US Congress grills former IRS boss over tax scandal

Under fierce questioning by US lawmakers, the political appointee who headed the IRS during the tax agency\'s targeting of conservative groups insisted Tuesday he was not involved in the scandal. Senators grilled retired IRS boss Douglas Shulman about what he readily acknowledged was \"inexcusable\" behavior by agents who, from 2010, singled out right-leaning groups for excessive scrutiny. But while he acknowledged the targeting \"happened on my watch,\" he told the Senate Finance Committee that \"I don\'t believe I was aware of this\" until May 2012, when a Treasury Department inspector general alerted him of the abuse. The IRS actions have become one of a series of alleged abuses of executive power that have cast a shadow over President Barack Obama\'s second term, and Tuesday\'s hearing was not the first into the case. Last week House lawmakers questioned outgoing IRS chief Steven Miller, who Obama had forced to resign in the wake of the revelations. And a key figure in the controversy, director of the IRS exempt organizations division Lois Lerner, has invoked her constitutional right not to testify as scheduled Wednesday before the House Oversight Committee. Lerner\'s lawyer stated in a letter to the committee that Lerner \"intended to invoke her 5th amendment right and refuse to answer questions,\" although she remained under subpoena to appear at the hearing, committee official Ali Ahmad told AFP. Lerner sparked the scandal this month by acknowledging that the IRS inappropriately targeted conservative groups. While Shulman insisted he was not aware of the wrongdoing early on, he said he was \"dismayed\" and \"saddened\" to learn of the abuse. \"The actions outlined in that report have justifiably led to questions about the fairness of the approach taken here.\" Shulman described a vast agency tasked with overseeing tax-exempt groups and carefully scrutinizing those applying for such non-profit status. He was appointed by president George W. Bush in late 2007, and served as IRS chief from 2008 until his term ended in November 2012. The targeting program began in 2010 and was phasing out by June 2011. The Finance Committee chairman, Democrat Max Baucus, blasted the IRS and accused Shulman and Miller of essentially being asleep at the switch. \"The IRS abandoned good judgment and lost the public\'s trust,\" Baucus said. Top committee Republican Orrin Hatch insisted there was \"more than a hint of political bias\" by IRS agents who put conservative groups with words like \"Tea Party\" or \"Patriot\" in their names under burdensome review. But Hatch expressed frustration with the IRS officials\' refusal to say who knew about the centralizing of the groups and how far up the chain of command it went. \"One way or another, we\'re going to learn the facts about what went on here,\" Hatch said. Obama has said he knew nothing about the abuse until the Internal Revenue Service report leaked this month. The White House acknowledged Monday it was told in April that an inspector general was finalizing an audit into IRS abuses, but stressed Obama aides made no attempt to intervene or influence findings. Attention turned to portions of the tax laws that delineate non-profit status, and discrepancies between the federal statute and IRS regulations in determining what are known as \"501(c)(4) organizations.\" Such groups, which are not required to reveal their donors, spent millions of dollars on political activity in 2012, with critics saying they played outsized roles in shaping the presidential campaign. Baucus noted that under a decades-old federal statute, such groups must \"exclusively\" be engaged in social welfare or community good, while the IRS regulations say the groups must be only \"primarily\" engaged in social welfare. \"Clearly a Mack truck is being driven through a 501(c)(4) loophole,\" Baucus said, arguing that once the immediate scandal clears the law itself should be reformed to make it clearer which groups should qualify. Republicans, meanwhile, hammered Shulman and Miller for their refusal to say whether more senior officials were involved. \"What we have on our hands is abuse, harassment, and the suppression of First Amendment rights and nobody owning up to it,\" Senator Pat Roberts said.