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Thirty Days Later, What Else Have We Learned About The IRS?

- June 27, 2013

In May, IRS Chief Danny Werfel Was Asked To Conduct A 30-Day Review Of The IRS. "Treasury Secretary Jack Lew has instructed Werfel undertake a comprehensive report of the agency within 30 days of taking office - a step Werfel said will help the agency regain the trust of Americans." (Lauren French, "Danny Werfel, New IRS Chief, Says Agency Needs To Regain Public's Trust," Politico, 5/22/13)

  • Today, Acting IRS Commissioner Danny Werfel Testify Before The House Ways And Means Committee On The Status Of His 30-Day Review. "Werfel is scheduled to testify before the House Ways and Means Committee on Thursday." (Abby Phillip, "IRS Says It Screened Groups Based On 'Questionable Criteria' Until June," ABC News, 6/24/13)

WHO COULD HAVE PREDICTED ALL THAT WOULD COME OUT ABOUT THE IRS OVER THE LAST 30 DAYS?

The IRS Spent About $50 Million On 220 Conferences Between 2010 And 2012

According To An Inspector General's Report, The IRS Spent $50 Million On 220 Conferences Between 2010 And 2012. "The Internal Revenue Service, already under fire after officials disclosed that the agency targeted conservative groups, faces increased scrutiny because of an inspector general's report that it spent about $50 million to hold at least 220 conferences for employees between 2010 and 2012." (Alan Fram, "IRS Woes Grow With Report Of Conference Spending," The Associated Press, 6/3/13)

  • Conference Spending Included $4 Million For An August 2010 Trip To Anaheim, California, For Which They Did Not Even Attempt To Negotiate Lower Room Rates. "The conference spending included $4 million for an August 2010 gathering in Anaheim, Calif., for which the agency did not negotiate lower room rates, even though that is standard government practice, according to a statement by the House Oversight and Government Reform Committee." (Alan Fram, "IRS Woes Grow With Report Of Conference Spending," The Associated Press, 6/3/13)
  • "Instead, Some Of The 2,600 Attendees Received Benefits, Including Baseball Tickets And Stays In Presidential Suites That Normally Cost $1,500 To $3,500 Per Night." (Alan Fram, "IRS Woes Grow With Report Of Conference Spending," The Associated Press, 6/3/13)
     
  • "In Addition, 15 Outside Speakers Were Paid A Total Of $135,000 In Fees, With One Paid $17,000 To Talk About 'Leadership Through Art,' The House Committee Said." (Alan Fram, "IRS Woes Grow With Report Of Conference Spending," The Associated Press, 6/3/13)
     
  • The IRS Spent $11,430 For A "Happiness Expert" And $27,500 For An "Innovation Expert." "Source says IRS spent $11,430 to have 'happiness expert' lead 4 workshops, $27,500 for 'innovation expert' at 2010 conference" ( Kelly O'Donnell Twitter Feed, 6/3/13)
     
  • One Conference Speaker Was Paid $17,000 To Discuss "Leadership Through Art." "In addition, 15 outside speakers were paid a total of $135,000 in fees, with one paid $17,000 to talk about 'leadership through art,' the House committee said." (Alan Fram, "Report: IRS Spent $50M Holding 220 Employee Conferences Over Three Years," The Associated Press , 6/3/13)

IRS Managers Were Placed On Administrative Leave For Violating Ethics Rules

Two IRS Managers Were Placed On "Administrative Leave For Accepting Free Food And Other Gifts." "The Internal Revenue Service, fighting political scandal and accusations of lavish spending, said Wednesday that it placed two managers on administrative leave for accepting free food and other gifts in violation of government ethics rules." (Lisa Rein, "IRS Put Two Managers On Leave For Accepting Free Gifts, Violating Ethics Rules," The Washington Post , 6/5/13)

  • "One Of The Managers Put On Paid Administrative Leave Is Fred Schindler, A Lawyer Who Serves As Director Of Implementation Oversight For The 2010 Health-Care Reform Law For The IRS, Congressional Sources Said." (Lisa Rein, "IRS Put Two Managers On Leave For Accepting Free Gifts, Violating Ethics Rules," The Washington Post , 6/5/13)
  • "The Other Is Donald Toda, A California-Based Manager In The Small-Business And Self-Employed Division." (Lisa Rein, "IRS Put Two Managers On Leave For Accepting Free Gifts, Violating Ethics Rules," The Washington Post , 6/5/13)
  • "The Free Food Came To $1,162, According To The Congressional Sources." (Lisa Rein, "IRS Put Two Managers On Leave For Accepting Free Gifts, Violating Ethics Rules," The Washington Post , 6/5/13)

IRS Workers Charged Some Inappropriate Items To The Taxpayer Credit Card

Some IRS Workers Used Agency Credit Cards To Buy Wine, Romance Novels, Diet Pills And Baby Clothes. "A government watchdog says lax oversight by the Internal Revenue Service allowed workers to use agency credit cards to buy wine for an expensive luncheon and, in one case, romance novels, diet pills and baby clothes." (Stephen Ohlemacher, "IG: IRS Credit Cards Used For Wine, Pornography," The Associated Press, 6/25/13)

  • "Two IRS Credit Cards Were Used To Buy Online Pornography, Though The Employees Reported The Cards Stolen. One Of The Workers Reported Five Agency Credit Cards Lost Or Stolen." (Stephen Ohlemacher, "IG: IRS Credit Cards Used For Wine, Pornography," The Associated Press, 6/25/13)

