An audit released this week by the Inspector General at the Treasury Department revealed that the Internal Revenue Service cannot account for around 2,000 laptops used by volunteers in a tax-assistance program last year. The computers may still contain personal taxpayer information, the audit said.
"I'm worried that just as clothes dryers have the knack of making socks disappear, the federal government has discovered a core competency of losing computers," Grassley said in a statement. "This inventory-control problem is serious and must be addressed. It involves tax dollars and potentially confidential taxpayer information and data related to national security and criminal investigations."
Grassley asked the director of the Office of Management and Budget, Mitchell Daniels, to take on the problem, saying in a letter to Daniels that the report "highlights what appears to be a disturbing trend of government coming up short as stewards of taxpayer money."
At least 400 laptops belonging to federal law enforcement agencies including the FBI, the Drug Enforcement Administration and the U.S. Marshals Service have been misplaced, lost or stolen, a recentby the Justice Department's Inspector General determined. The audit speculated that "national security or sensitive law enforcement information" is at risk, and it complained that the agencies suffer from a "a lack of accountability."
The IRS programs in question were the Volunteer Income Tax Assistance (VITA) and Tax Counseling for the Elderly (TCE) programs. The programs provided free tax help to people with special needs, including the elderly; those with disabilities; and non-English speakers. Volunteers prepared around 1.1 million tax returns for 2001.
In order to promote electronic filing, the IRS provided more than 6,600 desktop and laptop computers to the roughly 18,000 VITA/TCE sites nationwide. In 2001, the IRS reported that it was unable to account for around 2,300 computers. In that same year, the IRS put in place a program to track its property, but the audit found that the system was not working properly and that "the IRS cannot physically account for computers provided to volunteers."
For example, the audit department performed a random test looking for 41 computers that the IRS had obtained from other government agencies. It found only three of those computers listed in the asset-management database.
Aside from the missing computers, the new audit found that the IRS did not ensure that taxpayer information was removed from the laptops after the returns had been prepared. It also didn't ensure that only authorized software was installed on the computers.