House panel says former IRS official may have committed crimes in tea party targeting

WASHINGTON — The House Ways and Means Committee voted Wednesday to refer a former Internal Revenue Service official to the Justice Department for possible criminal prosecution in the agency's tea party controversy.

Committee investigators say they have uncovered evidence that Lois Lerner may have violated the constitutional rights of conservative groups, misled investigators and risked exposing confidential taxpayer information.

Lerner, who retired last year, headed the IRS division that processes applications for tax-exempt status. The agency has acknowledged that agents improperly singled out tea party and other conservative groups for extra scrutiny when they applied for tax-exempt status from 2010 to 2012.

In a publicly released letter, committee chairman Dave Camp, R-Mich., says Lerner specifically targeted Crossroads GPS, the political nonprofit co-founded by GOP strategist Karl Rove. The letter says Lerner inappropriately intervened in the group's application, seeking to have it denied. The letter also says Lerner sought to have the group audited.

There is no evidence, Camp said, the liberal groups were targeted in the same way.

"We think there's reason to believe that laws were broken, that constitutional rights were violated," Camp said. "We have to make sure that the signal goes out that this can't happen again."

The Ways and Means Committee has been investigating the IRS for nearly a year, since shortly after the mishandling of tea party applications became public. Wednesday's vote to refer the matter to the Justice Department was 23-14, with all Republicans voting in favor and all Democrats voting against.

"It now seems clear that Republican members of the Ways and Means Committee have decided that they do not want to be left behind in the Republican campaign to declare this a scandal and keep it going until November," said Rep. Sander Levin of Michigan, the committee's ranking Democrat.

Lerner's lawyer issued a statement Wednesday declaring her innocence.

"This is just another attempt by Republicans to vilify Ms. Lerner for political gain," said the lawyer, William W. Taylor III. "Ms. Lerner has done nothing wrong. She did not violate any law or regulation. She did not mislead Congress. She did not interfere with the rights of any organization to a tax exemption. Those are the facts."

Wednesday's vote came after an extraordinary two-hour closed-door meeting of the committee. The meeting was closed so committee members could talk about confidential taxpayer information.

Once the meeting was re-opened, the committee voted to publicly release its referral letter to Attorney General Eric Holder, even though it contains information about a specific taxpayer, namely Crossroads GPS.

Democrats on the committee noted that the authority has rarely been used. The last time it was done was when the committee voted to release an audit of President Richard Nixon's tax returns, Levin said.

Levin said Camp could have simply transmitted the information about Lerner to the appropriate authorities at the Justice Department, without making it public.

Camp defended the release of the information.

"Look, the potential violation of constitutional rights occurred in secret, inside the bowels of the IRS," Camp said. "I think it's important that the public has an understanding of what went on, and I think if I sent a secret letter to the Department of Justice, I think that would be doing a disservice to the Americans whose constitutional rights are on the line."

Steven Law, president and CEO of Crossroads GPS, applauded the committee's action.

Lerner has emerged as a central figure in investigations by congressional committees. The House Oversight Committee has scheduled a vote for Thursday on whether to hold Lerner in contempt of Congress for refusing to answer questions at two congressional hearings.

At both hearings, Lerner invoked her constitutional right against self-incrimination. House Oversight Committee Chairman Darrell Issa, R-Calif., said Lerner had effectively waived her Fifth Amendment right not to answer questions by providing an opening statement at a hearing last year.

Taylor and Democrats on the oversight committee disagree.