White House still misleading Americans on IRS scandal?

This is a rush transcript from "Hannity," May 28, 2013. This copy may not be in its final form and may be updated.

SEAN HANNITY, HOST: Eric Holder is not the only member of the Obama administration who is misleading the American people. Because we have uncovered new evidence to suggest that the IRS is still at this very hour targeting conservatives. Now if this is true, it will directly contradict what the president and his top aides have been saying for weeks. Watch this.


JAY CARNEY, WHITE HOUSE PRESS SECRETARY: The misconduct had stopped in May of 2012. So, despite all the media interest in our April, 2013 awareness, it's important to remember that the misconduct, of course, had stopped almost a year earlier.


HANNITY: Now according to the American Center for Law and Justice, that is blatant lie, because that organization is representing more than two dozen conservative groups that claim the IRS harassed them after May of 2012. Now the ACLJ is also out the administration for claiming this abuse of power was limited to one rogue office in Cincinnati.

Now, take a look. This letter was from an IRS office in El Monte, California. It was sent to a conservative group and included dozens upon dozens of questions and demands. Now, needless to say that's a long way from Cincinnati.

Here's another letter, also from California, requiring a group with the forbidden word "patriot" in its title to supply the tax agency with mounds of information.

Oh, and remember when we were told that nobody in D.C. was involved in orchestrating these politically motivated witch hunts? Well, then why did somebody from the agency's Washington headquarters send this letter to the Albuquerque Tea Party back in April of 2010?

All right. Joining me now are two of the attorneys hoping to get the answer to that question and much more. From the American Center for Law and Justice, Jay Sekulow and Robert Ash are with us. Guys, good to see you.



HANNITY: All right. Is what Jay Carney said that this stopped in May of 2012, Jay, is that a truthful statement or is this going to be another thing that he has to contradict at some point?

SEKULOW: It's absolutely incorrect as a matter of fact and as a matter of policy. We have a letter that we received in our office Sean on May 6 of this year, from the IRS asking for responses to intrusive questions. We have a series of letters from last year, from Lois Lerner herself who was then the of course acting, she was the head of the tax- exempt and she's now on administrative leave. We have letters from lawyers as you just said in Washington, D.C.

And Sean, I am holding in my hand right here the lawsuit that is being filed in U.S. district court tomorrow morning representing 25 conservative groups, not all Tea Party groups by the way. There are other conservatives groups in this list. And this complaint which is about an inch thick, does not compare to the amount of documents that Skip Ash's been handling with the IRS on our behalf. Skip has been really dealing with the agents on this during the last year and a half. And he will tell you, it's mounds of documents, Sean. Mounds of documents.

HANNITY: All right. Skip, tell us what you know.

ASH: Well, I see every document that goes through that comes from a Tea Party group, one of our clients, that goes back to the IRS. I have been dealing with the IRS agents now for about a year and a half. And we have provided a great deal of information. We've provided in one case 688 pages of data to answer their questions and that still has not satisfied them. We still have ten of our groups who have not been given any type of tax- exempt status.

So, of our 27 original clients, we now have only 15 that are approved, none have been disapproved, but we have -- what you need to understand is that from the time that they submit their initial paperwork until they get contacted the first time with additional questions, has ranged from as low as four months up to 25 months, and the vast majority are over one year.

HANNITY: Isn't it interesting, because a lot of this was leading into the 2012 election after the Tea Party's success in 2010. Do you think this was a delay tactic? Have you concluded that, Jay, maybe they did this for political purposes to sort of neuter or neutralize the Tea Party movement?

SEKULOW: Well, you know, Sean, I do. And I'll tell you why for two reasons primarily. Number one, the president and Senate Democrats were calling on investigations of these conservative groups going back before the 2012 election. So when you have Chuck Schumer and Dick Durbin saying, they can't believe the IRS did this. Really? They signed letters asking the IRS to do this. That's number one.

Number two, the president made comments about these conservative organizations. And I'll tell you, there's really a third one here. And the e-mails between the inspector general's office and the Congressional staff indicate that this report was actually ready probably in September or certainly late September, but it kept getting delayed. And I cannot help but think now that the inspector general admitted, which, of course, was the truth, we knew this all the time, that he never spoke to anybody in the White House that he did not in fact do an investigation, that it was only an audit, couple that with the fact what Skip just said, Sean, there were up to two years when there was no communication between the IRS.

In fact, Skip will tell you, we sent letter after letter after letter in some of these files and never got a response from the IRS even acknowledging receipt.

HANNITY: We will go through the timeline later in the program tonight. But Lois Lerner new about this in June of 2011. The audit that was done internally by the IRS was finished in May of 2012. And we were told by Doug Shulman in March of 2012, no, we aren't doing this when he should have known better, if he didn't. So the timeline seems way off here, no?

SEKULOW: It does. And Skip could answer this directly, but the fact is, Sean, there was a series of times, gaps. I'm talking about six months where no communication from the IRS. And Skip, if I'm not mistaken, some of that was where you were sending out letters and no response was coming back from IRS to the agents we were dealing with. They said, they couldn't answer the question, they couldn't decide and they even pulled back questions and then re-submitted others.

ASH: That's exactly right. It's one of those situations where we had -- we finally were retained by a client, we contacted the IRS to ask for additional time to answer them. We would get no response. We would send another letter, we'd get no response. We send another letter, get no response. Five or six months has passed and then we would get a letter back saying never mind the previous questions which we had been working on all along, we're coming up with a new set of questions.


ASH: And that's happened on more than one occasion.

HANNITY: Yes. All right. Jay, let's go back.

SEKULOW: Coming right out of Washington D.C., Sean. That's where it was coming out of. Not some rogue office in Cincinnati.


HANNITY: The White House also said that they didn't know anything about this, but then we find out that the president's attorney, the White House counsel and the chief-of-staff were informed about it and there was coordination with the Treasury on forcing this question or faking this question.

SEKULOW: Correct.

HANNITY: Tell us more about that lawsuit, you just held it up, that you are going to file tomorrow.

SEKULOW: This one is being filed in U.S. District Court. We represent 25 groups. And Sean, I will tell you, it is about as you can see, always an inch thick and it is going to require the IRS to file some serious answers. You know, I served in the office of chief counsel, Internal Revenue Service right out of law school. I spoke to a friend of mine today, a lawyer in Atlanta who also worked in that same office, he's representing a Tea Party group as well. So, he got former IRS lawyers, myself and this other friend of mine. And a whole team of lawyers going after this very, very seriously, Sean.

When you look at this lawsuit, they're going to have to give answers, there's going to be depositions, we will go to the agents and find out who told them what. I will tell you from my experience as being a junior lawyer, a trial lawyer with Treasury, there is no way this came out of rogue agents. And we've got letters from Washington D.C. In fact, agents were telling people in Washington, they were getting supervisory approval. And by the way, Cincinnati is not a small office. That's the largest office for processing taxes and applications.

And one other thing out here, Sean. This idea that there was this huge increase in 2010, actually if you look at it factually, there was not, of applications. That was not true either. So, I don't know how the White House is going to explain this, I don't know the White House counsel is going to explain it, but I'll tell you what, we will take a lot of depositions in a very big lawsuit. Yes.

HANNITY: All right. Last question. Do you think we were lied to about this being out of one rogue agency?

SEKULOW: No doubt in my mind this was not one rogue agent and one rogue agency. This was IRS which is part of Treasury. And Sean, obviously we know now the White House knew what was going on and helped figure out how to get this information out before the IG report came out. There's a lot here.

HANNITY: All right. Guys, good to see you both. I appreciate it.

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