hard drive crashes. That information was actually provided to 
the Ways and Means Committee. We have not been able to pursue 
whether there are 6, 12, or 15 because, once the IG started, we 
agreed that we would not pursue any of those issues until they 
have completed their investigation.
    Mr. Cummings. Now, just a last question. When the DOJ was 
here the other day, and you were asked about this a bit 
earlier, they talked about the fact that they had not gotten 
information about the crash back in April. They got it in June, 
I think, like everybody else.
    Mr. Koskinen. Correct.
    Mr. Cummings. Why is that?
    Mr. Koskinen. When we, in April, determined that in fact 
there had been a hard drive crash and some emails may have been 
lost, our next step was to in fact investigate how many emails 
did we actually have and could we find, and our plan and 
proposal was that we would pull all of that information 
together, including information about custodians, and make a 
public presentation to the committees, including a description 
of why it takes us so long in our archaic system to actually 
respond to requests for documents.
    We provided that information in the June 13 report, as I 
testified earlier. We did that before the complete production 
of Lois Lerner emails, which is when we originally intended, 
because the Senate Finance Committee asked us for an update on 
both the determination process documents as well as the other 
searches we were doing. We gave them that. We noted that we had 
found nothing beyond what we had noted in our March letter with 
regard to the determination process, which was the subject of 
the investigations when they started. But we had not completed, 
at that time, the review of the custodians, nor had we 
completed, until the end of June, the production to the tax 
writers of all of Lois Lerner's emails and we are moving toward 
producing the redacted version to this committee.
    So our plan was when we pulled it all together, we would be 
able to explain what our process was, the difficulties, what we 
had learned about Lois Lerner's emails, what we had learned 
about others, and what we had been able to determine. As I 
noted, we were able to recover 24,000 Lois Lerner emails. We 
thought all of that was important information for people to 
have rather than simply saying, well, there is a problem with 
her computer and we are now investigating how many emails there 
were, which would have triggered hearings six weeks earlier, 
but we would not have known nearly as much as we now know.
    But we don't know everything we would like to know because 
we have in fact stopped asking people about it while the IG is 
doing his investigation, which we fully support. I have 
confidence that the IG is independent of us, he was appointed 
by a different administration. He has 15 people working on it, 
according to the filings they made last Friday, and we have 
told him and I have told him personally whatever he needs, 
documents, whatever people he wants to find, he can have access 
to and we will stay out of the way. So we have gone out of our 
way not to talk to anyone who potentially he might want to 
interview about what happened three years ago when the hard 
drive crashed.
    Mr. Cummings. Thank you, Mr. Chairman.
    Mr. Jordan. Mr. Koskinen, real quick. Russell George told 
you that he did not want this committee and Congress 
interviewing the same witnesses he was interviewing?
    Mr. Koskinen. No. He told me that he did not want us 
interviewing any witnesses----
    Mr. Jordan. Well, that is fine. That is not the same as 
Congress. Why did you make it so difficult for us to get--why 
did we have to subpoena Mr. Cain?
    Mr. Koskinen. Because the IG, in our discussions, had said 
he did not want us to do anything that would cause any of our 
employees to be interviewed before he had a chance to interview 
    Mr. Jordan. Just for the record, so the inspector general 
did not tell you that it would hinder his investigation if 
Congress interviewed the same people he was interviewing.
    Mr. Koskinen. No, the inspector general told us if we 
started providing names, let alone witnesses, it would 
interfere with their investigation, and that is why we did not 
    Mr. Jordan. That is not my question.
    Mr. Koskinen. I testified two weeks ago and said that we 
were trying to cooperate with the IG, and as I recall Chairman 
Issa said he understood that, which is why you all don't 
release full transcripts, and that you would work----
    Mr. Jordan. You have conveyed to this committee that the 
inspector general told you he didn't want this committee 
interviewing the witnesses he was interviewing. And he did not 
say that to you.
    Mr. Koskinen. No, what I----
    Mr. Jordan. Okay, that's all I need.
    Mr. Koskinen. Okay.
    Mr. Jordan. That is all I need.
    The gentleman from North Carolina is recognized, Mr. 
    Mr. Meadows. Thank you, Mr. Chairman.
    Mr. Commissioner, I want to go back to one thing that the 
gentleman from Maryland just asked and make sure I heard you 
correctly. So if you know the testimony that you have given to 
Congress is not correct, you are not going to correct that 
until we get a final report from the IG? Did I hear that 
correct? Because that is I thought what you said.
    Mr. Koskinen. No. No, what I said was the testimony I have 
given in the past was accurate as of the time with what I knew. 
I testified as to what I knew. Right now the question is do I 
know anything more about tapes, backup tapes, and the answer is 
I don't know any more other than the IG is investigating 
whether there are backup tapes and whether in fact they are 
    Mr. Meadows. So if you find, during the course of your 
normal business, that what you have told Congress is incorrect, 
you will come immediately to us and let us know, is that 
    Mr. Koskinen. I am happy to correct. In fact, the chairman, 
with regard to----
    Mr. Meadows. So within 24 hours of you finding that you 
have given us incorrect testimony, you will come and let us 
    Mr. Koskinen. Yes, sir. If I know it is incorrect, and, in 
fact, if the committee has any questions, Chairman Issa was 
very thoughtful and said, when Lois Lerner's lawyer talked 
about what she did with records, he sent me a letter and said 
here is what she said, here is what you said, take a look at it 
and correct it, and I appreciated that.
    Mr. Meadows. Well, we appreciate the fact that you will 
come back to us, because I thought you were saying you were 
going to wait until the IG gave you a report.
    Mr. Koskinen. No, no. I said I wouldn't know until the IG 
investigation is complete what the answer is in terms of how 
many custodians had----
    Mr. Meadows. But you won't know what they found until they 
come back, but you will know what you--so are you saying that 
you are not talking to Mr. Cain or anybody?
    Mr. Koskinen. I am not----
    Mr. Meadows. So you are not talking to anybody in the IRS 
about any of this?
    Mr. Koskinen. I am not talking to any potential witnesses 
for the inspector general about what happened three years ago 
in the investigation----
    Mr. Meadows. All right. So when you read the reports about 
Mr. Cain, did you talk to him and say, hey, this doesn't jive 
with what I know?
    Mr. Koskinen. No, because Mr. Cain is someone that I assume 
the IG is going to be talking to in terms of what did he know 
and when, and what do we know about----
    Mr. Meadows. So did you talk to somebody who talked to him?
    Mr. Koskinen. No. All I did was I read the release that 
this committee put out.
    Mr. Meadows. All right. So did you read the release of the 
Ways and Means press release that talked about a scratched hard 
    Mr. Koskinen. I saw that this morning. It was put out last 
night, I understand.
    Mr. Meadows. Does that concern you, that it was scratched, 
and not crashed? Would that concern you? It concerns me. Does 
it concern you, if that is accurate?
    Mr. Koskinen. I don't know--if it is accurate. As I say, I 
haven't talked. I don't know the gentleman, I don't know what 
he said. All I know is----
    Mr. Meadows. But if it is accurate, would that concern you?
    Mr. Koskinen. I understand----
    Mr. Meadows. That it was scratched. Let me tell you why it 
concerns me.
    Mr. Koskinen. Okay, good.
    Mr. Meadows. And this is an HP laptop. To get to the hard 
drive, it is no easy task. You have multiple screws that have 
to be taken to get to it. Then once you get to that, you 
actually have a hard drive inside that has seven more screws 
that have to be taken off to get to the hard drive in order for 
it to be scratched. Would that concern you that if it were 
indeed scratched, that there may be some other motive?
    Mr. Koskinen. It would be a piece of information that I 
    Mr. Meadows. Would it concern you, yes or no?
    Mr. Koskinen. I wouldn't know whether to be concerned or 
    Mr. Meadows. Okay.
    Mr. Koskinen. I don't know anything about whether--as I 
understand from the press release----
    Mr. Meadows. Well, it concerns me, and I am going to ask my 
staff to go and see how long it would actually take to get to 
that hard drive to make--if indeed it were scratched.
    Mr. Koskinen. I know. But I assume there are a lot of ways 
hard drives get scratched.
    Mr. Meadows. I can assume that too.
    Mr. Koskinen. I know nothing about that. I am sure the IG 
is going to look into that and I am sure he has already talked 
to that witness, or would like to have talked to him before----
    Mr. Meadows. Well, I hope so. So let me go back to the 
numbers. I think earlier you just said you had 2,000 hard drive 
crashes this year?
    Mr. Koskinen. Yes.
    Mr. Meadows. Is that correct? All right, so let me ask you 
about numbers. And you know that I am a numbers guy, because I 
just did the numbers real quickly. If you look at your entire 
body of some 84,000 to 90,000 IRS employees, depending on which 
year, but let's take that, that is a 2.2 percent failure rate.
    Mr. Koskinen. Correct.
    Mr. Meadows. All right. In the people that truly are 
involved in this, in that sphere of 80 people, if indeed we had 
16 to 18 hard drive crashes, why would the hard drive crash of 
that group of people be 10 times greater than what you have 
throughout the agency? Can you explain? What would be the 
probability of that happening?
    Mr. Koskinen. First of all, I have no information as to 
know whether that is the actual number or not.
    Mr. Meadows. All right. Well, let's take the number that 
you do know, seven, that you testified.
    Mr. Koskinen. Right.
    Mr. Meadows. All right? That still would be four times 
greater than your overall average. Can you explain that?
    Mr. Koskinen. I don't know what the details were. I do 
know, when I asked for the industry statistics, once you get 
beyond the warranty period, the failure rate goes to 10 to 15 
    Mr. Meadows. But Lois Lerner's laptop was a new laptop, it 
was not an old one. And, actually, the probability of her hard 
drive failing at that time was at the lowest, according to 
industry standards, was at the lowest possible time. Does that 
surprise you?
    Mr. Koskinen. No.
    Mr. Meadows. All right. But it does surprise you that her 
hard drive failed?
    Mr. Koskinen. No. I tell you, my understanding about it is, 
from the industry, it is 2 to 5 percent, depending on the 
computers, are regularly----
    Mr. Meadows. So out of this circle, if you have 10 times 
that amount, would you say that is an anomaly?
    Mr. Koskinen. If you had 10 times the amount, that would be 
an anomaly. I don't know whether we----
    Mr. Meadows. Well, I am giving you the numbers, so that 
would be an anomaly.
    Mr. Koskinen. If you stipulate you have 10 times as many as 
the industry average, that would be an anomaly.
    Mr. Meadows. All right, thank you.
    I yield back.
    Mr. Jordan. The gentleman from Pennsylvania, Mr. 
    Mr. Cartwright. Thank you, Mr. Chairman.
    Mr. Koskinen, the very first question you got in your 
testimony today was something to the effect Mr. DeSantis, my 
colleague, put the question to you whether you were aware you 
were under investigation by the Department of Justice. You 
know, this is a very public hearing. This is a very, very 
public. We invite members of the press to come to these 
hearings, and these hearings are televised, and I think it is 
important that we don't lead the public down the wrong path on 
what the truth is here.
    Mr. Koskinen, have you received a target letter from the 
Department of Justice to say that you are under investigation?
    Mr. Koskinen. No.
    Mr. Cartwright. Has anyone, anyone told you verbally that 
you are under investigation by the Department of Justice?
    Mr. Koskinen. No.
    Mr. Cartwright. Has anyone, anyone said to you verbally 
anything that would hint to you that you are under 
investigation by the Department of Justice?
    Mr. Koskinen. No.
    Mr. Cartwright. Has anyone, anyone said anything to you to 
hint to you that you might be the target of a Justice 
Department investigation sometime in the future?
    Mr. Koskinen. No.
    Mr. Cartwright. Thank you for that.
    Another thing that you have been trying to get out, and you 
are continually interrupted in your answers, were comments 
about industry statistics about computer failures. I want to 
give you a chance now to make full sentences.
    Mr. Koskinen. In May, when I was advised we had this 
problem and we were proceeding to find how many Lois Lerner 
emails we could have, I asked, A, what are the industry 
standards for hard drive crashes, and I was told it is 
somewhere between 2 to 3, sometimes 5 percent within the 
warranty period. If you have older computers, which a lot of 
our employees have, it goes as high as 10 to 15 percent. I then 
asked that we do a review of all of the 82 other custodians to 
determine what, if any, of them had hard drive crashes and, if 
they had them, whether it caused any loss of emails. We have, 
as I said, over 2,000 crashes already this year, but all of 
those didn't result in loss of emails. In fact, you can lose 
emails without your hard drive crashing.
    So at the time we were starting down that road to complete 
our review of exactly what were the situations with regard to 
the production of documents. As I say, that has stopped from 
coming to closure because the IG himself is actually looking at 
all of that.
    Mr. Cartwright. Thank you.
    Now, Mr. Koskinen, on June 20th you testified before the 
Ways and Means Committee that even after discovering Ms. 
Lerner's 2011 hard drive crash you said, ``The IRS took 
multiple steps over the past months to assess the situation and 
produce as much email as possible for which Ms. Lerner was an 
author or recipient. During this time and into May we were also 
identifying and reviewing Lerner emails to and from 82 other 
custodians. By mid-May, as a result of these efforts, the IRS 
had identified the 24,000 Lerner emails between January 1 and 
April 2011.''
    Commissioner Koskinen, why did the IRS take these steps to 
recover Ms. Lerner's emails?
    Mr. Koskinen. It was an attempt on our part to produce as 
many Lois Lerner emails, either from her accounts or other 
accounts, as possible in response to the request of this 
committee and the Ways and Means Committee to produce all of 
Lois Lerner's emails. So we were trying to make sure that there 
were no emails anywhere in the system to or from Lois Lerner 
that we had not located and had not provided.
    Mr. Cartwright. All right. So despite the hard drive crash, 
the IRS has still produced 24,000-plus additional emails from 
Ms. Lerner, is that right?
    Mr. Koskinen. That is correct.
    Mr. Cartwright. All right. Now, witnesses have told this 
committee that in February of 2014 IRS employees discovered 
that there were fewer of Lois Lerner's emails from January 2009 
to April 2011 than there were for other periods, and upon this 
discovery IRS officials immediately took steps to determine the 
reasons for this discrepancy and whether they could locate 
additional emails from Ms. Lerner during that time period.
    The question there is why didn't you inform us about the 
discrepancy in Ms. Lerner's emails when you testified before 
this committee in March?
    Mr. Koskinen. Because in March I did not know and we didn't 
know whether we had lost emails or not. One of the first things 
that was investigated in February and into March was to review 
all of our production processes to see if anything in the way 
we had reached into the system to produce the emails, put them 
into our search method had caused us to in fact misplace those 
emails, because it wasn't clear initially as to whether, 
whatever her problems with her computer were, had resulted in 
any loss of emails.
    So the first process while we were producing all the other 
documents regarding the determination process was to make sure 
that we hadn't ourselves done anything in the process to cause 
emails in that period to be lost. And we determined ultimately 
into April and May that nothing that we had done in the search 
process had caused the emails to be not producible.
    Mr. Cartwright. All right. I thank you, Mr. Commissioner.
    I yield back.
    Mr. Jordan. I thank the gentleman.
    Now recognize the gentleman from Pennsylvania, Mr. Meehan.
    Mr. Meehan. I thank the gentleman.
    Commissioner, thank you for taking the time to come up and 
be with us again today. I know you came here before and I know 
we are going through a lot of detailed testimony, but the 
baseline is accurate, that to the best of your knowledge, when 
you testified before that the emails were not available from 
Ms. Lerner during the period that they had been, to the best of 
your knowledge, that they had been destroyed because they had 
been recycled on the tape. And I am not questioning that at 
this particular moment.
    But I think what has people interested is Mr. Cain came up 
here not so long ago and he is a pretty sophisticated guy. His 
job is to produce documents for investigations and litigation 
and other kinds of thing and, therefore, he not only has a very 
detailed understanding of the process, but a deep appreciation 
of the implications to do or failure to do, including exposure 
for failure to do things. He also has a very sophisticated 
understanding of how to answer questions with respect to this, 
appreciating that when he is under oath, anything that he says 
would put him in a particular position in which, if it is known 
to be wrong, it could expose him to further scrutiny. Let's 
just put it that way.
