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Online Bigun

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The IRS Scandal Blows Wide Open
« on: April 17, 2014, 10:33:33 AM »
The IRS Scandal Blows Wide Open

April 17, 2014 by Arnold Ahlert

A bombshell revelation has brought the IRS scandal to a new level. Judicial Watch has released internal IRS communications revealing that former Tax Exempt Organizations director Lois Lerner was in contact with the Department of Justice (DOJ) regarding whether it was possible to criminally prosecute tax-exempt groups she believed had “lied” about their political activity. Judicial Watch obtained the documents by successfully filing a Freedom of Information Act (FOIA) lawsuit against the IRS in October 2013, following the agency’s stonewall of four FOIA requests dating back to the previous May.

Contained in those documents is an email exchange between Lerner and Nikole C. Flax, then-Chief of Staff to then-Acting IRS Commissioner Steven T. Miller. On May 8, 2013, Lerner sent the following email to Flax:

“I got a call today from Richard Pilger Director Elections Crimes Branch at DOJ … He wanted to know who at IRS the DOJ folk s [sic] could talk to about Sen. Whitehouse idea at the hearing that DOJ could piece together false statement cases about applicants who “lied” on their 1024s –saying they weren’t planning on doing political activity, and then turning around and making large visible political expenditures. DOJ is feeling like it needs to respond, but want to talk to the right folks at IRS to see whether there are impediments from our side and what, if any damage this might do to IRS programs.

I told him that sounded like we might need several folks from IRS…”

Flax responded the next day:

“I think we should do it – also need to include CI [Criminal Investigation Division], which we can help coordinate. Also, we need to reach out to FEC. Does it make sense to consider including them in this or keep it separate?”

Sen. Sheldon Whitehouse (D-RI) had chaired a hearing on Apr. 9, 2013 in which he discussed the abuse of the 501(c)(4) tax-exempt designation. During that hearing, he made his leftist agenda clear, insisting that “after the Supreme Court opened the floodgates to big money in elections in its disgraceful Citizens United decision, big donors like to use these non-profit entities to launder campaign spending and hide their identities.”

Whitehouse also asked witnesses from DOJ and IRS why they hadn’t prosecuted 501(c)(4) groups who have made false statements about their activities, or donors who have used shell companies to mask their donations to Super PACs. He urged both entities to “put together a criminal case showing a fairly straightforward false statement or a fairly [straightforward] shell corporation disclosure violation.”

In a March 27, 2013 email to a top staffer at the IRS, Lerner revealed the impetus behind that meeting:

“As I mentioned yesterday — there are several groups of folks from the FEC world that are pushing tax fraud prosecution for c4s who report they are not conducting political activity when they are (or these folks think they are). One is my ex-boss Larry Noble (former General Counsel at the FEC), who is now president of Americans for Campaign Reform. This is their latest push to shut these down. One IRS prosecution would make an impact and they wouldn’t feel so comfortable doing the stuff.

So, don’t be fooled about how this is being articulated – it is ALL about 501(c)(4) orgs and political activity”

An IRS prosecution for the sake of “impact” sounds remarkably like a show trial, but the fact that Lerner advocated such an idea is not surprising. She too had nothing but contempt for Citizens United, a reality she made clear during a 2010 speech at Duke University. At the time she insisted the Supreme Court “dealt a huge blow, overturning a 100-year-old precedent that basically corporations couldn’t give directly to political campaigns.”

Apparently Lerner knew such a prosecution might be at odds with the law. Minutes before sending the above email she sent this one:

“Whether there was a false statement or fraud regarding an [sic] description of an alleged political expenditure that doesn’t say vote for or vote against is not realistic under current law. Everyone is looking for a magic bullet or scapegoat — there isn’t one. The law in this area is just hard.”

Just as damning are a trio of emails that show Lerner working to tamp down the emerging IRS scandal. They are important because all of them were sent before her May 10, 2013 speech attempting to blame the entire debacle on “low level” IRS employees in Cincinnati:

• May 1, 2013: After receiving an email from an assistant showing that 501(c)(4) applications had increased from 1591 in 2010 to 3398 in 2012 , Lerner wrote back, “Looks to me like 2010-2012 doubled too. Oh well – thanks.”

