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National Journal: Watchdog Group Says IRS Not Monitoring Lobbying Coalitions

June 15, 2012 by

Read the full story here. National Journal

“The pro-transparency group Cause of Action is calling on a Treasury Department inspector general to investigate why, according to the group, the Internal Revenue Service is not overseeing lobbying coalitions.

CoA argues that these loose coalitions are spending money on lobbying but because they are not incorporated, they don’t have disclosure requirements or pay taxes. Saying that it wanted to “provide the public with a better understanding of the rules that apply to coalitions and to ensure that lobbying entities are paying taxes and are in compliance with IRS regulations,” CoA wrote the IRS in March asking for documentation showing how the agency monitors tax-exempt organizations’ lobbying ties.

“Cause of Action is concerned about the risk that lobbying coalitions are exercising political influence without paying taxes under the Internal Revenue Code,” CoA wrote in its request for documents. “In order to avoid the disclosure requirements of the Lobbying Disclosure Act, many organizations are simply not incorporating…”

Filed Under: News Tagged With: ,

Cause of Action Demands Investigation of IRS’s Failure to Address Lobbying Violations

June 14, 2012 by

 

CAUSE OF ACTION DEMANDS INVESTIGATION OF IRS’S FAILURE TO ADDRESS LOBBYING VIOLATIONS

Lack of oversight of stealth lobbying uncovered by Cause of Action

WASHINGTON – Following an investigation into the oversight of lobbying disclosures, Cause of Action (CoA) uncovered that the Internal Revenue Service (IRS) fails to monitor activities that could violate tax-exempt statuses, prompting CoA to send a request for investigation to the Treasury Department Inspector General concerning the IRS’s lack of action.

On March 22, 2012, Cause of Action wrote to Douglas Shulman, Commissioner of the IRS, to inquire about the IRS’s monitoring of tax-exempt organizations that house lobbying coalitions. These coalitions, as has been revealed in numerous media outlets over the past several years, dodge the Lobbying Disclosure Act by existing as loosely organized groups which are not incorporated under the law.  Concerned that lobbying coalitions are exercising political influence without paying taxes under the Internal Revenue Code, CoA sought to ensure that lobbying entities are paying taxes and are in compliance with IRS regulations.

In response to a Freedom of Information Act (FOIA) request Cause of Action submitted, on May 14, 2012, the IRS responded that it was unable to locate any documents relating to the tax-exempt status of unincorporated coalitions residing at tax-exempt corporations, their fiscal sponsors, or any investigations by the IRS into these organizations.

“The inability of the IRS to produce any documents on oversight or investigation into stealth or coalition lobbying points to a gross lack of accountability by the federal government,” stated Dan Epstein, Executive Director of Cause of Action. “The burden now lies upon the Treasury Department’s investigators to examine why the IRS has turned a blind eye to numerous coalitions that have the potential to lobby with tax-exempt dollars, which is a clear violation of the Lobbying Disclosure Act.”

On June 8, 2012, CoA sent a request for investigation letter to J. Russell George, the Treasury Inspector General for Tax Administration (TIGTA) which states that “the IRS has failed to require lobbying coalitions to report their activities and the IRS has failed to conduct oversight over tax-exempt corporations that sponsor coalition lobbying without disclosing those activities. Moreover, the IRS, despite concerns by Congress and the media, has failed to conduct any investigations of lobbying coalition activities that may be inconsistent with the Internal Revenue Code.  As a result, we strongly request that you immediately investigate these matters.”

At the time of this release, CoA has not received a response from TIGTA concerning the request for investigation.

About Cause of Action:

Cause of Action is a non-partisan, non-profit organization that uses public advocacy and legal reform tools to ensure greater transparency in government, protect taxpayer interests and promote economic freedom. For more information, visit www.causeofaction.org.

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Filed Under: Press Release Tagged With: ,

Roll Call: Epstein: Culture Must Protect Fed Whistle-Blowers

May 22, 2012 by

Epstein: Culture Must Protect Fed Whistle-Blowers

By Dan Epstein
Special to Roll Call

Hollywood glorifies them, the media lauds them as heroes, and Members of Congress wave bills around asserting to protect them, but are federal whistle-blowers being retaliated against by their own agencies?

