of justice? >> no. >> has anyone, anyone said to you verbally anything that would hint to you that you're under investigation by the department of justice? >> no. >> has anyone, anyone said anything to you to hint to you that you might be the target of a justice department investigation some time in the future? >> no. >> thank you for that. another thing that you've been trying to get out and you were continually interrupted in your answers were comments about industry statistics about computer failures. i want to give you a chance now to make full sentences. >> in may when we had this problem and proceeding to find how many lerner e-mails we could have, u asked the industry

standards for hard drive cra crashes. sometimes 5% within the warranty period. older computers, it goes as high as 10 to 15%. i ask we do a review to determine if any of them had hard drive crashes and caused any loss of e-mails. we have over 2,000 crashes already this year, but all of those didn't result in loss of e e-mails. you could lose e-mails without your hard drive crashing. to complete our review of exactly what were the situations with regard to the production of documents, that is coming to closure because the i.g. is looking at all of that. >> thank you. and mr. koskinen, on june 20th you testified before the ways and means committee that even after discovering the hard drive crash you said, the irs took

multiple steps over the past months to assess the situation and produce as much e-mail as possible for which lerner was an author or resip yecipientrecipi. during this time we were identifying and reviewing lerner e-ma e-mails to and from 82 other custodians. by mid-may the irs had identified the 24,000 lerner e-mails between january 1 and april 2011. commissioner koskinen, why did the irs take these steps to recover ms. lerner's e-mails? >> it was an attempt on our part to produce as many e-mails either from her accounts or other accounts as possible in response to the request of this committee and the ways and means committee to produce all of lois lerner's e-mails. we were trying to make sure there were no e-mails anywhere in the system to or from lois lerner that we had not located and not provided.

>> all right, now so despite the hard drive crash, the irs still produced 24,000 plus additional e-mails, is that right? >> that's correct. >> witnesses have told this committee that in february of 2014 irs employees discovered that there were fewer of lois lerner's e-mails from january 2009 to april 2011 than there were from other periods. on this discovery, irs officials immediately took steps to determine the reasons for this discrepancy and whether they could locate additional e e-mails from ms. lerner during that time period. the question is why didn't you inform us about the discrepancy in ms. lerner's e-mails when you testified before this committee in march? >> because in march i did not know and we department know whether we had lost e-mails or not. one of the first things that was investigated in february and

into march was to review all of our production processes to see if anything in the way we had reached into the system to produce the e-mails, put them into our search method had had caused us to misplace those e-mail because it wasn't there initially whether the problems with her computer resulted in any loss of e-mails. so the first process while we were producing the other departmentings regarding the determination process was to make sure we hadn't ourselves done anything in the process that caused e-mails in that period to be lost. we determined ultimately into april and may that nothing that we had done in the search process had caused the e-mails to not be producible. >> thank you, i yield back. >> i thank the gentleman. commissioner, thank you for take ing the time to come up and be with us again today. i know you came here before and i know we're going through a lot of detailed testimony, but the

baseline is accurate to the best of your knowledge when you testified before that the e-mails were not available from ms. lerner during the period that they had been to the best of your knowledge that they had been destroyed because they were recycled. i'm not questioning that testimony at this particular moment. but i think what has people interested is mr. cane came up here not so long ago and he's a very sfis kuwaophisticated guy. his job is to produce documents for investigations and litigation and other kinds of things. therefore, he not only has a very detailed understanding of the process, but a deep appreciation of the implications to do or failure to do including exposure for failure to do things. he also has a very sophisticated understanding of how to answer questions with respect to this.

appreciating that when he's under oath, anything he says will put him in a particular position, which if it is known to be wrong he could be exposed to further scrutiny. so i'm curious as to why he would come and testify that -- i don't know, and this is his words, i don't know if there's a backup date for information on there or there isn't, that he was now unsure about whether there were some backup tapes from the period of time that may not have been erased. i'm using his u direct testimony. there is an issue as to whether or not -- that all of the backup recovery tapes were destroyed on the schedule. i don't know whether they are or aren't, but it's an issue that's being looked at it. what do we know about this issue

and why would he have made that statement? >> what i know about that issue is i was advised by the inspector general that they were -- they had taken tapes they found and they were reviewing those tapes to see if they had been totally recycled or whether they were not recycled and usable. i was advised about that because the inspector general, again, wanted us not to do -- because he knew however, they had found them, somebody knew i.g. had them. he didn't want us to do anything to investigate further what those tapes were, what they did with them. i said, that was fine. and at this point, what he has said is what he knows is, because as you said he's been involved in it, is that the inspector general is looking at some tapes to see whether, in fact, any of them turned out not to be recyclable or information that's recoverable.

at this time as mr. cane's testimony states, it's not clear whether they do or don't. >> or whether the substance leads to information when given that identification that it was believed to be they had been produced but now maybe some of them have been found. weren't you concerned about what procedure they used to potentially come up with new tapes? >> when the inspector general advised me of that, i was interested that we were advise ued had been recycled. i agreed with him that they would do the investigation. we wouldn't do anything to interfere with that. i wouldn't and none of our people would talk to anybody about it. i can't tell you how they found them, what they are, and as mr. cane said, whether there's anything on them or not. >> did you have any idea about what the issue is that he referred to because that was the

very specific thing. there is an issue as to whether all of the backup tapes had actually been recycled. >> yes, and the issue as i just said, is that he obviously is aware of what the inspector general advised me, which is the inspector general has taken some tapes and is reviewing those to see if they have been recycled, if there's information on them that can be found or used. that's all i know and i assume that's all he knows. beyond that, i haven't talked to anybody about this because, again, our position with the inspector general is sglsh just one follow-up question. why are these not available from a third party vender who in the event of a cyber attack would protect us against destruction of all records which would put our government in a position, so we take steps to assure that essential documents are reserved

to have them in third party data storage situations. why were the documents that are relevant to this particularly the documents relevant to the 2009-2011 area, why were they not backed up and available today? >> that's an important question. as i have testified earlier, there's been no actions taken since this investigation started with regard to any information in production. we have frozen and saved and backed up all e-mails from six months before the start of the investigation forward. what we're talking about is what happened three years ago. and three years ago the process was to use backup tapes for basically disaster recovery purposes and recycle them every six months. that was protocol and process that had gone on for some years. it used to be they only kept them for one month.

it was increased. that was the process three years ago. whatever e-mails were lost three years ago were not lost, they were lost then. nothing had been lost as far as i know since this investigation started. we have gone out of our way to protection all of the data and all of the documents. >> thank you. i have further questions but my time is expired. thank you. >> you're an attorney and you talked about these documents having been missed, but at the period of june 29th, 2011, lois lerner is informed that some of the activities she's been associated with may have been involved with practices. you're a yale lawyer. and you understand the situation in which there is potential for litigation. and the requirements that when there's potential for litigation that there is requirement with

recordkeeping responsibilities that retain the documents relevant to that. this occurred before the period we are looking at. if you were informed that somebody is holding your agency or you in particular as having potentially engaged in discriminatory practices, would you preserve the documents from that era? >> any time there's an investigation, any time there's an inquiry, we have litigation document policies and procedures. we have done our best to protect every document for the last year and a half, almost two years now, and any time anyone raises a serious question about production of evidence, we go out of our way to protect it. i don't know what the circumstances were three years ago. >> this was knowledge that it was discriminatory practices and

she was inform ed that she was central to the potential that there were complaints about discriminatory practices on the parts of the irs. would that the kind of document you would preserve? >> again, our protocol is if there's going to be an investigation, if there's a serious issue raised, we protect and preserve documents. wrun one of the things is we need to have an e-mail system of record so it would be easier to protect official records, preserve them and it would be easier to search them. we should not have to spend. $18 million answering straight forward questions for documents, but that's the system we have. the constraints on the budget has been for the past few years. we should have an e-mail system

that's more searchable and a system of record. >> thank you. >> i think his question cuts right to the chase. it was unnoticed there was a problem and suddenly her computer crashes, but it's worst than that. they identified 82 custodians of information relevant to the investigation. now we know from mr. cane's testimony up to 20 may u have had computer hard drive crashes. so this is way beyond the 3% to 5% that the commissioner keeps citing. this is approaching 25% of the relevant people that they have identified have had computer problems and may not be able to get the documents we need. i'll recognize the jept l lady from illinois. >> thank you, mr. chair. good morning, commissioner. on july 7th, 2014, you testified that since you were confirmed in december of 2013 the irs has "probably provided 300 to 400,000 documents to congress."

