Lois Lerner, EO Director, Takes the Fall in IRS Scandal

By Ken Berry

The "Tea Party scandal" at the IRS has claimed another victim: Lois Lerner, director of the IRS Exempt Organizations (EO) division, has been placed on administrative leave after refusing to resign. Ken Corbin, a deputy director and twenty-seven-year IRS veteran from another division, was promptly named to oversee the EO as acting director.
 
But Lerner's reprieve may be short-lived. "The IRS owes it to taxpayers to resolve her situation quickly," said Senator Charles Grassley (R-IA). "She shouldn't be in limbo indefinitely on the taxpayers' dime."
 
Lerner is the third official to fall by the wayside this month as congressional committees continue to investigate reported IRS activities targeting conservative groups applying for tax-exempt status. Previously, acting IRS Commissioner Steven Miller was forced to step down, as was Joseph Grant, one of Miller's top deputies.
 
Formerly just a bit player at the IRS, Lerner stepped center stage on May 22 when she invoked her Fifth Amendment right at the hearing before the House Oversight and Government Reform Committee chaired by Representative Darrel Issa (R- CA). Lawmakers were angered that Lerner pleaded the Fifth after delivering an opening statement in her defense. Chairman Issa has indicated there's a good chance he'll recall Lerner to the proceedings. He believes she may have waived her constitutional rights by making the opening statement.

Tea Party Scandal

Follow AccountingWEB's coverage of the Tea Party scandal here.

 
According to an inspector general's report released May 14, Lerner initially discovered wrongdoings by staffers back in 2011 but failed to take appropriate steps to resolve matters. She has also has come under fire for allegedly misleading or lying in staff briefings over the past year. It's a federal crime to make false statements to Congress.
 
Lerner's former boss, IRS Commissioner Douglas Shulman, was questioned this week about the failure of mid-level managers who knew of the problem involving the conservative groups but failed to follow the chain of command. Because she's a civil servant, Lerner can't be fired.
 
Corbin has the support of IRS Acting Commissioner Daniel Werfel, who himself was just named to replace Miller. "He has strong management experience inside the IRS handling a wide range of processing issues and compliance topics as well as taxpayer service areas," said Werfel in an internal memo. "Combined with his track record of leading large work groups, these skills make him an ideal choice to help lead the Exempt Organizations area through this difficult period." 
 
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