McCain staffer wanted tea parties audited until it was 'ruinous'

Sen. John McCain

The IRS targeting of tea party and Christian groups during the 2012 presidential election campaign, when Barack Obama was seeking his second term, was just one of many examples of the deployment of the federal bureaucracy for political purposes during the previous administration.

But, at least in the IRS case, Democrats were not the only ones to blame.

Judicial Watch has obtained internal IRS documents that show a staff-level employee for Sen. John McCain, R-Ariz., urged the IRS to audit the targeted groups until it became "ruinous" for them.

Henry Kerner was McCain's staff director and chief counsel of the Senate Homeland Security Permanent Subcommittee at the time. He since has been appointed by President Trump to the United States Office of Special Counsel.

"The explosive exchange was contained in notes taken by IRS employees at an April 30, 2013, meeting between Kerner, [former IRS official Lois] Lerner, and other high-ranking IRS officials. Just ten days following the meeting, former IRS director of exempt organizations Lois Lerner admitted that the IRS had a policy of improperly and deliberately delaying applications for tax-exempt status from conservative non-profit groups," Judicial Watch said.

The scandal generated lawsuits, settlements, new scrutiny of the IRS and a huge black eye for the Obama administration.

"The Obama IRS scandal is bipartisan – McCain and Democrats who wanted to regulate political speech lost at the Supreme Court, so they sought to use the IRS to harass innocent Americans,” said Judicial Watch President Tom Fitton.

"The Obama IRS scandal is not over – as Judicial Watch continues to uncover smoking gun documents that raise questions about how the Obama administration weaponized the IRS, the FEC, FBI, and DOJ to target the First Amendment rights of Americans."

The vicious comments were made at a meeting involving Lerner, other IRS officials and "select" top staffers from the Senate Governmental Affairs Committee.

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They were meeting to discuss the concerns of both Sen. Carl Levin, D-Mich., and Sen. John McCain, R-Ariz., that the IRS was not reining in political advocacy groups in response to the Supreme Court's Citizens United decision.

"Senator McCain had been the chief sponsor of the McCain-Feingold Act and called the Citizens United decision, which overturned portions of the Act, one of the 'worst decisions I have ever see,'" Judicial Watch said.

Kerner, Judicial Watch said, "recommends harassing non-profit groups until they are unable to continue operating. Kerner tells Lerner, Steve Miller, then chief of staff to IRS commissioner, Nikole Flax, and other IRS officials, 'Maybe the solution is to audit so many that it is financially ruinous.' In response, Lerner responded that 'it is her job to oversee it all.'"

The report on the meeting:

Henry Kerner asked how to get to the abuse of organizations claiming section 501 (c)(4) but designed to be primarily political. Lois Lerner said the system works, but not in real time. Henry Kerner noted that these organizations don’t disclose donors. Lois Lerner said that if they don’t meet the requirements, we can come in and revoke, but it doesn’t happen timely. Nan Marks said if the concern is that organizations engaging in this activity don’t disclose donors, then the system doesn’t work. Henry Kerner said that maybe the solution is to audit so many that it is financially ruinous. Nikole noted that we have budget constraints. Elise Bean suggested using the list of organizations that made independent expenditures. Lois Lerner said that it is her job to oversee it all, not just political campaign activity.

When Judicial Watch revealed the information, McCain issued a statement blasting "false reports claiming that his office was somehow involved in IRS targeting of conservative groups."

The documents had been released earlier, but large portions were blacked out.

The strategy session came only weeks before Lerner went public, admitting her agency inappropriately put a bull's-eye on American conservatives.

The government later confirmed the harassment when the Treasury Inspector General for Tax Administration revealed: "Early in Calendar Year 2010, the IRS began using inappropriate criteria to identify organizations applying for tax-exempt status" (e.g., lists of past and future donors). The illegal IRS reviews continued "for more than 18 months" and "delayed processing of targeted groups' applications" in advance of the 2012 presidential election.