today how many pages of documents has the irs produced to congress in the ongoing investigation about the irs in review of tax exempt applications? >> as i testified earlier, we produced 960,000 pages of tax writing committees redacted documents produced 700,000 pages to this committee. >> i would imagine e massing document production of this magnitude takes an extraordinary amount of time and money, as you talked about the money. >> it's yes, it's been a significant distraction. we spent at last count $18 million responding. we continue to produce documents. we hope shortly to be able to complete the production of lois lerner e-mails to this committee, but in an area of declining resources, most of it is done in our office of chief counsel. there are 500 fewer people than there were four years ago. so that's been a significant

strain on our chief counsel's office. >> and how many employees have been involved in this process and how many hours have been logged in to comply with all of these requests? >> we have had over 250 emplo e employees at various times involved in that. over 120,000 hours devoted to it and we continue to work on the production of those documents. >> i understand that current agency staff, many of whom have other job speedometers, have been tasked with complying with congressional document requests. is that correct? >> that's correct. our i.t. department has been asked for information. we have witnesses that are being interviewed as we go. as i have noted, the entire issue about the c 4 investigation and operations involves about 800 employees in the entire organization. only a portion of them working on this. we have 89,000 other hard working, dedicated employees working on matters of importance

to the the government and to taxpayers. >> the individuals working on this, they have had to put their current workload aside? >> yes. particularly the lawyers, it's a probably for us because they have obligations to represent the agency in tax cases. they have an obligation to continue to work with treasury to develop rules and regulations and procedures, so it is a constraint. >> the irs deputy associate counsel was interviewed by committee staff on july 17th, 2014. he said that the irs currently exists, quote, with an increased workload and reduced staff from several years ago. we have taken these people from their day jobs. they have no replacements for them because there are no replacements. so we have pulled together people from all parts of the organization to contribute to the project on a full-time basis. but there is no one to back fill

the work that continues to exist and pile up. that's particularly critical when you're dealing with people in the field that are trying cases that have deadlines. that type of resource commitment has been a drain on the entire office of the chief counsel. commissioner, would you agree with that assessment of investigations impact when your agency's workload? >> i would. >> also, he was asked about the impact that chairman issa's subpoena had on the morale of his team. he said his employees have been working tirelessly to help the irs comply with congress to impact in a negative way. commissioner, i would like to give you an opportunity to address any concerns you may have about the impact the various congressional investigations are having on your agency's morale and ability to perform in core functions. >> as mr. cane apparently noted,

we have a large number of people who have day jobs who have been totally devoted to this who have been trying to be responsive and they are subject to depositions and recorded interviews. it sends, these are all career people, an effect on morale because they thought they were doing what they were asked to do. they were trying to provide information. most of them had never had a deposition of theirs taken. they haven't spent six, eight hours under cross-examination. so they are worrying about am i going get called up next and all they have been doing is producing documents. >> thank you. >> sitting here listening to some questions that the chairman asked and i'm convinced that

you're damned if you do and you're damned if you don't. this is what i'm talking about. the i.g. asked you not to engage -- what the i.g. ask you not to do? >> not to do any further investigations or interviews or discussions with employees, but anything having to do with the hard drive crash, any other hard drive crashes while they did their investigation. >> and then the chairman wept on to say that he didn't tell you that this committee was under the same e restrictions. that's accurate, right? i.g. didn't say to you -- have

nig to do. do you understand my question? how do you obey the law and obey the wishes of the i.g.? >> the i.g. was telling the committee and giving any instruction to the committee. the only conversation was when he told me when he told me about the existence of the backup case. he said he had provided that information to the investigative committee and asked it to treat it confidently while his investigation was going on. >> so if something came up now where we contacted you and said we want to meet with experts in

the irs because we think that this committee has something relevant to our investigation, is there any way that you would treat that differently now than you would have if you'd never had conversation with the i.g.? >> actually, we have tried to be responsive as best we can to the wide range of requests we have. we have a number of requests coming in and requests for interviews. we have tried to figure out what the priorities are so we can do it in the right order chrks is at my hearing in march, we agreed the next priority was to provide all the lois lerner e-mails. we wanted that to be our next priority. we're getting close to completing that.

>> i guess what i'm getting at is i assume you wouldn't have the discussion based on what the i.g. told you, you wouldn't have a discussion with the irs now because the i.g. told you not to. >> that's correct. so we have had witnesses coming to testify and give depositions here, we have not talked to them beforehand. we don't feel that we want to do anything that would interview with the i.g.'s investigation. so people come up and have done that without any conversations we have made. >> the jept l lady asked about morale. it's a tough position. on the other hand if you don't get revenue, you have a problem.

when you think about the reduction and based upon what was just read, it seems like based on what was said, people from different areas to do certain things. he said some of them have speedometers and deadlines. the point is something has got to give. and can you tell us what we're losing? >> well obviously we have 10,000 fewer employees than five years ago. 500 fewer in the office. people either have to spend a lot longer working. we have done our best and taking people around chief counsel and

put them on the production effort. that means that the other ones would have done did you want get done. we continue to shrink rather than expand. so we vice president complained about it. we simply produced documents as fast as we can. our biggest problem and obstacle is we have this archaic way to search each hard drive to pull out data to get it into a search machine, which we'd like to change going forward. it means the office of chief counsel, you put the more stress and it makes it more difficult. my concern is over the course of the three and a half years, we have other issues and as we ask people, if they become subjects of depositions and

cross-examinations, it's going to be harder to get people to leave their day u job. that's our only broader concern. but we think it's appropriate and we're happy to cooperate as best we can. i'll make one point. they don't talk about this issue and prep for it, that's not accurate. we interviewed yesterday and he told us the ways and means committee, there was prep sessions done. one thing that impacts morale is a subpoena. that's your cause. we tried for weeks to come and

be interviewed. we got all kinds of information you have contradicted. that's the pressure. you could have helped morale of the very employees you represent if you had let them be interviewed. >> it's just like a deposition. for people who have never done it before, they are nervous. >> my point is by you making it so we had to subpoena, that only adds to the anxiety of the employee. that's your creation. >> that's why we're delighted to work out a schedule where there won't be subpoenas. >> we appreciate that, but it took that subpoena to get that. >> i want to understand this.

why did mr. cane have to be subpoenaed? i didn't ask you. >> we were in the process of discussing the production of witnesses because we are concerned with the investigation. and while we were doing this as the chairman said mr. cane got a subpoena, which didn't allow him to appear and would allow us to have a conversation about setting up a production schedule of witnesses. so the chairman is right. we were in the process of trying to do this, but i would say we were subpoenaed. >> you take all of it. mr. cane told during his deposition because he had to be

subpoenaed, he told committee staff that he wasn't even not y notified by you that we had requested an interview. all he knew is he got the subpoena. you didn't even tell him. that's what he told us in the deposition last thursday. so it's all on you. you're the reason we had to subpoena the individual to get his testimony. >> he eventually came voluntarily, is that right? >> after we hired private counsel after we sent the subpoena. >> thank you, mr. chairman. it's good to see you again, commissioner. i want to read a quote to you of june of 2014. i want you to tell me if you know who said it. we confirm the backup tapes no longer existed because they had been recycled because of policy. >> it was me. >> it is you. can you tell us who we is in

that quote? >> the we is the irs. i intend to take speedometer for the agency and talk about it. i was advised that people had talked to everyone in the agency to ensure that during the course of several months of looking for -- >> so we is the royal we speaking on behalf of the entire irs. how about the word confirmed? what does the word confirmed mean to you? that you confirmed the backup tapes no longer exists? >> i was told -- >> by whom. >> i don't remember who, we had four or five people working on the report. mr. cane said in his testimony that that was accurate as of june 13th. >> what does the word confirmed mean to you? >> that somebody wept back and looked and made sure any backup tapes that had existed had been recycled. >> are you still confirmed? >> at this point, i have no

basis for not been confirmed. the i.g. advised me they were looking at tapes. i have not been advised. >> confirmed is a pretty strong word. are you still confirmed that no backup tapes exist? >> i know the i.g. is looking and he hapt found anything. >> i'm glad you mentioned the i.g. i find it vexing that once the i.g. is involved, nobody else can do anything. that is not supported by the law. can there be a criminal investigation while there's an i.g. investigation? >> what i was talking about -- >> there can be an irs investigation. if there were sexual harassment in the workplace, are you telling this committee you would

wait? >> we would take whatever action was necessary. >> precisely. you would not wait until an i.g. concluded his or her investigation. >> our policy, and my understanding when i chaired the counsel of inspector general that if the i.g. starts an investigation shs the agency will not themselves run a competing investigation. basically the i.g. advises us what the investigations are, when they advise us about those investigations we allow them to proceed. >> let me give you possibly an alternative view, commissioner, which is that people cite ongoing i.g. investigations which it suits them to not cooperate and they don't cite ongoing i.g. investigations when it did you want suit them. >> that's not my policy. >> you can certainly understand how a cynic might view it that way. because there's nothing about an ongoing i.g. investigation to

