26 Sep 2012

ICYMI: Grassley Presses for Accountability in Fast and Furious Scandal

By Grassley Press

Wednesday, the Inspector General for the Department of Justice issued his report on ATF's Operation Fast and Furious.

This report is a significant milestone for the family of Border Patrol Agent Brian Terry.

He was killed in a firefight with illegal aliens who were armed with illegal guns from Fast and Furious.

Attorney General Holder delayed any discipline for the officials responsible for Fast and Furious until after this report was released.

The time for accountability has finally come.

There are no more excuses for inaction.

The Inspector General's non-partisan review confirmed virtually everything I heard from whistleblowers over the last year and a half.

The Justice Department tried to push all the blame on the ATF and officials in Phoenix.

But, the Inspector General confirmed that senior officials in Washington ignored red flag after red flag.

Senior officials in both the Justice Department and ATF knew or should have known that Operation Fast and Furious was putting guns into the hands of criminals.

But, they ignored the risks and failed to take steps to protect public safety.

The Inspector General also confirmed that there were major information-sharing failures between law enforcement agencies.

We are still going through the nearly 500 page report, as well as 309 pages of new documents that the Justice Department produced late Wednesday.

However, I was surprised to learn from the report that Attorney General Holder testified that he doesn't remember the conversation with me about Fast and Furious in my office on January 31, 2011.

I remember that conversation.

My staff told the Attorney General that day what whistleblowers had told us.

Specifically, we discussed in that meeting that two weapons that ATF let go in Fast and Furious were found at the murder scene of Border Patrol Agent Terry.

I emphasized that I was personally bringing it to his attention because these were very serious and credible allegations, not a just run-of-the-mill letter.

Yet, even after that meeting, the Department didn't take it seriously.

The Inspector General's independent report says so explicitly:

"We do not believe that the gravity of this allegation was met with an equally serious effort by the Department to determine whether ATF and the U.S. Attorney's Office had allowed the sale of hundreds of weapons to straw purchasers."

The Justice Department claimed that its process for writing letters to Congress was sound.

But its February 4, 2011 response was false.

DOJ later withdrew it and claimed it relied on bad information from ATF and the U.S. Attorney's Office.

However, the Inspector General agreed with me that the Justice Department's response was seriously flawed?and not just the initial response.

The Inspector General also found that the Justice Department knew its initial reply wasn't true when it reaffirmed the denial of the whistleblower allegations in a May 2, 2011 letter to me.

Instead of acknowledging that it was wrong, the Department repeatedly doubled-down on its denials.

For example, Attorney General Holder said on multiple occasions since November 2011 that the wiretap affidavits authorized by Justice Department headquarters did not put senior leadership on notice that ATF was walking guns.

Most recently, on June 7 of this year the Attorney General went before the House Judiciary Committee.

At this point, many Members of Congress had obtained and read the affidavits, even though the Justice Department did not want us to see them.

Members who reviewed them said that the affidavits contained evidence of gunwalking.

But, Attorney General Holder testified:

"I've looked at these affidavits.  I've looked at these summaries. There's nothing in those affidavits as I've reviewed them that indicates that gun walking was allowed."

Well, now the Inspector General has read them too.

His independent, non-partisan conclusion is at odds with the Attorney General.

I quote from his report: "[T]he affidavits described specific incidents that would suggest...ATF was employing a strategy of not interdicting weapons or arresting known straw purchasers."

In fact, much of the Inspector General's report is redacted because those affidavits are still under seal.

Chairman Issa and I asked the Justice Department months ago to move to unseal them so the public could decide for themselves.

Now the Inspector General has joined us and is also calling on the Department to ask for permission from the court to release the affidavits.

The Justice Department should have filed that motion months ago.

Unsealing the affidavits will allow the American people and the Terry family to see the whole story.

The details in those affidavits show that senior officials knew or should have known about gunwalking in Fast and Furious.

The Inspector General independently confirmed this point, contrary to Attorney General Holder's denials.

Those denials by the Attorney General show either incompetence or lack of truthfulness.

Congress created an explicit statutory duty for certain senior Justice Department officials to authorize all wiretap applications.

Deputy Assistant Attorney General Jason Weinstein, who served directly under Criminal Division head Lanny Breuer, was one of the officials who approved some of those affidavits.

Senior officials like Mr. Weinstein tried to claim that they shouldn't be held accountable because they only read memos summarizing the wiretaps?not the full wiretap applications.

But, the Inspector General found that Justice Department officials should review more than just the cover memo.

He said that under the statute they have a responsibility to be informed before authorizing wiretap applications.