    So I am curious as to why he would come and testify that, I 
don't know if there is a, and this is his words, I don't know 
if there is a backup tape with information on there or there 
isn't; that he was now unsure about whether there were some 
backup tapes from the period of time that may not have been 
erased. I am using his direct testimony. There is an issue as 
to whether or not there is a--that all of the backup recovery 
tapes were destroyed on the six-month retention schedule. I 
don't know whether they are or they aren't, but it is an issue 
that is being looked at.
    What do we know about this issue and why would he have made 
that statement?
    Mr. Koskinen. What we know about that, or what I know about 
that issue is I was advised by the inspector general that they 
had taken tapes they had found, I don't know how they found 
them, and they were reviewing those tapes to see if they had 
been totally recycled or whether they were not recycled and 
usable. I was advised about that because the inspector general, 
again, wanted us not to do any--because he knew, however they 
had found them, somebody knew that the IG had them. He didn't 
want us to in fact do anything to investigate further what 
those tapes were, where they were found, who found them, what 
they did with them.
    So our guy said that was fine, and at this point, I haven't 
talked to Mr. Cain about this, but according to his testimony, 
what he has said is what he knows is, because, as you say, he 
has been involved in it, is that the inspector general is 
looking at some tapes, I don't know how many and which ones, to 
see whether in fact any of them turned out not to be recyclable 
or any of them have information that is recoverable. But at 
this point, as Mr. Cain's testimony states, it is not clear 
whether they do or don't.
    Mr. Meehan. Or whether in fact substantively there is 
information, when he gave you that identification that they 
are, as you said, it was believed that they had all been 
produced, but now maybe some of them have been found. Weren't 
you concerned about what procedure they used to potentially 
come up with new tapes?
    Mr. Koskinen. When the inspector general advised me of 
that, I was interested as to why they were looking at tapes 
that we had been advised had all been recycled, but I didn't 
cross-examine the inspector general about it, I agreed with him 
that they would do the investigation, we wouldn't do anything 
to interfere with that; I wouldn't and none of our people would 
talk to anybody about it. So I can't tell you how they found 
them, what they are, and, as Mr. Cain said, whether there is 
anything on them or not. At this point, we are supporting the 
inspector general.
    Mr. Meehan. Do you have any idea about what the issue is 
that he referred to? Because that was the very specific thing. 
There is an issue as to whether all of the backup tapes had 
actually been recycled.
    Mr. Koskinen. Yes. And the issue, as I just said, is that 
he obviously is aware of what the inspector general advised me, 
which is the inspector general has taken some tapes, I don't 
know which ones, and is reviewing those to see if they have 
been recycled, if there is information on them that can be 
found or used. That is all I know and I assume that is all he 
knows. But beyond that I haven't talked to anybody about this, 
I haven't asked anybody about it because, again, our position 
with the inspector general is he is doing the investigation.
    Mr. Meehan. Just one follow-up question. But why are these 
not available from a third party vendor who, in the event of a 
cyber attack, would protect us against the destruction of all 
records which would put our Government in a remarkably perilous 
situation, so we take steps to ensure that essential documents 
are preserved by having them in third-party data storage 
situations? Why were the documents that are relevant to this 
period, particularly the documents relevant to the 2009, 2011 
area, why were they not backed up and available today?
    Mr. Koskinen. That is a very good and important question. 
As I have testified earlier, there has been no loss of any 
information and no actions taken since this investigation 
started with regard to any information and production of 
documents. We have frozen and saved and backed up all emails 
from six months before the start of the investigation forward.
    What we are talking about is what happened three years ago, 
and three years ago the process was to use backup tapes for 
basically disaster recovery purposes and recycle them every six 
months. That was the protocol and the process that had gone on 
for some years and, in fact, it used to be they only kept them 
for one month, and it was increased to six months. But that was 
the process three years ago. Whatever emails were lost three 
years ago were not lost. They were lost then. Nothing has been 
lost, as far as I know, since this investigation started. We 
have gone out of our way to protect all of the data and all of 
the documents.
    Mr. Meehan. Thank you. I have other questions, but my time 
has expired. Thank you.
    You are an attorney, and you talked about these documents 
having been missed. But at the period of June 29th, 2011, Lois 
Lerner is informed that some of the activities that she has 
been associated with may have been involved with discriminatory 
practices. Now, you are a Yale lawyer, and you understand the 
situation in which there is a potential for litigation and the 
requirements that when there is a potential for litigation, 
that there is a requirement consistent with the record-keeping 
responsibilities to preserve the documents that may be relevant 
to that. All of this occurred before the period of time that we 
are now looking some years down the road.
    So if you were informed that somebody was holding your 
agency, or you in particular, as having potentially engaged in 
discriminatory practices, would you preserve the documents from 
that era?
    Mr. Koskinen. We have, any time there is an investigation, 
we have litigation document hold policies and procedures. As I 
say, we have done our best to protect every document for the 
last year and a half, almost two years now, and anytime anyone 
raises a serious question about the production of evidence, we 
go out of our way to protect it. I don't know what the 
circumstances were three years ago.
    Mr. Meehan. Well, this was knowledge that there were 
discriminatory practices and she was informed that she was 
central to the potential that there were complaints about 
discriminatory practices on the part of the IRS. Would that be 
the kind of a document that you would preserve in anticipation 
of potential litigation?
    Mr. Koskinen. Again, our protocol is if there is going to 
be an investigation, if there is a serious issue raised, we 
protect and preserve documents. As I have testified, one of the 
things I had asked about early in this investigation is we need 
to have an email system of record so that it would be easier to 
protect official records, preserve them, and it would be much 
easier to search them.
    As I have said, we should not have to spend $18 million 
answering straightforward questions for documents, but that is 
the system we have. The constraints on the budget have been 
significant over three or four years. Going forward, we are 
looking again at is there a way to get out of the late 20th 
century and into just the early part of the 21st century, 
because we should have an email system that is, as I say, much 
more searchable and a system that is a system of record.
    Mr. Meehan. Thank you, Mr. Chairman.
    Mr. Jordan. Well, I thank the gentleman. I think his 
question cuts right to the chase. She was on notice that there 
was a problem and suddenly her computer crashes. But it is 
worse than that. The IRS has identified 82 custodians of 
information that are relevant to the investigation, and now we 
know from Mr. Cain's testimony last week up to 20 may have had 
computer hard drive crashes. So this is way beyond the 3 to 5 
percent that the commissioner keeps citing; this is approaching 
25 percent of the relevant people that they have identified 
have had computer problems and may not be able to get us the 
documents. I appreciate the gentleman's questioning.
    We recognize the gentlelady from Illinois for her time.
    Ms. Kelly. Thank you, Mr. Chair.
    Good morning, Commissioner.
    Mr. Koskinen. Good morning.
    Ms. Kelly. On July 7th, 2014, you testified that since you 
were confirmed in December 2013, the IRS has ``probably 
provided 300,000 to 400,000 documents to Congress.'' To date, 
how many pages of documents has the IRS produced to Congress in 
furtherance of the ongoing investigation about the IRS's review 
of tax-exempt applications?
    Mr. Koskinen. As I testified earlier, we have produced 
960,000 pages to the tax writing committees; redacted documents 
we have produced 700,000 pages to this committee.
    Ms. Kelly. I would imagine amassing a document production 
of this magnitude takes an extraordinary amount of time and 
money, as you talked about the money.
    Mr. Koskinen. Yes. It has been a significant distraction. 
We spent, as I noted, at last count, $18 million responding. We 
continue to produce documents. We hope shortly to be able to 
complete the production of redacted Lois Lerner emails to this 
committee. But in an area of declining resources, most of it is 
done in our Office of Chief Counsel. There are 500 fewer people 
in the chief counsel's office now than there were four years 
ago, so it has been a significant strain on our chief counsel's 
    Ms. Kelly. And how many employees have been involved in 
this process and how many hours have been logged in to comply 
with all of these requests, to comply with Congress?
    Mr. Koskinen. We have had over 250 employees at various 
times involved, we have had over 100,000 or 120,000 hours of 
efforts devoted to it, and we continue to work on the 
production of those documents.
    Ms. Kelly. I understand that current agency staff, many of 
whom have other job responsibilities, have been tasked with 
complying with congressional document requests. Is that 
    Mr. Koskinen. That is correct. Our IT department has been 
asked for information. We have witnesses that are being 
interviewed as we go. As I have noted, the entire issue about 
the (c)(4) investigation and the (c)(4) operations involved 
about 800 employees in the entire exempt organization; only a 
portion of them work on this. That means we have 89,000 other 
hardworking, dedicated IRS employees working on matters of 
importance to the Government and to taxpayers.
    Ms. Kelly. The individuals working on this, they have had 
to put their, I would imagine, current workload aside.
    Mr. Koskinen. Yes. And particularly lawyers is a problem 
for us because they have obligations to represent the agency in 
tax cases. They have an obligation to continue to work with 
Treasury on the development of rules and regulations and 
procedures, so it is a constraint.
    Ms. Kelly. Thomas Cain, the IRS Deputy Associate Chief 
Counsel for Administration and Procurement, was interviewed by 
committee staff on July 17, 2014. He said that the IRS 
currently exists ``with an increased workload and a reduced 
staff from where we were several years ago. We have taken these 
people from their day jobs. They have no replacements for them 
because there are no replacements, so we have pulled together 
people from all parts of the organization to contribute to the 
project, again, on a full-time basis. But there is no one to 
backfill the work that continues to exist and pile up, and that 
is particularly critical when you are dealing with people in 
the field that ordinarily are trying cases that have deadlines. 
So that type of staffing commitment and resource commitment has 
been a drain on the entire Office of the Chief Counsel.''
    Commissioner, would you agree with Mr. Cain's assessment of 
investigations impact on your agency's workload?
    Mr. Koskinen. I would.
    Ms. Kelly. Mr. Cain was also asked about the impact that 
Chairman Issa's subpoena for his testimony had on the morale of 
his team. He said that his employees have been working 
tirelessly to help the IRS comply with Congress who are 
``visibly impacted in a very negative way.'' Commissioner, I 
would like to give you an opportunity to address any concerns 
you may have about the impact the various congressional 
investigations are having on your agency's morale and ability 
to perform its core functions.
    Mr. Koskinen. Well, as Mr. Cain apparently noted, we have a 
large number of people who have day jobs who have been in part 
or totally devoted to this who have been trying to be 
responsive. When they then are subject to depositions and 
recorded interviews, it sends, these are all career people, a 
deleterious effect on morale because they thought they were 
actually doing what they were asked to do, they were trying to 
provide information. Most of them have never had a deposition 
of theirs taken; they haven't spent six, eight hours under 
cross-examination. So for everybody else who is working on this 
project, they are now looking over their shoulder, worrying 
about, well, am I going to get called up next; and all they 
have been doing is producing documents.
    Ms. Kelly. Okay, thank you. Thank you for your time.
    Mr. Cummings. Would the gentlelady yield?
    Ms. Kelly. Yes, I will.
    Mr. Cummings. I was sitting here listening to some 
questions that the chairman asked you, and I got convinced that 
you are damned if you do and you are damned if you don't, and 
this is what I am talking about. The IG, appointed by a 
Republican, asked you not to engage in, I don't want to take 
words out of your mouth, but what did the IG ask you not to do?
    Mr. Koskinen. Not to do any further investigations or 
interviews or discussions with employees about anything having 
to do with the hard drive crash, any other hard drive crashes 
while they did their investigation.
    Mr. Cummings. And the chairman went on to say that he 
didn't tell you that this committee was under the same 
restrictions. That is accurate, right? He didn't tell you, the 
IG didn't say to you, what I am telling you about your 
restrictions does not have anything to do with the committee. 
You understand my question?
    Mr. Koskinen. Yes.
    Mr. Cummings. I am going back to what the chairman said 
because I am trying to figure out how do you obey the law and 
obey the wishes of the IG.
    Mr. Koskinen. No, the question was, and I answered it, was 
that the IG didn't tell you that he was telling the committee, 
giving any instruction to the committee. The only conversation 
I know he had with the committee was when he told me about the 
existence of the backup tapes and asked us not to do any 
further questioning about that. He said he had provided that 
information to the investigative committees and had asked them 
to treat it confidentially while his investigation was going 
    Mr. Cummings. So if something came up now where we 
contacted you and said we want to meet with X person in the IRS 
because we think, that is, this committee thinks that that 
person has something relevant to our investigation, is there 
any way you would treat that differently now than you would 
have if you had never had the conversation with the IG? You 
follow what I am saying?
    Mr. Koskinen. No. Actually, we have tried to be responsive 
as best we can to the wide range of requests we have. We have 
six investigations and a number of requests coming in, and 
requests for interviews. While we have tried with more success 
in some areas than others to try to figure out what the 
priorities are so that we can do it in the right order, which 
is at my hearing in March we agreed the next priority after we 
completed the determination issue was to provide all the Lois 
Lerner emails we had, and we had a long discussion back and 
forth and committed that would be our next priority, and we are 
getting close to completing that.
    Mr. Cummings. I guess what I am getting at is that I assume 
you wouldn't have a discussion, based upon what the IG told 
you, you wouldn't have a discussion with an employee of the IRS 
now because the IG told you not to.
    Mr. Koskinen. That is correct. So when we have had 
witnesses coming to testify and give depositions here and Ways 
and Means, we have not talked to them beforehand, they have 
simply come up. Again, we don't feel that we want to do 
anything that would interfere with the IG's investigation or 
this committee's investigation, so people have come up and, to 
the extent they have been interviewed, they have done that on 
their own, without any conversations with me.
    Mr. Cummings. Now, the gentlelady just asked you about 
morale at the IRS. The IRS is a kind of tough position because 
nobody seems to like the IRS.
    Mr. Koskinen. That is right.
    Mr. Cummings. On the other hand, if you don't get revenue, 
you have a problem. We have a problem as a Nation.
    Mr. Koskinen. Right.
    Mr. Cummings. But when you think about the reduction in 
employees, and based upon what Mr. Cain said that the 
gentlelady just read, it seems like something has to give, and 
I am just curious as to what is giving. You follow what I am 
saying? In other words, if you have, based upon what Mr. Cain 
said, you are pulling people from different areas to do certain 
things, you said that some of them have quit responsibilities 
and deadlines. The point is something has got to give, 
    Mr. Koskinen. Right.
    Mr. Cummings. Can you tell us what we are losing?
    Mr. Koskinen. Well, what has to give is obviously we have 
10,000 fewer employees than we had four years ago; we have 500 
fewer in the Office of Chief Counsel. So what happens is people 
either have to spend a lot longer working. At some point you 
run out of things you can do. We have done our best and taken 
people from around the agency, particularly around Chief 
Counsel, and put them on the production effort. To do that 
means that the work that they otherwise would have done doesn't 
get done because we have no capacity to add more people, to 
hire more people. We are only replacing one in every five 
people who leave the agency, so we continue to shrink rather 
than expand.
    So we haven't complained about it, we basically simply 
produce documents as fast as we can. We have explained that our 
biggest problem and obstacle is that we have this sort of 
arcane, archaic system where you have to search each hard drive 
to pull out data to actually get it into a search machine, 
which we would like to change going forward. But it does mean 
that, particularly in the Office of Chief Counsel, you put them 
under more stress, it makes it much more difficult with the 
other ongoing day jobs they have.
    My concern, more importantly, though, is over the course of 
certainly the three and a half years I am left, we will have 
other issues, and as we ask people to do productions and just 
respond to congressional inquiries, if they become subjects of 
depositions and cross-examinations, it is going to be harder to 
get people to decide they want to leave their day job and help 
us respond to Congress. So that is our only broader concern. 
But, again, we think it is appropriate and we are happy to 
cooperate with the committee as best we can.
    Mr. Cummings. Thank you.
    Mr. Jordan. I would just make one point. The witness 
testified that they don't talk about this issue and prepare and 
discuss and prep for it. That is just not accurate. We 
interviewed Mr. Oursler yesterday, and he told us specifically 
that when Steve Manning came and briefed the Ways and Means 
Committee, there was prep sessions done for Mr. Manning to get 
ready to come in front of Congress. So to portray it as you are 
not talking about this issue as you bring people before 
Congress is just not accurate.