keep you from doing your job. just like there's nothing about an ongoing i.g. investigation that keeps the department of justice from the criminal investigation. there's nothing about an i.g. investigation. >> this particular case as a general matter, my policy has been if the i.g. is doing an investigation, we won't interfere with that investigation. >> words have consequences. you can have a dual investigation without interfering, can't you? >> i think it's very difficult. >> so you are saying if there was an allegation of sexual harassment or racial discrimination within the irs, you would not look into that until the i.g. had complete d hs or her investigation? >> i'm telling you as a general matter, that's not what the i.g. would be investigating. those claims would come to personnel and be investigated. >> the i.g. did you want have

criminal jurisdiction. all three of those are important areas. so those should be ongoing even while an i.g. is doing the investigation. >> the i.g. does do criminal investigations. >> they refer to an entity that has a power to indict. >> my understanding -- >> it might be the same people who gave you the understanding that you were confirmed the tapes don't exist. i'm going to say this in conclusi conclusion. we could not believe about the morale at the irs. it takes a lot to stump me, but that stunned me. here's a piece of advice i will give. if the folks like lois lerner and others would have spent more time working on the backlog,

more time working on their case load and less time targeting groups and less time trying to overturn supreme court decisions they didn't agree with, maybe morale would be better. >> would the gentleman yield? >> i'd be thrilled to. >> commissioner, i want to maybe summarize what the gentleman was asking you with a question. do you have full faith and trust that your i.g. is doing a thorough investigation at the same level as would be done if you were doing it as the commissioner? >> i have all confidence in the inspector general. they have far more capacity in some of these areas. they have 15 people working on this. i'm very comfortable and confident that they are doing a thorough job and i have told them we can do whatever we can. >> so at least as to your own investigation, you consider the i.g.'s investigation to be your investigation? >> i do not. we do not control the i.g.

he's very independent. i am satisfied that when he gets done, we will have an independent review and investigation of what wpt on. >> thank you. >> gentleman? >> will the gentleman from virginia yield for one follow-up question? >> it's his call. i have been very generous. >> i thank the chair. i want to follow-up on the gentleman from south carolina's point. what you're just saying is that your belief that it is wrong for you to do an investigation at the same time as an i.g. is doing an investigation s that correct? >> if we were doing an investigation -- >> your predecessors who did exactly that in 2012 were wrong? because when the i.g. started it, they did their own sworn

testimony, ta did their own so what they did was not right. >> everybody has their own. >> in your opinion, that would not be right? i just want to show the hypocritical point there that it's not consistent with what irs has already done. >> my point only was it's consistent with how i have behaved in the past and how i will behave in the future. i.g. is an important independent source of the investigation. i will cooperate with it and not interfere with it. >> i thank the gentleman for fielding. i ask unanimous concept that all his time be restored. >> i thank my friend from north carolina and the chairman. welcome back, mr. koskinen. it must be a thrill and a highlight of your week. i guess we're going to do this as long as we're in session.

by the way, just sort of a side bar, i wish my friend from south carolina was still here because his concern for morale at the irs is really touching. and gosh, if we were really that serious about it maybe we wouldn't have slashed money from their budget and recommended another $350 million this year. but that's a different pattern. >> they recommended another billion on top of the $350 million. so we're a billion 350 under water. >> the morale, we'll keep on flogging people until the morale has improved. that seems to be the flophiloso of some of my friends. i'm glad we're talking about the i.g. because i'm amazed that jay russell george would have thought it wise or prudent to completely omit from the may

14th report any mention of a critical, and i think astonishing, that was conducted by the head of investigations the weeks leading up to the may 14th report. mr. chairman, i'd like to enter into the conclusion which was september in a may 3rd, 2013 e e-mail to the acting principle deputy, chief counsel, assistant i.g. and two employees whose names have been redacted. >> without objection. >> this this astounding e e-mail concluded that after obtaining and reviewing 5,500 irs e-mails from identified staff members from the exempt organizations division in cincinnati that in addition to there being no e-mail directing staff to target tea party or other political

organizations and no conspiracy or effort to hide e-mails about the director, and u quote, review of these e-mails reviewed that there was a lot of discussion on how to process the tea party and other political applications then they would be on the lookout list specifically naming those groups. however, the e-mails indicated the indications needed to be polled because the employees were not sure on the application. there was no indication, i'm still quoting, polling these select applications was politically motivated. there were unclear processing directions so they pulled them. this is, he says, a very important nuance, end quote. would you agree with that finding, mr. koskinen?

>> sounds right to me. >> have you any idea why the inspector general would not include such a critical finding after the press compliantly giving the headlines to my friends on the other side of the aisle? here's a critical piece of information maybe with a smoking gun for looking for exoneration from the head of investigations. why would that not be included in the monologue? >> i have no idea. >> is it worthy of your time to ask that question, respecting the independence of the two offices? >> i would not ask the i.g. that question. he's done his report, done his investigation. but when they do investigations, they have any number of them going on. we times agree, sometimes

disagree with process. we don't go back and question. >> but here you are for the third time before this committee and probably not the last. and your reputation and that of your organization has been called into question with unfortunately not been critically examined by the media despite our efforts on this side of the aisle. here is the head of investigations in your organization that says otherwise that directly challenges the thought a only tea party and conservative groups are challenged and it was deliberate and targeted. he says otherwise it doesn't put it in the report. the inspector general have

formally requested an investigation. before the counsel. he's under a cloud himself. the chairman questioned other employees of the irs because of their political giving. they were a republican staff member on this committee. he's given political contributions to republican candidates. he's a bush appointee. he met solely with the republican side of the aisle in getting ready for his audit. that raises serious questions if sauce for the goose, it's sauce for the gander. this is a critical piece of information. i can't. imagine you could be copasetic with an audit report for your organization. >> well, it's an interesting

piece of information that obviously is useful for people to review. as i have said, he's independent. he's the treasury department for irs. and we have supported in the past. i think he is doing an independent review of all of this and i look forward to his response and findings about what happened with regard to the hard drive crash. >> how about in his response to why he department include this important information from his head of investigations in the final audit report on may 14th. >> that's a question that i'm probably not going to ask him. >> i yield back, mr. chairman. >> i would just ask the gentleman.

at the same time criticize the work he did before where he identified the targeted group. can't have it both ways. >> mr. chairman, consistent in raising questions about the professionalism of mr. george. we have both filed a formal complaint. i'd be glad to share it with the chairman. >> with all due respect, when we get accesses to the witnesses. >> actually maybe a new inspector general is the answer. >> relative to the idea it was just mismanagement, 80 mr% of t applicants have been backlogged. the "usa today" reported not approve a single tax exempt application by a tea party group for 2010 to may 2012 during the same time they approved dozens

of progress you have groups. none of the treatment conservative groups was given. >> mr. chairman, i have a memo saying targeted is actually not accurate. i also have materials that were presented to irs. they have e tea party, patriots, progressive. >> 298 cases, only 3 had the word progressive. none used the word occupied. no progressive group was denied c-4 status. hundreds of tea party conservative groups were. some are still waiting. just for the record. >> i guess you and i can argue that all day and we need to get on to this hearing. >> mr. koskinen, why june 13th?

let me ask this. why not february 2nd when you learned there was a big gap and e-mails that looked like they were missing? why not february 4th? is mr. cane a solid lawyer at the irs? >> certainly is. >> so why not february 4th when mr. cane, who testified just last thursday, said they couldn't disclose that on february 4th. how about mid-february when mr. cane said last thursday that we know we knew then in mid-february that the data on her computer was unrecoverable.

