Congressional auditors could not substantiate claims made by IRS whistleblowers at much-publicized 1997-1998 Senate Finance Committee hearings, mostly because agency records are inadequate.
The allegations of IRS employee and management misconduct raised at the hearings helped hasten the passage of IRS reform legislation last year. But the General Accounting Office reported Friday that it could not find evidence that the allegations were true, mostly because of poor recordkeeping on the part of the IRS.
"IRS' lack of adequate information systems and documentation in the areas of employee discipline, retaliation against whistleblowers and taxpayers, and zeroing out of recommended taxes prevented us from doing a more comprehensive analysis of these issues," GAO said in its report (GGD-99-82). "This lack of information hinders both congressional oversight and IRS management from addressing any problems in these areas."
GAO's investigation of whistleblower complaints could neither prove nor disprove their allegations.
For example, an IRS executive told the Finance Committee in April 1998 that high-level managers who committed wrongdoing were protected from punishment. But GAO found the IRS' system for tracking cases against executives and employees was in such disarray that it couldn't determine whether the allegation was true. GAO found that cases against executives take longer to resolve than cases against employees, but that could be due to several different factors, including the fact that complaints against executives can be filed anonymously while complaints against employees are usually filed, with documentation, by their managers.
GAO also found no supporting evidence in five specific claims of favoritism brought up at the hearing nor in eight claims of managers tampering with tax documents.
Though GAO criticized IRS' recordkeeping, the auditors found that IRS Commissioner Charles Rossotti is improving the agency's system for tracking and resolving cases against executives.
Because the IRS did not track whistleblower reprisal cases, GAO could not determine how widespread retaliation is at the agency. Nor did GAO uncover any specific discriminatory hiring or promotion practices in the IRS' Midwest District Office. Congress received numerous EEO complaints from employees in that office.
Despite the lack of evidence to substantiate whistleblower complaints, GAO found a widespread perception that employee misconduct is not handled properly at the IRS.
In response to the GAO report, Rossotti said he is reforming the agency's discipline processes and pledged to publicize actions taken to resolve employee misconduct.
"I have made it clear to all IRS employees through numerous memoranda, policy statements and all-employees messages that retaliation is intolerable, and that I will take decisive action in any case where retaliation is found to have occurred," Rossotti said, adding that the agency will share "information on actions taken in response to complaints with IRS employees and the public, including summaries of specific cases."
Senate Finance Committee Chairman William Roth, R-Del., said he will work with Rossotti to improve recordkeeping at the agency.
"While the GAO was unable to confirm or contradict most of the specific allegations, its report raises issues that give us serious concern in our ongoing IRS oversight efforts," Roth said.