The recent General Service Administration and Secret Service scandals have shone a light on the lack of protection for whistle-blowers, despite laws in place that should safeguard them. GSA employees are afraid of retaliation, according to Inspector General Brian Miller. Administrator Jeff Neely threatened that his employees would be “squashed like a bug” if they spoke out against spending abuses.

Yet some insiders are choosing to brave the storm and stand up to the government to expose fraud and waste. The Senate Homeland Security and Governmental Affairs Committee received calls from agency insiders providing tips for the panel’s probe of the misbehavior of Secret Service agents in Colombia. Numerous federal agency insiders are contacting government watchdogs with information concerning waste, fraud and mismanagement. Are these signs that something is truly rotten in Washington, D.C., or only symbolic of a vain hunt for government carrion?

In the current administration, whistle-blowers should know the policies and procedures in place that offer them protection. As virtually his first act in office, President Barack Obama issued an ethics pledge to all executive branch appointees mandating that, “the head of every executive agency shall, in consultation with the Director of the Office of Government Ethics, establish such rules or procedures … as are necessary or appropriate to ensure that every appointee in the agency signs the pledge upon assuming the appointed office.”

Because of the president’s stated commitment to ethics, Cause of Action asked the Office of Government Ethics to disclose whether the GSA violated the Standards of Ethical Conduct for Employees of the Executive Branch.

Neely’s Las Vegas boondoggle was clearly wasteful, but it may also signify something deeply unethical about federal employee conduct.

A system of accountability is only as effective as the employees charged with its use. Cause of Action continues to await disclosure by the Office of Government Ethics of any documents that may reveal violations of ethics rules by the GSA as well as disclosure by the Office of Special Counsel of complaints made against the GSA by current or former employees who were silenced or retaliated against for blowing the whistle.

The president entered office promising to “strengthen whistle-blower laws to protect federal workers who expose waste, fraud and abuse of authority in government.”

Although little-known even on Capitol Hill, the Council of Inspectors General on Integrity and Efficiency exists to oversee and evaluate federal agencies in their accountability, including their maintenance of procedures designed to protect federal whistle-blowers. Jeffrey Zients, chairman of the council and acting director of the Office of Management and Budget, has been asked to conduct an agency-wide audit, evaluation and investigation to assess the state of whistle-blower protection within the federal government and respond to those violations of ethical rules and whistle-blower laws that have occurred.

Effective government cannot take place if whistle-blowers are threatened into silence. With the recent scandals that have come to light, it is time to determine whether agencies are committed to protecting whistle-blowers. If the government fails to defend those employees who blow the whistle on waste or fraud, then the government effectively endorses a culture of reckless spending and unaccountability.

As economic growth has slowed in an already economically embattled America, now is the key time to commit to government efficiency. As several Members of Congress recently pointed out, “Cutting the fat and tightening the belt are things that all American families do. It’s wrong if the federal government refuses to do the same.”

Investigating and exposing waste in the government not only has the salutary effect of increasing accountability, but it has a concomitant influence on the government’s culture of spending. While requests were made to 32 federal agencies for records on spending on commemorative coins and awards, one might label gift spending as negligible compared to, say, Department of Defense contracts yielding illegal kickbacks. Conceded, but spending taxpayer dollars on commemorative items reveals just how numb our tax-dollar-funded federal employees have become to the idea of self-stewardship.

Callousness toward wasteful spending and a corresponding vitriol toward whistle-blowers has become epidemic in Washington. A first step to curing Washington of its culture of waste is to treat the illness by promoting and maintaining a culture that protects whistle-blowers. Only then will the president’s ethics pledge avoid what taxpayer-funded commemorative coins have turned out to be: of empty value.


