IRS Prematurely ‘Retired’ Data Storage Devices

Patrick Howley | Political Reporter

The Internal Revenue Service (IRS) prematurely “retired” computer data storage devices worth millions of dollars and filed “disposal” documents for computer hardware that still existed, according to an internal inspector general report reviewed by The Daily Caller.

IRS commissioner John Koskinen testified before Congress that ex-official Lois Lerner’s emails were lost in a June 2011 computer crash and that her hard drive storing those emails was “recycled.”

The IRS also claimed that it lost emails from six other employees due to separate computer crashes. U.S. Archivist David Ferriero said that the IRS “did not follow the law,” which requires government agencies to keep email records, to print out emails in case there’s a computer crash, and to notify Ferriero’s office when records are lost or destroyed.

Koskinen confirmed that IRS employees’ emails during this period were saved on six-month backup tapes. But Koskinen could not explain why the IRS did not inspect Lerner’s backup tape before it was erased. “It would be difficult, but I don’t know why they didn’t do it,” Koskinen said. “I have no idea or indication that they did.”

The IRS, which spent $44.1 million in information technology (IT) hardware maintenance in fiscal year 2011 and $47.8 million in fiscal year 2012, closed out its six-year business relationship with the email archiving-and-recovery company Sonasoft in September 2011. Meanwhile, sophisticated data storage devices were being thrown away in the agency’s national IT offices in Maryland, even though the IRS was still paying for maintenance on the devices.

The IRS prematurely “retired” data-storage devices and filled out “disposal” documents for hardware that still existed and was supposed to still be in use, according to a Sept. 24, 2013 Treasury Inspector General (TIGTA) report entitled “Increased Oversight of Information Technology Hardware Maintenance Contracts Is Necessary To Ensure Against Paying for Unnecessary Services.”

“In another [maintenance] contract, 22 of 54 storage devices had been retired prior to the end of the service contract or were migrated to a separate storage contract as part of the IRS’s efforts to consolidate data storage,” according to TIGTA.

“When the contract was originally awarded in December 2009, it covered 54 storage devices with an average annual hardware maintenance cost of about $2.5 million,” according to the TIGTA report. “The current list, dated April 1, 2013, showed 32 storage devices requiring maintenance. The decrease in the number of storage devices is due to the retirement of those hardware assets or the migration to a separate storage contract as part of IRS’s efforts to consolidate and share storage across the IRS.”

The IRS also filled out disposal documentation for IT devices that still existed.

“In another contract reviewed, we compared the asset listing to the information technology asset inventory system and identified four retired assets,” the TIGTA report stated. “The IRS provided the disposal documentation for these four retired assets showing that these assets were ‘written off’ because they could not be located during the inventory. However, as a result of our subsequent inquiries, the IRS confirmed that the assets existed and took steps to correct the information technology asset inventory management system by placing the assets into an ‘in use’ status.”

In June 2012, the IRS “retired” ten hardware assets more than six months before the maintenance contracts on the devices were up, and continued spending $6,692 per month in maintenance costs.

The report, conducted between April 2012 and May 2013, analyzed seven of 208 IRS hardware maintenance contracts signed since fiscal year 2009. The report inspected the IRS’ national Cybersecurity, Enterprise Operations and Strategy and Planning office in Lanham, Md., and the Agency-Wide Shared Service’s Office of Procurement in Oxon Hill, Md., in the Washington, D.C. area. TIGTA stated in the report that it did not find evidence of fraudulent activity.

It might be difficult to even figure out which programs the IRS has and which ones it doesn’t. The agency purchased IT devices that it did not add to its official inventory until prompted.

“In two contracts reviewed, the IRS purchased a total of 25 information technology assets and upgraded the maintenance coverage for these assets,” the TIGTA report stated. “However, none of the 25 assets were recorded in the information technology asset inventory management system.”

A separate Sept. 30, 2013 TIGTA report found that IRS “offices were not taking sufficient steps to recover assets placed in a temporary ‘missing’ status.”

TIGTA is currently conducting an investigation into Lois Lerner’s missing emails.

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