why department you tell us in mid-february? how about march 26th? why not on march 26th when you were in front of this committee and everyone on both sides of the aisle were asking about lois lerner's e-mails and you assured us you would produce all her e-mails. when you knew lawyer at the irs, you knew mid-february her e-mails were unrecoverable. >> be careful note that's what mr. cane knew, that's not what i knew. >> well that's a problem too. that's something you should have known. mr. cane is a high ranking official. you didn't know? >> i did not know. >> do you know kate duval? >> i do know. >> what is her responsibility? >> she's counsellor of the

commission. >> she's your lawyer? >> yes. >> she knew in mid-february. she didn't tell you? >> i have testified at some length at a couple hearings and i'm happy to standby that if you want to go over it again. basically what i told you was in mid-to late february i knew that we had taken the lois lerner e-mails that had been produced and instead of looking at them -- >> not the point. tom kain said they were unrecoverable. he said he told kate. did she tell you they were uncoverable? >> she did not. >> that's a problem. why not tell us april 4th when this committee was briefed. the briefing was about how we would deal with how the irs was going to deal with committee requests for concerns about the

lost or april 4th. miss duval could have told the committee at that time? >> i've testified at some length in the past that our -- earlier today -- >> sheert key question. why not in mid april when you knew let's puts up the slide. this is a question we had earlier in one of our hearings. why not when you knew -- what date did you learn you could not get all of her e-mail? i learned that in april. why not april? >> as i testified then and i've testified on numerous occasions, my judgment was, a, we needed to find out what e-mails we did have. we needed to put together it in a full report, which we did. >> why not any time in april? someone at the irs told someone at treasury who told someone at the white house, according to press reports. if it was good enough to pass on to the treasury and white house, why not tell us in april? >> because i thought at that

point we did not have the full information as to what was involved, how many e-mails. >> you learned in april thp unrecoverable. your chief lawyer in charge of document knew in february. kate duval knew in february. you wait until june 13th. why? >> i would note, all of those e-mails that determined whether they were -- that she had a hard drive crash, they were provided to this committee and the tax writers knew as early as the fall she had had a hard drive crash. the terms were produced -- the materials about the e-mail chain about her trying to restore her hard drive were produced to the tax writers in april and to this committee in may. there was no secret that we were hiding. we were processing through -- >> no. you were given as e-mails. but you didn't tell us there were e-mails you couldn't give us. why didn't you tell us you had -- the irs had destroyed e-mails that belonged to lois lerner? why didn't you tell us that in. >> first of all, e-mails from

ms. learner, may have been de -- >> the tapes were recycled. when you back up tapes are destroy and recycled. so they are destroyed. why didn't you tell us you could not produce those e-mails that they were lost in april? >> this hearing is noted to be an update on what we're doing. i have given you at least two different oeksz. >> answer the question. why june 13th why not june 12th, 10th? why not may 10th? why not -- if you couldn't do it in april, why did you wait two more months. >> we will be here a long time if you want to repeat all the questions i have answered. i've answered it before. i'm happy to answer again. it's in the testimony i have given before you have read. we were producing lois lerner e-mails. our strategy and thoughts were -- i thought the most efficient way to complete was to complete production so we would know how many e-mails we had

from her account, how many e-mails we had been able to retrieve from other account so you would have a full idea what the universe was. i hoped we would find how many other problems we had with custodians and we would produce that ace report to the committees and a public report that would explain what our e-mail process is, why it's complicated, what we had determined about lois lerner's e-mails and her crashes, what the e-mails we have been able to recover and it would be a full report. june 13th was a friday. i should have known friday the 13th was going to be an interesting day. we had been asked by the finance committee which was considering trying to come to closure on their report whether we would give them an update on our march letter in which we advised the tax brighting committees that we had completed production of all of the information we had about the determination process which was the start of the investigation. that's what the ig was focused on as you have discussed. we said we would do that. they called and we were going forward. we didn't know when. they called and said they would like that report no later than

that friday because they were going to have a meeting the following week. so we pulled the document together at that point. we had not completed, as i said earlier, the review of how many custodians were involved with hard drive crashes and what the impact were. we had no idea if you lost a hard drive -- one of the hard drive crashes was in february of this year, not very relevant. to meet the friday deadline we produced that document and shared it with everybody on friday june 13th. it was to meet a request from the finance committee which was having a meeting the next week and wanted to consider whether they had enough information to do a report. >> the senate finance committee drove the timing of when you disclosed that had you lost lois lerner e-mails. >> yes. because we were going to produce that. >> i think it's something different. i just do. you are going to disagree. i think you were never going to tell us. you got to remember what happened here. judicial wash does a full

request. they learn on april 18th of this year that the irs and the department of justice had been working on possible ways to bring policy claims action against tea party groups. and there was an e-mail from that request, a lawyer at the justice department and miss lerner had an exchange after a senate hearing. we got -- we saw that e-mail. we said, we're going to talk to the lawyer at the justice department who was meeting with miss lerner days before the report went public in may of 2013. on may 6 we interview mr. pilger. we learn in his opening statement in that deposition we learn this. he said, turning -- i'm reading straight from his statement. turning to my contacts with miss lerner in the fall of 2010. shocked us. we didn't know they were meeting

in 2010, that the justice department was meeting with the irs in 2010. in the fall of 2010 at the direct of the chief of the public integrity section of the justice department. i contacted the internal revenue service. when i contacted them they directed me to lois lerner. who met once at the public integrity section offices for an hour with some of her staff, my chief, jack smith, or personnel from my section and the fbi. so now we learn in 2010 the justice department with the fbi is meeting with lois lerner. so we said, we bert subpoena documents from the justice department. we said to the justice department, we want any communications with lois lerner that you have had. we get this slide. we get this e-mail. put this up if we can. we get this communication. from lois lerner and richard

pilger. now, mr. koskinen, did you give us this e-mail? do you know? >> i don't know. >> i can tell you, you didn't. we got it from the justice department. after we got this from the justice department, we contacted you all on june 9th. we said, hey, how come we didn't get this e-mail from you? there's no 6103 issue with this e-mail. we were concerned. this is from 2010. so we contacted you. we said we're wondering why the irs hasn't sent us this e-mail from four years ago. and then suddenly four days later, you tell the finance committee, the congress, more importantly the american people, you know what, we lost lois lerner e-mails. we have lost a bunch from that time period. my theory is this. you guys weren't ever going to tell us until we caught you.

we caught you because judicial watch did a request. they found out there was this collaboration going on between the justice department and the irs. we took that e-mail. we interviewed mr. pilger. he told us he met with lois lerner in 2010. we then subpoenaed justice. they complied and gave us the e-mail. we say, why didn't you give it to us? then you knew you were caught. you said -- he didn't tell us this but you knew. we didn't give it to you because we don't got it. now we have to tell the world, we lost them. what bert time to do it than friday june 13th, saying we are complying with some senate concern. send in ta letter, put it on page 7 of the third addendum and say, you know what, we may have a problem with lois lerner e-mails. that's what i think. i think all kinds of people logically going through this would say, you know what? that's what prompted these guys four days after they get a letter from this committee saying, why didn't you send us these e-mails, you decide, we

better come clean. because -- plus, you have told us you nuclear back in april that you lost them. so you wait two months and then you decide, we bert do it june 13th, four daze after they figured out justice and the irs were working together in 2010. they got an e-mail that indicates that and we can't produce it. >> when you find any direct evidence to support that assertion, i would be happy to see it. if you think this organization in four days could produce that report, you don't understand how large organizations function. you could ask anybody who worked on that report, that report was under production for a long time. >> i'm not saying it wasn't. i'm saying including the statement we lost lois lerner e-mails was put in that report. >> it was in that report and it was in that report -- >> one thing i learned in these investigations, it's always important to look at the time line. look at the time line. you knew in april. you didn't tell us until june

13th. what events happened between april when you knew and june 13th? one key event was the request from judicial watch, finding this collaboration between the irs and the justice department, us getting that e-mail because we subpoenaed the justice department. they give it us to. it's in the time frame 2010 to 2012 when you lost lois lerner e malz. you say, you know what? they got us. we got to come clean. >> mr. chairman. >> then you do the letter on june 13th. >> i can respond? there are a set of senior staff people in the senate finance committee will dispute your assertion. if you find direct evidence to anybody that worked on that report, in terms of the timing, the fact we were not going to deliver it, i will be astounded because there is no such evidence. have i been very patient. but before you make that charge and claim, you should have better evidence that a single e-mail dated june 9th. >> we have a few other e-mails from that exchange.