Yet the Inspector General also found that even "a reader of the ... cover memorandum would infer from the facts that ATF agents did not take enforcement action to interdict the weapons or arrest [straw purchasers]."

So, the memo Mr. Weinstein admits he did read indicated that ATF had walked guns, according to the Inspector General.

Back in September of last year, Attorney General Holder said at a press conference:

"The notion that somehow or other this thing reaches into the upper levels of the Justice Department is something that...I don't think is supported by the facts."

Maybe the Attorney General doesn't think someone who reports directly to the head of the Criminal Division is a senior official, but I do.

As a result of the Inspector General's findings, Deputy Assistant Attorney General Weinstein has resigned.

Weinstein should be held accountable but he shouldn't take the fall for more senior officials who are also culpable.

Mr. Weinstein reported directly to Assistant Attorney General Lanny Breuer.

When the Justice Department sent its letter to me denying ATF ever walked guns, Breuer knew otherwise.

He knew in 2010 about gunwalking in another case, Operation Wide Receiver.

That was long before the allegations in Fast and Furious.

Yet he waited nine months before emails about Wide Receiver were about to be produced to Congress before he publicly apologized for not doing more about gunwalking in Wide Receiver.

I asked Breuer whether he had seen the draft of February 4 false letter to me.

Breuer testified: "I cannot say for sure whether I saw a draft of the letter that was sent to you."

Then, a month after Breuer's testimony, the Justice Department released more documents showing that Breuer was sent five drafts of the letter before it was sent to me.

He forwarded three of them to his personal email account.

Breuer still maintained in written responses that it was "highly unlikely" he had read the letter because he was in Mexico when it was sent.

On this matter, the Inspector General report contained a significant factual error.

The report read: "The OIG found no e-mail messages from Breuer in which he proposed edits, commented on the drafts, or otherwise indicated he had read them."

That is not true.

In response to one of the drafts Breuer received, he commented that to Weinstein that it was "great work."

That may not be a proposed edit, but it is certainly a comment.

Thus, Breuer's statement to Congress is simply not credible.

Emails show that Breuer was very engaged in the process, asking for and receiving updates from Weinstein at each stage of the drafting.

Breuer and Weinstein sent multiple emails to each other on the matter each day, with Breuer asking after a quiet period: "Jason, let me know what's happening with this."

Rather than holding him accountable for this evidence, the Inspector General report gives him a pass.

Worse, new emails produced Wednesday show that Breuer was in the weeds about his deputy, Jason Weinstein, coming to brief Senate Judiciary Committee staff a week after the Justice Department's false letter.

On February 13, 2011, Breuer sent an email about such details as what specific questions my staff asked of Weinstein at the briefing.

Breuer wrote: "The goal - and by all accounts it seems to have worked - was to communicate that ATF's work in the AZ case and others like it reflected sound judgment and investigative work."

It is clear that Breuer was in the weeds enough to know that what the Justice Department was communicating to me was undermined by the gunwalking he knew about in Wide Receiver.

He should have come forward in February 2011 and told Congress that he knew ATF had walked guns.

His failure to do so, coupled with his attempt to mislead Congress, are why I have called for him to resign or be fired.

Now Attorney General Holder has been saying for months that he would hold off on any personnel action until the Inspector General report was released.

Mr. Attorney General, it's time to hold people accountable.

I'd like to close with language from a statement that the family of Border Patrol Agent Brian Terry issued:

"The Department's failures chronicled in the report had deadly and tragic consequences for hundreds of innocent American and Mexican victims of violent crimes.

"And our son, friend, relative and hero, Brian Terry, is dead.

"Questions and concerns should have been raised before the weapons purchased in this failed government sting wound up in the hands of drug dealers and killers, including those who killed Brian.

"The focus today should not be on political spin control nor on praise for the DOJ supervisors who chose to resign in light of the report's findings, but rather on the gross negligence of the Department documented in the report and the tragic consequences of that negligence."

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24 Sep 2012

Final passage of reform bill, controls on government charge cards

By Grassley Press

Bill to Prevent Abuse of Government Charge Cards on Way to President's Desk

WASHINGTON - A bill that will require federal agencies to put new controls on government charge cards and enforce more stringent penalties for violations by federal employees is on its way to the President for his signature, following final passage by Congress over the weekend.

The reform measure was sponsored by Senator Chuck Grassley of Iowa, Senator Joe Lieberman of Connecticut and Senator Susan Collins of Maine, and it first won Senate approval in July 2011.  The House of Representatives passed it during the summer.  The Senate needed to act again for final passage, which it did very early Saturday morning.

