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Did Lois Lerner Illegally Disclose Information to the FEC?

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Eliana Johnson reports for National Review Online:

The “phony scandal” at the IRS keeps growing.

E-mail correspondence unearthed by the House Ways and Means Committee reveals that Lois Lerner, the figure at the center of the scandal, may have committed a felony by divulging information about a conservative group to the Federal Election Commission, in an incident that dates back at least to 2008, before President Obama took office. Though some conservatives have eagerly sought evidence that Obama’s White House instigated the IRS’s targeting of tea-party groups, the latest evidence suggests that an anti-conservative bias may instead be an endemic feature of the federal bureaucracy. And now, an FEC official is raising the specter of systemic bias at that agency, too, calling the techniques its lawyers employ a “much more sophisticated way” of discriminating against conservative groups than those used by the IRS.

“When we spoke last July, you had told us that the American Future Fund had not received an exemption letter from the IRS,” an FEC attorney wrote in a February 2009 e-mail to Lerner.

But Section 6103 of the Internal Revenue Code provides that both “return information” and “taxpayer return information” are strictly confidential. An IRS source tells National Review Online that, within the agency, disclosing the information that Lerner appears to have provided is considered “a violation of Section 6103.”

That’s a felony punishable by up to $5,000 in fines or five years in prison. If found guilty of such a violation, Lerner, who has been on paid administrative leave since May, would also lose her job: “If such offense is committed by any officer or employee of the United States,” the law reads, he shall “be dismissed from office or discharged from employment upon conviction for such offense.”

Tax-law experts, however, disagree about whether Lerner’s apparent disclosure was a violation of Section 6103. Steven Willis, a professor of tax law at the University of Florida’s Levin College of Law, argues that it was. The law “does not allow for disclosure of pending applications,” Willis says, and though he acknowledges that the law is a “technicality,” he maintains that Lerner’s violation is something more serious. “In her position as director of Exempt Organizations, Ms. Lerner would surely have been aware of section 6103,” Willis tells me. “She would have had responsibility to ensure that employees who reported to her not violate the sections.” Further, her role as a senior IRS official “adds to the seriousness.”

However, it’s not clear that Lerner disclosed anything that could not have been inferred from information otherwise available to the FEC. Attorneys at that agency knew, based on information provided by the American Future Fund, that the group had applied for tax exemption. Further, once an organization is granted tax exemption, federal law mandates that its application as well as the IRS’s approval letter be made publicly available; since its application was not publicly available, lawyers could have deduced that its file was pending. For this reason and others, Bryan Camp of Texas Tech University’s law school does not believe Lerner broke the law. “Assuming the disclosure occurred, I don’t see that as a 6103 violation,” he says, citing a provision that allows the IRS to verify whether an organization is “currently held to be exempt.” But Camp adds a caveat. “The law of disclosure is complex and treacherous,” he says. “There are very few, even in the office of chief counsel, who understand all the ins and outs.”

The IRS, for its part, is defending Lerner’s actions. The agency told National Review Online in a statement, “The email . . . indicates that both Ms. Lerner and the FEC attorney recognized the IRS obligation to protect taxpayer information and that neither person wanted the IRS to provide the FEC with anything other than publicly available information.”

Regardless of whether Lerner broke the law, the e-mail exchange released by the Ways and Means Committee suggests that information was passed from the FEC to the IRS — and vice versa — and was used by both agencies to target conservative groups. . . .


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