IRS Destroyed Tapes with Lois Lerner Emails, Watchdog Confirms

In the latest wrinkle in the two-year-old investigation of alleged political targeting by the Internal Revenue Service, an inspector general on Thursday previewed a coming report describing tax agency employee destruction of back-up tapes containing emails from former Exempt Organizations division chief Lois Lerner.

J. Russell George, Treasury Inspector General for Tax Administration, and a deputy told the House Oversight and Government Reform Committee of the “unbelievable set of circumstances” in an update on multiple probes into IRS handling of nonprofit tax- exempt applications. The hearing, said Chairman Rep. Jason Chaffetz, R-Utah, was called to get ahead of the scheduled release of a written report during the Fourth of July week.

George testified: “422 tapes most likely to have contained Ms. Lerner’s emails from 2010 and 2011 were erased in March 2014, [and] we were unable to recover all of the missing emails. Comparing the IRS email transaction logs to the IRS production to the Congress revealed there could be as many as 23,000 to 24,000 additional missing emails. As a result of the investigative process, TIGTA was successful in recovering over 1,000 e-mails that the IRS did not produce.”

The investigation has also revealed that the IRS “did not search for, review or examine the two separate sources of backup tapes, the server hard drives, or the loaner laptops that ultimately produced new, previously undisclosed e-mails,” George added. The watchdog’s office in February found relevant emails the IRS had not discovered.

Chaffetz and other Republicans blasted Internal Revenue Commissioner John Koskinen for having testified previously that the IRS had “turned over every stone” in seeking missing Lerner emails. “Ten months after a subpoena, eight months after a preservation order,” these emails were destroyed, Chaffetz said. That was just 30 days after President Obama, on the eve of the Super Bowl, told a TV interviewer that there is “not a smidgen of corruption” at the IRS, Chaffetz added. Yet in searching for missing emails, “the IRS didn’t even look at five of the six sources, or the obvious places, like [Lerner’s] phone,” he said. “It defies any sense of logic, and somebody will be held accountable.”

But George and deputy Tim Camus said that two “lower level” employees at a Martinsburg, W.Va., IRS facility erased the tapes as part of their normal housekeeping procedures. “The investigation uncovered testimony and email traffic between IRS employees that indicate that the involved employees did not know about, comprehend or follow the chief technology officer's May 22, 2013, email directive to halt the destruction of email backup media due to 'the current environment' and ongoing investigations,’ George said.

“It appears they had a misunderstanding of the memo--they thought it was for hard-drives and personal computers, not backup tapes,” Camus said. Under questioning, he acknowledged that such a move might indicate “incompetence,” and that it was unlikely such destruction occurred by accident. “They have to pick up the tapes and place them on a machine to obliterate” the data, he said. When the report is delivered next week, he added, he expects the IRS to hold people accountable.

Camus also said his team had tried to find building entry logs for the Saturday in 2011 when then-IRS official Lerner discovered that her hard drive had crashed, the event that triggered the retroactive search for her emails. But those logs had also been erased, he said.

Republicans attacked Koskinen’s credibility and countered the assertions by committee Democrats that the multiple probes into the targeting charges, which have cost $20 million and prompted 22 hearings, are politically motivated and wasteful. “Watergate had 250 hours of televised hearings,” said Scott DesJarlais, R-Tenn., and “this is an incident more serious than Watergate. It only takes one email to be evidence of wrongdoing,” he added.

Rep. Trey Gowdy, R-S.C., who chairs the House Select Committee on Benghazi, elicited from the witnesses the fact that the IRS’ document retrieval operation was run by IRS chief counsel staffer Catherine Duval, who is now “doing that same job” at the State Department.

From the Democratic side, Rep. Gerry Connolly, D-Va., attacked the IG for being three months late in responding to inquiries about his own alleged bias. But George explained that he had been dealing with a very ill mother, and other members, including the ranking Democrat, acknowledged that George had alerted them to that personal reason for his not working full time.

Ranking member Rep. Elijah Cummings, D-Md., cautioned Camus for appearing to agree with some of the Republican questioners’ characterizations of Koskinen. “You just accused the commissioner of a crime, of lying to Congress,” Cummings said, seeking clarification.

 “That was not my intention,” Camus said, adding that crimes require the person who misbehaved or offered false testimony to be willing. “I don’t know if the commissioner knew at the time” the proper email searching had not been done,” George added. 

“The IRS has not been briefed on TIGTA’s findings in advance of the issuance of their report, which is expected next week,” the agency said in a statement. “We look forward to reviewing their findings and taking immediate steps to make improvements and take corrective actions. It is important to note that after considerable work since last summer and with the assistance of independent contractors, TIGTA’s review found that the vast majority of the emails it has recovered had already been located by the IRS and produced to Congress as part of the ongoing investigations.”

Cummings also asked about TIGTA’s probe of possible targeting of progressive groups, whose applications were also delayed by the IRS in 2010 as it worked on its criteria for rejecting applications for social welfare group status. He worried that this probe had become “a second-rate review.” George replied that he is working on it, but feels “stymied” by the continuing review of missing emails, which involve many “overlapping key players, some of whom have left the IRS,” as well as the continuing review of possible IRS crimes by the Justice Department.

 “Drip, drip drip,” George told the lawmakers, “with every new recovery of destroyed backup tapes extends our investigation.”