IRS tea-party bloodbath continues in Congress, as evidence emerges that IRS's own internal probe ended in May 2012, six months before election, but was hidden from legislators

Tempers flared in a House Oversight and Government Reform Committee hearing Wednesday, with members on both sides of the aisle castigating the Internal Revenue Service for targeting conservative groups with special scrutiny, and then hiding the practice from Congress.

Rep. Darrel Issa, the committee's chairman, said that the committee learned just yesterday that the IRS completed its own investigation a year before a Treasury Department Inspector General report was completed.

But despite the IRS recognizing in May 2012 that its employees were treating right-wing groups differently from other organizations, Issa said, IRS personnel withheld those conclusions from legislators.

'Just yesterday the committee interviewed Holly Paz, the director of exempt organizations, rulings and agreements, division of the IRS,' Issa said. 'While a tremendous amount of attention is centered about the Inspector General's report, or investigation, the committee has learned from Ms. Paz that she in fact participated in an IRS internal investigation that concluded in May of 2012 - May 3 of 2012 - and found essentially the same thing that Mr. George found more than a year later.'

'Think about it,' he continued: 'For more than a year, the IRS knew that it had inappropriately targeted groups of Americans based on their political beliefs, and without mentioning it, and in fact without honestly answering questions that were the result of this internal investigation.'

Deputy Treasury Secretary Neal Wolin testified that he was unaware of that IRS investigation until he read other officials prepared testimony just a few days ago.
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One top Democrat breathed fire, warning that prosecutions could result.

Massachusetts Democratic Rep. Stephen Lynch said that if witnesses stonewalled the committee there would be legal consequences.

'If you refuse to answer,' Lynch said, 'you will leave us no choice but to ask for a special counsel or the appointment of a special prosecutor to get to the bottom of this.'

'I hope that’s not the approach of the IRS going forward,'he added. 'Because there will be hell to pay.'

Lynch later castigated Douglas Shulman, the former IRS Commissioner who ran the agency while its abuses were going on, for failing to tell Congress the truth about what his agency had already concluded in the investigation that ended in May 2012.

Shulman testified in March 2012, two months earlier that there was 'absolutely' no special targeting of conservative groups going on.

'At no time, to the best of my memory, was I ever given the impression that these [IRS employees] were only [looking closely] at conservative groups' Shulman told Lynch on Wednesday.

'You misled Congress. Make no question about it,” Lynch snapped back.

'You did nothing. You abdicated your responsibility.'

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