Federal Criminal Juvestigators Association P.O. Box 353 Forestville, Connecticut 06010 April 18, 1975 Mr. Donald C. Alexander Commissioner of Internal Revenue 1111 Constitution Avenue, N.W. Dear Commissioner Alexander: I am the Executive Secretary of the Federal Criminal Investigators Association which is composed of both active and retired criminal investigators employed by the United States Government. We have approximately 900 Special Agents of the Intelligence Division, I.R.S., as members, which we believe is approximately 50% of your Intelligence Division working force. I am writing to ask your assistance in my organization's attempt to determine the validity of certain rumors regarding a number of your decisions which are having a demoralizing effect on the investigative personnel of the I.R.S. and thereby reducing its efficiency. I am not attempting to interfere with the prerogatives of management of the I.R.S. as they have a difficult enough job. However, I am taking the liberty of appealing directly to you because I know that you are just as concerned as we are in seeing that both the needs of your investigators and the Government are served. Let me give you an example of how an unfounded rumor was handled by the F.C.I.A. After the passage of H.R. 9281 (2 1/2% retirement bill), we received numerous inquiries indicating that various agencies were reviewing their criminal investigator position to determine if the GS-1811 classification was justified. Part of the rumor was that Special Agents of the Intelligence Division would be reclassified to general investigators and that their positions would be downgraded or abolished. Our inquiries established that there was no validity to this rumor and we passed this information to our membership by publishing our findings in our monthly newsletter. However, since that time, numerous other rumors have circulated causing grave concern among our members and these rumors were buttressed by certain actions of your office. Will you please take time from your busy schedule to give us your comments on the following areas of concern: Your text material for a speech before the Annual Convention of the Tax Section of the American Bar Association, Honolulu, Hawaii, on August 14, 1974, indicated a strong and drastic move away from the use of the Internal Revenue Service as a "law enforcement agency. If this is to be your policy for the future, what role do you have planned for the Intelligence Division? 2. Restrictions of Arrests by Special Agents In numerous conversations you have indicated strong opposition to Special Agents making arrests, particularly when shown photographs of suspected felons in handcuffs. Are you opposed to the use of established law enforcement procedures in tax cases, at the risk of the safety of the Special Agent and the arrested individual? Would you prefer that criminal investigators in the I.R.S. not make any arrests? If so, how do you expect the courts and the public to consider tax evasion a serious crime (which it must, if voluntary compliance is to continue) when I.R.S. does not consider it or treat it as a serious crime? 3. Frohibitions on Special Agents Participating in Raids Improper conduct by a criminal investigator during a raid can generate unfavorable publicity and possible law suits for damages. However, such isolated instances do not call for the complete abandonment of this investigative technique but, rather, are a lesson upon which to formulate future conduct. If one of your investigators abuses his subpoena authority, does that mean that you will forbid all investigators from using this authority? Is there perhaps another reason for prohibiting your investigators from participating in raids and arrests with other Federal agencies, even when they can gain valuable information on a person they are investigating? 4. De-emphasis of Strike Force Program and Narcotics Traffickers Program You have stated that the Internal Revenue Service has changed the criteria for involvement in these activities in that they must satisfy the revenue and professional criteria which have long been established within the I.R.S. as guides for channeling its resources. Further, you have stated that in the future, special activities will have to compete openly and equally for resources against the regular tax administration activities. It is the opinion of the Association that the I.R.S. cannot and should not divorce itself from the needs of the government as well as the public which it serves. In the areas of Organized Crime, Narcotics Traffickers and Political Corruption, history has proven that numerous skillful violators of various statutes of the U.S. Code have only been brought to justice through the Judicious use of tax laws. Therefore, to curtail or restrict such resources from endeavors in these areas is to deny the public, for whom we all work, the right to a fair, unbiased and impartial return on its investment and to deny your criminal investigators the integrity of a system which should be operated impartially. Is there not a need for I.R.S., as well as all other enforcement agencies, to be vitally concerned with law violators? Should we not utilize, whenever and whereever needed, all our resources to combat crime? Is not the I.R.S. one of these resources? This, above all else, has caused more complaints and rumors than any other subject. We understand that the study by Treasury has been completed and its preliminary draft presented to you for comments. Will you follow the guidelines published by Treasury? If not, what guidelines will you issue? Can you put to rest the persistent rumor that your restrictions on premium pay were designed to defeat the new legislation making such pay part of the base pay computation for retirement purposes? Is it not to the benefit of the taxpayer that the investigation be completed as speedily and efficiently as possible? Is it not to the benefit of the witness contacted during an investigation that they be contacted in the evening rather than normal daytime working hours when they might suffer a loss of pay? Does not premium pay save the government and witnesses both time and money in addition to speeding up the investigation? How can premium pay be applied after the fact when regulations prohibit it? What happens when an agent is required to interview a witness after hours, the situation is uncontrollable and the agent is not on premium pay? Why is I.R.S. the only U.S. Treasury law enforcement agency that administers premium pay differently? On again, off again more off than on, regardless of whether the cases call for the investigator to be on premium pay. 6. Suspension of Information Gathering and Retrieval, and Confidential Funds Since the inception of the Intelligence