    And regarding the morale issue, if the IRS would have been 
willing to let Tom Cain come and be interviewed, we wouldn't 
have had to issue the subpoena. One thing that impacts morale 
is when you get a subpoena. I get that. But that is your cause. 
You caused the subpoena, Mr. Koskinen, we didn't. We tried for 
weeks to get Mr. Cain to come and be interviewed, and you guys 
said, no, can't do it, so we had to issue the subpoena; and we 
got all kinds of information that contradicts testimony you 
have given in front of Congress.
    So that is the issue. If we are talking about morale, you 
could have helped morale of the very employees you represent if 
you had let him be interviewed by us without a subpoena.
    Mr. Koskinen. We actually agree. Subpoenas sound different, 
but when they come for an interview, it is still under oath and 
it is still a transcribed interview and it looks just like a 
deposition, and that is, for people who have never done it 
before, of concern; they get nervous.
    Mr. Jordan. And my point is by you making it so we had to 
subpoena, that only adds to the anxiety of the employee. So 
that is your creation on your employees, not ours.
    Mr. Koskinen. And that is why we were delighted to work out 
with you a schedule where there won't be subpoenas, but people 
will still come----
    Mr. Jordan. We appreciate that. But it took a subpoena to 
get that rolling.
    The gentleman from South Carolina is--oh, I am sorry.
    Mr. Cummings. I just asked you for a--because we have a 
tendency to ask questions and not let him answer. I want to 
understand this, and I think it is for the benefit of the 
entire committee. Why did Mr. Cain have to be subpoenaed? Why 
is that?
    Mr. Jordan. Because we tried----
    Mr. Cummings. No, no, no, I didn't ask you. I asked him.
    Mr. Jordan. Oh. I didn't know who you were asking.
    Mr. Cummings. No, I am asking him.
    Mr. Jordan. That is fine. He can answer.
    Mr. Cummings. Thank you.
    Mr. Koskinen. We were in the process of discussing 
production of witnesses. We, as I say, were concerned about 
interfering with the IG's investigation, and while we were 
doing that, as the chairman said, then Mr. Cain got a subpoena, 
which did, A, allow him to appear without any further ado and 
did allow us to basically have a conversation about setting up 
a production schedule of witnesses. So the chairman is right, 
we were in the process of trying to do this, but I would say we 
take some responsibility for the fact that you had to do a 
subpoena. I would agree with that.
    Mr. Jordan. You take all of it. We asked. Mr. Cain told 
during his deposition, because he had to be subpoenaed, he told 
committee staff that he wasn't even notified by you, Mr. 
Koskinen, or Ms. Duvall or whoever, that we had requested an 
interview. He didn't even know that. All he knew was he got the 
subpoena. So you didn't even tell him that we were trying to 
interview him. That is what he told us in the deposition last 
Thursday. So it is all on you. You are the reason we had to 
subpoena the individual to get his testimony.
    Mr. Cummings. But he eventually came voluntarily, is that 
    Mr. Jordan. Yes. After he hired private counsel after we 
went his subpoena.
    Mr. Cummings. All right.
    Mr. Jordan. The gentleman from South Carolina is 
    Mr. Gowdy. Thank you, Mr. Chairman.
    It is good to see you again, commissioner. I want to read a 
quote to you from June of 2014. I want you to tell me if you 
know who said it, okay? ``We confirmed the backup tapes from 
2011 no longer existed because they had been recycled pursuant 
to the IRS normal policy.'' Do you know who said that?
    Mr. Koskinen. Sounds like me.
    Mr. Gowdy. It is you. Can you tell us who ``we'' is in that 
    Mr. Koskinen. The ``we'' is the IRS. I tend to take 
responsibility for the agency and talk about it. I was advised, 
when the draft report was submitted to me, that people had 
talked to everyone in the agency to ensure that in the course 
of our several months of looking for backup tapes----
    Mr. Gowdy. So ``we'' is the royal we, just speaking on 
behalf of the entire IRS. How about the word ``confirmed?'' 
What does the word ``confirmed'' mean to you, that you 
``confirmed'' the backup tapes no longer exist?
    Mr. Koskinen. Confirmed. When I read that, I asked the 
question, was told----
    Mr. Gowdy. By whom?
    Mr. Koskinen. I don't remember who; we had four or five 
people who were working on the report. And was told, and I 
gather Mr. Cain said in his testimony, that that was accurate 
as of June 13th.
    Mr. Gowdy. What does the word ``confirmed'' mean to you?
    Mr. Koskinen. Confirmed means that somebody went back and 
looked and made sure that in fact any backup tapes that had 
existed had been recycled.
    Mr. Gowdy. Are you still confirmed?
    Mr. Koskinen. At this point, I have no basis for not being 
confirmed. I do understand the IG advised me that they were 
looking at tapes. I have not been advised as to whether any of 
those tapes----
    Mr. Gowdy. Well, confirmed is a pretty strong word, 
commissioner. Are you still confirmed that no backup tapes 
    Mr. Koskinen. Well, at this point, I know the IG is looking 
and he hasn't found anything, so as far as I know.
    Mr. Gowdy. I am glad you mentioned the IG. And I find this 
confounding, I find it vexing, that once the IG is involved, 
nobody else can do anything. That is not supported by the law. 
Can there be a criminal investigation while there is an IG 
    Mr. Koskinen. There can be all sorts of investigations. 
What I was talking about was the IG.
    Mr. Gowdy. Right. And there could be a congressional 
investigation while there is an ongoing IG investigation also, 
    Mr. Koskinen. Of course.
    Mr. Gowdy. And there can be an IRS investigation. If there 
were sexual harassment or discrimination in the workplace, are 
you telling this committee that you would wait until the IG 
investigated it before you would stop some insidious practice?
    Mr. Koskinen. We would take whatever action was necessary.
    Mr. Gowdy. Precisely. You would not wait until an IG 
concluded his or her investigation.
    Mr. Koskinen. Can I answer that question?
    Mr. Gowdy. Sure.
    Mr. Koskinen. Our policy, and it has been my understanding 
when I chaired the Council of Inspectors General across the 
Government, that if the IG starts an investigation, the agency 
will not themselves run a competing investigation to try to get 
there first. Basically, the IG advises us what the 
investigations are. When they advise us about those 
investigations, we allow them to proceed. If there are----
    Mr. Gowdy. Let me give you possibly an alternative view, 
commissioner, which is that people cite ongoing IG 
investigations when it suits them to not cooperate, and they 
don't cite ongoing IG investigations when it doesn't suit them.
    Mr. Koskinen. That is not my policy.
    Mr. Gowdy. Well, you can certainly understand how a cynic 
might view it that way, right? Because there is nothing about 
an ongoing IG investigation that would keep you from doing your 
job. Just like there is nothing about an ongoing IG 
investigation that keeps the Department of Justice from a 
criminal investigation or a committee of Congress from a 
congressional investigation. There is nothing talismanic about 
an IG investigation.
    Mr. Koskinen. In this particular case, as a general matter, 
my policy has always been if the IG is doing an investigation 
wherever I am, we won't interfere with that investigation; we 
want it to be independent.
    Mr. Gowdy. Words have consequences, Mr. Koskinen. Nobody is 
asking you to interfere. You can have a dual investigation 
without interfering, can't you?
    Mr. Koskinen. I think it is very difficult.
    Mr. Gowdy. So you are saying that if there is an allegation 
of sexual harassment or racial discrimination within the IRS, 
you would not look into that until the IG had completed his or 
her investigation? Is that what you are telling me?
    Mr. Koskinen. I am not telling you that. I am telling you, 
as a general matter, that is not what the IG would be 
investigating. As a general matter, those claims would come to 
personnel; they would be immediately investigated by our legal 
    Mr. Gowdy. Well, the IG doesn't have criminal jurisdiction; 
the IG doesn't have jurisdiction over legislative policy; the 
IG doesn't have jurisdiction over appropriations. All three of 
those are very important areas. So those should be ongoing even 
while an IG is doing his or her investigation, correct?
    Mr. Koskinen. Actually, the IG does do criminal 
    Mr. Gowdy. No, sir, they refer to an entity that actually 
has the power to indict, which does not include the IG.
    Mr. Koskinen. They actually, my understanding, mark our 
criminal investigations----
    Mr. Gowdy. It might be the same people who gave you the 
understanding that you were confirmed that the tapes don't 
exist, so my advice is to be very careful who you take your 
advice from. And I am going to say this in conclusion, Mr. 
Koskinen. I really could not believe the colloquy that you had 
with one of our colleagues about the morale at the IRS. It 
takes a lot to stun me, but that stunned me. Here's a piece of 
advice I would give. If the folks like Lois Lerner and others 
would have spent more time working on the backlog, more time 
working on their caseload, and less time targeting groups and 
less time trying to overturn Supreme Court decisions they 
didn't agree with, maybe morale would be better and maybe their 
backlogs would be lessened.
    Mr. Issa. Would the gentleman yield?
    Mr. Gowdy. I would be thrilled to.
    Mr. Issa. Commissioner, I just want to maybe summarize what 
the gentleman was asking you with a question. Do you have full 
faith and trust that your IG is doing a thorough investigation 
at the same level as would be done if you were doing it as the 
    Mr. Koskinen. I do. I said earlier I have a lot of 
confidence in the inspector general. They have far more 
capacity in some of these areas; they have 15 people working on 
this. I am very comfortable and confident that they are doing a 
thorough job, and I have told them we will do whatever we can 
    Mr. Issa. So at least as to your own investigation, you 
consider the IG's investigation to be your investigation.
    Mr. Koskinen. I do not. We do not control the IG; he is 
very independent. He is doing an independent investigation of 
all of this. I am satisfied that when he gets done we will have 
an independent review and investigation of what went on.
    Mr. Issa. Thank you.
    Mr. Jordan. The gentleman from Virginia is----
    Mr. Meadows. Will the gentleman from Virginia yield for 
just one follow-up question?
    Mr. Jordan. You will get time added if the gentleman--it is 
his call, but if you yield, I will give you some additional 
time. I have been very generous.
    Mr. Connolly. I thank the chair. Of course I would be glad 
to yield.
    Mr. Meadows. I thank the gentleman from Virginia.
    I want to follow up on the gentleman from South Carolina's 
point, because what you are just saying is that your belief is 
that it is wrong for you to do an investigation at the same 
time as an IG is doing an investigation, is that correct?
    Mr. Koskinen. As a general matter, if we were doing an 
investigation, it would interfere with his investigation.
    Mr. Meadows. So what you are saying is that your 
predecessors who did exactly that in 2012 were wrong, because 
when the IG started it, they did their own--under sworn 
testimony, they did their own investigations. So what they did 
was not right.
    Mr. Koskinen. Everybody has their own policies. I don't 
know what they did or didn't do.
    Mr. Meadows. But in your opinion that would not be right.
    Mr. Koskinen. If the IG----
    Mr. Meadows. I just want to show the hypocritical point 
there that it is not consistent with what IRS has already done.
    Mr. Koskinen. My point only was it is consistent with how I 
have behaved in the past and how I will behave in the future. 
My view is that the IG is an important independent source of 
investigations. Whenever the IG is doing an investigation, I 
think it is important to cooperate with it and not interfere 
with it.
    Mr. Meadows. All right, I thank the gentleman from Virginia 
for yielding.
    Mr. Jordan. Great question.
    Mr. Meadows. I ask unanimous consent that all his time be--
    Mr. Jordan. He has it.
    Mr. Connolly. I thank my friend from North Carolina and I 
thank the chairman.
    Welcome back, Mr. Koskinen.
    Mr. Koskinen. Always a pleasure to be here.
    Mr. Connolly. I can tell. It must be a thrill and the 
highlight of your week. And I guess we are going to do this as 
long as we are in session.
    By the way, just sort of a sidebar, I wish my friend from 
South Carolina was still here, because his concern for morale 
at the IRS is really touching. And, gosh, if we were really 
that serious about it, maybe we wouldn't have slashed eight 
hundred and something million dollars from your budget in the 
last four years and recommended another $350 million this year. 
But that is a different matter.
    Mr. Koskinen. Actually, you actually recommended another 
billion on top of the $350 million. So at this point we are a 
billion 350 under water.
    Mr. Connolly. A billion 350. But the morale, we will keep 
on flogging people until the morale is improved. That seems to 
be the philosophy of some of my friends on the other side of 
the aisle.
    At any rate, I am glad we are talking about the IG, because 
I am amazed that J. Russell George, the TIGTA, would have 
thought it wise or prudent to completely omit from the May 14th 
final audit report any mention of a critical, and I think 
astonishing, analysis that was conducted by TIGTA's own head of 
investigations the weeks leading up to the release of the May 
14th report.
    Mr. Chairman, without objection, I would like to enter into 
the record the conclusion of TIGTA's Deputy Inspector for 
Investigations, Tim Camus, which was sent in a May 3rd, 2013 
email to TIGTA's Acting Principal Deputy IG Michael Phillips, 
Acting Deputy Inspector General for Audit Michael McKinney, 
Chief Counsel Michael McCarthy, Assistant IG for Exempt 
Organizations Gregory Kurtz, and two TIGTA employees whose 
names have been fully redacted. It is just a one-pager.
    Mr. Jordan. Without objection.
    Mr. Connolly. I thank the chair.
    This astounding email from TIGTA's chief investigator 
concluded that after obtaining and reviewing 5,500 IRS emails 
from identified staff members of the Exempt Organizations 
Division in Cincinnati, that in addition to there being no 
email directing staff to target Tea Party or other political 
organizations and no conspiracy or effort to hide emails about 
such a directive, according to Mr. Camus, ``Review of these 
emails revealed that there was a lot of discussion between the 
employees on how to process the Tea Party and other political 
applications. There was a be-on-the-lookout list specifically 
naming those groups.''
    ``However, the emails indicated the organizations needed to 
be pulled because the IRS employees were not sure how to 
process them, not because they wanted to stall or hinder the 
application. There was no indication that pulling these 
selected applications was politically motivated. The email 
traffic indicated there were unclear processing directions and 
the group wanted to make sure they had guidance in processing 
the applications, so they pulled them. This is, he says, a very 
important nuance.''
    Would you agree with that finding, Mr. Koskinen?
    Mr. Koskinen. It sounds right to me.
    Mr. Connolly. Have you any idea why the inspector general 
would not include such a critical finding after all of the 
strum and drum, and after the press compliantly giving the 
headline to my friends on the other side of the aisle every 
single time, Tea Party targeted, here is a critical piece of 
information, maybe even a smoking gun if we are looking for 
exoneration, from the head of investigations in TIGTA's own 
office. Why would that not be included in the May 14th final 
audit report?
    Mr. Koskinen. I have no idea.
    Mr. Connolly. Is it worthy of your time to ask that 
question, respecting the independence, of course, of the two 
    Mr. Koskinen. I would not ask the IG that question. He has 
done his report; he has done his investigation. When they do 
investigations, they have any number of them going on. When 
they do the reports, we agree most of the time, sometimes 
disagree with recommendations, sometimes disagree with the 
process, but we do that in the orderly course of responding to 
their report. Thereafter, we don't go back and question them.
    Mr. Connolly. But, Mr. Koskinen, here you are for the third 
time before this committee, and probably not the last, and your 
reputation and that of your organization has been called into 
question with a charge that has unfortunately not been 
critically examined as often as I would like by the media, 
despite our efforts on this side of the aisle. Here is the head 
of investigations in your organization under TIGTA that says 
otherwise, that directly challenges the propounded thought that 
only Tea Party and conservative groups were challenged, and it 
was deliberate and it was targeted. He says otherwise and the 
TIGTA doesn't put it in his final audit report.
    By the way, an inspector general who has been questioned by 
a number of us up here, and we have formally requested an 
investigation of his conduct before the Council of IGS, so he 
is under a cloud myself. And I have heard my friend, the 
chairman, Mr. Jordan, question other employees of the IRs 
because of their political giving, while Mr. George was a 
Republican staff member on this committee, he has given 
political contributions to Republican candidates, he is a Bush 
appointee, and he met solely with the Republican side of the 
aisle in getting ready for his audit. That raises serious 
questions. If it is sauce for the goose, it is sauce for the 
gander about his independence. But this is a critical piece of 
information, it seems to me, and I can't imagine you could be 
copacetic with its elimination from an audit report that is a 
pretty critical audit report for your organization and, indeed, 
for your leadership.
