Where the I.R.S. Investigation May Go From Here

If Washington scandals have taught us anything, it is that the most trouble comes from the cover-up, not the conduct.

So it may be with the criminal investigation into how the Internal Revenue Service processed tax-exempt applications from conservative organizations. The critical issue may hinge on what agency officials told Congress rather than the original actions.

Attorney General Eric H. Holder Jr. told the House Judiciary Committee on Wednesday that the investigation would look at whether there were violations of the civil rights laws in how the I.R.S. singled out selected organizations for closer review. He further pointed out that “false-statement violations might have been made, given at least what I know at this point.”

The announcement of a criminal investigation gives the administration grounds to claim that it cannot go into details about any misconduct for fear of prejudicing cases. Whether any charges are ever filed is likely to focus on what was said to Congress rather than a violation of anyone’s civil rights.

The primary criminal statute dealing with civil rights violations, 18 U.S.C. § 242, comes out of the Reconstruction Era after the Civil War and was originally intended to protect the voting rights of former slaves. The statute makes it a crime for anyone acting under “color of law” to willfully subject another person to “the deprivation of any rights, privileges, or immunities secured or protected by the Constitution or laws of the United States.”

The Justice Department has used this provision in cases involving police officers who physically attacked suspects, with one of the most famous prosecutions involving police officers who beat Rodney King.

Whether the statute could be applied to anyone at the I.R.S. for singling out applications for tax-exempt status from conservative organizations is a more difficult question. As Victor Fleischer pointed out in DealBook about a report issued by the Treasury Department inspector general for tax administration, the problem seems to be “one of incompetence, not conspiracy.”

The fact that the I.R.S. applied political criteria in its review could implicate political association and free speech rights under the First Amendment. But what is less clear is whether the exercise of any rights was actually deprived because applications were not denied on the basis of political affiliation. It may be difficult for prosecutors to show a willful violation of a specific right by any individual at the I.R.S., even when the conduct smacks of political favoritism.

A much more likely path to criminal charges lies in what I.R.S. officials told Congress about how these applications were being handled, including any denials that political criteria were used in reviewing applications. This reflects the lesson learned from the Watergate scandal that it’s not the crime, it’s the cover-up that gets people in trouble.

Mr. Holder identified the false-statement statute, 18 U.S.C. § 1001, as one likely area of investigation. In addition, if any I.R.S. official testified falsely under oath before Congress about this issue, then there is also the potential for a perjury charge.

One significant hurdle for the Justice Department in pursuing a false-statement or perjury case is proving that a defendant actually lied, which means showing more than just that the defendant did not make full disclosure of the facts. Courts have interpreted § 1001 and the perjury law similarly as requiring proof that the statement was completely false, so that there is no way it could be construed as literally true even if intended to be misleading.

That means the words used by a witness or in a letter to Congress about how the I.R.S. treated applications from conservative organizations could be subject to varying interpretations, making it difficult for prosecutors to prove falsity. As President Bill Clinton once famously replied when asked whether he committed perjury: “It depends upon what the meaning of the word ‘is’ is.”

A broader statute that could be invoked is 18 U.S.C. § 1505, which makes it a crime to corruptly obstruct or impede any “inquiry or investigation” by Congress. This provision does not require proving a statement was false, but only that the person sought to make it more difficult for Congress to conduct its business. Indeed, the statute covers any “endeavor” to obstruct, meaning that the defendant need not be successful to commit the crime.

This type of charge has been used in a number of highly publicized cases as a means to overcome potential hurdles to proving perjury or false statement. For example, the Justice Department used it in prosecutions arising from the Iran-contra investigation against Oliver North and former Defense Secretary Caspar Weinberger, and more recently against Roger Clemens related to suspected steroids use.

Congress will be conducting several hearings on the matter, starting with the House Ways and Means Committee on Friday, at which the former acting I.R.S. commissioner, Steven Miller, is scheduled to testify. Other agency officials are sure to be grilled on Capitol Hill about their role in dealing with applications from conservative organizations and, perhaps more important, their responses to Congress on this issue.

An interesting question is whether any of these officials will invoke the Fifth Amendment privilege against self-incrimination and refuse to respond to questions. That will be a strong indication that the criminal investigation is focusing on potential false statement and obstruction charges.

Whether to assert the privilege is a difficult choice because of the potential for losing one’s position in the government for not being cooperative in an investigation. And unlike private companies, the government will not pay the legal fees to defend an official from an investigation into potential wrongdoing, so those costs would come out of the person’s own pocket. Given that government positions do not pay anything close to what the private sector does, an investigation could quickly wipe out an official’s financial resources.