Division, it has always been the policy and DUTY to receive, evaluate, and when necessary, investigate fully any information which has a tax consequence and comes to the attention of any Special Agent. However, with the suspension and/or restrictions placed on Information Gathering and Retrieval and the use of Confidential Funds, you have removed your criminal investigative personnel from contacts with informants and the surveillance of organized crime figures, corrupt politicians and narcotics traffickers, since monies for these activities comes from Confidential Funds. Even worse, you have prohibited your criminal investigators from contacts with other law enforcement agencies (in developing information on the aforementioned people) since Internal Revenue Manual Section 9311.2(3) does not permit contacts outside of the I.R.S. other than public records. I would be remiss if I did not inform you that the suspension of the Manual provisions permitting agents from gathering information on people such as narcotics traffickers, corrupt politicians and organized crime figures might raise grave questions concerning these suspensions. No responsible management official can fail to understand the importance of this function to any intelligence organization. Will your future instructions limit the I.R.S. information gathering to merely straight tax information? Is it not true that many significant income tax cases are developed as a result of gathering information that appeared unrelated to taxes? For example, Former Vice President Agnew, Governor Hall and the Watergate tax cases. Is it not true that a large part of the Intelligence Division inventory comes from Information Gathering by the Special Agents? I am sure your Special Agents are not interested in the sex lives of any individuals unless an individual pays large sums of money for this service and this expenditure is not commensurate with his reported income. This should cause an agent to become suspicious of the tax return and rightly so. Would he not be remiss in his duty if he did not attempt to document this expenditure in any criminal tax case as a cost of living item in a net worth case? 7. Foor and Inadequate Communications by the Commissioner's Office and Others on Matters Affecting Employee Morale in the Intelligence Division We have received allegations that the Director's communications are often misinterpreted by your staff before they reach your office. We have been told that one of your staff has stated that the Intelligence Division is "behind the times. A further remark allegedly made by this same individual while he was in a district was that he "one day would bring Intelligence to its knees." Would you please explain these remarks, if true . and if not true, put this rumor to rest? 8. Adversary Posture of the Commissioner Toward OC&R Section of the Department of Justice Numerous reports of conflicts between your office and the Department of Justice suggest an adversary relationship rather than the spirit of cooperation needed to work together to perform effectively. Since the Department of Justice handles the prosecution of all the criminal cases of the Intelligence Division, is that adversary posture another way of emasculating the Intelligence Division? 9. Restrictions on Legal Use of Electronic Surveillance If the use of Electronic Surveillance is legal, why do you prevent your Intelligence Agents from using it? Do you plan to continue this restriction? 10. Failure to Endorse and Support Agressive Fraud Investigations of Major Political Figures, Organized Criminal Activities and Major Corporations I would be remiss if I did not call to your attention the reaction of the public and media to your actions and statements that I.R.S. should prosecute the "little guy" i.e., the butcher, the baker and candlestick maker while organized crime figures, narcotics traffickers and major political figures are pushed into the background. Is this a correct evaluation of your policy? If not, will you please state your policy in this area? 11. Transfer of Wagering Enforcement to BATF Why this was done we do not know. However, the effect is clear, as your men and other law enforcement people believe, that you did this because you did not consider your men capable of doing this type of investigation. Could you explain the reason for this transfer especially when the I.R.S. Agents were fully trained and experienced in the field of wagering and BATF was forced to expend large sums of money to send its agents to school during a period when the President is calling for economy in government? 12. Retirement of The Director, Intelligence Division It has been alleged that the Director of the Intelligence Division has retired because he was being pressured by your office to conduct investigations on the "little guy" as opposed to his policy of conducting investigations in accordance with the mission of the Intelligence Division. This mission is, in fact, the identification of and agressive enforcement of pockets of non-compliance which encompasses Narcotics Traffickers, Organized Crime Activities and political corruption. Will you advise whether or not these allegations are true? 13. Disclosure of Identity of Confidential Informants Another recent development are the questions Internal Audit (a non-criminal division) is asking your criminal investigators about their contacts with "confidential informants" even though no payment was made to the informant. It appears from the questions that they are attempting to learn the names of these informants. As any criminal investigator knows, once an informant's name has been disclosed to another individual, two things usually occur: a) the informant is useless to the investigator from then on, and b) other informants discover that you divulged a name without the informant's permission, and they, therefore, refuse to give you any further information. The above restrictions plus others instituted by the I.R.S. prevent the Intelligence Division from developing informants to give them information on corrupt politicians, organized crime figures and narcotics traffickers. How is the public going to react to the preclusion of your special agents in investigating political corruption, organized crime and narcotics cases? Will it not be a "black eye" for the entire agency? 14. Restrictions on Pre-Trial Publicity Far Beyond the Requirements of the Is it your policy to restrict pre-trial publicity so that the public will not be aware that I.R.S. does prosecute tax evaders? In summary, Mr. Commissioner, whereas each of the circumstances mentioned herein, taken separately may be explained as a proper exercise of management's discretion, the sum total of all of these restrictions and curtailed activities can |