    Mr. Koskinen. Well, it is an interesting piece of 
information that obviously is useful for people to review. As I 
have said, I do have confidence in Mr. George that he is 
independent. He actually is the Treasury Department inspector 
for IRS, and we have supported him the past and he is doing an 
independent review of all of this, and I look forward to his 
response and findings about what happened with regard to the 
hard drive crash.
    Mr. Connolly. Well, how about his response to why he didn't 
include this important missive from his head of investigations 
in the final audit report of May 14th?
    Mr. Koskinen. That is a question that I am probably not 
going to ask him.
    Mr. Connolly. I yield back, Mr. Chairman.
    Mr. Jordan. I would just ask the gentleman which way do we 
want it. Do we want to say this committee can't get access to 
witnesses because there is an ongoing inspector general's 
investigation and at the same time we are waiting for the 
inspector general to do his good work and at the same time 
criticize the work he did before where he identified the 
targeting of conservative groups? It seems to me you can't have 
it both ways.
    Mr. Connolly. Well, Mr. Chairman, there are a number of us 
who have been raised and been quite consistent in raising 
questions about the objectivity and professionalism, frankly, 
of Mr. George. Mr. Cartwright and I have both filed a 
complaint, formal complaint, and I would be glad to share it 
with the chairman because----
    Mr. Jordan. With all due respect, then you should be 
advocating we get access to the witnesses and not wait until 
the inspector general has them first.
    Mr. Connolly. Well, actually, maybe a new inspector general 
is really the answer.
    Mr. Jordan. Well, relative to this idea that somehow it was 
just mismanagement, 80 percent of the applicants in the backlog 
were filed by conservative groups, less than 7 percent were 
filed by liberal groups. According to the Ways and Means 
Committee, the IRS approved every single group with the word 
progressive in its name. USA Today reported the IRS did not 
approve a single tax-exempt application filed by a Tea Party 
group from September 2010 to May 2012. During the same time 
they approved dozens of liberal and progressive groups. The 
idea that was just how--if it was mismanagement, it was 
mismanagement in a targeted way, because none of the treatment 
to conservative groups was given in the same way to progressive 
    Mr. Connolly. Mr. Chairman, I have a memo from Gregory Kutz 
saying targeted is actually not accurate. I also have materials 
that were presented to IRS for training that have elephants and 
donkeys, they have Tea Party, they have Patriots, they have 
    Mr. Jordan. 298 cases in the IRS backlog. Only three had 
the word progressive; four used the word progress and none used 
the word occupy. No progressive group was denied its (c)(4) 
status. Hundreds of Tea Party conservative groups were in fact 
denied. Some still waiting. Some still waiting, just for the 
    Mr. Connolly. Well, I guess you and I could argue that all 
day, Mr. Chairman, and we need to get on with this hearing and 
allow Mr. Koskinen to get back to his job.
    Mr. Jordan. Mr. Koskinen, why June 13th? Why that date? Let 
me ask you this. Why not February 2nd, when you first learned 
there was a big gap in a bunch of emails that looked like they 
were missing? Why not February 4th, when, as Mr. Cain 
testified--and, Mr. Koskinen, you know Mr. Cain. Do you know 
Tom Cain?
    Mr. Koskinen. I do know Mr. Cain.
    Mr. Jordan. Is Mr. Cain a solid lawyer, professional good 
employee at the Internal Revenue Service?
    Mr. Koskinen. Certainly is.
    Mr. Jordan. All right. So why not February 4th, when Mr. 
Cain, who testified just last Thursday, said they knew her hard 
drive had crashed? Why not tell us, look, we may have a 
problem? Why not come and disclose that to someone on February 
4th? Or how about this? How about mid-February, when Mr. Cain 
said last Thursday that we know, we knew then in mid-February 
that the data on her computer was unrecoverable? Why didn't you 
tell us in mid-February? Or how about the hearing we have 
talked a lot about, Mr. DeSantis raised in the opening 
questions, why not at March 26th? Why not disclose on March 
26th, when you were in front of this committee and everyone on 
both sides of the aisle asked you about Lois Lerner's emails 
and you assured us that you would produce all her emails, and 
yet you knew, according to Mr. Cain's testimony, a good 
professional employee, lawyer at the IRS, you knew that in mid-
February her emails were unrecoverable?
    Mr. Koskinen. You should be careful to note that is what 
Mr. Cain knew, that is not what I knew.
    Mr. Jordan. Well, that is a problem too. That is something 
you should have known. Mr. Cain is a high-ranking official in 
charge of documents, and you didn't know?
    Mr. Koskinen. I did not know. I have testified----
    Mr. Jordan. Do you know Kate Duvall?
    Mr. Koskinen. Pardon?
    Mr. Jordan. Do you know a person named Kate Duvall?
    Mr. Koskinen. Kate Duvall I do know.
    Mr. Jordan. And what is Kate Duvall's responsibilities, 
what is her title at the Internal Revenue Service?
    Mr. Koskinen. She is counselor to the commissioner.
    Mr. Jordan. So she is counselor to you.
    Mr. Koskinen. Yes.
    Mr. Jordan. She is your lawyer.
    Mr. Koskinen. Yes.
    Mr. Jordan. She knew in mid-February, according to Mr. 
Cain's testimony, and she didn't tell you?
    Mr. Koskinen. What she told me, and I have testified at 
some length at at least a couple hearings on this, and I am 
happy to stand by that testimony. If you want to go over it 
again, basically, what I have told you is in mid to late 
February I knew that we had taken the Lois Lerner emails that 
had been produced and instead of looking at them from search 
    Mr. Jordan. That is not the point. Tom Cain said they were 
    Mr. Koskinen. I did not----
    Mr. Jordan. And he said he told Kate Duvall. Did she tell 
you that they were unrecoverable?
    Mr. Koskinen. She did not tell me they were unrecoverable.
    Mr. Jordan. Well, that is a problem.
    Why not tell us April 4th, when Ms. Duvall briefs this 
committee, both Republican and Democrat staff members, and the 
briefing was about how we would deal with how the IRS was going 
to deal with committee requests for producing Lois Lerner's 
emails, they didn't know they were lost at the time? Why didn't 
you tell us April 4th? Ms. Duvall could have told the committee 
at that time.
    Mr. Koskinen. I have testified at some length in the past, 
and earlier today, that----
    Mr. Jordan. Well, here is the key question. Let me jump in 
here a second. Why not mid-April, when you knew? In fact, let's 
put up the slide. This is a question we had earlier in one of 
our hearings. Why not, when you knew, what date did you learn 
you could not get all of her email? I learned that in April. 
Why not April?
    Mr. Koskinen. As I testified then, and I have testified on 
numerous occasions, my judgment was, A, we needed to find out 
what emails we did have; we needed to put them together in a 
full report, which we did, and----
    Mr. Jordan. Why not any time in April? Someone at the IRS 
told someone at Treasury, who then told someone at the White 
House, according to press reports. So if it was good enough to 
pass on to Treasury and the White House, why not tell us 
sometime in April?
    Mr. Koskinen. Because I thought that at that point we did 
not have the full information as to what was involved, how many 
emails there were----
    Mr. Jordan. You learned in April they were unrecoverable. 
Your chief lawyer in charge of document production knew in mid-
February they were unrecoverable. Kate Duvall knew in mid-
February they were unrecoverable. And you wait until June 13th.
    Mr. Koskinen. Right.
    Mr. Jordan. Why June 13th?
    Mr. Koskinen. First of all, I would note all of those 
emails that determine whether they were--that she had a hard 
drive crash or not, what she had tried to do, our emails were 
provided to this committee, and the tax writers knew as early 
as the fall she had had a hard drive crash. The materials were 
produced. The materials about the email chain, about her trying 
to restore her hard drive were produced to the tax writers in 
April and to this committee in May. So there was no secret that 
we were hiding. We were processing through----
    Mr. Jordan. No, no, no. You were giving us emails, but you 
didn't tell us there were emails you couldn't give us. That is 
my question. Why didn't you tell us the IRS had destroyed 
emails that belonged to Lois Lerner? Why didn't you tell us 
    Mr. Koskinen. It is not clear--first of all, emails from 
Ms. Lerner may or may not haven lost; they were not destroyed 
as a conscious effort by the IRS to destroy them.
    Mr. Jordan. The tapes were recycled and----
    Mr. Koskinen. Right. Backup----
    Mr. Jordan. When backup tapes are destroyed and they are 
recycled, so at some point they are destroyed. Why didn't you 
tell us you could not produce those emails, that they were 
lost, in April?
    Mr. Koskinen. This hearing is noted to be an update on what 
we are doing. I have given you, on at least two different 
    Mr. Jordan. Okay, then answer the question. Why June 13th? 
Why not June 12th? Why not June 10th? Why not May 10th? If you 
couldn't do it in April, why did you have to wait two more 
    Mr. Koskinen. We are going to be here a long time if you 
want to repeat all of the questions I have answered in the 11 
and a half hours of hearings before.
    Mr. Jordan. Do you know what I think?
    Mr. Koskinen. But let me just answer this question. But I 
have answered it before and I am happy to answer it again, but 
it is in the testimony I have given before that you have read 
closely. We were producing Lois Lerner emails. Our strategy and 
thoughts were and I thought the most efficient way to proceed 
was to complete the production so we would know how many Lois 
Lerner emails we had from her account, how many Lois Lerner 
emails we had been able to retrieve from other accounts so you 
would have a full idea what the universe was. I had hoped that 
we would be able to find out how many other problems we had 
with custodians, and we would produce all of that as a report 
to the committees and a public report that would explain what 
our email process is, why it is so complicated, what we had 
determined about Lois Lerner's emails and her crashes, and what 
the emails would have been able to recover, and it would be a 
full report.
    June 13th was a Friday. I should have known Friday the 13th 
was going to be an interesting day. We had been asked by the 
Finance Committee, which was considering trying to come to 
closure on their report, whether we would give them an update 
on our March letter in which we advised the tax writing 
committees that we had completed the production of all of the 
information we had about the determination process, which was 
the start of the investigation. That was the IG was focused on, 
as you have just discussed. We said we would do that.
    They then called and we were going forward, we didn't know 
when. They then called and said they would like that report no 
later than that Friday because they were going to have a 
meeting the following week. So we pulled the document together 
at that point. We had not completed, as I noted earlier, the 
review of how many custodians were involved with hard drive 
crashes and what the impacts were. We had no idea if you lost a 
hard drive, one of the custodians, and in fact one of the 
custodian hard drive crashes was in February of this year, not 
very relevant.
    So to meet the Friday deadline we actually produced that 
document and shared it with everybody on Friday, June 13th, and 
it was to meet a request from the Finance Committee, which was 
having a meeting the next week and wanted to consider whether 
they had enough information to do a report.
    Mr. Jordan. So your testimony is the Senate Finance 
Committee drove the timing of when you disclosed that you had 
lost Lois Lerner emails.
    Mr. Koskinen. Yes, because we were actually going to 
produce that report----
    Mr. Jordan. I think it is something different, I just do. 
Obviously, you are going to disagree, but I think you were 
never going to tell us. You have to remember what happened 
here. Judicial Watch does a FOIA request and they learn on 
April 18th of this year that the IRS and the Department of 
Justice had been working on possible ways to bring false claims 
action against Tea Party groups, and there was an email from 
that FOIA request, Richard Pilger, a lawyer at the Justice 
Department, and Ms. Lerner had an exchange in 2013 after a 
Senate hearing. We saw that email. We said, you know what, we 
are going to talk to Mr. Pilger, the lawyer at the Justice 
Department, who was meeting with Ms. Lerner just days before 
the TIGTA report went public, in May of 2013.
    So on May 6 we interview Mr. Pilger and we learn, in Mr. 
Pilger's opening statement in that deposition, we learn this: 
he said--I am reading straight from Mr. Pilger's statement: 
``Turning to my contacts with Ms. Lerner, in the fall of 
2010''--shocked us. We didn't know that they were meeting clear 
back in 2010, that the Justice Department was meeting with the 
IRS clear back in 2010. ``In the fall of 2010, at the direction 
of the chief of the Public Integrity Section at the Justice 
Department, Jack Smith, I contacted the Internal Revenue 
Service. When I contacted them, they directed me to Lois 
Lerner, who met once at the Public Integrity Section offices 
for about an hour with some of her staff, my chief, Jack Smith, 
other personnel from my section, and the FBI.''
    So now we learn in 2010 the Justice Department, with the 
FBI, is meeting with Lois Lerner, and so we said, you know 
what, we better subpoena documents from the Justice Department. 
And we said to the Justice Department we want any 
communications with Lois Lerner that you have had. And we get 
this slide. We get this email. Let's put this up, if we can. We 
get this communication from Lois Lerner and Richard Pilger.
    Now, Mr. Koskinen, did you give us this email, do you know?
    Mr. Koskinen. I don't know.
    Mr. Jordan. Well, I can tell you you didn't. We got it from 
the Justice Department. And after we got this from the Justice 
Department, we contacted you all on June 9th and we said, hey, 
how come we didn't get this email from you? There is no 6103 
issue with this email. We were concerned. This is an email from 
clear back in 2010. So we contact you, Mr. Koskinen, in a 
letter and we said, you know, we are wondering why the IRS 
hasn't sent us this email from four years ago. And then, 
suddenly, four days later you tell the Finance Committee, the 
Congress, more importantly, the American people, you know what, 
we lost Lois Lerner emails. We have lost a bunch of Lois from 
that time period.
    My theory is this, Mr. Koskinen: You guys weren't ever 
going to tell us until we caught you. And we caught you because 
Judicial Watch did a FOIA request; they found out there was 
this collaboration going on between the Justice Department and 
the IRS. We took that email, we interviewed Mr. Pilger. Mr. 
Pilger told us he met with Lois Lerner in 2010. We then 
subpoenaed Justice. They complied with our subpoena, gave us 
the email. We contact you and say why didn't you give it to us, 
and then you knew you were caught.
    You didn't tell us this, but you knew, we didn't give it to 
you 'cause we don't got it. Now we have to tell the whole world 
we lost them. And what better time to do it than Friday, June 
13th, saying we are complying with some Senate concern, said it 
in a letter, put it on page 7 of the third addendum, and say, 
you know what, we may have a problem with Lois Lerner emails? 
That is what I think.
    Mr. Koskinen. Good. If you find----
    Mr. Jordan. I think all kinds of people logically going 
through this would say, you know what, that is what prompted 
these guys. Four days after they get a letter from this 
committee saying why didn't you send us these emails, you just 
say, well, we better come clean. Plus, you have already told us 
you knew clear back in April that you lost them. So you wait 
two months and then you say, wow, we better do it June 13th, 
just four days after they figured out Justice and the IRS were 
working together in 2010, and they got an email that indicates 
that and we can't produce it.
    Mr. Koskinen. When you find any direct evidence to support 
that assertion, I would be happy to see it. If you think that 
this organization, in four days, could produce that report, you 
don't understand how large organizations function. You could 
ask anybody who worked on that report; there is a whole series 
of people. That report was under production for a long time 
    Mr. Jordan. I am not saying it wasn't. I am saying 
including the statement we lost Lois Lerner emails was put in 
that report.
    Mr. Koskinen. It was in that report and it was in that 
    Mr. Jordan. And one thing I have learned in these 
investigations, it is always important to look at the time 
    Mr. Koskinen. Look at the time line----
    Mr. Jordan. Look at the time line. You knew in April; you 
didn't tell us until June 13th. What events happened between 
April, when you knew, and June 13th? One key event was the FOIA 
request from Judicial Watch, finding this collaboration between 
the IRS and the Justice Department, us getting that email 
because we subpoenaed the Justice Department; they give it to 
us, it is in the relevant time frame, 2010 to 2012, when you 
lost Lois Lerner emails, and suddenly you say, you know what, 
they got us. We have to come clean.
    Mr. Cummings. Mr. Chairman?
    Mr. Jordan. And then you do the letter on June 13th.
    Mr. Koskinen. Can I respond? That is a very serious charge.
    Mr. Jordan. Sure.