"This bill is about accountability," said Grassley.  "The public trust has been violated by abusive use of government charge cards.  By putting some common-sense controls into the law, we can make certain the federal bureaucracy improves the way it responsibly manages the use of these cards."

"Government charge cards create numerous efficiencies by allowing federal employees to make small, official purchases without a mound of paperwork.  But over the years, the Government Accountability Office and the Inspectors General have identified many examples of fraudulent or illegal use of these charge cards.   Even at the General Services Administration, which administers the charge card program for the entire federal government, a high-ranking employee was able to rack up tens of thousands of dollars in personal expenditures on a government charge card.  This legislation would impose stricter controls on charge cards to help reduce waste, fraud, and abuse.  It's a common-sense way to keep the government accountable for taxpayer dollars," said Lieberman.

"This bill would require agencies to ensure that purchase and travel cards are used only for approved spending and to take action for misuse of cards.  While purchase and travel cards have been important tools in meeting the government's procurement needs in a timely and cost-efficient manner, their use often has been subject to some malfeasance and inappropriate purchases by individual card holders.  American taxpayers get the bill for these federal credit cards and they deserve complete assurance that their money is going to legitimate business purposes," said Collins.

The senators' effort to codify new controls and penalties responds to outrageous accounts of purchases made with government charge cards, as well as independent analysis which found inadequate and inconsistent controls within government agencies.  At issue are purchase cards, which are used by authorized federal employees for small-scale items needed for official business, such as office supplies, as well as travel cards, which are issued to federal employees to pay for official travel expenses.  When purchase cards are misused, taxpayer money is wasted.  When travel cards are misused and the bills aren't paid, the government risks losing millions of dollars in rebates.

Grassley has put the spotlight on problematic use of these cards for many years, first at the Department of Defense and then also at the Department of Housing and Urban Development, the U.S. Forest Service, the Federal Aviation Administration, and elsewhere.

Over the years, the nonpartisan Government Accountability Office has documented fraudulent, questionable and overly expensive purchases made by federal workers with government purchase and travel cards, including kitchen appliances, jewelry, gambling, cruises, and even the tab at gentlemen's clubs and legalized brothels.

Below is a summary of the reform legislation.  The Senate also had passed the reform measure in 2009, but it was never taken up by the House of Representatives

Summary of the Government Charge Card Abuse Prevention Act

The bill would require all federal agencies to establish certain safeguards and internal controls for government charge card programs, and to establish penalties for violations, including dismissal when circumstances warrant.  The bill would also increase oversight by providing that each agency Inspector General periodically conduct risk assessments and audits to identify fraud and improper use of government charge cards. These reforms are based on the experience of Grassley and other members of Congress, the GAO, and agency Inspectors General in investigating the weaknesses in agency policies and procedures that have lead to instances of waste, fraud, and abuse in government charge card programs.

The required safeguards and internal controls include :

  • performing credit checks for travel card holders and issuing restricted cards for those with poor or no credit to reduce the potential for misuse
  • maintaining a record of each cardholder, including single transaction limits and total transaction limits so agencies can effectively manage their cardholders
  • implementing periodic reviews to determine if cardholders have a need for a card
  • properly recording rebates to the government based on prompt payment, sales volume, etc.
  • providing training for cardholders and managers
  • utilizing effective systems, techniques, and technologies to prevent or catch fraudulent purchases
  • establishing specific policies about the number of cards to be issued, the credit limits for certain categories of cardholders, and categories of employees eligible to be issued cards
  • invalidating cards when employees leave the agency or transfer
  • establishing an approving official other than the purchase card holder so employees cannot approve their own purchases
  • reconciling purchase card charges on the bill with receipts and supporting documentation
  • reconciling disputed purchase card charges and discrepancies with the bank according to the proper procedure
  • making purchase card payments promptly to avoid interest penalties
  • retaining records of purchase card transactions in accordance with standard government record keeping polices
  • utilizing direct payments to the bank when reimbursing employees for travel card purchases to ensure that travel card bills get paid
  • comparing items submitted on travel vouchers with items already paid for with centrally billed accounts to avoid reimbursing employees for items already paid for by the agency
  • submitting refund requests for unused airline tickets so the taxpayers don't pay for tickets that were not used
  • disputing unauthorized charges and tracking the status of disputed charges to proper resolution

 

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21 Sep 2012

Grassley, Latham Seek Answers to Concerns Over Bank Regulations Leading to Firings

By Grassley Press

WASHINGTON -- Sen. Chuck Grassley and Rep. Tom Latham of Iowa today asked the Federal Deposit Insurance Corporation (FDIC) for details of the federal regulations that are meant to protect consumers from financial fraud but might be penalizing bank employees for old, minor infractions that are not a threat to current financial customers.