>> yield for one moment. i know the a lot has been said about what thomas cane said. last week, thomas cane told our staff that the irs always intended to alert us about the lost e-mails. so i know you have all these theories. unfortunately, our committee has been one where we put our these headlines and go chasing facts that in many instances never exist. but i'm just saying, include everything when you are asking your questions. >> all i'm saying is this. they get a letter from us on june 9th where they know we have this e-mail from the justice department that they can't produce. four days later they tell the world, we have lost lois lerner e-mails. when they knew that according to mr. koskinen's testimony in questioning from me that he knew in april they couldn't get miss lerner's e-mails.

when they decided to tell us four daze after we knew there was e-mails we were getting from justice that we weren't getting from the internal revenue service. that timing is pretty suspect, particularly in light of the fact all the other things we have heard from the irs. one computer crash, no was seven, no to eight. now up to 20. no backup tapes available. we can't confirm that. in light of everything we have heard, when you look at the time line, it looks pretty suspect. all i'm saying is i'm not sure they were going to tell us. >> mr. chairman, you -- mr. chairman, you have -- this has been very interesting because one member on your side, the gentleman i don't know his name, said to the man under investigation -- i heard -- i was in the entire hearing and he never said that. by the way, the justice department never said that.

then you mr. chairman made some strong accusations. when you made these kind of accusations, i would appreciate it if would you just give the witness an opportunity to answer. because these are the kind of allegations that tarnish one's reputation and you have come up with this theory and i'm not saying your theory is -- your theory is what it is. you have to be able to answer. these all i'm asking. >> appreciate the ranking member. >> as i said, i haven't seen mr. cane's testimony. but it doesn't surprise me that he would say that we had been producing this report for some time and clearly planned on making it public. you can talk to people. we would be happy to give you those constants the people we talked to at finance who did have a meeting the following

week asked us for an update that we did provide. they asked for it no later than that friday. i am very confident that no one working on this report had any idea about it other than that we were going to produce it and provide all of the information to the public. i think any other assumption is not based on facts. >> are you willing to make those witnesses available? are you going to make us subpoena them so they can come here under oath and testify that, yes, in fact, we -- from mid april when the commissioner knew that lois lerner e-mails were lost, we were planning on telling congress as soon as we got all the information. they will come and testify to that? will they testify, you know what, after the june 9th letter, we decided we better put in the information that we lost e-mails. >> i don't think you will find anyone that will make that latter question. >> are you willing to have those people come testify? tell us who they are, who the people who worked on this report. >> we will talk about to you about -- >> you have talked to some of them. you have others on your

schedule. >> gent many lady from -- gentleman from nevada is recognized. >> thank you, mr. chairman. you know, i do share concerns by some of my colleagues on the other side about why the irs delayed in providing congress with notification regarding the unrecoverable e-mails, because it raises questions. i don't share in the chairman or other members' conspiracy and rush to judgment about any motives as to why there was a delay. and i feel, again, as i have said in previous meetings, that

we fail to get all the facts in order to then make a proper decision. i'm not a defender of the irs or any other federal agency. i've said from the beginning that i believe that there was wrongdoing. but the chairman and others want to conclude or make conclusions about that wrongdoing without justification or evidence to support their assertion. mr. chairman, you just read into the record some comments by mr. pilger that i had asked to be entered into the record the full transcripts. so i'm going to ask again for unanimous consent that the transcribed interview opening statements of doj officials richard pilger and jack smith be allowed to be entered into the record, particularly since you

just hand picked certain statements and i'm requesting the full transcript be entered. will the chairman please provide that courtesy for this to be entered into the record under unanimous consent? if the gentleman would yield for a second. i read from the opening statement that -- >> that's what this is. >> if you are asking for the opening statement, not the full questions from democrats staff, republican staff, but just the opening statement from mr. pilger and mr. smith, we would be happy do that. >> thank you. i also want to follow up to some of the claims that have been made by my republican colleagues and give you an opportunity to respond. it has now been stated twice today that mr. cane testified during his july 17th interview that in mid february 2014, the irs realized that lois lerner's

e-mails would not be recoverable. i want to clarify here because i don't want mr. cane's statements to be taken out of context. it is true that mr. cane told us that he had discovered that miss lerner's hard drive had crashed and that the contents of the hard drive were unrecoverable. however, that does not mean that mr. cane said that he thought in february of 2014 that the irs would never be able to produce those e-mails to congress. in fact, mr. cane was asked "and as of march 2014, you were not aware that the irs would be unable to recover all of miss lerner's documents" and he answered that's correct. he further explains that the irs was engaged in a process to find miss lerner's e-mails from other sources at the irs.

those efforts were successful and yielded the production of an additional 24,000 lois lerner e-mails. is that correct? >> that is correct. >> mr. cane also explained that the irs' goal with respect to the document productions to congress was to fully comply with those requests as expa dishously as possible. he stated with respect to fulfilling that goal, and i quote, i have tried my best and everyone that i work with have tried their best. commissioner koskinen, do you share that belief that every effort was made to provide this committee and others with those e-mails that you were able to recover? >> i do. >> and beyond the issue of failing to notify us in a timely manner, then the question becomes, you know, what can be made of why that time line was

delayed? >> right. as i have said, first of all, all of the e-mails in question had been provided in the normal course to this committee and the other investigators. so there was no attempt to not produce information that showed that in fact there had been a problem with lois lerner's hard drive. in fact, none of of us at the irs or investigators noted that in the fall productions there were e-mails from lois lerner saying she had problems with her hard drive and had lost e-mails. everybody then was looking at subject matter. but it's not as if any of these e-mails were withheld or not produced in a regular manner. so that as we were work fwhg april and may pulling all the information together, trying to determine how many e-mails we had, we were producing e-mails as a regular matter. the e-mails that were the bay sifs our june 13 report had all been provided previously to all of the investigators. >> thank you. >> time has expired. the chair now recognizes the chairman of the committee. >> thank you.

commissioner, i really wish we had your it guys here instead because it is inherently a little hard when we are asking you so many questions that are not related directly to your past experience. i appreciate your continued volunteer to come up. hopefully, as we interview some of your it professionals and others involved, it will make it easier to ask questions. a lot has been done to talk about this, a drive this large that aparentally went to bad that not a single piece of information could be saved. and you asked us to believe that your very special experts couldn't save one piece of data from this drive or one just like it, correct? >> that's what i was advised. that's what the e-mail strain that we produced and i testified about at previous hearings said.

>> the american people don't believe that. you realize that it's -- the idea that we can recover the last 17 or 18 seconds from challenger exploding above our atmosphere falling to the sea and being left under the sea for a year, that we could recover the voice from that makes people wonder why a product that simply came in and out of the office with lois lerner every day suddenly not one piece of data could be recovered. it doesn't surprise you the american people just have a hard time believing that, does it? >> i don't know whether the american people believe that. but i do understand that when our criminal investigation division, which our experts at extracting information say they could not recover any e-mails, that seems -- i could understand people saying, well, if you kept trying. >> do you think it's reasonable for us to check with your criminal investigation people,

interview people involved to see if that passes the reality check in spite of what the american people may think or the doubts they may have? do you think it's fair for us to check into that in. >> yes. in fact, those interviews are being scheduled. some of them, i gather, from the press release i saw from ways and means that some of those it people have already been interviewed. >> it's fair for us to do an interview and to investigate on our own in order to bring the credibility that we bring as if you will a doubting thomas to the process? you would agree with that? >> i've never had any concern and objection to the oversight. as i said, spent four years with the senate with the oversight committee. i'm a big bleber in congressional oversight. >> i appreciate that you are. one of the things that we discovered that was not made available to us early on was the existence of this ocs, this chat

capability that exists within the irs note woshg. is that right? >> that's correct. spent some time testifying a couple weeks ago about that. >> you wrote me back a letter when i asked about it. in the letter it said, basically, that no records were kept because it was the equivalent of visits or phone calls. do you remember that in the letter? >> yes. >> now, would it surprise you to know that we disagree with you, that, in fact, it is the opinion of this committee that the federal records act, unless you can train and guarantee that no policy decisions, none of the kinds of activities we're discovering in e-mail, could be done on ocs, that, in fact, you should turn on that switch and you should collect and you should retain ocs chat unless you can assure us that it's not doing the equivalent -- i will be brief but i will explain something to you. years ago when i was a subcommittee chairman, and president bush was in office, we investigated the minimal

management service. what we discovered there was that they had systematically signed leases that were simply wrong and cost the american people billions of dollars. and we could find not a shred of evidence in e malz to show the absurdity of how this came do pass. after we deposed people we discovered that they admitted that only the cover sheet was brought to them, that they signed or initialled and they never read the leases. one mistake was passed through multiple cigna turz. more than importantly, as we went through the process, what we discovered was at minimal management service, now defunct and disgraced organization, they had a policy of what they call talking over the transim. lawyers made no record. lawyers went out of the way to have no paper trail of things they did in their consultation. i will tell you today that has

to end. that the american people expect that the federal records act, the presidential records act is not something to be avoided and you should not be trying or allowing the bypassioning of few fur oversight that you said rightfully so with your experience you believe in. maintaining data so that it can be analyzed by your inspector general who is conducting your primary investigation. you have full confidence in. activities going on in the ways and means which are slightly different than ours, our activities or anything in the senate are ham ped by policies of any part of government that allow the use of something that clearly bypasses future oversight. so i hope today that in addition to your willingness to cooperate and help us in getting to the answers i mentioned on this that you will recognize that your letter is not acceptable, that

e-mail is a substitute, not just for the old-fashioned letter but it's a substitute for a visit. it's a substitute for a phone call. and that in fact the reason that those are important is that the phone call and the visit in the old days, you would have done a memo for the record if you wanted to do your job. that isn't being done. e-mails and these chats are extremely important. and i'd like to have a second round at some time. but i would yield back at this time. >> mr. chairman, i have a point of information. yesterday, the chairman informed committee members he will hold another hearing next wednesday. we have the notice. cot chairman inform us who will be testifying at that hearing on wednesday? >> pursuant to the rules, we will inform at the appropriate time. at this time, they haven't sent

anything out. i appreciate your inquiry. >> you don't know or you won't tell us? >> i think we'll -- regular order, please? >> we will do regular order. the chair at this point will now recognize the gentleman from michigan for five minutes. >> thank you very much, mr. chairman. commissioner, any of my constituents were not as forthcoming as the irs, there would be a presumption of guilt. they would be fined and/or have their wages garnished and/or liens laid on their home and/or savings accounts seized. when i go back to the district, i had the opportunity to talk to many irs former employees of the irs now retired. i asked them what they thought about what was going on at the irs. and i heard despicable behavior every step of the way.