    Mr. Koskinen. There were a whole set of serious staff 
people in the Senate Finance Committee who will dispute your 
assertion. And if you find any direct evidence of this to 
anybody who worked on that report, in terms of the timing of 
it, the fact that we were otherwise not going to deliver it, I 
will be not only surprised, I will be astounded, because there 
is no such evidence. And it seems to me, and I have been very 
patient about all of this, but before you make that kind of 
charge and claim, you ought to have better evidence than a 
single email dated June 9th.
    Mr. Cummings. Mr. Chairman?
    Mr. Jordan. We have a few other emails from that exchange.
    Mr. Koskinen. That is fine.
    Mr. Cummings. Would the chairman yield for one moment?
    Mr. Jordan. I would be happy to yield.
    Mr. Cummings. I know a lot has been said about what Thomas 
Cain said. Well, last week Thomas Cain told our staffs that the 
IRS always intended to alert us about Ms. Lerner's lost emails. 
So I know you have all these theories. Unfortunately, our 
committee has been going when we put out these headlines and 
then we go chasing facts that never exist.
    Mr. Jordan. All I am saying----
    Mr. Cummings. But I am just saying include everything when 
you are asking your questions.
    Mr. Jordan. Great point. All I am saying is this. They get 
a letter from us on June 9th, where they know we now have this 
email from the Justice Department that they can't produce, and 
four days later they tell the world we have lost Lois Lerner 
emails, when they knew that, according to Mr. Koskinen's 
testimony in questioning from me, that he knew in April they 
couldn't get Ms. Lerner's emails. So they waited two months. 
And then when they decided to tell us, it was four days after, 
on a Friday, four days after we knew there were emails we were 
getting from Justice that we weren't getting from the Internal 
Revenue Service.
    Now, all I am saying is that timing is pretty suspect, 
particularly in light of the fact all the other things we have 
heard from the IRS. One computer crash. No, it was seven. No, 
it was eight. Now may be up to 20. We can confirm that there 
are no backup tapes that are available. Oh, we can't confirm 
that, now there may be one available. In light of everything we 
have heard from the IRS, when you start looking at the time 
line, it looks pretty suspect.
    Mr. Cummings. Well, Mr. Chairman----
    Mr. Jordan. And all I am saying is I am not sure they were 
going to tell us.
    Mr. Koskinen. You didn't say I am not--I am sorry----
    Mr. Cummings. Would the chairman yield?
    Mr. Jordan. I would be happy to yield.
    Mr. Cummings. Mr. Chairman, this has been very interesting 
because one member on your side, the gentleman, I don't know 
his name, said that the man was under investigation. I was in 
that entire hearing and he never said that. By the way, the 
Justice Department never said that. Then you, Mr. Chairman, of 
course, have made some strong accusations, and when you make 
these kind of accusations, I would appreciate it if you would 
just give the witness an opportunity to answer, because these 
are the kind of allegations that tarnish one's reputation, and 
you have come up with this theory, and I am not saying your 
theory is--your theory is what it is, but he ought to be able 
to answer, please. That is all I am asking.
    Mr. Jordan. Appreciate the ranking member.
    Mr. Koskinen. As I said, I haven't seen Mr. Cain's 
testimony, but it doesn't surprise me that he would say that we 
had been producing this report for some time and clearly 
planned on making it public. You can talk to people. We would 
be happy to give you those contacts, the people we talked to at 
Finance who were in fact did have a meeting the following week, 
had asked us for an update that we did provide. They asked for 
it no later than that Friday.
    I am confident and I am very confident that no one working 
on this report had any idea about it other than that we were 
going to produce it and provide all of the information to the 
public. I think any other assumption is not based on facts.
    Mr. Jordan. Well, are you willing to make those witnesses 
available or are you going to make us subpoena them so they can 
come here under oath and testify that, yes, in fact, from mid-
April, when the commissioner knew that Lois Lerner emails were 
lost, we were planning on telling the Congress as soon as we 
got all the information? They will come and testify to that or 
will they come and testify, you know what, after the June 9th 
letter we decided we better put in the information that we lost 
Lois Lerner emails?
    Mr. Koskinen. I don't think you will find anyone will make 
that latter testimony.
    Mr. Jordan. But my question to you is are you willing to 
have those people come testify. Tell us who they are, who the 
people who worked on this report.
    Mr. Koskinen. We will be happy to talk with you. You have 
already talked to some of them and you have others on your 
    Mr. Jordan. All right.
    The gentleman from Nevada is recognized, Mr. Horsford.
    Mr. Horsford. Thank you, Mr. Chairman.
    You know, I do share concerns by some of my colleagues on 
the other side about why the IRS delayed in providing Congress 
with notification regarding the unrecoverable emails, because 
it raises questions. I don't share in the chairman's or other 
members' conspiracy and rush to judgment about any motives as 
to why there was a delay, and I feel, again, as I have said in 
previous meetings, that we fail to get all the facts in order 
to then make a proper decision. I am not a defender of the IRS 
or any other Federal agency. I have said from the beginning 
that I believe that there was wrongdoing, but the chairman and 
others want to conclude or make conclusions about that 
wrongdoing without justification or evidence to support their 
    Now, Mr. Chairman, you just read into the record some 
comments by Mr. Pilger that I had asked to be entered into the 
record the full transcripts, so I am going to ask again for 
unanimous consent that the transcribed interview opening 
statements of DOJ officials Richard Pilger and Jack Smith be 
allowed to be entered into the record, particularly since you 
just handpicked certain statements, and I am requesting the 
full transcript be entered. Will the chairman please provide 
that courtesy for this to be entered into the record under 
unanimous consent?
    Mr. Jordan. If the gentleman would yield for just a second. 
I read from the opening statement that Mr.----
    Mr. Horsford. That is what this is, the transcribed----
    Mr. Jordan. If you are just asking for the opening 
statement, not the full questions from Democrat staff, 
Republican staff, but just the opening statement from Mr. 
Pilger and Mr. Smith, we would be happy to do that.
    Mr. Horsford. Thank you.
    Mr. Jordan. All right.
    Mr. Horsford. I also want to follow up to some of the 
claims that have been made by my Republican colleagues and give 
you an opportunity to respond. It has now been stated twice 
today that Mr. Cain testified during his July 17th interview 
that in mid-February 2014 the IRS realized that Lois Lerner's 
emails would not be recoverable. I want to clarify here, 
because I don't want Mr. Cain's statements to be taken out of 
context. It is true that Mr. Cain told us that he had 
discovered that Ms. Lerner's hard drive had crashed and that 
the contents of the hard drive were unrecoverable.
    However, that does not mean that Mr. Cain said that he 
thought, in February of 2014, that the IRS would never be able 
to produce those emails to Congress. In fact, Mr. Cain was 
asked, ``And as of March 2014, you were not aware that the IRS 
would be unable to recover all of Ms. Lerner's documents,'' and 
he answered, ``That is correct.'' He further explained, as you 
have, that the IRS was engaged in an extensive process to find 
Ms. Lerner's emails from other sources at the IRS; and, in 
fact, those efforts were successful and yielded the production 
of an additional 24,000 Lois Lerner emails. Is that correct, 
Mr. Koskinen?
    Mr. Koskinen. That is correct.
    Mr. Horsford. Mr. Cain also explained that the IRS's goal 
with respect to the document productions to Congress was to 
fully comply with those requests as expeditiously as possible. 
He stated with respect to fulfilling that goal, ``I have tried 
my best, and everyone that I work with have tried their best.'' 
Commissioner Koskinen, do you share that belief that every 
effort was made to provide this committee and others with those 
emails that were you able to recover?
    Mr. Koskinen. I do.
    Mr. Horsford. And beyond the issue of failing to notify us 
in a timely manner, then the question becomes what can be made 
of why that time line was delayed.
    Mr. Koskinen. Right. And as I have said, first of all, all 
of the emails in question had been provided in the normal 
course to this committee and the other investigators, so there 
was no attempt to not produce information that showed that in 
fact there had been a problem with Lois Lerner's hard drive. In 
fact, none of us at the IRS or investigators noted that in the 
fall productions there were emails from Lois Lerner saying she 
had problems with her hard drive and had lost emails.
    But everybody then was looking at subject matter. But it is 
not as if any of these emails were withheld or not produced in 
a regular manner. So that as we were working in April and May 
pulling all the information together, trying to determine how 
many emails we actually had, we were producing emails as a 
regular matter, and the emails that were the basis of our June 
13 report had all been provided previously to all of the 
    Mr. Horsford. Thank you.
    Mr. DeSantis. [Presiding] The gentleman's time has expired.
    The chair now recognizes the chairman of the committee, Mr. 
    Mr. Issa. Thank you.
    Commissioner, I really wish we had your IT guys here 
instead, because it is inherently a little hard when we are 
asking you so many questions that are not related directly to 
your past experience. But I appreciate your continuing to 
volunteer to come up. Hopefully, as we interview some of your 
IT professionals and others involved, it will make it easier to 
direct questions.
    But a lot has been done to talk about this, a drive this 
large that apparently went so bad that not a single piece of 
information could be saved, and you have asked us to believe 
that your very special experts couldn't save one piece of data 
from this drive, or one just like it, correct?
    Mr. Koskinen. That is what I was advised, yes. And that is 
what the email strain that we produced and I testified about at 
previous hearings says.
    Mr. Issa. The American people don't believe that. You 
realize that the idea that we can recover the last 17 or 18 
seconds from Challenger exploding above our atmosphere, falling 
to the sea and being left under the sea for a year that we 
could recover the voice from that makes people wonder why a 
product that simply came in and out of the office with Lois 
Lerner every day, suddenly, not one piece of data could be 
recovered. It doesn't surprise you the American people just 
have a hard time believing that, does it?
    Mr. Koskinen. Well, I don't know whether the American 
people broadly believe that, but I do understand that when our 
Criminal Investigation Division, which our experts at 
extracting information say they could not recover any emails, 
that seems probative on the one hand, but on the other hand I 
could understand people saying, well, if you kept trying----
    Mr. Issa. But do you think it is reasonable for us to check 
with your Criminal Investigation people, interview people 
involved to see if that passes the reality check, in spite of 
what the American people may think or the doubts they may have? 
Do you think it is fair for us to check into that?
    Mr. Koskinen. Yes. In fact, those interviews are being 
scheduled. Some of them, I gather from the press release I saw 
from Ways and Means, that some of those IT people have already 
been interviewed.
    Mr. Issa. So it is fair for us to do an interview and to 
investigate on our own in order to bring the credibility that 
we bring as if, you will, a doubting Thomas, to the process. 
You would agree with that?
    Mr. Koskinen. Yes. I have never had any concern or 
objection to the oversight. As I said, I spent four years in 
the Senate that Senator Ribicoff was on, the Government 
Operations Oversight, chaired that committee. I am a big 
believer in congressional oversight.
    Mr. Issa. And I appreciate that you are. One of the things 
that we discovered that was not made available to us early on 
was the existence of what is called OCS, this chat capability 
that exists within the IRS's network, is that right?
    Mr. Koskinen. That is correct. I spent some time testifying 
a couple weeks ago about that.
    Mr. Issa. Right. And you wrote me back a letter when I 
asked about it, and in the letter it said, basically, that no 
records were kept because it was the equivalent of visits or 
phone calls. Do you remember that in the letter?
    Mr. Koskinen. Yes.
    Mr. Issa. Now, would it surprise you to know that we 
disagree with you? That in fact it is the opinion of this 
committee that the Federal Records Act, unless you can train 
and guarantee that no policy decisions, none of the kinds of 
activities we are discovering in email could be done on OCS, 
that in fact you should turn on that switch and you should 
collect and you should retain OCS chat unless you can assure us 
that it is not doing the equivalent. And I will be brief, but I 
will explain something to you.
    Years ago, when I was a subcommittee chairman and President 
Bush was in office, we investigated the Mineral Management 
Service, and what we discovered there was that they had 
systematically signed leases that were simply wrong and cost 
the American people billions of dollars; and we could find not 
a shred of evidence in emails to show the absurdity of how this 
came to pass. So after we deposed people repeatedly, we finally 
discovered that they all admitted that only the cover sheet was 
brought to them, that they signed or initialed, and they never 
read the leases; so that one mistake was passed through 
multiple signatures.
    But, more importantly, as we went through the process, what 
we discovered was, at Mineral Management Service, a now-defunct 
and disgraced organization to a certain extent after the BP 
disaster, they had a policy of what they called talking over 
the transom. Lawyers made no memos for the record. Lawyers went 
out of their way to have no paper trail of things they did in 
their consultation.
    I will tell you today that has to end; that the American 
people expect that the Federal Records Act, the Presidential 
Records Act is not something to be avoided, and you should not 
be trying or allowing the bypassing of future oversight that 
you said rightfully so, with your experience, you believe in.
    Maintaining data so that it can be analyzed by your 
inspector general, who is conducting your primary 
investigation, you have full confidence in, activities going on 
in Ways and Means, which are slightly different than ours, our 
activities, or anything in the Senate are hampered by policies 
of any part of Government that allow the use of something that 
clearly bypasses future oversight.
    So I hope today that in addition to your willingness to 
cooperate and help us in getting to the answers I mentioned on 
this, that you will recognize that your letter is not 
acceptable; that email is a substitute not just for the old-
fashioned letter, but it is a substitute for a visit, it is a 
substitute for a phone call; and that, in fact, the reason that 
those are important is that the phone call and the visit, in 
the old days you would have done a memo for the record if in 
fact you wanted to do your job. That isn't being done. Emails 
and these chats are extremely important.
    And I would like to have a second round at some time, but I 
would yield back at this time.
    Mr. Cartwright. Mr. Chairman, I have a point of 
information. Yesterday Chairman Issa informed committee members 
that he will be holding yet another hearing on this topic next 
Wednesday. We have the notice. Could the chairman please inform 
us who will be testifying at that hearing on Wednesday?
    Mr. Issa. Pursuant to the rules, we will inform at the 
appropriate time. But at this time they haven't sent anything 
out and I appreciate your inquiry.
    Mr. Cartwright. So you don't know or you won't tell us?
    Mr. DeSantis. I think we will----
    Mr. Issa. Regular order, please.
    Mr. DeSantis. We will do regular order and the chair, at 
this point, will now recognize the gentleman from Michigan, Mr. 
Bentivolio, for five minutes.
    Mr. Bentivolio. Thank you very much, Mr. Chairman.
    Commissioner, if any of my constituents were not as 
forthcoming as the IRS, there would be a presumption of guilt, 
they would be fined and/or have their wages garnished and/or 
liens laid on their home and/or savings accounts seized.
    When I go back to the district, I had the opportunity to 
talk to many IRS former employees at the IRS, now retired, and 
I asked them what they thought of what was going on at the IRS, 
and I heard despicable behavior every step of the way. The IRS 
no longer credible.
    I think at this point, Mr. Chairman, I would like to yield 
    Mr. Issa. Would the gentleman yield?
    Mr. Bentivolio. Yield to the gentleman from California.
    Mr. Issa. Thank you. I appreciate that. In regular order, 
this is helpful not to need a second round.
    Commissioner, there has been approximately a year of 
production of emails. In your earlier hearing I remember that 
it might take two years, sort of an estimate. But let me ask 
you a question. Have you reviewed the time line when this 
committee issued lawful demands for Lois Lerner's emails? Have 
you reviewed the time line of who did what and when?
    Mr. Koskinen. No.
    Mr. Issa. Would you be prepared to deliver to us a time 
line, meaning calendars, activities of individuals who were 
charged with going out and finding those emails, what they did, 
and when they did it?
    Mr. Koskinen. As I say, we have approximately 250 people 
doing that work.
    Mr. Issa. Well, no. Actually, you have had people redacting 
and you have had people legal reviewing. I am only talking 
about who went and got the information, the emails, who 
accumulated them, the gathering.
    Mr. Koskinen. Yes. That is not just one or two people, that 
is a set of people. But we would be happy to provide you the 
information in any form that would be usable.
    Mr. Issa. Well, here is the inquiry I will ask you today. 