 

"Indications so far are that the FDIC's guidance to banks might be problematic," Grassley said. "We're asking for the guidance directly to try to determine whether that's the case.  The rules have to make sense and have their intended effect of protecting the public from bank fraud.  They can't be so rigid that they result in the firing of workers for petty crimes that are decades-old and have nothing to do with financial fraud.  And they can't be applied unfairly so they result in a double standard for executives and rank-and-file workers."

 

"Good citizens are more than willing to follow the rules.  But in typical Washington fashion, the FDIC isn't sharing what those rules are," Latham said.  "This creates uncertainty, frustration, and costs everyone involved time and resources.  America's citizens and businesses deserve better than that from Washington."

 

In addition to seeking the regulatory guidance the FDIC has given to banks, Grassley and Latham also are seeking the details of the process by which individuals seek waivers from the criminal background regulations.  Grassley and Latham asked for information including the guidance given to FDIC employees on processing waivers; the number of waivers sought, granted and denied; the number of FDIC employees assigned to process waivers; and a list of the documents prospective applicants are asked to provide.

 

Grassley and Latham began reviewing the effects of the banking regulations meant to weed out employees with criminal histories presenting risk of financial fraud after the Des Moines Register reported that Wells Fargo has fired workers including a 68-year-old customer service representative in Des Moines for putting a cardboard dime in a washing machine 49 years ago.  Other constituents have written with similar stories.

 

The text of the Grassley-Latham letter is available here.

 

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21 Sep 2012

New Allegations Emerge of White House Involvement in Secret Service Prostitution Scandal

By Grassley Press
WASHINGTON - In light of recent press reports of White House personnel involvement in the Colombia prostitution scandal that plagued the Secret Service last spring, Senator Chuck Grassley is pressing for answers to previous inquiries that the White House has ignored.

 

Grassley sent the White House a letter on April 23, 2012 asking questions about the review conducted by the Office of the White House Counsel into allegations of involvement of White House staffers in the prostitution scandal.  Grassley has yet to receive a response from the President.

 

In a new letter sent to the White House late yesterday, Grassley renewed his original request and posed several more questions, including inquiries about contacts that White House personnel has had with the Department of Homeland Security Inspector General conducting a review of the Secret Service's involvement in the scandal.

 

Here is a copy of the text of Grassley's letter.  A signed copy can be found here. The April 23, 2012 letter can be found here.

 

September 20, 2012

 

Via Electronic Transmission

 

Kathryn H. Ruemmler

Assistant to the President and White House Counsel

Office of the White House Counsel

Executive Office of the President

The White House

1600 Pennsylvania Avenue, N.W.

Washington D.C., 20500

 

Dear Ms. Ruemmler:

 

I write to follow up on a letter dated April 23, 2012 (attached), that I sent to you regarding the
"review" conducted by the Office of the White House Counsel into allegations of the involvement of White House staffers in the prostitution scandal that occurred in Colombia in April 2012.  In my letter, I sought information in response to statements by the White House press secretary, Jay Carney, that your office had reviewed these allegations and concluded that there was "no indication of any misconduct" by White House staffers.[1] Mr. Carney failed to elaborate further about the "review" conducted by your office.

 

In my letter, I asked you detailed questions regarding how you conducted this "review" and what specific conclusions you drew about White House staff involvement in this scandal.  I have yet to receive a response.  However, the White House spokesman quickly told the public, without further explanation, that he was confident that there was no such involvement.

 

Now more allegations have arisen regarding White House personnel procuring prostitutes during the President's trip to Colombia.  Yesterday, an article on Foxnews.com quoted an unnamed "high-ranking Secret Service official" as stating, "Three U.S. delegation members that stayed at the Hilton brought prostitutes back as overnight guests.  One of them was ours [Secret Service] and the other two were White House staffers."[2] Furthermore, according to the article, multiple law enforcement sources speculate that the forthcoming report to be issued by the Department of Homeland Security Office of Inspector General (DHS/OIG) has been delayed in order to cover up this involvement by White House staff.

 

Accordingly, I request you respond to my questions in the April 23 letter, and also respond to the following additional questions:

 

1.      Has the White House been in contact with the DHS/OIG? If so, what has been the nature of that contact?

 

2.      Has the White House seen a copy of the draft DHS/OIG report?  Whether or not the White House has seen a copy of the report, is the White House aware of the findings of the report, specifically regarding the allegations of involvement of White House staffers?

