Rep. Darrell Issa, R-Calif., the ranking Republican on the House Oversight and Government Reform Committee, said Thursday the Treasury Department's inspector general agreed to an investigation sought by him and Sen. Susan Collins, R-Maine, the ranking member of the Senate Homeland Security and Government Affairs Committee, The Hill reported.
"In response to your request, (the Treasury Inspector General for Tax Administration) is initiating a review of the IRS's oversight of tax-exempt Section 501(c)(3) organizations and Section 527 organizations and will review internal IRS referral processes with regard to non-profit fraud investigations," Treasury Inspector General J. Russell George wrote to Issa in a letter.
The letter did not say the Treasury would be investigating the Association of Community Organizations for Reform Now specifically, but said it would take a broad look at IRS's enforcement of rules for a number of groups.
"The lack of an appropriate firewall between ACORN's charitable activities and its political arm has raised significant questions regarding the appropriateness of their status as a taxable non-profit corporation and their management of federal dollars," Issa said. "Cutting ties with ACORN is a good first step for the federal government, but since they have been the recipients of taxpayer dollars, we have an obligation to investigate to discover whether or not those dollars were misused in anyway.
The organization came under heavy, bipartisan criticism last week after a surreptitiously recorded video emerged in which two conservative activists posed as a prostitute and pimp and received advice from a Baltimore ACORN employee on how to avoid paying taxes.