And, again, we appreciate your coming, but you are not the IT 
guy, you are not any of the 200 people, per se. It is clear, 
now, from this side of the dais, that we issued requests and 
subpoenas. Two things were to occur: one, at the moment we 
issued our first letter, it required that you preserve 
information. There is a question about whether that was 
preserved, because in order to preserve it you would have to go 
look for it. So the tapes that now your own people have 
admitted they are not sure whether they exist or not, they have 
undercut your claim that you are very comfortable that they 
were gone at the end of six months, that means that nobody went 
out to say where are the tapes, what are the tapes, are there 
    Additionally, in order to not know that Lois Lerner had 
this gap, either you weren't looking extensively all at once 
or, and this is one of my concerns, people just didn't want to 
admit that they weren't going out and looking for emails by 
essentially what we expected, was to do a key word search on a 
server and deliver the data.
    Remember that for months, even before you came onboard, we 
were being told, well, here are some key words and we want to 
search on these key words; and the IRS was adding key words 
that allowed them to deliver the false narrative that 
progressives were being targeted. They were adding self-serving 
words and they were searching them.
    This committee had a reasonable expectation that you were 
searching the entire database, you were searching not six 
months worth of emails, not 6,000 emails or less that had been 
preserved, but you were searching the historic emails. Not 
until recently, the last six weeks, did we understand that if 
that was how you were getting all of your information, you were 
knowingly looking at a small fraction of the historic two-or 
three-year email selections.
    We now understand no more than 6,000 emails, only six 
months of record, so it is now appropriate for us to understand 
your employees' search techniques, what they did, because at 
some point they must have started searching, okay, who has 
PSTs? Send us your PSTs. Or did they, and this is why we have 
to ask directly, did they send out one of these do you have any 
information relevant and please send it to us. Because the key 
word search would imply that in fact they were accumulating all 
these PSTs, these downloaded local files and then searching 
    If in fact that process didn't begin in earnest in the 
first week or month, if in fact your predecessor was delivering 
selected data from what was basically the last six months of 
things still preserved, we need to know that, because it does 
appear as though, in this long investigation, there has been 
either an absence of a willingness to disclose problems or an 
absence of real fact-finding, getting these emails quickly, or 
deliberate obstruction.
    We don't know which and we would like to know, as I said in 
the beginning of this, who went looking for what when. Not 
interested in who read them, not interested in who edited them, 
who redacted them or who released them. And that information 
would be equally valuable whether it was pursuant to the House 
or Senate's request or to Ways and Means or this committee's 
    But giving us that gives us a time line of who was involved 
in going and looking so we know who knew that in fact something 
like Lois Lerner's email on her personal hard drive was of any 
relevance, because this committee didn't know that there was a 
lack of a central database for the first almost year of this 
    I thank the chairman and yield back.
    Mr. DeSantis. The gentleman yields back.
    The chair now recognizes the gentlelady from Wyoming for 
five minutes.
    Mrs. Lummis. Thank you, Mr. Chairman.
    I have no doubt, Mr. Koskinen, that morale at the IRS is 
low. I want to tell you about morale in Wyoming. The people of 
Wyoming, who I work for, all feel targeted. They think the IRS 
is out to get them. They are lower than a snake's belly about 
the IRS because they know that Lois Lerner was brought into the 
IRS from the Federal Elections Commission, where she had a 
history of political targeting, political bias. They know that 
she was tapped to enforce the largest tax increase in history, 
Obamacare, after, after she targeted conservative groups while 
overseeing 501(c)(4)s, tax-exempt organizations. They saw her 
come to this committee and say I have broken no laws and then 
take the 5th. They know that we subsequently found out that she 
did break a law, that she provided confidential taxpayer 
information to another Federal agency, which is against the 
    And they know that so far she has gotten away with that, 
that the Justice Department isn't doing anything about it and 
that she got away scot-free. They know that when they get 
letters from the IRS, that they are being targeted. I have a 
constituent who got a letter and an investigation from the IRS 
that has cost her $50,000 just to close her estate, because 
they keep asking her what make and model is your bed. Your bed? 
They think her bed is some expensive antique. Incidentally, she 
is a very active member of the Republican party. She feels 
    Morale is low in Wyoming because our government has turned 
against us. So this is a legitimate investigation. I hope it 
continues at length. I hope it goes on until we get to the 
truth, because the people we work for feel like the Government 
is getting away with their tax dollars that they don't know; 
they feel like the Government is denying them tax-exempt status 
that they deserve; they feel like they can't trust the IRS. 
That is why this investigation. That is why you are here and 
asked the same questions over and over. I am sure it is 
frustrating. We are frustrated too, but it is because our 
constituents are mortified and scared, and are going to take 
matters into their own hands, because they don't feel we have 
the ability to do it ourselves.
    So, with no apologies for the morale at the IRS and no 
apologies for how many times we are asking you the same 
questions over and over, Mr. Chairman, While I thank you for 
your attendance, I do yield back the balance of my time.
    Mr. Issa. Would the gentlelady yield?
    Mrs. Lummis. I will.
    Mr. Issa. Some people just don't have enough questions for 
you, commissioner.
    I mentioned the time line and my interest in that. Let me 
just ask you one other question, which is when you look at this 
investigation and you look at the fact that a Federal judge is 
now ordering you to show certain things, you look at your IG's 
investigation, you look at our investigation, are you aware and 
do you recognize the three separate channels are perceived and 
in reality are very different as to what your responsibilities 
are and how you approach them?
    Mr. Koskinen. My response to all of them is the same; if 
people have, from any branch of Government, questions, we have 
an obligation to respond to them in response to----
    Mr. Issa. I appreciate that, but the IG does in fact work 
under you; he has limited authority.
    Mr. Koskinen. Absolutely not.
    Mr. Issa. I understand his independence, but in fact----
    Mr. Koskinen. He is the Treasury Department IG. We have no 
control, influence over him. He doesn't work in the IRS.
    Mr. Issa. But in fact he has testified that when he wants 
information, he has to ask for it and he may not always get it, 
that in fact there is a process and sometimes it is very 
frustrating for him to get information. Even though you say he 
is independent, he doesn't have the authority to demand things 
and automatically get them, isn't that true?
    Mr. Koskinen. I have never had, in my time here or other 
places, an experience with an IG not able to get the 
information he needs, and I am committed, as Mr. George knows, 
that whatever information he wants in any investigation, he is 
welcome to have.
    Mr. Issa. Well, we will certainly hold you to that. Thank 
    Mr. Koskinen. I am happy to be.
    Mr. Issa. Yield back.
    Mr. DeSantis. Thank the chairman.
    For the other members who do want to do a second round, we 
will do that, so I will kick it off and recognize myself.
    I just want to reiterate people mentioned the morale, and, 
granted, a lot of the things that happened were before you were 
there, but I do think it is worth mentioning that there are a 
lot of taxpayers who have had their morale hit. When they see 
some of the conference spending that has gone on, $50,000 for a 
Star Trek parity video and other lavish expenses on their dime, 
and, again, that was before you were there, but that really 
irks a lot of folks and certainly our constituents. And I think 
the same goes for the targeting. When people feel like they 
were being targeted or in fact were targeted simply from 
exercising their constitutional rights, I think that hurts 
their morale too. So I just think it is important that we 
mention that.
    Now, a lot has been going on about when you knew there was 
a problem, why you delayed telling Congress, and I think it is 
the case that the standard that would be applied to an official 
such as yourself is not simply what you actually knew, but what 
you should have known. In other words, you can't bury your head 
in the sand and not be apprised of what people in your 
organization know. So I think that is going to be a question. 
Clearly there were people at the senior leadership level at the 
IRS early February, mid-February, who knew that the problems 
were more substantial than what you indicated to us that you 
personally knew, so the question is going to be why did you not 
know more.
    And I think that goes into what I and some other folks have 
raised. And I know my friend Mr. Cartwright disputed the notion 
that this is being investigated by the Justice Department. And 
just so we are clear, because I don't want to be lobbing 
charges that aren't true, here is the transcript from last 
week's hearing with James Cole, DOJ Deputy AG.
    Chairman Jordan: The fact that the commissioner, meaning 
you, at the Internal Revenue Service delayed telling Congress, 
the American people, the FBI, and the Justice Department is a 
matter that you are going to investigate?
    Mr. Cole replied, We are going to look into what the 
circumstances were around that, yes.
    So we are concerned about it and the DOJ seems also to be 
concerned about it, and I think that that is important to know.
    Let me ask you this. You mentioned that you have seen the 
Ways and Means press release about their conducting interviews 
with different IRS technical witnesses about what in fact 
happened to the hard drive, so they told Ways and Means that 
the hard drive was scratched and that data was likely 
recoverable from it; and, of course, the IRS, just last week in 
Federal court, has filed a declaration saying, consistent with 
what I think you have testified to, that the hard drive was 
destroyed and in fact no data was recoverable for it.
    So my question is what is an American to think when they 
see some witnesses telling a congressional committee scratched, 
may be recoverable, but yet the IRS is representing in Federal 
court that it was destroyed and completely unrecoverable?
    Mr. Koskinen. I wasn't there and I haven't talked to those 
people, and I don't know what that interview yesterday----
    Mr. DeSantis. But they were the technical people, would be 
the ones that we would most want to talk to about that, 
    Mr. Koskinen. All I know is the emails that actually I have 
testified at a couple previous hearings about show that there 
were efforts made by Ms. Lerner and the IT department to 
restore the hard drive. It went to the Criminal Investigation 
Division, and they are experts and they said they were not able 
to retrieve information from that hard drive. That is all I 
know and that is what the emails contemporaneously at the time 
showed and said, was that they had tried, the experts in the 
IRS had tried; they were unable to recover any information.
    Mr. DeSantis. Okay. And I read the pleadings and I take 
that point, but we are getting conflicting information, it 
seems, in the Congress at this point, so I think it is going to 
be important that that be resolved, because clearly you can't 
be telling the court one thing and then having people in the 
organization who are on the ground and maybe had intimate 
knowledge telling the Congress the other thing.
    I am almost out of time, but just very quickly, switching 
gears a little bit. The D.C. Circuit issued an opinion about 
the IRS's regulation as respects to Obamacare subsidies, taxes, 
and mandates in the States that have exchanges not run by a 
State, but run by the Federal Government. Given that right now 
there is a circuit split, where you have the 4th Circuit saying 
that basically it was either a close call or a scrivener's 
error, you have the D.C. Circuit saying actually the IRS didn't 
have the authority to issue that ruling, are you going to 
rescind that rule until this can be resolved by the Supreme 
Court, or what is the IRS's position in light of the Halbig 
    Mr. Koskinen. The rule about the granting of advanced 
premium tax credit all is run by HHS. Our regulation said that, 
in fact, it was appropriate and acceptable to go through the 
Federal marketplace. We have no plans, until the issue is 
revolved in court, to rescind or change that rule or change our 
preparation for the next filing season.
    Mr. DeSantis. And is it your position, as the IRS, that you 
have construed that to be that there may have been a drafting 
error on the statute, but the intent of Congress was that the 
subsidy should go, and is that why the IRS has taken the 
position that they have taken?
    Mr. Koskinen. I am fully supportive of the Justice 
Department opinion, which was upheld in the 4th Circuit, not 
upheld in the D.C. Circuit. I don't have a different view of 
the legality; I think the Justice Department puts it very well 
that they think the statute is enforceable and the regulations 
are appropriate.
    Mr. DeSantis. Okay, I am out of time, and I will now yield 
to the ranking member of the full committee, Mr. Cummings.
    Mr. Cummings. Thank you very much, Mr. Chairman.
    On July 9th you appeared before the Subcommittee on 
Government Operations for a hearing entitled Solutions to Close 
the $106 Billion Improper Payments Gap. Even though it was 
clearly not the stated purpose of the hearing, Republican 
members of the committee asked you a number of questions 
regarding the committee's investigation into the IRS treatment 
of applications for tax-exempt status.
    At the hearing, Chairman Issa also released emails from 
Lois Lerner regarding the IRS instant messaging system, called 
OCS, that he claims proved that Ms. Lerner ``intentionally 
sought to hide information from Congress.'' Despite your 
testimony that you were unfamiliar with the system and would be 
happy to look into its use, Republican members repeatedly 
questioned you about the specifics of OCS.
    Commissioner, now that you have learned of the system, can 
you describe what OCS is?
    Mr. Koskinen. Yes. I actually provided a letter to the 
committee that Chairman Issa referenced earlier. What I have 
been advised is OCS is a system that exists in Microsoft 
systems and it basically allows people around the Country, its 
primary use is to have a teleconference and you can put the 
same information up on the screen and everybody looks at it at 
the same time, and it is a way to have a telecommunications 
gathering in a meeting.
    It allows you also to, in effect, have an instant messaging 
capacity for those who use it--not everybody uses it; I don't 
use it because I didn't know it existed--that much like your 
cell phone, somebody, if they see you are online, can send you 
a text message and it is like calling you on the phone. So like 
all text messages, it is a sometimes faster and more efficient 
way to communicate than picking up the phone and calling 
    Mr. Cummings. Despite the fact that the email exchange 
occurred on April 9th, 2013, nearly two years after Ms. 
Lerner's computer crashed, and more than one year after the 
inspector general's audit began, Chairman Issa declared that 
the email exchange was a ``smoking gun.'' On July 11th, the IRS 
sent a letter to the committee explaining that OCS messages 
``are substitutes for telephone calls and in-person meetings'' 
and ``the IRS does not currently preserve communications sent 
and received through OCS.'' Is that accurate?
    Mr. Koskinen. That is accurate.
    Mr. Cummings. The IRS further explained that the Federal 
Records Act ``does not require recording or retention of 
telephone calls or meetings as a substitute for telephone calls 
and in-person meetings that would not normally be recorded. 
Communications sent through OCS are not considered records 
subject to Federal records or other retention requirements.''
    I ask unanimous consent that the letter be entered into the 
record, Mr. Chairman.
    Mr. DeSantis. Without objection.
    Mr. Cummings. Commissioner Koskinen, does the Federal 
Records Act require retention of the OCS messages?
    Mr. Koskinen. It is my understanding it does not. In fact, 
it is my understanding that now our review, our record-keeping 
process and in 2011 we got a score of 93 and in 2012 got a 
score of 99. But we are meeting with NARA. We have reached out 
to them to try to work with them to ensure, A, that we are 
complying with the Act now and if there are ways we can improve 
our official records-keeping, we are very anxious to do that. 
As I say, ultimately we hope some day to be able to afford to 
have, in effect, an email system that is a system of record.
    Mr. Cummings. Are you aware of any evidence that Lois 
Lerner used the OCS system to intentionally hide information 
from Congress or the inspector general?
    Mr. Koskinen. I am not. As note, we produced 43,000 emails 
from her account, so she obviously used email significantly.
    Mr. Cummings. To the best of your knowledge, has any IRS 
employee used the OCS system to intentionally hide 
communications from Congress or the inspector general?
    Mr. Koskinen. I have no knowledge of any such activity.
    Mr. Cummings. Once again, your testimony is corroborated by 
the results of the committee's investigation. After receiving 
hundreds of thousands of pages of documents and interviewing 
dozens of IRS employees, the committee has not identified any 
evidence supporting the chairman's allegation that Ms. Lerner 
or any other IRS employee used the OCS system to intentionally 
hide information from Congress.
    I want to thank you, Mr. Koskinen, for your testimony. I 
have 14 seconds left. Is there anything else you wanted to tell 
    Mr. Koskinen. No. I would just add to the congresswoman 
from Wyoming, talking about she works for taxpayers, my view is 
we all work for taxpayers. I, as the head of the agency, am 
basically employed by the American people. We have important 
responsibilities to be careful stewards of the money we spend; 
it is ultimately money that comes from the American people.
    And we have an obligation to ensure that everyone is 
treated fairly and the same, and to the extent that there are 
people who have lost trust and confidence in the IRS to do 
that, one of our major challenges is to restore that trust. 
Whenever we are going to continue and audit people, as I have 
said in the past. Some of them will be Democrats, some will be 
Republicans, some may not belong to a party, some may have 
voted for one person or another, some may be active in 
politics; and what they need to be confident of is when they 
hear from the IRS, it is not because of any of that, it is all 
    When they hear from us, it is because of some question in 
their tax return. And if somebody else had that same question, 
they would be heard from us as well. But we have an obligation 
and a commitment to treat everybody fairly and evenly across 
the board. I have met with over 11,000 IRS employees across the 
Country, and I have never seen a more dedicated workforce 
dedicated to the mission to the IRS, to providing taxpayer 
service to enforcing the Internal Revenue Code, and I am 
delighted to be part of that workforce.
