US Attorney general Eric Holder orders probe of Internal Revenue Service

Washington: Attorney General Eric Holder said on Tuesday he has ordered a Justice Department investigation into the US tax agency's targeting of conservative groups for extra tax scrutiny.

The FBI was coordinating with the Department of Justice to see if any laws were broken, Holder said at a news conference at the Justice Department. Holder called the practice, in his words, "Outrageous and unacceptable."

Congress was not told that conservative tea party groups were being inappropriately targeted by the Internal Revenue Service during the 2012 election, even after its acting chief had been briefed on the matter. The Internal Revenue Service's failure to inform Congress was just the latest development in one of several scandals that have beset President Barack Obama just a few months into his second term.

Holder's comments come a day after President Barack Obama said that, if the agency intentionally targeted such groups, "that's outrageous and there's no place for it."

The IRS has apologized for what it acknowledged was "inappropriate" targeting of conservative political groups during the 2012 election to see whether they were violating their tax-exempt status. In some cases, the IRS acknowledged, agents inappropriately asked for lists of donors.

The agency blamed low-level employees in a regional office, saying no high-level officials were aware.

Acting IRS chief Steven Miller was first informed on May, 3, 2012, that applications for tax-exempt status by tea party groups were inappropriately singled out for extra scrutiny, the IRS said Monday.

At least twice after the briefing, Miller wrote letters to members of Congress to explain the process of reviewing applications for tax-exempt status without disclosing that tea party groups had been targeted. On July 25, 2012, Miller testified before the House of Representatives Ways and Means oversight subcommittee, but again did not mention the additional scrutiny - despite being asked about it.

At the hearing, Republican Congressman Kenny Marchant told Miller that some politically active tax-exempt groups in his district had complained about being harassed.

Earlier, Republican Congressman Charles Boustany had raised concerns with the IRS about complaints that tea party groups were being harassed. Boustany specifically mentioned tea party groups in his inquiry.

In a June 15, 2012, letter to Boustany, Miller did not mention that in 2011, agents used materials that included a list of words to watch for, such as "tea party" and "patriot."

In an opinion piece in Tuesday's editions of USA Today, Miller conceded that the agency demonstrated "a lack of sensitivity to the implications of some of the decisions that were made." He said screening of advocacy groups is "factually complex, and it's challenging to separate out political issues from those involving education or social welfare."

Miller's editorial, however, did not address why he did not inform Congress after he was briefed on the issue.

Republican Sen. Roy Blunt called Tuesday for Miller to step down or for Obama to replace him.

"If the reports are accurate that Steven Miller knew about the IRS' egregious targeting of conservative groups last year and misled members of Congress about those actions, he should step down or be removed immediately," Blunt said Tuesday.

While Republicans have blasted the administration for targeting conservative groups, no blame has been laid directly on Obama, who said he first learned about the tax targeting issue from news reports on Friday. White House spokesman Jay Carney said the White House counsel's office was alerted the week of April 22 that the inspector general was finishing a report concerning the regional IRS office. But, he said, the counsel's office did not get the report and the president did not learn the focus until Friday.

Republicans are trying to link the scandal to the administration's response to the September attacks in Benghazi, Libya, that killed a US ambassador, for which they have hammered Obama ever since. They say it's another example of the government abusing its power, and point to emails disclosed Friday that show senior administration officials pushed for references to prior warnings and al-Qaida to be deleted from the talking points used by U.N. Ambassador Susan Rice five days after the attack.

Republicans insist that the Obama administration misled Congress and the American people in the immediate aftermath of the attack, trying to play down an act of terrorism that would reflect poorly on Obama weeks before the 2012 presidential election. Democrats accuse Republicans of trying to exploit a tragedy for political gain.