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Oversight Comittee Chairman Darrell Issa, R-Calif., and Rep. Jim Jordan, R-Ohio

WASHINGTON — The IRS appears to have been caught red-handed breaking federal law in its zeal to criminally prosecute conservatives for their political activities.

The House Oversight Committee has revealed the IRS sent the FBI a database containing more than a million pages of confidential taxpayer information that is protected by federal law.

Attorney General Eric Holder’s Department of Justice, or DOJ, is now admitting the FBI should never have had that data in the first place.

The information was delivered just weeks before the 2010 elections to the FBI, after a conversation between Richard Pilger, an official with the Justice Department’s Election Crimes Branch, and former IRS Director of Exempt Organizations Lois Lerner, a central figure in the scandal.

Richard Pilger, U.S. Department of Justice, Criminal Division

“At the very least, this information suggests that the IRS considered the political speech activities of nonprofits to be worthy of investigation by federal law-enforcement officials,” wrote Chairman Darrell Issa, R-Calif., and Subcommittee Chairman Jim Jordan, R-Ohio, in a letter to IRS Commissioner John Koskinen.

The lawmakers are demanding more information from the IRS chief after their discovery that the agency transmitted 21 disks, constituting a 1.1 million page database of information from 501(c)(4) tax exempt organizations, to the FBI in October 2010.

“The IRS apparently considered political speech by nonprofit groups to be so troublesome that it illegally assisted federal law-enforcement officials in assembling a massive database of the lawful political speech of thousands of American citizens, weeks before the 2010 midterm elections, using confidential taxpayer information,” wrote Issa and Jordan.

Reaction was swift and scathing on Capitol Hill and among the grassroots.

“This is absolutely shocking and appalling,” high-powered Washington attorney Cleta Mitchell told WND.

Attorney Cleta Mitchell

“That the IRS was seeking to assist in criminally prosecuting citizens groups for exercising their free speech rights is beyond horrifying. This is America – not 1930′s Germany or 1950′s Soviet Russia,” said the lawyer who represents several tea-party groups targeted by the IRS.

The real criminals are in the White House said Rep. Steve Stockman, R-Texas, who told WND, “This is yet more evidence of criminal activity by the Obama administration. It’s also proof ‘campaign finance reform’ is just a way for government to target citizens who express dissenting views.”

He added, “Under Obama there is increasingly no difference between the State and the Party. Democrats view government’s central role as one of suppressing dissent.”

Catherine Engelbrecht knows a thing or two about being targeted by the federal government, having had an entire alphabet soup of federal agencies come knocking on her door after she helped found, and then led, True the Vote and King Street Patriots.

Even though the Englebrechts had spent two decades of running a business without any interest from federal agencies, once she applied for tax-exempt status for her grassroots groups, the Texan was suddenly audited by the IRS and ATF, received multiple visits by OSHA and ATF, and even was visited by the ranking Democrat on the Oversight Committee, Rep. Elijah Cummings, D-Md.

An astounding 15 audits or inquiries, in all.

Engelbrecht told WND, “The discovery that Lois Lerner provided the Elections Crimes Branch of the FBI with 1.1 million pages of documents is shocking, but the fact that the IRS and FBI have withheld this smoking gun evidence for over a year demonstrates this Administration’s continued contempt for Congress, and the law.”

She continued, “Lois Lerner obviously hoped this information would encourage the FBI to prosecute conservative groups on the Administration’s enemies list.”

Jenny Beth Martin, president and co-founder of Tea Party Patriots, told WND, “This is further evidence of how the Obama administration sought to criminalize free-speech as early as 2010. The more we learn about this IRS targeting of individuals and groups, the more we see it is rotten to the core.”

Rep. James Lankford, R-Okla., who is is a member of the Oversight Committee, told WND, “Records associated with tax collection are to be kept secure and should never be used for political purposes. Now, it’s clear right before the 2010 election the IRS transferred documents outside their jurisdiction for purposes unrelated to tax collection.”

“We cannot allow this administration to overstep the law or put the private information of the American people at risk for political purposes,” he concluded.

Tea Party Patriots President Jenny Beth Martin

“It also shows how important it is that Congress keep asking questions until we learn the truth of this outrageous abuse of power by the administration,” added the leader of a national grassroots coalition with more than 3,400 locally organized chapters and more than 15 million supporters nationwide.

The Oversight Committee learned of the database earlier this month only after interviewing DOJ’s Pilger, who had discussed with Lerner the possibility of prosecuting tax exempt organizations that engaged in political activity.

In an e-mail dated Oct. 5, 2010, Lerner asked Pilger about his formatting preference for “the disks we spoke about.” Pilger forwarded Lerner’s e-mail to an FBI agent, writing, “This is incoming data re 501c4 issues. Does FBI have a format preference?” He then responded to Lerner, “Thanks Lois – FBI says Raw format is best because they can put it into their systems like excel.”

A livid Issa and Jordan noted, despite an intensive investigation of targeting, the IRS had not disclosed to congressional investigators that Lerner had sent a massive database of tax exempt organizations to the FBI for scrutiny.

“We were extremely troubled by this new information, and by the fact that the IRS has withheld it from the Committee for over a year,” wrote Issa and Jordan to IRS Commissioner Koskinen. “We were astonished to learn days ago from the Justice Department that these 21 disks contained confidential taxpayer information protected by federal law. We ask that you immediately produce all material explaining how these disks were prepared and transmitted to the FBI.”

The letter continues, “Despite two Committee subpoenas, the IRS has not produced material relating to these 21 disks and all associated information. … The subpoena [to the IRS] created a legal requirement on you, as the Commissioner of the IRS, to identify and produce all subpoenaed material in an expeditious manner. Your choice to withhold this highly relevant material obstructs the Committee’s ongoing oversight obligations – especially when this information implicates violations of federal law.”

The letter requests the IRS immediately provide a full and complete explanation as to why information about the disks was withheld, all documents and communications related to the creation and transmittal of the disks, and communications between the IRS and any other agency related to the 21 disks.

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