    Mr. Cummings. Thank you, Mr. Chairman.
    Mr. DeSantis. Before I recognize the chairman of the 
subcommittee, I just will, with respect to Lois Lerner's emails 
in terms of OCS, when she initially wrote the email to Maria 
Hooks saying she had a question about OCS, she said she was 
cautioning folks about email and that we have had several 
occasions where Congress has asked for emails and there have 
been an electronic search for responsive emails, so we need to 
be cautious about what we say in emails. Someone asked if OCS 
conversations were also searchable. I didn't know, but told 
them I would get back to them.
    So I just think it is important the context, when she was 
asking about OCS, was to try to evade congressional oversight.
    With that, I will recognize the chairman of the 
subcommittee, Mr. Jordan.
    Mr. Jordan. I thank the chairman.
    Let me go to the Helbig decision, Mr. Koskinen. Does the 
IRS have an obligation to now tell taxpayers the tax credit may 
in fact not be available?
    Mr. Koskinen. I think we have an obligation to keep 
taxpayers informed about all aspects of the Affordable Care 
Act, all aspects of the Internal Revenue Code. We have a 
program of public information to advise taxpayers now, if they 
are getting premium tax credits, before these decisions. If 
their information changes, they should go back and make sure 
the credit is correct. To the extent that we go forward----
    Mr. Jordan. Are you going to educate taxpayers on the 
potential ramifications of the Halbig decision?
    Mr. Koskinen. We actually will put out information 
regarding it. As I say, right now, at this point, two courts 
have come to different conclusions, so we don't intend to make 
any different changes. Therefore, I think our advice, although 
it is not totally in my control because it is a policy issue of 
how to deal with it and we are just tax administration, but my 
general assumption is people will and should continue to 
operate as they have thus far until we get to a final court 
decision. And the courts have not indicated that anyone should 
do anything differently.
    Mr. Jordan. Let me go to the Ways and Means statement 
yesterday, their press statement. One of the things they say in 
the lead paragraph, it says, in-house professionals at the IRS 
recommended the agency seek outside assistance in recovering 
the data. Are you going to do that, or have you done that 
already, outside professionals to recover data lost or that may 
be recoverable on the scratched hard drive or the tape that now 
in fact may be available? Is that something the IRS is going to 
    Mr. Koskinen. As you know, my understanding is that that 
hard drive is the normal process. Once the Criminal 
Investigation Division determined they could not restore any 
information from it, that hard drive was recycled and no longer 
    Mr. Jordan. When that took place, when you were trying to 
get to the data, did you in fact go get outside assistance in 
trying to recover the data?
    Mr. Koskinen. I was not around at that time, but I am not 
aware of any attempt to go outside the IRS.
    Mr. Jordan. So even though in-house professional says, you 
know what, this might be a little above our pay scale, we 
should go get the outside tech experts, the super wiz kids who 
can do this stuff, we should bring them in, to your knowledge, 
that was not done?
    Mr. Koskinen. To my knowledge, I don't know even about that 
statement. I haven't seen his transcript as to whether--I was 
not aware that that recommendation has been made, but I have no 
information indicating that that was done, i.e., that outside 
experts were sought. All I have seen is the emails that I 
actually have testified about in which Criminal Investigation 
Division reported they could not restore the hard drive. But I 
have no information that the IRS at that time did anything 
    Mr. Jordan. They did not. I just want to be clear. It is 
your understanding that there was not outside professionals who 
were brought in to try to recover the data.
    Mr. Koskinen. That is right. I have no indication that was 
done, and it is my assumption by the emails that I saw when I 
testified that when the Criminal Investigation Division----
    Mr. Jordan. So no outside experts were brought in, even 
though in-house experts recommended they be brought in.
    Mr. Koskinen. I had no information about the in-house 
    Mr. Jordan. I am going by what the Ways and Means Committee 
is reporting, that they said in-house professionals said in 
fact we should go get some outside experts. This is beyond our 
scope; we need someone else to come get this because this is 
such important information. And you are saying you don't think 
that was done.
    Mr. Koskinen. I don't think it was done. But I haven't seen 
the full context of what that gentleman said, either.
    Mr. Jordan. Okay. You don't think it was done and you don't 
know if it was asked for. They are reporting that it was asked 
for and it wasn't done.
    Mr. Koskinen. It wasn't done. Right.
    Mr. Jordan. Which is a problem. Which is a big problem, 
when your tech experts say we need outside tech experts to come 
in and get the data, no, no, no, we don't want to do that, it 
is unrecoverable. As reported by what you have said in 
testimony and what has been filed with the court that it is 
    Mr. Koskinen. You have to remember this was three years 
ago, and there were no investigations ongoing at that time. In 
fact, the IRS had already taken extraordinary attempts even to 
go to the CID people----
    Mr. Jordan. But that is the point. If it is three years 
ago, that is why they said we need the outside experts. That is 
why they wanted the help. And you are saying it didn't happen.
    Mr. Koskinen. Right.
    Mr. Jordan. Which is a concern.
    Let me just do one other question, if I could.
    So, according to your testimony, a month ago the Ways and 
Means Committee said the IRS, in February, identified documents 
that indicated Ms. Lerner had experienced computer failure in 
2011, consistent with Mr. Cain. You knew in February there was 
a problem, February 2nd, February 4th you knew there was a big 
problem, according to Mr. Cain's testimony. In mid-February you 
knew it was unrecoverable. Your testimony says in mid-March 
2014, this review, we learned the data stored on her computer 
hard drive was determined to be unrecoverable. So Mr. Cain says 
he knew in February; you knew in mid-March.
    Mr. Koskinen. That is right. I actually knew----
    Mr. Jordan. But you were kept abreast----
    Mr. Koskinen. I actually knew in mid-April, and that is a 
misstatement on my part. If you read my testimony before this 
committee in the now three hearings I have had----
    Mr. Jordan. This is your written testimony in Ways and 
Means. This is not accurate?
    Mr. Koskinen. My written testimony?
    Mr. Jordan. This is your opening statement, what you said 
to the Ways and Means Committee. The IRS, in February, 
identified documents that indicated Ms. Lerner experienced a 
computer failure in 2011. Mid-March review, 2014, the data 
stored on her computer hard drive was determined to be 
    Mr. Koskinen. No, I am sorry, that is correct. That was 
what the IRS knew----
    Mr. Jordan. So here is my question.
    Mr. Koskinen. Yes.
    Mr. Jordan. Mr. Cain says on February 4th he knew. You 
indicate in your testimony mid-February we knew there were big 
problems, and you indicated in mid-March we knew it was 
unrecoverable. You knew, even though your key staff people, Mr. 
Cain and Ms. Duvall, knew in mid-February. You testified 
February 5th to the House Ways and Means Committee, February 
26th to the House Appropriations Committee on Financial 
Services, March 26th to this full committee, and April 8th to 
the Senate Finance Committee.
    In those hearings you were asked about Ms. Lerner and email 
and different things. You had four different opportunities in 
front of Congress. So I am wondering, in the back of your mind, 
were you wondering, when you answered these questions, that we 
are going to produce all of Lois Lerner emails, when we are 
going to comply, in the back of your mind, were you thinking 
maybe I should let these guys in on the little kind of 
important fact that, you know what, we have already determined 
that her hard drive is unrecoverable?
    Was that ever in the back of your mind when you were 
answering questions from members of Congress in four different 
committees over the time period when you have already learned 
significant facts. Even though in your mind, according to your 
testimony, you didn't fully know that we had lost them all for 
good, even though you sort of knew that it was pretty darn 
likely you had lost them all for good, in the back of your 
mind, did you think, you know what, maybe I should fully 
disclose what the real status is of Ms. Lerner's emails?
    Mr. Koskinen. No. As I have testified several times in the 
    Mr. Jordan. That didn't enter your mind at all?
    Mr. Koskinen. I didn't know that there were emails lost. I 
personally didn't know, and that is what I was testifying 
about, until the middle of April. When I testified, and I have 
said this before in several hearings, when I testified on March 
26th, I did not know that her emails were not recoverable.
    Mr. Jordan. But this is your testimony right here. I am 
reading. This is John Koskinen testimony.
    Mr. Koskinen. Right.
    Mr. Jordan. In the mid-March 2014 time frame, we learned 
the data stored on her computer hard drive was determined to be 
unrecoverable. So that is certainly before the March 26th 
hearing and the April 8th hearing in front of the Senate 
Finance Committee. So you had two opportunities where you 
already know it is unrecoverable. That means you are not going 
to get what is there.
    Mr. Koskinen. No, I am sorry. I take, and I go to the point 
earlier, I take responsibility for the agency. When I said, in 
that, trying to report to people what we knew, that is what the 
IRS knew. When you ask me specifically what did I know, I knew 
and didn't know until April. If you told me now that Tom Cain 
said he knew in February, I would henceforth say we, as the 
IRS, knew in February. I myself, personally, did not know.
    When I testify, I tell you what I know.
    Mr. Jordan. This goes right to the chairman's point. When 
our chief counsel knows in February, mid-February, that it is 
unrecoverable, you can't come in front of Congress and say I 
didn't know, that is why I didn't answer. Your chief counsel 
knows. You should have known.
    Mr. Koskinen. I should have known.
    Mr. Jordan. And you should have disclosed that, and you 
    Mr. Koskinen. I didn't know and I, therefore, couldn't 
disclose. And you are exactly right. I have not hidden behind 
the fact that somehow this is somebody else's responsibility. I 
am perfectly prepared to take full responsibility for exactly 
what we did with the production of the information to the 
    Mr. Jordan. But you didn't tell us that in your testimony. 
You didn't tell us, on March 26th, when you answered, you 
didn't tell us that. It would have been nice if we had known at 
that point. Kate Duvall and Tom Cain already knew it was 
unrecoverable, but somehow they didn't tell you because you 
would have to disclose that when asked about it in Congress, 
was that why they didn't tell you?
    Mr. Koskinen. I have no idea. This was an iterative 
process. At that point we were spending most of our time trying 
to produce all of the information for the determination 
process, which we were able to do by the middle of March.
    Mr. Jordan. This is what no one can figure out. Something 
this important, Lois Lerner, the lady who sat in your chair and 
took the Fifth, the central figure in this investigation, you 
lose her emails; your chief counsel knows in February, the 
lawyer in charge of document production knows in February, and 
they don't tell you, and you can come in front of Congress four 
times and not disclose that. And then when you do learn in 
April, you can wait until June 13th. That is what the American 
people are like, no wonder there is some morale concern and no 
wonder there is a distrust. That is unbelievable.
    Mr. Koskinen. Well, can I just add one point?
    Mr. Jordan. We didn't know, your chief counsel knew.
    Mr. Koskinen. You are going to talk to the chief counsel, 
and she will tell you what she knew or didn't know.
    Mr. Jordan. We already talked to Tom Cain, and he told us 
she knew.
    Mr. Koskinen. Right. He knew that, if you go back through 
there, that the hard drive had a significant problem. We did 
not know what emails we had. We, in fact, discovered and found 
24,000 additional emails from Lois Lerner to other people----
    Mr. Jordan. I appreciate the chairman's indulgence.
    All I am saying is this, when Tom Cain, the lawyer in 
charge of document production, the professional who you said 
does good work at the IRS, when he says unrecoverable, and they 
knew that in mid-February, and you come to Congress three times 
after they knew that, both he and your chief counselor, and you 
don't disclose that, you should have known that and you should 
have told us. And then when you do find out, you wait two more 
months. Come on. Come on, we are supposed to buy that?
    I yield back.
    Mr. DeSantis. I thank the chairman.
    I would point out, before I recognize my friend from 
Pennsylvania, here we are in, say, February, March, saying you 
didn't know how many Lerner emails were out there; and, 
granted, you were not commissioner during this whole time, but 
we have been asking for these things for over a year now. A 
subpoena was sent in August, reissued under your watch, so the 
IRS dragged its feet on that.
    And I realize a lot of that is not necessarily on your 
watch, but don't tell me nine, ten months after we request this 
stuff and five or six months after a subpoena is issued, that 
somehow you just don't know how many emails you have. That 
should have been something that should have been ascertainable.
    Thank you for the indulgence, and I will recognize Mr. 
    Mr. Cartwright. Thank you, Mr. Chair pro tem.
    Speaking of things that would be nice to know and things 
not disclosed, Mr. Koskinen, I asked the chairman of this full 
committee who the witnesses are supposed to be next Wednesday 
from the IRS. He declined to tell me. He declined to tell me 
whether he even knew who the witnesses next week will be. But I 
didn't ask you, Mr. Koskinen. This is your department. Do you 
know? Have you been informed by anybody on this committee who 
the witnesses sought for next week's hearing will be?
    Mr. Koskinen. Until I came to this committee meeting, I had 
no idea that the committee was going to hold yet another 
hearing next week.
    Mr. Cartwright. And would you agree with me that those are 
among the things that would be nice to know?
    Mr. Koskinen. It is always nice to know in advance when we 
are supposed to show up for a hearing. I don't know whether I 
am expected to show up again next Wednesday.
    Mr. Cartwright. Well, neither do I.
    Well, let's delve into the IRS forensic lab together, shall 
we? There were comments today about scratches on hard drives, 
and that is not my area of expertise, and I dare say it is not 
yours either.
    Mr. Koskinen. Right.
    Mr. Cartwright. But we did have John Minsek, an analyst 
from the IRS Criminal Investigations Unit, meet with Ways and 
Means staff on Monday. He told them he did not find anything 
suspicious about how a scratch got on Ms. Lerner's hard drive. 
The analyst, Mr. Minsek, said that he tried to recover Ms. 
Lerner's documents on two occasions, first with a normal tool 
set and then, using more advanced tools, he still couldn't 
recover any data.
    Mr. Commissioner, contemporaneous emails confirm that the 
IRS Criminal Investigations Unit could not recover her 
documents. Am I correct in that?
    Mr. Koskinen. That is correct.
    Mr. Cartwright. And the CI analyst, Mr. Minsek, then told 
Ways and Means Committee staff that he gave his colleague in 
the IRS IT shop the name of a third-party vendor that he used 
on rare occasions to recover information, but IRS IT staff had 
already consulted with outside experts at HP.
    Mr. Koskinen, do you know if IRS officials consulted with 
IT experts a second time in 2011 to recover Ms. Lerner's 
    Mr. Koskinen. I do not know.
    Mr. Cartwright. Okay.
    All right, finally, I want to touch on something that the 
gentlelady from Wyoming mentioned. She just said that her 
constituents are going to take matters into their own hands. 
And I say this because about an hour ago somebody walked into 
the Cannon House Office Building with a handgun, according to 
Chad Pergram, our friend from Fox News locally.
    Knowing that there are over 4,000 staffers and interns at 
risk here on the House side of the Capitol, and recalling the 
horrible Gabby Giffords tragedy and the loss of staffer Gabriel 
Zimmerman, I would ask that members refrain from making 
statements that could even possibly be misconstrued by the 
public as an invitation to do anything like that. It is obvious 
that Representative Lummis meant no such thing, but I think it 
behooves all of us to be very careful about the way we phrase 
things, because there are people out there ready and able to 
misconstrue things.
    With that, Mr. Chairman, I yield back.
    Mr. DeSantis. The gentleman yields back.
    The chair now recognizes the gentleman from Georgia, Mr. 
    Mr. Collins. Thank you, Mr. Chair, I appreciate it.
    Mr. Koskinen, here we go again. I told the story last time, 
and it was the story of my young son, who, to some media 
reports, became famous, I guess, or infamous, however you want 
to describe it, on the stories that he used to tell, and I 
recounted this time line, and I wish I could sit here today and 
see you again and say that what was not plausible then has now 
gotten a little bit plausible. It actually just seems to not 
have gotten any more plausible. People ask why are we 
continuing to do this? Because it just looks like there is 
something new comes out all the time. One request will say 
this, then another request.
    It was asked earlier--I had to leave and come back, and it 
was said how much paperwork that you have put to the committee 
and how many hours are being worked on. To restore trust in a 
relationship, whether it is between two people or whether it is 
between Government and the people that they serve, it should 
really be of no limit to restore that trust, especially with 
the IRS.