• May 2, 2013: Discussing an upcoming conference call with approximately 100 congressional staffers on May 22, Lerner cautions aides, “Need to be careful not to mention sequester/furlough unless asked although can allude to budget and resources restraints.”

• May 2, 2013: In response to an email reminding her about the upcoming conference call with congressional staffers, Lerner responded, “Arrgh – I just saw it. Sharon  could skate, but Cindy [Thomas] is the person who could answer that stuff. We need to give them some type of language in the event that type of question comes up” [apparently in reference to earlier email referencing “sensitive issues”].

Emails sent after the speech are equally revealing. One sent on May 10 blows a hole in the left’s contention that IRS targeting was a bipartisan affair:

• May 10, 2013: In an email to an aide responding to a request for information from a Washington Post reporter, Lerner admits that she “can’t confirm that there was anyone on the other side of the political spectrum” who had been targeted by the IRS. She then adds that “The one with the names used were only know [sic] because they have been very loud in the press.”

• May 10, 2013: An email from former Cincinnati program manager Cindy Thomas excoriates Lerner for her comments blaming the aforementioned low level employees. Highlighting the words “low-level workers” in bold-face type each of the seven times she used it in a short email, Thomas asked, “How am I supposed to keep the low-level workers motivated when the public believes they are nothing more than low-level workers and now will have no respect for how they are working cases?” Lerner’s response nearly an hour later was a terse, “I will be back shortly and give you a call.”

• May 15, 2013: In an email from an aide to Lerner, the aide specifically mentions “Tea Party Organizations,” the “Tea Party movement,” and “Tea Party Patriots” as organizations targeted by the IRS.

All of the above indicate a despicable level of strategizing aimed at not merely suppressing the efforts of conservative organizations — but targeting them with criminal prosecution and threatening them with imprisonment. Yet one sentence in the above emails stands out above all the rest. It is the one where Lerner states that “everyone is looking for a magic bullet or scapegoat.”

Who is “everyone”? IRS emails released by the House Oversight Committee reveal staff members working for Rep. Elijah Cummings (D-MD), the Committee’s Democratic Ranking Member, were in contact with the IRS multiple times between 2012 and 2013 regarding True the Vote, a conservative organization that works to prevent vote fraud. We now know the DOJ was in the loop as well. So was Lerner’s former employer, the Federal Elections Commission (FEC). They were given access by the IRS to highly confidential tax information about Tea Party groups, in clear violation of federal law.

Who gave them that access? Lois Lerner in an email chain that began Feb. 3, 2009, when the FEC made its request to her. That revelation also comes courtesy of an FOIA request filed by Judicial Watch.

Judicial Watch President Tom Fitton illuminates the implications of these latest document releases. “These new emails show that the day before she broke the news of the IRS scandal, Lois Lerner was talking to a top Obama Justice Department official about whether the DOJ could prosecute the very same organizations that the IRS had already improperly targeted,” he said. “The IRS emails show Eric Holder’s Department of Justice is now implicated and conflicted in the IRS scandal. No wonder we had to sue in federal court to get these documents.”

Now that it is clear the DOJ is part of the scandal, it becomes clear that they are incapable of handling the investigation of it. Thus, there is only one alternative: an independent prosecutor must be appointed. There is no question that Eric Holder’s March 10, 2014 letter to Sen. Ted Cruz (R-Tex.), saying that “such an appointment is not warranted” because the case does not present a conflict of interest or other extraordinary circumstances, is an utter fraud. Three major government entities—the IRS, the DOJ and the FEC–now known to be involved in the effort to harass right wing groups represents a gargantuan conflict of interest and the epitome of extraordinary circumstances.

The American people must rise up and demand such an appointment. The highest offices in the nation have been exposed colluding to persecute political opponents using any means at their disposal. The American people must do likewise to excise this rot from our most vital institutions.

http://www.frontpagemag.com/2014/arnold-ahlert/the-irs-scandal-blows-wide-open/print/


Online Bigun

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Re: The IRS Scandal Blows Wide Open
« Reply #1 on: April 17, 2014, 10:39:32 AM »
There is no way to permanently fix this with the income tax and the IRS in place!

Both need to be thrown onto the ash heap of history and be done with it!