 

3.      Has the White House had any input into the drafting of the report, including providing edits to the final version? If so, provide information regarding the nature of the edits.

 

4.      Was any contact between the White House and the DHS/OIG, including review and editing of the report, responsible for the delay in the DHS/OIG's meeting his target date of July 2, 2012 for release of the report?

 

5.      Has your office or any other office in the White House conducted a new review of the allegations in response to any findings by the DHS/OIG? If so, what did that new review consist of? What were its findings?

 

6.      Was the U.S. Secret Service aware of the alleged involvement of the White House staffers?  Have you been in contact with the U.S. Secret Service regarding these allegations? Has the U.S. Secret Service provided the DHS/OIG any information regarding these allegations?

 

7.      What will happen to these staffers if they are in fact found to have procured prostitutes while on official travel?

 

8.      If the report includes the findings that are being reported, how did your initial review fail to uncover the involvement of these staffers?  Do you concede that your initial review was performed in haste and without sufficient care?

 

9.      If the report includes the findings that are being reported, will Spokesman Carney issue a retraction or correction to his public comments denying any White House staff involvement?

 

Thank you for your prompt attention to this request. I would appreciate your response by September 27, 2012.

 

 

Sincerely,

 

 

 

Charles E. Grassley

Ranking Member

 

Attachment

 

[1] Steven T. Dennis. "WH Finds No Staff Involved in Secret Service Scandal." Roll Call.   April 23, 2012.

 

2 Jana Winter, "Probe of Secret Service Prostitution Scandal May Cite White House Advance Staff Involvement," Fox News.com, Sept. 19, 2012, available at http://www.foxnews.com/politics/2012/09/19/probe-may-cite-white-house-advance-team-involvement-in-prostitution-scandal/?test=latestnews.

21 Sep 2012

DoJ Fails to Answer Grassley Questions about Alleged Threats to News Reporter

By Grassley Press

Friday, September 21, 2012

 

Grassley: Justice Department Fails to Answer Questions about Alleged Threats to News Reporter

 

WASHINGTON -- Senator Chuck Grassley continues to press Attorney General Eric Holder for a complete accounting of a June incident in Louisiana where a senior civil rights lawyer for the department reportedly threatened a journalist.  Grassley initially asked the Attorney General about the incident in July.

 

Grassley said he was disappointed in the response from the department which failed to answer the vast majority of his questions and to produce the documents requested.  The alleged incident occurred at a meeting advertised as a public event to address the employment practices of a local fire department.

 

"I'm very concerned about what allegedly occurred in New Iberia.  If the news reports are accurate, the conduct by the Justice Department would strike at the very heart of a free press.  The department's failure to answer questions and to produce relevant documents is unacceptable on a subject so fundamental to this country's founding," Grassley said

 

Grassley said he expected complete answers to his letter by September 28.

 

Here's a copy of the text of the letter.  A signed copy can be found here.  Grassley's July 17 letter can be found here and the department's response can be found here.

 

September 20, 2012

 

Via Electronic Transmission

The Honorable Eric H. Holder, Jr.                           

Attorney General                       

U.S. Department of Justice                       

950 Pennsylvania Avenue, N.W.                          

Washington, DC 20530                         

 

Dear Attorney General Holder:

 

I write regarding the Department of Justice's letter dated September 4, 2012 from Acting Assistant Attorney General Judith Appelbaum.  Ms. Appelbaum was responding to my July 17, 2012 letter to you.

 

In my letter, I expressed my concern about reports of an incident at a public meeting in New Iberia, Louisiana involving a Senior Trial Attorney in the Civil Rights Division.[1] A letter from the Reporters Committee for Freedom of the Press summarized the reports on the incident as follows:

 

It is our understanding that on [June 12, 2012], Ms. [Rachel] Hranitzky arrived at the meeting and immediately asked if any journalists were present. When a Daily Iberian reporter attending the meeting responded in the affirmative, she informed him that he could neither record the meeting nor quote her statements. According to other attendees, the meeting had been advertised as a public meeting intended to address concerns with the city fire department's hiring and promotion process.  However, citing 'special rules' of the Department of Justice for agency attorneys, Ms. Hranitzky instructed that her statements be neither recorded nor quoted. When the reporter questioned this instruction on the basis that Ms. Hranitzky was speaking at a public meeting, she apparently threatened him with the possibility that the DOJ could call his editors and publisher, and warned that he would not 'want to get on the Department of Justice's bad side.' Furthermore, it is our understanding that Ms. Hranitzky demanded the reporter leave the meeting, although?after making his objection known but agreeing not to quote her?he was ultimately allowed to remain.