Filed Under: Media, News Tagged With:

Limited Government: The Fading American Norm

May 7, 2012 by

In an April 24, 2012 New York Times Magazine article entitled, “Earth to Ben Bernanke”  Paul Krugman writes, “Bernanke’s big retreat from F.D.R.-like resolve happened way back in 2003, less than a year after he arrived at the Fed. That month, a Fed staff report rejected many of the ideas Bernanke previously supported — and ever since, Bernanke has spoken only of limited responses to the problem of the zero lower bound.”  By “problem of the zero lower bound” Krugman means:

‘Right now, the Fed believes that it’s facing a weak economy and subdued inflation, a situation in which it would ordinarily cut interest rates. The problem is that rates can’t be cut further. When the recession began in 2007, the Fed started slashing short-term interest rates until November 2008, when they bottomed out near zero, where they remain to this day. And that was as far as the Fed could go, because (some narrow technical exceptions aside) interest rates can’t go lower. Investors won’t buy bonds if they can get a better return simply by putting a bunch of $100 bills in a safe. In other words, the Fed hit what’s known in economic jargon as the zero lower bound (or, alternatively, became stuck in a liquidity trap). The tool the Fed usually fights recessions with had reached the limits of its usefulness.’

Krugman’s solution, it appears, is to cut short-term interest rates and print money in the hope of stimulating private borrowing and spending.  And Krugman believes that such intervention requires F.D.R.-like resolve.  According to the Italian philosopher Georgio Agamben, writing on the concept of the state of exception, “from the constitutional standpoint, the New Deal was realized by delegating to the president (through a series of statutes culminating in the National Recovery Act of June 16, 1933) an unlimited power to regulate and control every aspect of the economic life of the country – a fact that is in perfect conformity with the already mentioned parallelism between military and economic emergencies that characterizes the politics of the twentieth century.”  In other words, from a philosophical standpoint, Krugman’s argument is one in which Bernanke should execute the same kind of authority in fixing the economy that a commander-in-chief would exercise in times of war.  Independent of whether Krugman’s solution is ideal from an economic standpoint, from a legal standpoint, Krugman’s rhetoric signals a mentality in which wide-scale economic regulation no longer becomes the kind of executive action taken in exceptional cases but instead the norm of economic policy.

But regulation does not occur in a vacuum;  implicit within, say, the Affordable Care Act is a concomitant institutional aggrandizement of the Department of Health and Human Services as well as the Internal Revenue Service, both of which gain more authority in spending, rulemaking and enforcement.  Indeed the Dodd-Frank regulations entailed the establishment of the Consumer Financial Protection Bureau.  The Troubled Asset Relief Program entailed an Inspector General office and congressional appropriations that funded investigations (the Financial Crisis Inquiry Commission) and, eventually, spending (the Stimulus plan).  Economic intervention through regulation no longer takes place at the margin, or in the exceptional case, but instead has become the norm – one synonymous with administrative aggrandizement and the expansion of executive power. This has enormous consequences for transparency and accountability of the Executive Branch as the bureaucrats of the Federal Reserve or Consumer Financial Protection Bureau are unelected and any check on their spending comes after-the-fact, when policies and regulations have passed and any form of oversight will fail to retroactively remedy the damage regulatory regimes have done to job creation and capital formation in the market.  The American founders conceived of the normal state of American constitutionalism to be one of limited government.  Now this notion has become an exception relegated to the norm of administrative aggrandizement and, worse, overreach in the form of interventionist, enforcement-based (as opposed to cooperative) regulatory schemes and spending buttressed by an unchecked, unaccountable bureaucracy. Such executive power in the United States has been traditionally justified in times of war where martial law becomes a necessity for purposes both exceptional and expedient.  Constitutional rights to due process, habeas review, and the Third Amendment prohibition against the quartering of soldiers in “any house, without the consent of the owner” were seen as permanent limits against executive aggrandizement during times of war where national defense may need to subrogate other rights.  And yet now the bureaucrats and their regulations have become quartered within our savings and wealth.  And without our consent.