We can and should return to the type of taxation universally endorsed by our founders (taxes on article of consumption) for all of the reasons clearly laid out by Hamilton in Federalist 21.

Offline mystery-ak

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Re: The IRS Scandal Blows Wide Open
« Reply #2 on: April 17, 2014, 10:51:34 AM »
If this was any other administration...well we know what would be happening....

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Offline happyg

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Re: The IRS Scandal Blows Wide Open
« Reply #3 on: April 17, 2014, 10:58:26 AM »
The IRS absolutely needs abolished, and the Fair Tax be put in place. Not only are republicans being hurt by the crimes committed by the IRS, Justice Dept., and the FEC, but so are democrats who have little or no clue to what is happening. Not all of them would approve of this, and elections would change when this revelation is revealed to everyone. We can't count on the MSM to do any heavy lifting, so we can only use the resources we have,  mainly ourselves.

Offline massadvj

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Re: The IRS Scandal Blows Wide Open
« Reply #4 on: April 17, 2014, 11:09:25 AM »
Yep.  Not a smidgen of corruption.  Let's move on.
"She only coughs when she lies."

Online Bigun

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Re: The IRS Scandal Blows Wide Open
« Reply #5 on: April 17, 2014, 11:18:15 AM »
Yep.  Not a smidgen of corruption.  Let's move on.

Well if you parse words like they do he was telling the truth as there is FAR more than a "smidgen" of corruption here!

Online Bigun

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Re: The IRS Scandal Blows Wide Open
« Reply #6 on: April 17, 2014, 11:30:03 AM »
The IRS absolutely needs abolished, and the Fair Tax be put in place. Not only are republicans being hurt by the crimes committed by the IRS, Justice Dept., and the FEC, but so are democrats who have little or no clue to what is happening. Not all of them would approve of this, and elections would change when this revelation is revealed to everyone. We can't count on the MSM to do any heavy lifting, so we can only use the resources we have,  mainly ourselves.

And despite all the BS you have heard about it the income tax alone is mostly responsible for our manufacturing having moved offshore!

Offline Chieftain

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Re: The IRS Scandal Blows Wide Open
« Reply #7 on: April 17, 2014, 12:02:09 PM »
This is going to come to haunt the Obama Administration about the time the relief for Eric Holder is announced.  That nomination needs to be held in abeyance until such time as IRS and DOJ come clean.

This is also going to play very heavily in not only the mid term elections this Fall but also the presidential campaigns to come.


Offline Oceander

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Re: The IRS Scandal Blows Wide Open
« Reply #8 on: April 17, 2014, 12:03:54 PM »
The IRS absolutely needs abolished, and the Fair Tax be put in place. Not only are republicans being hurt by the crimes committed by the IRS, Justice Dept., and the FEC, but so are democrats who have little or no clue to what is happening. Not all of them would approve of this, and elections would change when this revelation is revealed to everyone. We can't count on the MSM to do any heavy lifting, so we can only use the resources we have,  mainly ourselves.

Please explain how the "Fair" Tax is going to stop the Justice Dep't and the FEC from engaging in politically-motivated abuse.  Sounds to me like it should be called the Fairy-Tale Tax.

Offline Oceander

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Re: The IRS Scandal Blows Wide Open
« Reply #9 on: April 17, 2014, 12:06:50 PM »
And despite all the BS you have heard about it the income tax alone is mostly responsible for our manufacturing having moved offshore!

No, politically motivated legislation designed to punish the capital that funds these businesses has pushed them offshore.  Only a blithering idiot would think that abolishing the IRS and the current income tax would stop this - or don't you think that non-tax fees and charges couldn't be imposed on these businesses or their owners in the absence of the current IRS and the current Internal Revenue Code.  Please, focus on the problem - politically-motivated corruption in the federal government - and stop getting yourself lost in the weeds of a false, rhetorical agenda.

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Re: The IRS Scandal Blows Wide Open
« Reply #10 on: April 17, 2014, 12:17:14 PM »
Please explain how the "Fair" Tax is going to stop the Justice Dep't and the FEC from engaging in politically-motivated abuse.  Sounds to me like it should be called the Fairy-Tale Tax.

It won't and nobody ever said that it would but it will DAMNED SURE stop them from using the tax code and the IRS to do it with!