 

The reports about the incident in New Iberia and the existence of a DOJ policy or "special rules" which were the cause of the incident are troubling.  Consequently, I wrote you and asked several direct questions and made requests for documents.

 

The September 4 response letter ignores the vast majority of my questions and does not provide all of the documents I requested.  Accordingly, I am attaching a copy my July 17 letter and ask that you directly answer all of my questions and produce all of the documents that I requested.

Also, the September 4 response letter raises a new question.  The letter states that "the [Civil Rights] Division has taken steps to ensure that its employees are fully aware of the Department's consistent policy that public meetings are open to the public, including the press."  Describe in detail each of the "steps" taken.

 

I ask that you provide written answers and documents by September 28, 2012.

 

Sincerely,

 

 

Charles E. Grassley

Ranking Member, Senate Judiciary Committee

 

Cc: Hon. Patrick J. Leahy, Chairman, Senate Judiciary Committee

 

[1]  Matthew Beaton, "'DOJ practice' slammed by politicos, group," The Daily Iberian  (July 8, 2012) (available at http://www.iberianet.com/news/doj-practice-slammed-by-politicos-group/article_32a8d028-c8b7-11e1-aa3d-0019bb2963f4.html).
20 Sep 2012

Disclosure of tax returns by Administration officials

By Grassley Press

Floor Speech of Senator Chuck Grassley

on the Disclosure of Tax Returns by Administration Officials

Delivered Wednesday, September 19, 2012

On August 2, the Majority Leader decided that the valuable time of this body would be best employed by speculating on the contents of the tax returns of presidential candidate Gov. Mitt Romney.  These remarks also touched upon the vetting process of the Finance Committee.  As a senior member of the Finance Committee, as well as a former Chairman and Ranking Member of the Committee, I have come to familiarize my colleagues with the Committee's vetting process.

On Thursday, August 2, the Majority Leader exclaimed, "As we know, he has refused to release his tax returns.  If a person coming before this body wanted to be a Cabinet officer, he couldn't be if he had the same refusal Mitt Romney does about tax returns."

This statement demonstrates a misunderstanding of the confirmation process for cabinet officials and the Finance Committee vetting process in particular.

The fact is, most prospective cabinet officers do not need to disclose their tax returns.  Actually, no prospective cabinet officer is required to make their tax returns public in ordinary circumstances.

To my knowledge, the Finance Committee is the only committee that asks nominees to provide copies of tax returns.  Specifically the Finance Committee asks that nominees provide copies of their last three Federal tax returns.  The Committee may request further returns if it is warranted by the circumstances.

The Committee asks for this information for a few reasons.  To begin with, many nominees referred to the Finance Committee, such as the Secretary of the Treasury and the Commissioner of the IRS, will be able to exercise significant influence over tax policy and administration.  Additionally, the examination of a nominee's tax returns sheds light on the nominee's character.

Over the last few years, several high-flyers in the Obama administration have come up short when measured by their tax returns.   Therefore, the vetting process utilized by the Finance Committee has received a lot of attention.

Only two cabinet officers and one position with the status of cabinet-rank are referred to the Finance Committee.  These are the Secretaries of the Treasury and the Department of Health and Human Services, and the United States Trade Representative.

As I said before, to my knowledge the Finance Committee is the only Committee to requests copies of actual tax returns.  This means that, not counting the vice president, there are 19 members of the cabinet who do not release their tax returns during the Senate confirmation process.

As I said, no cabinet official is required to make his or her tax returns public.  This goes to the details of the Finance Committee's vetting process.

All nominees referred to the Committee are required to submit copies of their last three filed tax returns.  These copies, along with other financial data, are shared with a very limited number of staff specially designated by the Chairman and Ranking Member.

While being reviewed, the returns themselves are kept under very tight control.  Most staff for the Chairman and Ranking Member do not have access to the tax returns.  Neither the Chairman nor Ranking Member may unilaterally release the tax returns or information obtained from them.

This means that even when I was Chairman, the Committee rules prohibited me from unilaterally releasing a nominee's tax returns or even making public that nominee's specific tax information.

When an issue is identified pertaining to a nominee's tax information, the Chairman and the Ranking Member jointly determine how to proceed.  Information is only released under bipartisan agreement, and after consultation with the nominee.

For example, Secretary Geithner was given the opportunity to withdraw his nomination before the world learned of his failure to pay all of his taxes. He was also provided an opportunity to review the bipartisan memo that the Committee eventually released.

In sum, no nominees vetted by the Finance Committee need to make their tax returns public, and in the majority of cases no information is released.  Additionally, the purpose of the vetting is not to damage the credibility of the nominee.  I bet those seeking Governor Romney's tax returns are operating under a different standard.

