Former Senate candidate Christine O’Donnell told her tax records were breached

More than two years after her upstart Senate campaign rocked the Delaware political world, Christine O’Donnell got an unexpected contact from a U.S. Treasury Department agent warning that her private tax records may have been breached.

The phone message earlier this year shocked the battled-scarred candidate, a tea party favorite who knocked off Republican mainstay Michael Castle in the primary before losing in a bid to win Vice President Joseph R. Biden’s former seat.

“Ms. O’Donnell, this is Dennis Martel, special agent with the U.S. Department of Treasury in Baltimore, Md. … We received information that your personal federal tax info may have been compromised and may have been misused by an individual,” he said in the January message left on her cellphone.

For Ms. O’Donnell, the message immediately raised red flags.

On March 9, 2010, the day she revealed her plan to run for the Senate in a press release, a tax lien was placed on a house purported to be hers and publicized. The problem was she no longer owned the house. The IRS eventually blamed the lien on a computer glitch and withdrew it.

Now Mr. Martel, a criminal investigator for the Treasury Department’s inspector general for tax administration, was telling her that an official in Delaware state government had improperly accessed her records on that very same day.

Beyond that, Ms. O’Donnell and Senate investigators who have tried to help her have run into a wall of silence, leaving more questions than answers about whether abuses of the IRS system extend to private individuals and not just the tax-exempt groups already identified as victims.

“I don’t know. And I’d like to know,” Ms. O’Donnell told The Washington Times in her first interview about the case. “Because whether it’s one, eight or 80 [cases], it’s an abuse of power at the IRS. It’s using the IRS as a political weapon, and that shouldn’t be done.”

Investigators for Sen. Chuck Grassley of Iowa, an influential Republican who serves on the Finance and Judiciary committees, have uncovered one key issue: a backdoor system in which state officials can access Americans’ private tax records in the name of investigating with little oversight or accountability.

The Treasury Department’s tax watchdog has informed Mr. Grassley that at least four politicians or political donors have had their personal tax records improperly accessed through that system since 2006, including one case in which a willful violation of federal law was identified.

But the Justice Department has declined to prosecute any of the offenders. Treasury officials have refused to give Mr. Grassley any specifics on the cases or to describe the disposition of Ms. O’Donnell’s case, claiming even people who improperly access tax records have an assumption of privacy under federal tax laws.

Mr. Grassley scoffs at that explanation and is demanding answers from the Treasury and Justice departments.

“Taxpayer confidentiality laws are important. The purpose of those laws is to prevent and deter inappropriate uses of taxpayer information, not to prevent public scrutiny when that confidentiality has been breached or keep the victim in the dark,” Mr. Grassley told The Times.

“A taxpayer should be able to know whether someone breached his or her confidentiality, whether any investigation resulted, and the outcome of that investigation. … I look forward to whether the Justice Department sheds any light on its decision not to prosecute what the inspector general called inappropriate and in one case willfully inappropriate access to taxpayer records.”

All the IRS will say is that the one person believed to have willfully misused the tax record system worked outside the agency.

Ms. O’Donnell has spent the past six months trying to find out more about what happened to her personally, with little success.

Investigators have told her the probe has been closed, without offering an explanation. Ms. O’Donnell’s attempts to get records about the possible misuse of her tax files through Freedom of Information Act requests have been delayed or denied.

Mr. Martel did not return calls seeking comment, and Senate investigators have been unable to get permission to interview him about Ms. O’Donnell’s case.

The mystery aside, the incident has shined a spotlight on the access non-IRS employees have to Americans’ personal tax records.

Ms. O’Donnell and congressional aides have been told that criminal investigators in states have the ability to dial into the IRS database.

There is little public knowledge of such inquiries, and whether they are legally justified or if they’re being abused by those with political axes to grind.

In April, Ms. O’Donnell was told the investigation into her case was closed, though she was given few details about the findings.

During a one-hour interview with Mr. Martel this year, she was given the name of the man believed to have accessed her records and shown his photo. The man had also friended her on her personal Facebook page, she said.

Beyond that, all Mr. Martel told Ms. O’Donnell was that the man had no legitimate reason to access her records and that investigators had seen other instances like hers in which tax privacy had been breached.

Even before she got the message, the IRS was a sore subject for Ms. O’Donnell and her family.

She fought through a three-year audit into her personal finances that ended with her repaying $1,100 to the federal government. Family and friends also were subjected to audits, though they were cleared, she said.

She had been warned that such events were possible.

As she was considering a Senate run, Ms. O’Donnell said she was told by a prominent political figure in Delaware that if she challenged Mr. Castle, the IRS and others would “F with her head.”

Ms. O’Donnell said she has reason to believe her political opponents were behind the scheme.

“An official with this investigation told me that there was evidence linking this inappropriate use of my tax records with the Delaware political leadership, Delaware political leaders on both sides of the aisle,” she said, though she declined to identify the official with whom she spoke.

In the midst of the 2010 campaign, long before it was revealed that her tax information had been accessed, Ms. O’Donnell’s financial life was a subject of intense media scrutiny and was used repeatedly by her enemies.

Republican Party heavyweight Karl Rove, who was an adviser to President George W. Bush, was among the critics who blasted Ms. O’Donnell for, among other things, falling behind on her mortgage.

She acknowledged that she had missed payments but vehemently disputed reports about foreclosure of her home.

Ms. O’Donnell sold the home in 2008, and financial documents from her lender show that her debts were satisfied in July of that year — long before the IRS slapped the erroneous lien on the property, which she no longer owned. She continues to fight to get the lien removed from her credit records.

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