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Ouster of IRS official isn't ending investigations

WASHINGTON (AP) — Don't look for the outcry over the Internal Revenue Service's improper targeting of tea party groups to subside with the ouster of the agency's acting commissioner.

Three congressional committees are investigating and the FBI is looking into potential civil rights violations at the IRS, Attorney General Eric Holder said.

Other potential crimes include making false statements to authorities and violating the Hatch Act, which prohibits federal employees from engaging in some partisan political activities, Holder said.

President Barack Obama said Treasury Secretary Jacob Lew had asked for and accepted Steven T. Miller's resignation.

"Americans are right to be angry about it, and I am angry about it," Obama said Wednesday evening in a televised statement from the White House. "I will not tolerate this kind of behavior in any agency but especially in the IRS, given the power that it has and the reach that it has into all of our lives."

Miller's ouster came five days after an IRS supervisor publicly revealed that agents had improperly targeted groups with "tea party" or "patriots" in their applications for tax-exempt status. It came a day after an inspector general's report blamed ineffective management in Washington for allowing it to happen for more than 18 months.

The report said tea party groups were asked inappropriate questions about their donors, their political affiliations and their positions on political issues, resulting in delays averaging nearly two years for applications to be processed.

Miller, a 25-year IRS veteran, took over the agency in November, when the five-year term of Commissioner Douglas Shulman ended. Shulman was appointed by President George W. Bush.

Obama has yet to nominate a permanent successor. A new acting commissioner was not announced Wednesday evening.

In an email to employees, Miller said: "This has been an incredibly difficult time for the IRS given the events of the past few days, and there is a strong and immediate need to restore public trust in the nation's tax agency. I believe the service will benefit from having a new acting commissioner in place during this challenging period."

At the time when tea party groups were targeted, Miller was a deputy commissioner who oversaw the division that dealt with tax-exempt organizations.

The report by the Treasury inspector general for tax administration does not indicate that Miller knew conservative groups were being targeted until after the practice ended. But documents show that Miller repeatedly failed to tell Congress that tea party groups were being targeted, even after he had been briefed on the matter.

The IRS said Miller was first informed on May, 3, 2012, that applications for tax-exempt status by tea party groups were inappropriately singled out for extra, sometimes burdensome scrutiny.

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 Ways and Means oversight subcommittee but again was not forthcoming on the issue — despite being asked about it.

In all, members of Congress sent at least eight letters to the IRS over the past two years, asking about complaints from conservative groups that they were being harassed by the IRS. None of the IRS responses acknowledged that conservative groups were targeted.

Miller was scheduled to testify Friday at a Ways and Means hearing. A committee aide said Wednesday evening that Miller was still expected to attend the hearing.

"These allegations are serious — that there was an effort to bring the power of the federal government to bear on those the administration disagreed with, in the middle of a heated national election," said Senate Republican leader Mitch McConnell of Kentucky. "We are determined to get answers."

The Justice Department opened its criminal investigation last Friday, Holder said.

"I can assure you and the American people that we will take a dispassionate view of this," Holder told the House Judiciary Committee at a hearing Wednesday. "This will not be about parties, this will not be about ideological persuasions. Anybody who has broken the law will be held accountable."

But, Holder said, it will take time to determine if there was criminal wrongdoing.

Wednesday's hearing was the first of several in Congress that will focus on the issue. The House Oversight Committee announced Wednesday that it would hold a hearing May 22, featuring Lois Lerner, the head of the IRS division that oversees tax exempt organizations, and Shulman, the former commissioner.

The Senate Finance Committee announced a hearing for next Tuesday.

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Follow Stephen Ohlemacher on Twitter: http://twitter.com/stephenatap

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