Mystery: Where is the Treasury IG's Koch report?

Long before we found out that the Inspector General of the Treasury had discovered political targeting at the IRS against conservative groups applying for tax-exempt status, Senator Charles Grassley demanded an investigation into remarks made by Obama adviser Austan Goolsbee about the tax records of Koch Industries.  Those took place three years ago, prompting Grassley and other Republicans on Capitol Hill to press IG J. Russel George on whether the IRS had leaked confidential information to Goolsbee for political purposes.  The investigation concluded two years ago this month — but what did it find?  Grassley can’t get the report, and neither can anyone else, National Review’s Eliana Johnson reports:

George’s investigation concluded in August 2011. Since then, Koch Industries senior vice president and general counsel Mark Holden has repeatedly requested a report summarizing the agency’s findings from multiple federal agencies but has been summarily denied by all of them. “TIGTA sent me to the IRS, the IRS sent me back to TIGTA, but none of them would release the report or any information about the investigation,” Holden says.

It has been a Kafkaesque march through the federal bureaucracy. In August 2011 a TIGTA special agent told Holden in an e-mail that “the final report relative to the investigation of Austan Goolsbee’s press conference remark is completed, has gone through the approval process, and would now be available through a FOIA request.” Holden’s request, however, was denied. “Because your request is for law enforcement records concerning a third party, TIGTA can neither admit nor deny the existence of responsive records,” the agency wrote him.  He was instead referred to the Internal Revenue Service. After lodging a request there, he was sent back to TIGTA, only to be told, “Our previous response . . . also responds to this request” and “we are closing our file in this matter.”

Asked why the potential victim of a crime is prohibited from viewing TIGTA’s findings, TIGTA communications director Karen Kraushaar declined to go into detail, telling me only that “federal confidentiality law, including Section 6103 of the Internal Revenue Code, prohibits us from disclosing any information concerning our review of such allegations. Therefore, we regret that we cannot provide you with any further information.”

The agency divulged no more information to Senator Grassley. On requesting the report, he was told by George in a letter that, owing to the confidentiality provisions affecting individual tax records, “TIGTA could not provide information regarding action, if any, TIGTA might have taken beyond its review of the allegations.” As a result, George said, he was “unable to respond to any of the questions” Grassley posed about the investigation’s findings.

Essentially, the Treasury Department insists that it can’t release the results of an investigation into whether a taxpayer’s confidentiality was violated, because that would violate taxpayer confidentiality.  It’s an argument worthy of Catch-22, the famous wartime novel:

There was only one catch and that was Catch-22, which specified that a concern for one’s safety in the face of dangers that were real and immediate was the process of a rational mind. Orr was crazy and could be grounded. All he had to do was ask; and as soon as he did, he would no longer be crazy and would have to fly more missions. Orr would be crazy to fly more missions and sane if he didn’t, but if he were sane he had to fly them. If he flew them he was crazy and didn’t have to; but if he didn’t want to he was sane and had to. Yossarian was moved very deeply by the absolute simplicity of this clause of Catch-22 and let out a respectful whistle. (p. 56, ch. 5)

In fact, it’s worse than that.  According to Johnson, the taxpayer whose confidentiality Treasury protects with this policy isn’t the Koch Brothers, but Goolsbee:

Oddly, the results of investigations conducted by the Treasury Department inspector general are considered the confidential tax information of the alleged perpetrator. So, as a Ways and Means Committee  spokeswoman explains, the IG report is filed in the tax records of “the person who allegedly committed the violation” and its disclosure is considered tantamount to the release of the individual’s tax returns, a violation of section 6103.

In other words, if you violate taxpayer confidentiality, you can rest assured that no one will ever know it … at least if Treasury wants to make sure of it.  In Goolsbee’s case, that seems to be the decision.  It’s not what you snoop, it’s who you know, apparently.  Goolsbee insists that he was just talking out of his hat at the time and never received any confidential information, but if that’s the case, then how would a release of the TIGTA report that clears Goolsbee infringe on his own confidentiality?

The report could be demanded by the chairs of the governing Congressional committees.  In the Senate, that would be Grassley’s colleague Max Baucus, who has declined to make the request.  In the House, it’s Rep. Dave Camp (R-MI), who is already probing the IRS targeting policies.  Let’s hope Camp makes room in his next round of hearings to address this and get a look at the report to see what else the IRS may or may not have been doing in politics in 2010.