Washington, DC – Yesterday the Senate Judiciary Committee held a hearing on the nomination of Stuart F. Delery to be the Associate Attorney General of the United States. When questioning Delery, U.S. Senator Sheldon Whitehouse (D-RI) brought up a topic which he has long sought to highlight: the failure of the Internal Revenue Service (IRS) to refer cases to the Department of Justice (DOJ) that appear to represent clear violations of the rules governing the political activity of tax-exempt 501(c)(4) groups.
After pointing out that there have been reported instances of these groups filing paperwork with the IRS claiming not to be engaging in political activity, while simultaneously filing paperwork with the Federal Election Commission or state election commissions detailing the political activity they are engaged in, Whitehouse noted that, “It would appear to me that that evidence, while not conclusive, would at least be reasonable predication for an inquiry whether there has been a false statement made to a federal agency.”
He continued, “[B]ecause the IRS has not made a referral, the tax division has not taken any action. And I wonder if we are seeing kind of a hot potato rule here in which the IRS doesn’t want refer it because they don’t want to get in political trouble. The DOJ doesn’t want to take on a potentially challenging topic area like this, and so they are perfectly happy to not have the IRS refer anything to them. And the result is, for the public, the rather untoward spectacle of what appear to be open and notorious false statements being made, with nobody in the United States government taking the slightest interest in it.”
Senator Whitehouse has regularly raised this topic in recent years, most recently in a July letter to Attorney General Loretta Lynch.
In response to Whitehouse’s line of questioning yesterday, Delery replied that both DOJ and IRS are “constrained” by various factors, but declined to get into specifics or commit to any particular action.