the irs no longer credible. i think at this point, mr. chairman, i'd like to yield back. >> would the gentleman yield? >> to the gentleman from california. >> i appreciate that. this is helpful not to need a second round. commissioner, there has been approximately a year of production of e-mails in your earlier hearing i remember the -- it might take two years. sort of even estimate. let me ask you a question. have you reviewed the time line when this committee issued lawful demands for lois lerner's e-mails? you have reviewed the time line of who did what and when? >> no. >> would you be prepared to deliver to us a time line, meaning calendars, activities of individuals who were charged with going out and finding those e maims, what they did and when

they did it? >> as i say, we have had approximately 250 people doing that work. >> actually, you have had people redacting and people legally reviewing. i'm only talking about who went and got the information, the e-mails, who accumulated them, the gathering. >> that's not just one or two people. that's a set of people. we would be happy to provide you the information in any form that he would be usable. >> here is the inquiry i will ask you today. again, we appreciate your coming but you are not the it guy, any of the 200 people, per se. it is clear now from this side of the day as that we issued requests and subpoenas. two things were to occur. one, that the moment we issued our first letter it required that you preserve information. there's a question about whether that was preserved because in order to preserve it, you would have to go look for it.

the tapes that now your own people have admitted they are not sure whether they exist or not, they have under cut your claim that you were comfortable they were gone at the end of six months, that means that nobody went out to say, where are the tapes, what are the tapes, are there any. additionally, in order to not know that lois lerner had this gap, either you weren't looking extensively all at once or -- this is one of my concerns -- people just didn't want to admit that they weren't going out and looking for e-mails by essentially what we expected which was to do a key word search on a server and deliver the data. remember that for months, even before you came on board, we were being told, you know, here is some key words and we want to search on these key words. the irs was adding key words that allowed them to deliver the false narrative that

progressives were being targeted. they were adding self-serving words and they were searching them. this committee had a reasonable expectation that you were searching the entire database, you were searching not six months worth of e-mails, not 6,000 e-mails or less that had been preserved but you were searching the historic e-mails. not until recently, the last six weeks, did we understand that if that was how you were getting awful your information, you were knowingly looking at a small fraction of the e-mail selections. we now understand no more than 6,000 e-mails, only six months of record. so it is now appropriate for us to understand your employees' search techniques, what they did. because at some point they must have started searching, okay, who has psts?

send us your psts. did they -- this is why we have to ask directly. did they send out one of these, do you have any information relevant and please sent it to us? because the key word search would imply that in fact they were accumulating all these psts, these downloaded local files and then searching them. if, in fact, that process didn't begin in ernest in the first week or month, if, in fact, your predecessor was delivering selected data from what was basically the last six months of things still preserved, we need to know that, because it does appear as though in this long investigation there has been either an absence of a willingness to disclose problems or an absence of real fact finding, getting these e-mails quickly or dmrib rat obstruction. we don't know which. we would like to know as i said

in the beginning of this who went looking for what when. not interested in who read them. not interested in who edited them, who redacted them or who released them. that information would be equally valuable whether it was pursuant to the house or senate's request or to ways and means or this committee's request. but giving us that gives us a time line of who was involved in going and looking so we know who knew that in fact something like lois lerner's personal e-mail on -- or e-mail on her personal hard drive was of any relevance. because this committee didn't know there was a lack of a central database for the first almost a year of this investigation. i thank the chairman and yield back. >> chair now recognizes the gentle lady from wyoming for five minutes. >> thank you, mr. chairman. i have no doubt, mr. koskinen,

that moral at the irs is low. i want to tell you about moral in wyoming. the people of wyoming who i work for all feel targeted. they think the irs is out to get them. they are lower than a snake's belly about the irs. because they know that lois lerner was brought into the irs from the federal elections commission where she had a history of political targeting, political bias. they know that she was tapped to enforce the largest tax increase in history, owe be a mra care, after she targeted conservative groups while overseeing 501c4s,

tax exempt committees. they saw her say i broke no laws and then take the fifth. they know that we skwently found out that she did break a law, that she provided confidential taxpayer information to another federal agency which sh against the law. and they know that so far she's gotten away with that. that the justice department isn't doing anything about it and that she got away scott free. they know that when they get letters from the irs, that they are being targeted. i have a constituent who got a letter and an investigation from the irs that has cost her $50,000 just to close her estate. because they keep asking her, what make and model is your bed -- your bed.

they think her bed is some expensive antique. she is a very active member of the republican party. she feels targeted. morale is low in wyoming because our government has turned against us. so this is a legitimate investigation. i hope it continues at length. i hope it goes on until we get to the truth. because the people we work for feel like the government is getting away with their tax dollars that they don't know. they feel like the government is denying them tax exempt status that they deserve. they feel like they can't trust the irs.

that's why this investigation -- that's why you are here and asked the same questions over and over. i'm sure it's frustrating. we're frustrated, too. but it's because our constituents are mortified and scared and are going to take matters into their own hands because they don't feel we have the ability to do it ourselves. so with no apologies for the more morale at the irs and no apologies for how many times we are asking you the same questions over and over, mr. chairman, while i thank you for your attendance, i do yield back. >> would the gentle lady yield? >> i will. >> some people don't have enough questions for you, commissioner.

i mentioned the time line in and my interests in that. let me ask you one other question which is, when you look at this investigation and you look at the fact that a federal judge is now ordering you to show certain things, you look at your ig's investigation, you look at our investigation, are you aware and do you recognize that the three separate channels are perceived and are in reality very different as to what your responsibilities are and how you approach them? >> my response to all of them is the same. if people have from any branch government questions, we have an obligation to respond to them in response to -- sgli appreciate. the ig does, in fact, work under you. he has limited authority. >> absolutely not. >> i understand his independence. >> he is the treasury department ig. we have no control, influence

over him. he doesn't work in the irs. >> but in fact he has testified that when he wants information, he has to ask for it. and he may not always get did. that there's a process and sometimes it's very frustrating for him to get information even though you say he's independence. he doesn't have the authority to demand things and get them. isn't that true? >> i have never had in my time here or other places an experience with an ig not able to get information he needs. i am committed as mr. george knows that whatever information he wants in any investigation he is welcome to have. >> we will certainly hold you to that. thank you. >> i'm happy -- >> yield back. >> thank the chairman. the other members who do want to do a second round, we will do that. so i will kick it off and recognize myself. i want to reiterate, people mentioned morale. a lot of things happened before you were there. i do think it's worth mentioning there are taxpayers who have had

their morale hit when they see conference spending that has gone on. $50,000 for a video and other expenlss on their dime. that was before you were there. but that really irks a lot of folks and certainly our constituents. i think the same goes for the targeting when people feel like they were being targeted or in fact were targeted simply from exercising their constitutional rights. i think that hurts their morale, too. i think it's important that we mention that. now, a lot has been going on about when you knew there was a problem, why you delayed telling congress. and i think it is the case that the standard that would be applied to an official such as yourself is not simply what you actually knew but what you should have known. in other words, you can't bury your head in the sand and not be apprised of what people in your organization know. so i think that's going to be a question is clearly there were people at the senior leadership

level in the irs early february, mid february who knew that the problems were more substantial than what you indicated to us that you personally knew. so the question is going to be, why did you not know more. i think that goes into what i and some other folks have raised and i know my friend mr. cartwright disputed the notion that this is being investigated by the justice department. just so we're clear -- i don't want to be lobbying charges that aren't true. here is the transcript from last week's hearing with doj deputy ag. the fact that the commissioner at the irs delayed telling congress the american people, the fbi and the justice department is a matter you are going to investigate. mr. coal replies, where he going to look into what the circumstances were around that, yes. so we are concerned about it and the doj seems to be concerned about it. i think that that's important to know. let me ask you this.