I especially find it interesting that the Majority Leader compared Governor Romney to cabinet officials when speculating as to the contents of Governor Romney's returns.  There seems to be an implication that a discovery of unsatisfied tax obligations would be problematic to the Leader.

While the Majority Leader may want to speculate as to whether or not Governor Romney has paid his taxes, there are nominees and officials of the current administration we know did not completely satisfy their tax obligations.

I will start this trip down memory lane with our current Treasury Secretary.  Due in large part to his failure to pay self-employment taxes, irregularities in Mr. Geithner's returns added up to his owing a total of $48,268 in taxes and interest to the IRS.  Those seeking a full accounting of the episode may read the bipartisan memorandum prepared by the Finance Committee, which is part of the record of his January 2009 nomination hearing.  As I said, we don't need to speculate whether or not Secretary Geithner completely paid his taxes; we know he did not.

Secretary Kathleen Sebelius disclosed that in preparation for her confirmation she filed amended tax returns for 2005, 2006, and 2007.  She voluntarily made this information public in the form of a letter to Chairman Baucus and me.  This letter was printed in the record of her nomination hearing.  The result of those amended returns was that she paid a total of $7,040 in additional tax and $878 in interest to the IRS.

Finally, I want to mention former Senator Tom Daschle, who was the administration's nominee to be Secretary of HHS for a brief period.  Though Mr. Daschle withdrew his nomination before the Finance Committee held a hearing on his nomination, it was widely reported, including in the New York Times and the Los Angeles Times, that he failed to pay more than $128,000 in taxes in the three years prior to his nomination.

In mentioning Secretaries Geithner and Sebelius, and Mr. Daschle, I'm not suggesting anything beyond the reported facts of their circumstances or that their tax errors were intentional.  I just wanted to remind the Majority Leader of these situations where it is not necessary to speculate on whether or not taxes were owed.

While I appreciate the Leader's newfound attention to the Finance Committees vetting process, I want to ensure everyone has a clear understanding of the Committee's process.  I'd be happy to discuss the Committee's procedure with any interested colleague.  I am sure Ranking Member Hatch and his staff would also be happy to discuss the process with anyone who is interested.

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20 Sep 2012

IG Report on Fast and Furious Released

By Grassley Press

Wednesday, September 19, 2012

Senator Chuck Grassley, Ranking Member of the Senate Committee on the Judiciary, which has jurisdiction over the Justice Department, made the following comment after the Inspector General for the Justice Department released its long awaited report on Operation Fast and Furious.  Grassley first began investigating alleged gunwalking in January 2011 after whistleblowers came forward to alert Congress about gunwalking in Arizona.  The Justice Department and Attorney General Eric Holder initially denied gunwalking occurred.

"At first glance, the Inspector General's report reaffirms virtually everything that Congressman Issa and I have already reported.  Operation Fast and Furious was the height of irresponsibility on the part of a number of people from the ATF Phoenix field office all the way up to the Justice Department headquarters.  And, we still don't know the full extent of any White House involvement because they refused to be transparent and provide documents requested by the Inspector General.

"It's clear that both the ATF and the Justice Department failed to provide meaningful oversight of Operation Fast and Furious.  They ignored warnings from employees, and frankly, failed to do their jobs.  It took the death of our own Border Patrol Agent, action by a courageous whistleblower, and intense scrutiny from Congress before they even took note of what was happening under their own eyes.  Even then, they wouldn't come clean with how bad it really was until after they had sent a false letter and retracted it eight months later.

"It's particularly discouraging that this all could have been stopped early on if people had just read the wiretap applications.  The Inspector General noted that anybody reading those documents should have seen the red flags. The law requires that certain senior officials authorize those applications, and the Inspector General found that they did so without reading them.  I'm glad that the OIG is joining me and Chairman Issa in urging the Justice Department to move to unseal the wiretap applications so that the American people can read them and make up their own minds.

"The President also appears to be abusing his authority to exert executive privilege.  The White House rightly allowed the Inspector General to make public a small subset of the documents withheld from Congress under his claim of Executive Privilege, but it continues to shut out Congress' access to the rest of the documents.  It proves that this subset of documents could have been released earlier, and the President was merely thumbing his nose at Congress by claiming Executive Privilege on the eve of the contempt vote against Attorney General Holder for withholding the documents.

"It's time to hold people accountable.  Attorney General Holder is out of excuses for action.