As it stands now all the IRS has to to is make an ALLEGATION against anyone they want to destroy and it's done! They have WAY more money and lawyers than any of us do and even if you eventually prove them wron you will still be broke and they won't even say "I'm sorry"!

« Last Edit: April 17, 2014, 12:18:15 PM by Bigun »

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Re: The IRS Scandal Blows Wide Open
« Reply #11 on: April 17, 2014, 12:22:09 PM »
No, politically motivated legislation designed to punish the capital that funds these businesses has pushed them offshore.  Only a blithering idiot would think that abolishing the IRS and the current income tax would stop this - or don't you think that non-tax fees and charges couldn't be imposed on these businesses or their owners in the absence of the current IRS and the current Internal Revenue Code.  Please, focus on the problem - politically-motivated corruption in the federal government - and stop getting yourself lost in the weeds of a false, rhetorical agenda.


Yes! Politically motivated legislation that rewards their friends and punishes their enemies via the tax code!

The fact is that the income tax system puts every U. S. business trying to compete internationally at a disadvantage right from the get go!

http://www.fairtax.org/PDF/FairTax_on_American_manufacturing.pdf

http://www.fairtax.org/site/PageServer?pagename=research_economy
« Last Edit: April 17, 2014, 12:34:22 PM by Bigun »

Offline Oceander

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Re: The IRS Scandal Blows Wide Open
« Reply #12 on: April 17, 2014, 01:00:41 PM »
It won't and nobody ever said that it would but it will DAMNED SURE stop them from using the tax code and the IRS to do it with!

As it stands now all the IRS has to to is make an ALLEGATION against anyone they want to destroy and it's done! They have WAY more money and lawyers than any of us do and even if you eventually prove them wron you will still be broke and they won't even say "I'm sorry"!


you just love those weeds, don't you.  the existence of the IRS is UTTERLY irrelevant to the government's ability to destroy someone by financially draining them through ruinous litigation expenses.  All the government needs to do is arrest someone - which doesn't require any sort of probable cause at all - and they're destroyed, even if the charges are summarily dismissed at arraignment, or even before that by the ADA because they are so palpably false.  Just make sure that the media are tipped off before hand so they can immortalize the "perp walk" in photos and that arrest will never go away, no matter how strong are the laws sealing the arrest record.  neither will it go away if it makes it into the public records kept by private information gatherers like Lexis because there isn't any requirement that they destroy any arrest/criminal records that end up being sealed because they were dismissed.

And that's just the lazy man's way to do it.  Dinesh D'Souza will probably end up being ruined financially by having to defend himself against the criminal charges he's being prosecuted on for violating campaign finance rules.  I personally think it's grotesque that someone can be criminally prosecuted for using their First Amendment rights in a way that the government disapproves of, but there it is.  This tactic could easily be employed against all manner of conservative political groups.

And when the evidence isn't strong enough to push a criminal prosecution for violating campaign finance rules, there's always the statute that was mentioned in the article itself, 18 USC sec. 1001, which makes it a felony to give a false statement to the government.  Here's the relevant part of that statute:

Quote
(a) Except as otherwise provided in this section, whoever, in any matter within the jurisdiction of the executive, legislative, or judicial branch of the Government of the United States, knowingly and willfully—

(1) falsifies, conceals, or covers up by any trick, scheme, or device a material fact;

(2) makes any materially false, fictitious, or fraudulent statement or representation; or

(3) makes or uses any false writing or document knowing the same to contain any materially false, fictitious, or fraudulent statement or entry;

shall be fined under this title, imprisoned not more than 5 years or, if the offense involves international or domestic terrorism (as defined in section 2331), imprisoned not more than 8 years, or both. If the matter relates to an offense under chapter 109A, 109B, 110, or 117, or section 1591, then the term of imprisonment imposed under this section shall be not more than 8 years.

The DOJ emails discuss this statute because, as should be obvious, it is almost pathetically easy to indict someone under this statute and to prosecute that indictment at least through a trial, and thereby financially ruin the target, even if the target is acquitted, and - most to the point - this has absolutely, utterly nothing to do with the IRS or with the tax code.  In fact, the government could persecute conservative political organizations by finding information on the members of that organization that fall under the statute even if those statements are completely unrelated to the organization or its political activity.