you mentioned that you have seen the ways and means press release about their conducting interviews with different irs technical witnesses about what happened to the hard drive. so they told ways and means that the hard drive was scratched and that data was likely recoverable from it and, of course, the irs just last week in federal court has filed a declaration saying, consistent with what i think you have testified to, that the hard drive was destroyed and in fact no data was recoverable for it. my question is, what's an american to think when they see some witnesses telling a congressional committee scratched, may be recoverable but yet the irs is representing in federal court that it was destroyed and completely unrecoverable? >> i wasn't there and i haven't talked to those people and i don't know what that interview yesterday -- >> the technical people would be the ones that we would most want

to talk to about that, correct? >> all i know is e-mails that i have testified at a couple previous hearings about show that there were efforts made by miss lerner and the it department to restore the hard drive. it went to the criminal investigation division and their experts and they said they were not able to retrieve information from that hard drive. that's all i know. that's what the e-mails con testimony anously showed and said was that they had tried. the experts in the irs tried. they were unable to recover any information. >> i read the pleadings and i take that point. but we are getting conflicting information it seems in the congress at this point. i think it's going to be important that that be resolved. clearly, you can't be telling the court one thing and then having people in the organization who are on the ground and maybe had knowledge telling the congress the other thing. i'm almost out of time. very quickly, switching gears, a little bit, the d.c. circuit issued an opinion about the irs' regulation as respect to

obamacare subsidies and mandates in the states that have exchanges not run by a state but run by the federal government. given there's a circuit split where you have the fourth circuit saying that basically it was either a close call or error, you have the d.c. circuit saying the irs didn't have the authority to issue that ruling. are you going to put -- rescind that rule until this can be resolved about the supreme court? what's the irs' position in light of the case? >> the rule about the granting of advance premium tax credit all is run by hhs. we have our regulation said that in fact it was appropriate and accepting to go through the court -- through the federal marketplace. we have no plans until the issue is resolved in court to rescind or change that rule or change our preparation for the next filing season. >> is it your position as the irs that you construed that to be that there may have been a

drafting error in the statute but that the intent is the subsidy should go and is that why the irs has taken the position they have taken? >> i'm supportive of the justice department opinion which was uphold in the fourth circuit and not in the d.c. circuit. i don't have a different view of the legality. i think the justice department puts it well that they think the statute is enforceable and the regulations are appropriate. >> i am out of time. i will now yield to the ranking member of the full committee. >> thank you very much. on july 9th you appeared before the subcommittee on government operations for a hearing entitled solutions to close $106 billion improper payments gap. even though it was clearly not the stated purpose of the hearing, republican members of the committee asked you a number of questions regarding the committee's investigation into

the irs treatment of applications for tax exempt status. at the hearing they released e-mails from lois lerner regarding irs instant messaging system called ocs that he claimed that miss lerner intentionally sought to hide information from congress. despite your testimony that you were unfamiliar with the system and would be happy to look into its use, republican members repeatedly requested you about the specifics of ocs. commissioner, now that you have learned of the system, you can describe what ocs is? >> ocs actually provided a letter to the committee that the chairman referenced earlier. what i have been adviced is that it is a system that exists in microsoft systems. and it basically allowed people around the country -- it can have a teleconference and you

can put the same information up on the screen and everybody looks at it and it's a way to have a telecommunication s meeting. it allows you to have an instant messaging capacity. i don't use it because i didn't know it existed. much like your cell phone, if they see you are online, they can send you a text message. it's like calling you on the phone. like all text messages, it's sometimes faster and more efficient way to communicate than calling someone. >> despite the fact that the e-mail exchange occurred on april 9th, 2013, nearly two years after miss lerner's computer crashed and more than one year after the inspector general's audit began, they declared the e-mail exchange was a smoking gun. the irs sent a letter to the committee explaining ocs messages were substitutes for

telephone calls and in-person meetings. the irs does not currently preserve communications sent or severaled through ocs. is that accurate? >> that is accurate. >> the irs explained that the federal records act does not require recording or retention of telephone calls or meetings as a substitute for telephone calls and in-person meetings that would not normally be recorded. communications sent through ocs are not considered records subject to federal records or other retention requirements. i ask unanimous consent that the letter be entered into the record. >> without objection. >> commissioner, does the federal records act require retention of the ocs messages? >> it's my understanding it does not and in fact it's my understanding that now our reviewed record keeping process and in 2011 we got a score of 93

and in 2012 got a score of 99. but we are meeting with nara, we have reached tout them to try to work with them to ensure that we are complying with the act now and if there are ways we can improve our records keeping. we're anxious to do that. ultimately, we hope some day to be able to afford to have in effect an e-mail system that's a system of record. >> are you aware of any evidence that lois lerner used the ocs system to intentionally hide information from congress or the inspector general? >> i am not. we produced 43,000 e-mails from her account. she obviously used e-mails significantly. >> to the best of your knowledge, has any irs employee used ocs system to intentionally hide communications from congress or the inspector general? >> i have no knowledge of any such activity. >> once again, your testimony is corroborated by the investigation. after receiving hundreds of

thousands of pages of documents and interviewing dozens of irs employees, the committee has not identified any evidence supporting the chairman's allegation that miss lerner or any other irs employee used the ocs system to intentionally hide information from congress. i want to thank you, mr. koskinen for your testimony. have i 14 seconds left. is there anything else you wanted to tell us? >> i would add to the congresswoman from wyoming talking about she works for taxpayers, my view is we all work for taxpayers. as the head of the agency, basically i am employed bit american people. we have an important responsibilities to be careful stewards of the money we spend. it is money that comes from the american people. we have an obligation to ensure that everyone is treated fairly and the same. to the extent there are people who have lost and confidence, we

want to restore that trust. we are going to continue to contact and audit people. some of them will be democrats. some will be republicans. some may not belong to a party. some may have voted for one person or another. some may be active in politics. what they need to be confident of is when they hear from the irs it's not because of that. it's all irrelevant. it's because of some question in their tax return. if somebody else had that same question, they would get -- be laerd from us as well that we have an obligation and a commitment to treat everybody fairly and evenly across the board. i have met with over 11,000 irs employees across the country and i have never seen a more dedicated work force dedicated to the mission of the irs to providing taxpayer service to to enforcing the internal revenue code. i'm delighted to be part that was work fork. >> thank you. >> before i recognize the chairman of the subcommittee, i just will just -- with respect

to lois lerner's e malz in terms of ocs, when she initially wrote the e-mail to maria hook saying she had a question about ocs, she was cautioning folks about e-mail and that we have had several occasions where congress has asked for e-mails and there have been a search for e malz. we need to be cautious about what we say in e-mails. someone asked if ocs conversations were also searchable. i didn't know but told them i would get back to them. i think it's important the context when she was asking about ocs was to try to evade congressional oversight. i will recognize the chairman of the subcommittee, mr. jordan. >> thank you. does the irs have an obligation to now tell taxpayers the tax credit may not be available? >> we actually are -- i think we have an obligation to keep taxers informed about all aspects of the affordable care act, all aspects of the internal

revenue code. we have a program of public information to advice taxpayers if they are getting premium credits, if their information changes they should make sure the credit is correct. to the extent we go forward -- >> are you going to educate tafl payers on the ramifications of the decision? >> we will put out information regarding it. right now, at this point, two courts have come to different conclusions. we don't intend to make any changes. therefore, i think our advice, although it's not totally in my control because it's a policy issue of how to deal with it, we are just tax administration. but my general assumption is people will and should continue to operate as they have thus far until we get to a final court decision. the courts have not indicated that anyone should do anything differently. >> let me go to the ways and means statement yesterday. their press statement. one of the things they say is -- it says, in house professionals

at the irs recommended the agency seek outside assistance in recovering the data. are you going to that? or have you done that already? outside profrgsales to recover data lost or maybe that may be recoverable on the scratched hard drive or the tape that now may be available? is that something the irs is going to do? as you know, my understanding is that that hard drive is a normal process, once the criminal investigation division determined they could not restore any information from it, that hard drive was recycled and no longer exists. >> when that took place, when you were trying to get to the data, did you in fact go get outside assistance in trying to recover the data? >> i was not around at that time. but i am not aware of any attempt to go outside the irs. >> so even though in-house professionals says this might be a little above our pay scale, we should go get the outside tech

experts, the super whiz kids who can do this stuff, we should bring them in, to your knowledge, that was not done? >> to my knowledge, i don't know even about that statement. i haven't seen his transcript as to whether that -- i was not aware that that recommendation has been made. but i have no information indicating that that was done. that outside experiments were sought. all i have seen is the e-mails that i have testified about in which criminal investigation division reported they could not restore the hard drive. i have no information that we did -- the irs at that time did anything else. >> they did not? i want to be clear. it's your understanding there was not outside professionals brought in to try to recover the data? >> that's right. have i no indication that was done. it's my assumption by the e-mails that i saw when i testified that when the criminal investigation -- >> no outside experts were brought in even though in-house experts recommended they were brought in? >> i had no information about the recommendation. >> i'm going with what the ways and means committee reported.