"We'll be reading the report in more detail.  We've already noticed that the report contains a factual error that lets Assistant Attorney General Lanny Breuer off the hook.  The report accepts Breuer's version of events, claiming that he hadn't "proposed edits, commented on the drafts or otherwise indicated he had read them."  In fact, emails show that he received drafts of the February 4 letter and commented on them before it was sent, which he later denied to Congress.

"Last but not least, I hope the report helps answer questions for the Terry family.  They deserve more answers than they've received up to this point from their government."

18 Sep 2012

Grassley's comments on announcement by Siemens Energy, Inc.

By Grassley Press
Tuesday, September 18, 2012

Senator Chuck Grassley today commented on the restructuring announcement by Siemens Energy, Inc. regarding its operations in Fort Madison, Iowa.

"My heart goes out to the people losing jobs.  When you're in that situation, it's a depression, not a recession, for you and your family.  In this case and others, the market conditions described by the company emphasize the need for certainty of policies out of Washington, from the production tax credit for wind to the threat of other taxes going up and heavy-handed regulations that make it harder for businesses to sustain and create jobs.  Leadership is needed to provide the kind of certainty and confidence employers need to keep and hire workers."

18 Sep 2012

Biodiesel -- RFS Volume Increase announcement

By Grassley Press
Friday, September 14, 2012

Senator Chuck Grassley commented today about the final number released by the Office of Management and Budget (OMB) for the Renewable Fuels Standard volume increase.  Senator Grassley joined other senators six months ago in sending the attached letter urging OMB to act on this decision.

"This decision was too long in coming, especially with the negative impact the lack of certainty about policies in Washington is having on America's economy.  Biodiesel is a very good example of the impact that regulatory decisions and tax policy have on jobs and the economy.  Biodiesel has been a highlight of the Renewable Fuels Standard so far, so moving ahead with this increase is good news for plant workers going forward.  Along with creating jobs, biodiesel helps to expand renewable energy sources and reduce dependence on foreign oil."

18 Sep 2012

Grassley Works to Root Out Fraud and Abuse from Student Visa Program

By Grassley Press
WASHINGTON - Senator Chuck Grassley, Ranking Member of the Senate Judiciary Committee, along with Senators Chuck Schumer, Claire McCaskill and Dianne Feinstein, introduced legislation, known as the Student Visa Integrity Act, to help reduce fraud and abuse in the Student and Exchange Visitor Program.  Under current law, educational institutions must be a part of the Student and Exchange Visitor Program before enrolling students from abroad.

 

Congress mandated that a system be developed to track and monitor foreign students when it learned that one of the people responsible for the 1993 World Trade Center bombing was in the United States on an expired student visa.  The system, the Student Exchange Visitor Information System, was finally implemented in 2002 and is currently being modernized.  The Student Visa Integrity Act builds on the Student Exchange Visitor Information System to shut down sham schools and make it even more difficult to commit fraud with a student visa.

 

"An independent investigation confirms that the Department of Homeland Security isn't adequately monitoring schools, especially flight schools.  Educational institutions should be held accountable for enrolling people who haven't met the requirements of our immigration law," Grassley said.  "This is a national security matter, and a lesson should have been learned in 1993 and on September 11."

 

Once a foreign student has been accepted to an approved U.S. educational institution, the school issues a form I-20 for the student to present to the U.S. consulate when applying for a visa.  The Student Exchange Visa Program requires educational institutions to input certain data into the Student Exchange Visitor Information System when the student arrives on campus. That information, such as courses of study and attendance of the foreign students, is then relayed to the Department of Homeland Security to help the agency monitor schools, programs and students.

 

Specifically, the Student Visa Integrity Act:

·         makes it a criminal offense, subject to a two year mandatory sentence, if a person makes a materially false statement or provides materially false information when petitioning to bring in foreign students;

·         allows for the immediate withdrawal of a participant in the SEVP program if there's reasonable suspicion of fraud, requires the Secretary to withdraw a school if a school official is indicted for fraud, and permanently bars those convicted of being Designated School Officials in other institutions;

·         requires background checks on Designated School Officials, and training for these officials every three years;

·         requires the Department of Homeland Security to prohibit any flight school that is not FAA accredited (with Part 141 or Part 142) from bringing in foreign students, and prohibits schools that have not been licensed by the state to participate;

·         limits the program to accredited schools, prohibiting unaccredited schools from participation unless they are a "candidate" by an accrediting agency;

·         Requires the Secretary to report to Congress in 6 months on progress made to improve the program, and implement SEVIS II within two years.

As of January 2012, more than 850,000 active foreign students were in the United States and 10,000 schools are approved to be enrolled in the Student Exchange Visa Program.

 

-30-


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