 

By Dan Epstein, executive director of Cause of Action

Filed Under: Blog

Dan Epstein on Breitbart.com: Occupy’s Public Safety Threat Ignored by DOJ

May 3, 2012 by

Read the full story here. Breitbart

“On November 9, 2011, Cause of Action asked DOJ Inspector General Cynthia Schnedar to investigate the status of the DOJ’s response to the letter Rep. Jason Chaffetz had sent to Eric Holder in March of 2011. On December 28, 2011, the DOJ OIG declined our request, refusing to look into the request from Rep. Jason Chaffetz (R-UT) to Attorney General Eric Holder to clear threats to the safety of Americans presented months earlier…”

Filed Under: News Tagged With:

FOIA: U.S. Department of Health and Human Services is in violation of the No FEAR Act of 2002

May 2, 2012 by

From MSPB Watch:

“Last week, fellow advocate site Whistlewatch.org made a FOIA request to the Department of Health and Human Services and all of its operating divisions, seeking all No FEAR Act annual reports to Congress since the law’s passage in 2002, as required by section 203 of that law. Now, the following response came back from HHS’ Office of Inspector General, claiming that no such reports can be found:

HHS FOIA 12-0404

Which means that HHS is in violation of the No FEAR Act, and the public won’t get to know how much litigation damages and attorney fees HHS has spent reimbursing meritorious whistleblowers and victims of discrimination.”

Filed Under: Blog Tagged With: ,

WhistleWatch: Cause of Action Not for Profit Advocate Seeks Information on Whistleblower Retaliation From Federal Agencies

April 24, 2012 by

The WhistleWatch Blog: Cause of Action Not for Profit Advocate Seeks Information on Whistleblower Retaliation From Federal Agencies

22:20, April 23, 2012 by Evelynn Brown, J.D., LL.M

Amazing how quickly the Government Services Administration (GSA) scandal can rally members of Congress to take a fresh look at the failure of the federal government to protect their own whistleblowers.  Whistlewatch.org and other advocacy groups have been sounding the alarm for years, seemingly to no avail. However, the recent request by Cause of Action, a non-profit, public benefit corporation to the acting director of the Office of Management and Budget to perform a government-wide audit to determine whether agencies are abiding by whistleblower protection laws looks promising.  Congratulations to Daniel Epstein on this bold move who joins us in seeking to know exactly how much the federal government is spending to retaliate against federal whistleblowers.  Mr. Epstein’s Freedom of Information Act (FOIA) and related requests are available below. We further note the comments by GSA Inspector General Brian Miller that Regional Administrator Jeff Neely “‘squashed’ agency whistleblowers ‘like a bug”  should garner immediate public interest in abuse of authority and tax payer waste.  Perhaps now there will be renewed interest in the plight of whistleblowers who honor the Fourteen Principles of Ethical Conduct as revelations surface on the insidious long-term, financial impact on tax payers when whistleblowers are mistreated. Better protections of federal employees are desperately needed.  The recent Senate committee report on S. 743 to the Whistleblower Protection Enhancement Act (WPEA), can be found at this site with comments from our colleague, David Pardo.  Essentially federal agencies have been hiding the costs of retaliation against whistleblowers because Congress does not require them to publish the information. If the federal government loses a case (overwhelming majority of complaints are never recorded or are dismissed or settled because the whistleblower is pressured), the agency must reimburse the Judgment Fund.  This money comes out of the agency budget (funded by tax payers), usually the offending official’s department.  What is odd is that even when federal executives are aware of retaliation by management, they will still approve bonuses and excellent performance appraisals for those who violate whistleblower protection laws.  Rarely does any executive get called on the carpet.  There has been a lack of enforcement proceedings against management committing prohibited personnel practices. The Office of Special Counsel (OSC) reviews federal employee whistleblower complaints recently requested action be taken against 2 higher-ups in the Dover Air Force Base mortuary scandal.  Among other things, the investigation showed a tone set at the top to willfully harm the whistleblowers who reported gruesome details of how deceased veterans remains were being mishandled including sawing off an arm of a dead Marine and veteran remains left in boxes, leaking blood, for months.  This article discusses the severe retaliation including forensic analysis of computer hard drives reserved for espionage cases.  With government agencies and corporations openly calling whistleblowers snitches, rats, disloyal and character flawed, the tax payers must ask themselves some hard questions.  Do you want government employees to protect your money?  Or do you want it to be used to harm public servants who report misappropriation of funding, criminal conduct and dangers to public health and safety? WhistleWatch » Blog Archive » Cause of Action Not for Profit Advocate Seeks Information on Whistleblower Retaliation From Federal Agencies.

Filed Under: Blog Tagged With: ,