In fact, to take this statute to its absurd, but logical conclusion, if you get pulled over for a traffic violation on federal property by a federal cop, and you try to lie your way out of it ("no, honestly, officer, I totally stopped the car before I went through the stop sign"), you just violated this statute.

None of that has anything to do with the existence or non-existence of the IRS and the internal revenue code.

Offline Oceander

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Re: The IRS Scandal Blows Wide Open
« Reply #13 on: April 17, 2014, 01:05:23 PM »
Yes! Politically motivated legislation that rewards their friends and punishes their enemies via the tax code!

The fact is that the income tax system puts every U. S. business trying to compete internationally at a disadvantage right from the get go!

http://www.fairtax.org/PDF/FairTax_on_American_manufacturing.pdf

http://www.fairtax.org/site/PageServer?pagename=research_economy


You're getting lost in the weeds again.  Get rid of the IRS and the tax code and how much have you denied government actors the ability to engage in politically-motivated corruption?  Not a single iota.  Any other statute will do just fine, and plenty more can be enacted.  Given that the federal government has almost plenary power over the business activities of US companies via the Commerce Clause, the entire impact of the tax code on businesses could be replicated through direct regulation under that power, without having to go through the tax code.

Try an analogy.  Suppose we discover that mob assassins prefer to use Ruger pistols to assassinate people.  Do we stop those assassins by destroying the Ruger company?  Or do the mob assassins simply turn to something else, like Smith & Wesson?

You're a pretty sharp thinker, but your bete noir keeps getting you stuck in the weeds.

Online Bigun

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Re: The IRS Scandal Blows Wide Open
« Reply #14 on: April 17, 2014, 01:12:29 PM »

you just love those weeds, don't you.  the existence of the IRS is UTTERLY irrelevant to the government's ability to destroy someone by financially draining them through ruinous litigation expenses.  All the government needs to do is arrest someone - which doesn't require any sort of probable cause at all - and they're destroyed, even if the charges are summarily dismissed at arraignment, or even before that by the ADA because they are so palpably false.  Just make sure that the media are tipped off before hand so they can immortalize the "perp walk" in photos and that arrest will never go away, no matter how strong are the laws sealing the arrest record.  neither will it go away if it makes it into the public records kept by private information gatherers like Lexis because there isn't any requirement that they destroy any arrest/criminal records that end up being sealed because they were dismissed.

And that's just the lazy man's way to do it.  Dinesh D'Souza will probably end up being ruined financially by having to defend himself against the criminal charges he's being prosecuted on for violating campaign finance rules.  I personally think it's grotesque that someone can be criminally prosecuted for using their First Amendment rights in a way that the government disapproves of, but there it is.  This tactic could easily be employed against all manner of conservative political groups.

And when the evidence isn't strong enough to push a criminal prosecution for violating campaign finance rules, there's always the statute that was mentioned in the article itself, 18 USC sec. 1001, which makes it a felony to give a false statement to the government.  Here's the relevant part of that statute:

The DOJ emails discuss this statute because, as should be obvious, it is almost pathetically easy to indict someone under this statute and to prosecute that indictment at least through a trial, and thereby financially ruin the target, even if the target is acquitted, and - most to the point - this has absolutely, utterly nothing to do with the IRS or with the tax code.  In fact, the government could persecute conservative political organizations by finding information on the members of that organization that fall under the statute even if those statements are completely unrelated to the organization or its political activity.

In fact, to take this statute to its absurd, but logical conclusion, if you get pulled over for a traffic violation on federal property by a federal cop, and you try to lie your way out of it ("no, honestly, officer, I totally stopped the car before I went through the stop sign"), you just violated this statute.

None of that has anything to do with the existence or non-existence of the IRS and the internal revenue code.

Never said that the IRS was the ONLY tool at their disposal that's YOU Mr. Tax lawyer, trying to muddy the water!!

I sure did, and will continue to, say that the income tax and it's attendant IRS is a VERY big tool!

“The greatest tool Communism has in our toolbox is the progressive income tax.”

 Karl Marx

Ever wonder WHY he would say that?
« Last Edit: April 17, 2014, 01:15:42 PM by Bigun »


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