The IRS Spent $3,152 On "Popcorn Machine Rental, Game Rentals, And Give-Away Prizes Such As Sports Balls, Bandanas, Plush Animals, Sunglasses, And Stove Top Hats." (Treasury Inspector General For Tax Administration Report, 6/20/13)

In 2010, The IRS Spent $140 Per Plate For A Dinner It Hosted As Part Of Its Conference. "In FY 2010, the IRS requested and was authorized by the Office of Management and Budget to spend up to $126,500 for the purposes of hosting a conference at which the attendees from many of the world's largest countries met to consider and discuss issues of global and national tax administration in their respective countries and, specifically, mutual tax compliance challenges. The IRS was thus authorized to spend this money for the purpose of entertaining foreign officials. However, we did not find any Department of the Treasury or IRS criteria to assess the reasonableness of these entertainment expenses. TIGTA considers the cost of the expenses related to this conference to be high. For example, we identified a dinner at an approximate cost of $140 per person, four times the Federal Government per diem rate in Washington, D.C." ( Treasury Inspector General For Tax Administration Report, 6/20/13)

Yesterday, An IRS Employee Chose To Plead The Fifth Rather Than Answer Questions Regarding Abuse Of Government Contracting

Investigation Finds IRS Official Helped Friend Win $500 Million In Contracts. "Investigation finds IRS official helped friend win $500 million in contracts. An IRS official helped funnel work to a friend whose technology company received some $500 million in agency contracts, according to a new congressional investigation." (Bernie Becker, "Report: Friendship May Have Greased Wheels For IRS Contracts," The Hill, 6/25/13)

  • "The House Oversight Committee Found That Greg Roseman, The IRS's Deputy Director For IT Acquisition, 'Helped Steer Contracts' To Braulio Castillo, The Chief Executive Of Strong Castle, 'Through Back Channels.'" (Bernie Becker, "Report: Friendship May Have Greased Wheels For IRS Contracts," The Hill, 6/25/13)
  • "According To The Report, Roseman Did Not Tell Other IRS Officials About His Close Relationship With Castillo, And Didn't Recuse Himself From The Contract Process When Strong Castle Made A Bid." (Bernie Becker, "Report: Friendship May Have Greased Wheels For IRS Contracts," The Hill, 6/25/13)
  • Strong Castle Went From $250,000 In Annual Revenues When It Was Bought In January 2012 To Securing "Potentially A Half Billion Dollars In IRS Contracts" Just Six Months Later. "Strong Castle grew from a company with about $250,000 in annual revenues to an outfit with potentially a half billion dollars in IRS contracts, in the six months after Castillo purchased the company with his wife in January 2012." (Bernie Becker, "Report: Friendship May Have Greased Wheels For IRS Contracts," The Hill, 6/25/13)

Yesterday, IRS Official Gregory Roseman Pled The Fifth In A Hearing That Looked Into Ill-Gotten Contracts. REPRESENTATIVE DARRELL ISSA (R-CA): "Does anyone here, at this time, intend to invoke their Fifth Amendment rights? Mr. Roseman?" GREGORY ROSEMAN: "Yes sir, I do intend to waive my fifth-I intend to invoke my Fifth Amendment right to be silent." … REP. ISSA: "Mr. Roseman, what is your title at the IRS?" MR. ROSEMAN: "Mr. Chairman, my title was Deputy Director of Enterprise Network and Tier Systems Procurement." REP. ISSA: "Mr. Roseman, to whom do you report at the IRS?" MR. ROSEMAN: "I respectfully decline to answer any questions and invoke my Fifth Amendment privilege to remain silent." REP. ISSA: "Would you do that once again? I apologize." MR. ROSEMAN: "On the advice of counsel, I respectfully decline to answer any questions and invoke my Fifth Amendment privilege to remain silent." REP. ISSA: "Mr. Roseman, when did you first become aware of a company called Strong Castle Inc.?" MR. ROSEMAN: "Mr. Chairman, on the advice of counsel, I respectfully decline to answer any questions and invoke my Fifth Amendment privilege to remain silent." REP. ISSA: "Mr. Roseman, are you currently employed by the IRS?" MR. ROSEMAN: "Mr. Chairman, on the advice of counsel, I respectfully decline to answer any questions and invoke my Fifth Amendment privilege to remain silent." (Gregory Roseman, Committee on Oversight and Government Reform, U.S. House of Representatives, Testimony, 6/26/13)

Despite The Waste Of Taxpayer Money, The IRS Is Set To Give Out $70 Million In Bonuses

The "IRS Is Poised To Give Employees $70 Million In Bonuses." "The embattled IRS is poised to give employees $70 million in bonuses, according to a Republican senator. Iowa Sen. Chuck Grassley, a senior Republican on the Finance Committee, said his office has learned that the IRS is preparing to negotiate an agreement with its union to pay out the bonuses. In a letter to acting IRS Commissioner Daniel Werfel on Tuesday, Grassley said it violates an April directive from the White House to agencies to halt all bonuses because of budget constraints. Werfel, who worked at the Office of Management and Budget at the time, was the author of those guidelines." (Lauren French, "IRS Poised To Pay $70 Million In Bonuses," Politico, 6/19/13)


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