they said we should get outside experts, this is beyond our scope, we need someone else to get this. you are saying you don't think that was done? >> i don't think it was done. but i haven't seen the full context of what that gentleman said either. >> you don't think it was done and you don't know if it was asked for. they are reporting it was asked for. >> it wasn't done. >> it wasn't done. which is a problem. which is a big problem when your tech experts say we need outside experts, no, no, no, it's unrecoverable. as reported by what you said and testimony and what's been filed at the court. >> remember, three years ago. there were no investigations at that time. the irs had taken extraordinary attempts even to go to cid poem. >> it's three years ago. that's why they said we need outside experts. you are saying it didn't happen. which is a concern. let me do one other question if i could. according to your testimony a month ago, you said the irs in february identified documents that indicated miss lerner had

experienced computer failure in 2011. you knew in february there was a problem. february 4th you knew there was a big problem according to mr. cane's testimony. your testimony says in mid march 2014, this review, we learned the data stored on her computer hard drive was determined to be unrecoverable. mr. cane says he knew in february. you knew in mid march. but you were -- >> i actually knew in mid april. that's a misstatement on my part. usa read my testimony before committee and the now three hearings i have had -- >> this is your written testimony. isn't that accurate? >> my written testimony? >> it's what you -- this was your opening statement and what you said to the ways and meaning committee. the irs in february identified documents that miss lerner experienced a computer failure in 2011. the data on her computer hard drive was determined to be unrecoverable. >> that's correct. that was what the irs knew. >> here is my question.

mr. cane says on february 4th he knew. you indicate in mid february we knew there were big problems. you indicate in march you knew it was unrecovererable. you testified february 5th to the house ways and means committee, february 26th to the house probation subcommittee on finance services, march 26 to this full committee and april 8 to the senate finance committee. in those hearings you were asked about miss lerner and different things, had you four different opportunities in front of congress. i'm wondering -- in the back of your mind were you wondering when you answered these questions that we're going to produce all of lois lerner e-mails, when we're going to comply, in the back of your mind were you thinking, maybe you should let these guys in on the little kind of important fact that, you know what, we have already determined that her hard drive sun recoverable, was that ever in the back of your mind when you are answering members from congress in four different

committees over the time period you have learned committees ove time period when you've learned significant facts even though in your testimony you didn't know we fully lost them for good even though you knew wasority of darn likely we lost them for good. in the back of your mind did you think maybe i should disclose what the status was of lois lerner's e-mails. in a didn't enter your e-mail at all. >> i didn't personally know that there were e-mails lost until the mid of april. when i testified on march 26, i did not know that her e-mails were not recover. >> but this is your testimony. in the mid-march, 2014 time frame, we learned the data stored on her computer hard drive was determined to be unrecoverable. that's certainly from the march 26 hearing and the april 8 hearing in front of the senate finance committee.

so you had two opportunities where you ever know it's unrecoverable. that means you will not get what's there. i take responsibility for the agency when i said in trying to report to people what we knew that's what the irs knew. when you asked me specifically what i necessity i didn't know until april. i would say as the irs we knew in february. myself did not personally know -- when i testify i tell you what i know. >> this goes right to the chairman's point. when your chief counsel knows in february, mid-february that it's unrecoverable, you can't come in front of congress and say i didn't know that's why i didn't answer. your chief counsel knows. you should have known. you should have disclosed that. you didn't. >> i didn't know and therefore couldn't disclose.

i am perfectly prepared to take full responsibility for the production of the information to the congress. >> you didn't tell us that in your testimony. you didn't tell us -- on march 26 -- it would have been nice if we would have known at this point. date duval and tom cane knew it was unrecoverable but somehow they didn't tell you because you would have to disclose it if asked about it by congress. >> i have no idea. at this time we were spending all of our time trying to -- >> this is what no one can figure out. the central figure in this investigation, you lose her e-mails. your chief counsel knows in february. the lawyer in charge of document production knows in february. you can go up in front of

congress four times to disclose that. that's why the american people say no wonder there's a moral concern and as distrust. >> can i just add one point. you're going to talk to the chief counsel and she will tell you what she did or didn't know. >> right. he knew the hard drive had a significant problem. we did not know what e-mails we had. we found 24,000 additional e-mails from her to another people j i'm saying when tom cane the attorney who does good work at the irs says unrecoverable. and they knew that in february and you come to congress three times after he knew that and you didn't disclose that. you should have known that and told us. when you do find out you wait two more months, come on.

we're supposed to buy that. i yield back. >> i thank the chairman. i would point out before i recognize my friend from pennsylvania is here we are in say february, march saying you didn't know how many e-mails were out there. granted you were not commissioner but we've been asking for these things over a year now. subpoena was sent in august reissued under your watch. the irs dragged the feet on that but don't tell me nine, ten months after we request this stuff and five or six months after subpoenas are issued that you somehow don't know how many e-mails you had. that should have been something that's ascertainable. thank you for the indulgence. i will recognize mr. cartwright. thank you mr. chair. speaking of things that would be

nice to know, things not disclosed. mr. koskinen, i asked the chairman of this full committee who the witnesses are supposed to be next wednesday from the irs. he declined to tell me. he declined to tell me who he even knew the witnesses would be next week. have you been informed who the witnesses sought for next week's hearing will be. >> i had no idea that the committee was going to hold another hearing next week. >> would you agree with me that those are among the things that would be nice to know. >> it's always nice to know when i'm supposed show up for a hearing. i didn't even know if i'm supposed to show up next wednesday. >> let's delve into the irs forensic lab together. there were comments about

scratches on hard drives. that's not my area on expertise but we did have an analyst from the irs criminal investigation unit said he did not find anything suspicious about how it got an ms. lerner's hard drive. the analyst said he tried to recover her documents on two occasions first with a normal tool set and using more advanced tools, he still couldn't recover any data. mr. commissioner, e-mails confirm that the criminal investigations unit could not recover her documents. am i correct in that? >> that's correct. the cia analyst said he gave his colleague in the irs it shop the

name of a third party vendor that he used on rare occasions to recover information. it staff had already consulted with outside experts at hp. do you know where they consulted with experts a second tile to recover her e-mails. >> i do not know. >> finally, i want to touch on something that the gentle lady from wyoming mentioned. she said her constituents are going to take matters into their own hands. i say this because an hour ago somebody walk into the canon office building way handgun according to fox news locally. knowing that there are over 4,000 staffers and interns at

risk here on the house side of the capital and recalling the horrible gabby giffords tragedy and the loss of gab ri riel zimmerman. i would ask people refrain from making statements that could possibly be misconstrued by the public. it behooves all of us to be very careful about the way we frame things because there are people out there able and ready to miscontrue things. i yield back gentleman the chair recognizes the gentleman from georgia mr. chair. >> mr. koskinen. here we go again. i toll the story last time. it was the story of my young son who became famous however he

used to tell the stories. i recounted this time lime. i wish i could stand here today a and what was not plausible today has gotten more plausible. there's something new that koxs out all the time. it was asked earlier. i had to leave and come back. how much paper work that you've put to the committee and how many hours are being worked on to restore trust in a relationship whether it is between two people and tor the government they serve. frankly to tell me that you gave a million documents and that your hours are spent -- pause of the issues that have been raised and the lack of trust on both sides, i have democrats and

republicans in my district who are appalled at this. they want it solved. they want the real issues. i think that is an issue of trust that has been maintained here. frankly the plausibility story is getting to the level of unbelievable in a lot of ways. i do have some questions because we've talk about the lois lerner e-mails but in adig to those, the committee has also asked for other e-mails. i want to talk to you about those to see the status of those opinions. is that okay. >> sure. >> e-mails from responsive of the committee's request august second 2014 to february of 2014. have you gathered all of those e-mails. >> what were