    So, frankly, to tell me that you gave a million documents 
and that your hours you are spending, because of the issues 
that have been raised and the lack of trust on both sides, I 
have Democrats and Republicans in my district who are appalled 
at this; and they want it solved, they want the real answers 
and they want to continue, and they don't want to continue 
reading every week in the paper that something new has come up. 
I think that is an issue of trust that has to be maintained 
here; and, frankly, the plausibility story is just, again, 
getting to the level of unbelievable in a lot of ways.
    But I do have some questions, because we have talked a lot 
about the Lois Lerner emails, but in addition to those the 
committee has also asked for other emails, and I want to talk 
to you about those for just a second and see the status of 
those, is that okay?
    Mr. Koskinen. Sure.
    Mr. Collins. Okay.
    Holly Paz, emails responsive to the committee's request 
from August 2nd, 2013 to February 14th, 2014. Have you gathered 
all of those emails?
    Mr. Koskinen. We have provided all of the emails with 
regard to the determination process. And, again, pursuant to 
what I thought were the agreed upon search terms, but 
apparently not totally agreed with the investigative 
committees, that we would select 83 custodians who were the 
ones most likely to be involved and that we would search----
    Mr. Collins. Are those the same 83 that a quarter of their 
hard drives crashed?
    Mr. Koskinen. It is not clear a quarter. At this point, 
nobody knows what that answer is.
    Mr. Collins. Oh, so we could have more that have crashed.
    Mr. Koskinen. We could have more, we could have less. I 
don't know until we find out.
    Mr. Collins. I mean, does that just not boggle mind that of 
a small number, one about a quarter, and we can argue about a 
quarter, not a quarter, I am not a mathematician, neither are 
you, but that there may be others in that subset that deals 
with the areas we are asking for?
    Mr. Koskinen. Yes. And that is a perfect example as to why 
it would be very helpful, had we been able to complete the 
investigation of what happened to the custodians, we could tell 
you. The reason I actually decided we would continue to find 
out how many Lois Lerner emails we had was because if we hadn't 
been able to do that, people would be talking about----
    Mr. Collins. Let's not change the question. I asked about 
Holly Paz. We can get away form Lerner. I asked about Holly.
    Mr. Koskinen. No, no, but my point is that to the extent we 
can provide the full story, your point, then it is a lot easier 
to know and you can disagree about it. But it is a lot better 
to know what the total picture is. So when you get the 
custodians, because the IG is now doing that, we don't know 
what the answer is, so it may be 10, it may be 20, it may be 5, 
it may be 25. I don't know, and at this point we aren't able to 
investigate that, and we are hoping the IG, when he completes 
his investigation, would include, will conclude with the 
custodians as well.
    Mr. Collins. Well, that is another source of contention.
    Mr. Koskinen. That is the problem. Anyway, it is part of 
the problem we are doing this in dribs and drabs----
    Mr. Collins. I understand.
    Mr. Koskinen.--and every day having a press release about 
some aspect of some interview.
    Mr. Collins. Thank you for saying drips and drabs, because 
that is what this investigation seems like it has been every 
since we started it, and especially even from your comments and 
others, that every day we get drips and drabs and drips and 
drabs, and the people are tired of it, this Congress is tired 
of it. And this is the problem we have because I am going to 
assume from your question--I am an attorney as well--that that 
is a no. After all you said, you have not gathered all her 
emails, or you don't know if you have gathered all her emails.
    Mr. Koskinen. No, no, exactly right. I didn't mean to be 
evasive. We provided all of the emails that were determined to 
be relevant to the determination process. We have not yet 
provided all of her emails because our first priority, agreed 
with this committee in March, was we would find all of Lois 
Lerner's emails.
    Mr. Collins. So, no. So the question on William Wilkins, 
same question, yes or no?
    Mr. Koskinen. Same answer. You got all of his emails that 
are responsive to the investigation that started all of this.
    Mr. Collins. Okay, but no to all. Jonathan Davis, same 
    Mr. Koskinen. Again, you got all of his----
    Mr. Collins. No. I mean, because all is all. I mean, we had 
this conversation three months ago.
    Mr. Koskinen. That is right. And as I said in March, we are 
happy to keep working with you to figure out what your next 
priority is. Obviously, thanks to the system, we can't produce 
it all at once. We have actually produced a lot of stuff, and 
it takes us a long time. Part of the background on the June 
13th public report was to try to explain why, with our system, 
it takes so long to produce this stuff. We should not have to 
spend $18 million. We should have a better system. There is no 
doubt about that.
    Mr. Collins. I don't disagree. The question I have, though, 
is we need them all, in the sense of the clarification issue 
here, and we have just got that.
    I do have one quick--I want to go back to something that 
was asked a lot earlier and it was, I believe, from my friend 
from South Carolina. He said we confirmed, and you said I don't 
now who told me. And I have sat through this will be my third, 
I guess, with you listening, and there has been a lot of 
meetings in which you were told information, but you don't 
remember who was in the meeting or you don't know who told you 
that, and it hit me as I was sitting here. Maybe there were 
multiple people in the room and you are not sure who said it 
first or who told you first, so I am going to ask it 
differently. I don't want to know who told you first or last. I 
am not being specific in that nature. I want to know who was in 
the room when you were told that we have confirmed all that. 
And surely you are a very bright individual. You would know at 
least who was in the room.
    Mr. Koskinen. I have 12 meetings a day, on average.
    Mr. Collins. I do as well. I know most of the ones in the 
meeting, especially when it is senior staff on something of 
this nature.
    Mr. Koskinen. And those meetings average probably 8 to 10 
people, so I cannot tell you about any meeting who was actually 
in the room. But I can tell you who was likely in the room, and 
that is the people who have been working on the production with 
your staff. Obviously, my counselor was in the room, probably 
my chief of staff was in the room. But I can't tell you, and I 
don't recall because it wasn't significant at the time, who 
else was in the room. We were reviewing the document.
    Mr. Collins. It wasn't significant at the time that you may 
have lost emails? That was not a significant meeting?
    Mr. Koskinen. The issue here was whether we could confirm, 
your question was whether we could confirm.
    Mr. Collins. Confirm. But you are dealing with a bigger 
issue. I said is that not significant?
    Mr. Koskinen. This entire issue was significant, but I am 
actually running an agency that has to deal with filing 
seasons; we have overseas voluntary disclosure programs; we 
have voluntary tax return programs we have been putting out; we 
have been simplifying for small charitable organizations----
    Mr. Collins. And, look, I understand that and that is a 
great diversion to what we are asking right here. I get that 
the IRS has other issues, but I also get that the American 
people, even over years of making fun and doing everything else 
that unfortunately the IRS has had in the past. It is not now 
just the fact that they don't like the IRS because they have to 
send their money in.
    They are now at an issue both party line irregardless, they 
are not sure about the IRS because they don't trust the IRS 
anymore. And when that is an issue, everything should be 
focused on that. And this is the question that makes it just 
completely implausible and we keep getting dribs and drabs. I 
appreciate what you said on dribs and drabs, because that is 
the problem we have right now.
    Mr. DeSantis. The gentleman's time has expired.
    Mr. Collins. I will yield back.
    Mr. Koskinen. Can I just make one point clear, and that is 
nobody has a greater interest of getting you all the 
information you need and getting closure on this than I do and 
the people at the IRS. If we could conclude one of these six 
investigations, find out what the determination of facts are 
and the recommendations are, we are delighted to take those 
recommendations. We have accepted all of the inspector 
general's recommendations. The last thing in the world that 
benefits us is to have this go on any longer than necessary. So 
whatever we can do, as fast as we can produce documents. The 
relevance of the 960,000 pages isn't, gee, isn't that a big 
amount. It takes a lot of time to get all that done in our 
    Mr. Collins. The one thing we will agree upon is getting to 
the end of this is the end result so that we can move and the 
people can restore the trust in a Government agency in which 
they need to have trust that they don't have now.
    With that, I yield back.
    Mr. DeSantis. The gentleman's time has expired.
    I am going to recognize the gentleman from California for 
five minutes.
    Mr. Koskinen. This is round four?
    Mr. Issa. No, no. When people yielded me time under our 
arcane rules, that doesn't count.
    Mr. Koskinen. Okay.
    Mr. Issa. But I will be brief.
    Commissioner, we have a history, and I want to make sure I 
get the history straight today, because it does matter for this 
committee. You constantly talk about this agreement and 
discovery and so on. Were you aware that we considered that the 
IRS was stonewalling us and giving us information we didn't 
want and giving it to us in an order we didn't like it in the 
months of May, June, and July of 2013?
    Mr. Koskinen. I was not aware of that.
    Mr. Issa. Well, we have a number of letters basically 
showing our dissatisfaction, including what we now know to be 
erroneous information, misleading information that would imply 
that progressive were being targeted, the false narrative that 
continues to be used at times.
    On May 22nd, 2013, Lois Lerner took the Fifth. Shortly 
after that she became a person of extreme interest for this 
committee because in fact she had made statements outside of 
her assertion of the Fifth that she broke no rules, she broke 
no regulations. She additionally authenticated earlier 
testimony in statements again. After she took the Fifth, she 
then went back on the record. So under oath she made a number 
of statements.
    As we began investigating, we became very aware that Lois 
Lerner was an active participant in Washington of targeting 
conservatives. In addition, in evaluating her history, we 
became very aware that she did not like conservatives and she 
had that sort of predisposition. Plus, her public speeches made 
it very clear that on behalf of the President ``they want us to 
fix this'' and certainly the President had been the outgoing 
spokesperson again Citizens United, that we had every reason to 
focus our investigation on her as the hub in a hub and spoke 
system of deliberately targeting conservatives for their 
    Therefore, I issued, if the ranking member were here, he 
would call it unilateral, but pursuant to the committee rules I 
issued a subpoena and made it very clear that our first 
priority was to have all of Lois Lerner's emails, and that that 
was the priority. Were you aware of that?
    Mr. Koskinen. I am aware of that subpoena, yes.
    Mr. Issa. And you were aware that that was our goal?
    Mr. Koskinen. You have eight items on that subpoena, and 
that is at the top of the list.
    Mr. Issa. Very good. Therefore, when we interviewed Thomas 
Cain and we asked him, so is it fair to say this subpoena had 
no--and this was the subpoena of August 2nd--this subpoena had 
no impact on the process that you were following or the 
documents that you were reviewing. That was our question. His 
answer: It didn't impact our production process, that is 
correct. Question: Did it have any impact on which documents 
were chosen to review? Answer: No.
    Additionally throughout that transcribed interview, what we 
discovered was that you all met, had a discussion, if you will, 
and decided that you were not going to prioritize any aspect of 
delivery of Lois Lerner's documents, even though she had taken 
the Fifth before this committee, even though she clearly had 
public statements and she had been a person who had already 
unlawfully leaked, by planting a question, the outcome of an 
IRS TIGTA investigation. All of that is undeniable.
    Why in the world should the American people believe that 
you are cooperating with us when I issue a subpoena, our 
committee makes it clear in multiple letters that these are our 
priorities, and now we have sworn testimony or testimony under 
penalty of perjury that you didn't make any changes, you 
basically continued business as usual, which was delivering us 
based on you call it mutually agreed, but they were your 
criteria, primarily, as to search terms, and never disclosed to 
us that those search terms were searching but a small portion 
of what should have been the entire database? Do you have an 
answer for that?
    Mr. Koskinen. I wasn't there. My understanding is there are 
five other investigations that are now going on and were going 
on then, that there were a wide range of requests for documents 
from the Senate Finance Committee, Ways and Means, Permanent 
    Mr. Issa. Did any of them issue binding subpoenas?
    Mr. Koskinen. And I don't think anyone else had a binding 
subpoena. My understanding, and I wasn't there, was that----
    Mr. Issa. But after February 2014 we issued another 
subpoena. Did anything change then?
    Mr. Koskinen. At that point, we were, as I have testified 
before, we began to pull the rest of Lois Lerner's emails. We 
started with the analysis of the emails already produced, and 
that is where it was discovered that there were fewer emails in 
the 2011 period.
    One of the priorities at that time, though, competing 
priorities was to complete the production of the determination 
documents that everybody was interested in. There was kind of 
a, I gather, a process by which, with all of the conflicting 
questions to try to respond to documents that met as many of 
the requests as possible, and most of the requests certainly 
for Finance and, at that time, Ways and Means were for 
documents around the determination process.
    That was completed, and then since that time the full court 
press has been to produce all of Lois Lerner's emails, whether 
in her account or any other account.
    Mr. Issa. Thank you. Earlier on I asked you for a discovery 
process of who was looking for when throughout a time line, and 
your assistant took it in very copious notes there. I want to 
just add one clarification to that process. Obviously, we are 
interested in what you did during subpoenas, but we are getting 
that. You have delivered some, I guess we are looking at an 
exorbitant number of documents that you constantly and many 
people constantly cite.
    What we don't understand that I think the committee has an 
absolute obligation to understand, is in this process of what 
you looked and where you looked, understanding the sources that 
this has come from, because we are a committee of oversight 
reform, we are a committee that has an obligation to see that 
you spend the American people's money properly.
    It appears, from this side of the dais, as though the 
process is very fragmented, that in fact you are looking sort 
of under cookie jars, to use an expression of my youth; that 
you are providing large amounts of data from certain periods 
that based on a six-month backup and a very small server 
capacity wouldn't exist. So that means that they probably came 
from other places. And we need to understand all the places 
they came from, where you went.
    You have sent us, in many cases, hugely redundant emails. 
In other words, the same emails can come from multiple places. 
Understanding that so that we can figure out how to prevent it 
in the future is important, because this is not the last time 
that a Federal judge, an IG, or a congressional committee is 
going to want to know details. I think we can all agree to 
that, just as corporate America receives countless subpoenas 
for document production, so much so that they develop software 
explicitly to do these kinds of searches and retention policies 
for that reason.
    Can we have your agreement that we will receive some 
accounting of how that happens?
    Mr. Koskinen. Yes. And we would be glad to talk further 
with your staff to make sure we give you exactly what you need. 
But you are exactly right, we looked in the logical places, and 
I understand we looked under every cookie jar. We actually were 
dedicated to making sure that we found every existent Lois 
Lerner email on her account or anybody else's so that we would 
be able to say these are all the Lois Lerner emails we have, 
and that has led to 67,000.
    Mr. Issa. And I will make a rather unusual request in this 
case. We are more than happy to have a small group briefing 
meeting, bipartisan meeting, with the individuals who have been 
involved in this so that separate from the investigation, which 
is important and ongoing, the question of efficiency, the cost-
effect of fragmented data, the cost-effect of having, and I 
have held it up several times, individual drives like this that 
people have, notebooks that have been taken offline, all the 
other things that I suspect are one of the reasons this has 
become so expensive and difficult.
    That meeting is not exactly on course with this 
investigation, but it is separately a question from a 
standpoint of the management of the $82 billion worth of funds 
that Government spends to see if in fact policy changes with 
OMB and others should be instituted and funding allocated so 
that this kind of fragmentation doesn't happen in the future.
    So as one person who has worked in private America to 
another, that is something that your briefing can be informal, 
off the record, doesn't have to be definitive, but our 
committee, I think, really has to have an understanding so we 
can be part of policy formation, because what I know about how 
corporate America does it and what I am beginning to glean you 
have to do are very different.
    Mr. Koskinen. They are very different. As I have said, I 
asked that question some time ago, that we should not have to 
spend $18 million and this amount of time responding to 
document and email requests. But I think if we could kind of 
get two birds with one stone, we could, as you say, have that 
briefing that would answer your questions about how did this 
discovery process go and then what are the problems with that 
going forward, because it is my understanding that there has 
been a tremendous amount of effort made to make sure that we 
found every document responsive to the committee. It is a 
lengthy process.
    Again, the June 13th report starts out trying to explain to 
all of the investigators what the process is and why it is so 
anachronistic and so difficult. And I agree with you totally, 
going forward it would certainly help all of us if we had a 
more efficient system for preserving and finding documents and 
    Mr. Issa. Thank you, commissioner.
    I yield back.
    Mr. DeSantis. The gentleman yields back and that concludes 
our hearing today.
    Thank you, Mr. Commissioner, and the hearing is adjourned.
    [Whereupon, at 1:20 p.m., the subcommittee was adjourned.]



               Material Submitted for the Hearing Record